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An emerging body of research in international business examines firm response to challenging environments involving disasters, conflict and crime. This work has two salient characteristics: (a) a f...
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This study investigates the involvement of corporate level managers in innovation processes at the business unit level in diversified corporations. We present a process model of the emergence and e...
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Multinational enterprise (MNE) subsidiaries abroad are important organizations in their own rights. They typically hold some of the MNE’s most critical resources, and operate at the forefront of complex international environments. In this... more
Multinational enterprise (MNE) subsidiaries abroad are important organizations in their own rights. They typically hold some of the MNE’s most critical resources, and operate at the forefront of complex international environments. In this review, we identify and organize theoretical and empirical research on subsidiary management based on over 600 articles in leading academic journals. We develop a conceptual framework that integrates complementary streams of theoretical and empirical research with the subsidiary as its focal unit of analysis. In particular, we review six lines of research on subsidiary scope, practices, knowledge management, engagement with local market and nonmarket actors, performance, and individuals within subsidiaries. We highlight theoretical perspectives that have contributed to, and been advanced by, research on MNE subsidiaries. Based on the review, we explore future research agendas, linking the contemporary research themes with two main thrusts. First, s...
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How do decision makers of multinational enterprises (MNEs) appoint general manager (GM) successors in their local-market-seeking foreign subsidiaries? Extant literature suggests that to better addr...
Research Interests: Business and Subsidiary
In today’s interconnected world, there is ever greater need for developing new ways of coordinating, organizing, and reconfiguring of organizational structures and routines across inter and intra-o...
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Prior research into the effects of cultural differences between multinational enterprises’ (MNEs’) home and host countries on expatriate staffing decisions in foreign subsidiaries has produced a la...
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We show how the initial subnational entry location of foreign multinational enterprises (MNEs) in China influences their subsequent within-country location choices and expansion speed. We distinguish between MNEs that establish their... more
We show how the initial subnational entry location of foreign multinational enterprises (MNEs) in China influences their subsequent within-country location choices and expansion speed. We distinguish between MNEs that establish their first subsidiary in co-ethnic cores – dense agglomerations of other firms from the same country of origin – and MNEs that locate their first subsidiary in the periphery, i.e., outside of these co-ethnic cores. To identify co-ethnic cores in China, we employ a geo-visualization methodology, which draws the boundaries of cores organically and dynamically over time. We contrast our findings with the prevailing approach of using static administrative boundaries for identifying agglomerations. Our results provide evidence of path dependency, in that (a) entry through subnational locations with strong co-ethnic communities is followed by expansion into other locations where co-ethnic communities are present, and that (b) entry through co-ethnic communities ac...
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Over the past two decades, a growing body of research on human resource management (HRM) has analyzed the relationship between international HRM and institutions. This work has primarily been informed by two leading streams of... more
Over the past two decades, a growing body of research on human resource management (HRM) has analyzed the relationship between international HRM and institutions. This work has primarily been informed by two leading streams of theory—organizational institutionalism and comparative institutionalism. However, these two dominant streams have seen much juxtaposition, but little logical integration. Moreover, scholars have paid little attention to the dynamics of contextualization (more specifically, institutional development and evolution), which limits the relevance of extant research. In this article, we review the extant literatures and their intellectual origins and develop an integrative research agenda that emphasizes the multilevel nature of HRM and evolution under external institutional change.
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1. Too Complex to Manage? 2. The Architecture of an Organization 3. Planning for Frameworks 4. The Portfolio Driver 5. The Marketing Driver 6. The Organizational Driver 7. The Operational Driver 8. The Reputation Driver 9. The Financial... more
1. Too Complex to Manage? 2. The Architecture of an Organization 3. Planning for Frameworks 4. The Portfolio Driver 5. The Marketing Driver 6. The Organizational Driver 7. The Operational Driver 8. The Reputation Driver 9. The Financial Driver 10. Performance Excellence 11. Connecting the Dots
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Increasing societal expectations regarding responsible business conduct as well as an increasingly fierce enforcement environment are placing integrity and compliance highly on the list of management priorities. However, although many... more
Increasing societal expectations regarding responsible business conduct as well as an increasingly fierce enforcement environment are placing integrity and compliance highly on the list of management priorities. However, although many companies are investing serious efforts into compliance programs and are increasing the headcount within their compliance organizations it seems to be striking that severe ethical breakdowns still happen on a very regular basis. The reason may well be that strongly relying on classical elements of compliance programs to prevent misconduct such as establishing numerous policies, strengthening awareness training and increasing monitoring mechanisms works like trying to win the Tour de France with flat tires. Typically, structural causes are the driving forces behind systemic misconduct. These include; unbalanced incentives systems that determine bonuses, salary increases or career progression without any consideration of moral behaviors; a lack of respon...
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Purpose: The purpose of this paper is to provide a critical perspective on whether the boundary-spanner model and consequently complex disaggregated intra-MNE value chain activities are crisis resilient Design/methodology/approach: The... more
Purpose: The purpose of this paper is to provide a critical perspective on whether the boundary-spanner model and consequently complex disaggregated intra-MNE value chain activities are crisis resilient Design/methodology/approach: The paper is a conceptual theory development based on literature integration and phenomenological juxtaposing Findings: The need for boundary-spanning in assisting dispersed new and complex knowledge creation activities – which can hardly be replicated in virtual collaboration spaces alone – will endure if not even grow This requires deeper understanding of boundary spanning in the context of the globally dispersed MNE Increased location diversification engendered by COVID-19 implies a greater need for the boundary spanning function, not less Research limitations/implications: Regarding future research, the crisis provides a unique opportunity for taking a closer look at the formation, nurturing and resilience of interdependence, particularly behavioural ...
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Purpose – Recent research on intra-organizational knowledge-transfer showed that new capability development within multinational corporations shifts from parent companies to foreign subsidiaries. This paper seeks to identify antecedents... more
Purpose – Recent research on intra-organizational knowledge-transfer showed that new capability development within multinational corporations shifts from parent companies to foreign subsidiaries. This paper seeks to identify antecedents and barriers for reverse capability-transfer in multinational corporations. Design/methodology/approach – The paper adopts a multiple case study approach based on active interviews at six subsidiaries of a multinational manufacturing company. Findings – The results suggest that subsidiary autonomy, environmental heterogeneity, and managerial initiatives are all necessary antecedents of unique capability development at the subsidiary level, but that companies do not utilize foreign subsidiary-originated capabilities in their home-country operations. The results also show that person-to-person communication is required for intra-MNC capability-transfer in any direction, and that other forms of communication seem to be inefficient. Research limitations/...
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The development and operationalization of competitive advantages and superior capabilities across different countries are central to the strategies of multinational corporations (MNCs) (Dunning, 1980; 1988; 2000). The domain of this... more
The development and operationalization of competitive advantages and superior capabilities across different countries are central to the strategies of multinational corporations (MNCs) (Dunning, 1980; 1988; 2000). The domain of this research project lies within the MNC ...
ABSTRACT Until recently, corporations have taken mostly reactive positions on climate change by applying mitigation and adaptation strategies in response to imminent political or actual physical risks to their businesses. Few corporations... more
ABSTRACT Until recently, corporations have taken mostly reactive positions on climate change by applying mitigation and adaptation strategies in response to imminent political or actual physical risks to their businesses. Few corporations have taken a proactive, opportunity-seeking strategic approach to improve competitiveness over and above the mitigation and adaptation requirements set by policymakers, industry norms, or shifting consumer preferences. Considering that the climate change discussion no longer focuses on whether human activities have an impact on the changing climate, or how much impact they have, corporations should now focus on how to maximize competitiveness based on the actual and predicted climate change effects. © 2013 Wiley Periodicals, Inc.
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6 Intra-organizational turbulences in multinational corporations Andreas Schotter and Paul W. Beamish Introduction Scholars have recently pointed out that intra-organizational conflict in multinational corporations (MNCs) between... more
6 Intra-organizational turbulences in multinational corporations Andreas Schotter and Paul W. Beamish Introduction Scholars have recently pointed out that intra-organizational conflict in multinational corporations (MNCs) between headquarters (HQ) and their foreign ...
Research Interests: International Business, Behavior, Culture, Legitimacy, China, and 15 moreIntegration, Advantage, Mechanism, Authority, Matrix, Doz, Deutsch, Allocation, Information Asymmetry, M, C, L, G, J, and A
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Favors are a medium of exchange for social capital. Social capital creates social, political, and economic benefits for individuals, organizations, communities, and societies around the world. Favors promote cooperation between... more
Favors are a medium of exchange for social capital. Social capital creates social, political, and economic benefits for individuals, organizations, communities, and societies around the world. Favors promote cooperation between individuals and are used to bond individual actors with other individuals, groups, communities, and institutions. Favors are prevalent in business in emerging markets because of the presence of institutional voids, limited social and geographic mobility, and strong reciprocity norms. Favors create benefits and liabilities for business organizations and their networks. They produce outcomes beyond the favor exchange process that can be characterized as productive or perverse. Despite their prevalence and importance, favors and their dynamics are not well understood. We explore the antecedents, content, process, and consequences of favors. We conclude our multi-level analysis of favors with a discussion of the “breakeven” point for favors—the point where favors tip from having a positive effect to having a negative effect on organization performance. We present an integrated framework to explain the dynamics of favors in emerging market business contexts, and develop propositions to guide future research.
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In multinational enterprises (MNEs), regional management centres (RMCs) most frequently take the form of either dedicated regional headquarters (RHQs) or regional management mandates (RMMs) assigned to operating subsidiaries. We identify... more
In multinational enterprises (MNEs), regional management centres (RMCs) most frequently take the form of either dedicated regional headquarters (RHQs) or regional management mandates (RMMs) assigned to operating subsidiaries. We identify a series of critical differences in characteristics and performance between RHQs and RMMs, using a longitudinal sample of 855 Japanese RMCs across 41 countries. We also investigate parent-level differences between MNEs with distinct RMC configurations. We propose a structural complement to regional strategy extensions of the integration-responsiveness framework, and provide an important large sample baseline, aiding new theoretical and empirical research into MNE regional management strategy and structure.
Global organizations are inherently complex. The spatial dispersion of activities results in organizational subunits becoming embedded in local host-country contexts that differ from their parents’ home country contexts. These subunits... more
Global organizations are inherently complex. The spatial dispersion of activities results in organizational subunits becoming embedded in local host-country contexts that differ from their parents’ home country contexts. These subunits are also embedded in their parents’ corporate networks, causing them to differ from their locally embedded peers. The dual embeddedness and associated complexities create complex and often implicit boundaries. In addition, the contextual and operational diversity that affects the boundaries in global organizations are continually changing. Hence managing and coordinating across different inter- and intra-organizational boundaries has emerged as an important capability for the success of global organizations. So far, we have a limited understanding of the factors that affect the complexity and effectiveness of the boundary spanning function. In this article, we focus on clarifying these key issues and propose a model for effective boundary spanning in global organizations.
EMERGING MARKETS is all about carrots for compliant, spillover-generating foreign companies, 4 including benefits such as reduced tax hurdles, improved infrastructure, reformed labor laws, boosted workforce skills development, easier land... more
EMERGING MARKETS is all about carrots for compliant, spillover-generating foreign companies, 4 including benefits such as reduced tax hurdles, improved infrastructure, reformed labor laws, boosted workforce skills development, easier land acquisition, and fast-tracked business-license approvals. With China exhibiting slower economic growth and an increasingly challenging intellectual property protection environment, 5 many foreign multinationals have increased their focus on India. As Bill Maginas, former vice president, high-growth regions for Honeywell International Inc., explained:
India is the next big thing for Honeywell. Amongst our global growth regions, India provides the kind of market opportunity and promising local talent that allows us to execute our high-growth strategy playbook, which is based on an R&D and supply chain platform as the foundation to deep market penetration.
India is the next big thing for Honeywell. Amongst our global growth regions, India provides the kind of market opportunity and promising local talent that allows us to execute our high-growth strategy playbook, which is based on an R&D and supply chain platform as the foundation to deep market penetration.
This research examines region-bound headquarters disaggregation in multinational enterprises (MNEs). We link the formation of regional management centers—both dedicated regional headquarters (RHQs) and regional management mandates (RMMs)... more
This research examines region-bound headquarters disaggregation in multinational enterprises (MNEs). We link the formation of regional management centers—both dedicated regional headquarters (RHQs) and regional management mandates (RMMs) granted to operating subsidiaries—to the complexity argument underlying organizational information processing theory. We demonstrate how different dimensions of complexity associated with the number and dispersion of an MNE's subsidiary network in a focal region affect whether, and in which form, region-bound headquarters disaggregation takes place. Additionally, we consider boundary conditions affecting RMC formation based on within-region experience, global MNE footprint, and between-region effects. Empirically, we utilize a large global dataset of Japanese MNE foreign investments between 1992 and 2014, which allows us to perform event history analyses. This article is protected by copyright. All rights reserved.
We show how the initial subnational entry location of foreign multinational enterprises (MNEs) in China influences their subsequent within-country location choices and expansion speed. We distinguish between MNEs that establish their... more
We show how the initial subnational entry location of foreign multinational enterprises (MNEs) in China influences their subsequent within-country location choices and expansion speed. We distinguish between MNEs that establish their first subsidiary in co-ethnic cores – dense agglomerations of other firms from the same country of origin – and MNEs that locate their first subsidiary in the periphery, i.e., outside of these co-ethnic cores. To identify co-ethnic cores in China, we employ a geo-visualization methodology, which draws the boundaries of cores organically and dynamically over time. We contrast our findings with the prevailing approach of using static administrative boundaries for identifying agglomerations. Our results provide evidence of path dependency, in that (a) entry through subnational locations with strong co-ethnic communities is followed by expansion into other locations where co-ethnic communities are present, and that (b) entry through co-ethnic communities accelerates the pace at which MNEs establish additional subsidiaries in China. We also find that co-ethnic community effects continue to influence within-country MNE activities over time, despite a host of economic, institutional, and investment developments.
Increasing societal expectations regarding responsible business conduct as well as an increasingly fierce enforcement environment are placing integrity and compliance highly on the list of management priorities. However, although many... more
Increasing societal expectations regarding responsible business conduct as well as an increasingly fierce enforcement environment are placing integrity and compliance highly on the list of management priorities. However, although many companies are investing serious efforts into compliance programs and are increasing the headcount within their compliance organizations it seems to be striking that severe ethical breakdowns still happen on a very regular basis. The reason may well be that strongly relying on classical elements of compliance programs to prevent misconduct such as establishing numerous policies, strengthening awareness training and increasing monitoring mechanisms works like trying to win the Tour de France with flat tires. Typically, structural causes are the driving forces behind systemic misconduct. These include; unbalanced incentives systems that determine bonuses, salary increases or career progression without any consideration of moral behaviors; a lack of respon...
6 Intra-organizational turbulences in multinational corporations Andreas Schotter and Paul W. Beamish Introduction Scholars have recently pointed out that intra-organizational conflict in multinational corporations (MNCs) between... more
6 Intra-organizational turbulences in multinational corporations Andreas Schotter and Paul W. Beamish Introduction Scholars have recently pointed out that intra-organizational conflict in multinational corporations (MNCs) between headquarters (HQ) and their foreign ...
Intellectual property (IP) protection is the No. 1 challenge for multinational corporations operating in China. According to the U.S. government, China accounted for nearly 80% of all IP thefts from U.S.-headquartered organizations in... more
Intellectual property (IP) protection is the No. 1 challenge for multinational corporations operating in China. According to the U.S. government, China accounted for nearly 80% of all IP thefts from U.S.-headquartered organizations in 2013,1 amounting to an estimated $300 billion in lost business. Among European manufacturers, the loss of IP in China reduced potential profits by 20%.2 Although multinational corporations can’t afford to stay away from China, in order to remain competitive they must develop mechanisms that enable them to shift some of their innovation capabilities to China safely, without losing critical know-how.
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Today's business organizations, especially large ones, are complex places; difficult to manage and to control. Much of this complexity is self-induced and too much of the management of these organizations is done on an ad hoc basis.... more
Today's business organizations, especially large ones, are complex places; difficult to manage and to control. Much of this complexity is self-induced and too much of the management of these organizations is done on an ad hoc basis. Different reporting, control and management systems are used in different parts of the company and often these are incompatible, making it difficult, sometimes impossible for top management to know what is going on. Consequently it is an arduous task for managers to make strategic plans for the business or react quickly to changes in the environment. This book shows how much of this complexity can be smoothed away through the introduction of overarching management frameworks that are complete, consistent and comprehensive; bringing all the various parts of the organization together as a single system. It provides a whole-firm view of management and suggests that reputational and ethical issues are equally important to marketing, operations and finance and need to be considered within the framework. Management Frameworks is a practical and insightful book; offering students the tools and knowledge required for viewing strategy and management holistically. It will be required reading for executive education classes in strategic management and will find a ready audience with thinking managers everywhere. © 2013 Jacques Kemp, Andreas Schotter and Morgen Witzel. All rights reserved.
On February 24, 2010, Akio Toyoda, the grandson of Toyota Motor Corporation’s founder, Kiichiro Toyoda, endured a grueling question-and-answer session before the US House of Representatives Committee on Oversight and Government Reform.... more
On February 24, 2010, Akio Toyoda, the grandson of Toyota Motor Corporation’s founder, Kiichiro Toyoda, endured a grueling question-and-answer session before the US House of Representatives Committee on Oversight and Government Reform. The committee represented just one of three Congressional panels investigating the 2009-2010 recall of Toyota vehicles related to problems of sudden acceleration and the company’s delay in responding to the crisis.
Signs of the coming recall crisis began as early as 2006 when the National Highway Traffic Safety Administration (NHTSA) opened an investigation into driver reports of “surging” in Toyota’s Camry models. The NHTSA investigation was closed the next year, citing no defects. Over the next four years, Toyota, known in the industry for its quality and reliability, would quietly recall nearly nine million Toyota and Lexus models due to sudden acceleration problems. Toyota’s leadership, widely criticized for its slow response in addressing the problems, now had to move quickly to identify a solution that would ensure the safety of its vehicles, restore consumer confidence, protect the valuable Toyota brand, and recoup a plummeting share price.
Signs of the coming recall crisis began as early as 2006 when the National Highway Traffic Safety Administration (NHTSA) opened an investigation into driver reports of “surging” in Toyota’s Camry models. The NHTSA investigation was closed the next year, citing no defects. Over the next four years, Toyota, known in the industry for its quality and reliability, would quietly recall nearly nine million Toyota and Lexus models due to sudden acceleration problems. Toyota’s leadership, widely criticized for its slow response in addressing the problems, now had to move quickly to identify a solution that would ensure the safety of its vehicles, restore consumer confidence, protect the valuable Toyota brand, and recoup a plummeting share price.
For Chiquita Brands International, a pioneer in the globalization of the banana industry, bananas are not only serious business, they represent an array of economic, social, environmental, political, and legal hassles. Since its founding... more
For Chiquita Brands International, a pioneer in the globalization of the banana industry, bananas are not only serious business, they represent an array of economic, social, environmental, political, and legal hassles. Since its founding more than a hundred years ago as United Fruit Company, Chiquita has been involved in paying bribes to Latin American government officials in exchange for preferential treatment, encouraging or supporting US coups against smaller nations, putting in place dictatorships in Central America’s “banana republics,” exploiting local workers, creating an abusive monopoly, and now doing business with terrorists. 1
For American multinationals, the rewards of doing business abroad are enormous, but so are the risks. Over the past decades, no place has been more hazardous than Colombia, a country that is just emerging from a deadly civil war and the effects of wide-ranging narco …
For American multinationals, the rewards of doing business abroad are enormous, but so are the risks. Over the past decades, no place has been more hazardous than Colombia, a country that is just emerging from a deadly civil war and the effects of wide-ranging narco …