Advertisement

Organizational Networks Revisited: Predictors of Headquarters-Subsidiary Relationship Perception

  • Antonina Milekhina
  • Elena ArtyukhovaEmail author
  • Valentina Kuskova
Conference paper
Part of the Lecture Notes in Computer Science book series (LNCS, volume 11179)

Abstract

The problem of effective management of company subsidiaries has been on the forefront of strategic management research since early mid-1980s. Recently, special attention is being paid to the effect of headquarters - subsidiary conflicts on the company performance, especially in relation to the subsidiaries’ resistance, both active and passive, to following the directives of the headquarters. A large number of theoretical approaches have been used to explain the existence of intraorganizational conflicts. For example, Strutzenberger and Ambos (2013) examined a variety of ways to conceptualize a subsidiary, from an individual up to a network level. The network conceptualization, at present, is the only approach that could allow explaining the dissimilarity of the subsidiaries’ responses to headquarters’ directives, given the same or very similar distribution of financial and other resources, administrative support from the head office to subsidiaries, and levels of subsidiary integration. This is because social relationships between different actors inside the organization, the strength of ties and the size of networks, as well as other characteristics, could be the explanatory variables that researchers have been looking for in their quest to resolve varying degrees of responsiveness of subsidiaries, and – in fact – headquarters’ approaches – to working with subsidiaries. The purpose of this study is to evaluate the variety of characteristics of networks formed between actors in headquarters and subsidiaries, and their effects on a variety of performance indicators of subsidiaries, as well as subsidiary-headquarters conflicts. Data is being collected in two waves at a major Russian company with over 200,000 employees and several subsidiaries throughout the country.

Keywords

Network relationships Headquarters Subsidiaries relations 

References

  1. 1.
    Ferner, A., et al.: Dynamics of central control and subsidiary autonomy in the management of human resources: case-study evidence from US MNCs in the UK. Organ. Stud. 25, 363–391 (2004).  https://doi.org/10.1177/0170840604040041CrossRefGoogle Scholar
  2. 2.
    Edwards, R., Ahmad, A., Moss, S.: Subsidiary autonomy: the case of multinational subsidiaries in Malaysia. J. Int. Bus. Stud. 33, 183–191 (2002).  https://doi.org/10.1057/palgrave.jibs.8491011CrossRefGoogle Scholar
  3. 3.
    Roth, K., Nigh, D.: The effectiveness of headquarters-subsidiary relationships: the role of coordination, control, and conflict. J. Bus. Res. 25, 277–301 (1992).  https://doi.org/10.1016/0148-2963(92)90025-7CrossRefGoogle Scholar
  4. 4.
    Ghoshal, S., Bartlett, C.A.: The multinational corporation as an interorganizational network. Acad. Manag. Rev. 15, 603–626 (1990).  https://doi.org/10.5465/amr.1990.4310825CrossRefGoogle Scholar
  5. 5.
    Schotter, A., Beamish, P.W.: Performance effects of MNC headquarters-subsidiary conflict and the role of boundary spanners: the case of headquarter initiative rejection. J. Int. Manag. 17, 243–259 (2011).  https://doi.org/10.1016/j.intman.2011.05.006CrossRefGoogle Scholar
  6. 6.
    Andersson, U., Forsgren, M., Holm, U.: The strategic impact of external networks: subsidiary performance and competence development in the multinational corporation. Strateg. Manag. J. 23, 979–996 (2002).  https://doi.org/10.1002/smj.267CrossRefGoogle Scholar
  7. 7.
    Fey, C.F., Björkman, I.: The effect of human resource management practices on MNC subsidiary performance in Russia. J. Int. Bus. Stud. 32, 59–75 (2001).  https://doi.org/10.1057/palgrave.jibs.8490938CrossRefGoogle Scholar
  8. 8.
    Hedlund, G.: Autonomy of subsidiaries and formalization of headquarters-subsidiary relationships in Swedish MNCs. In: Otterbeck, L. (ed.) The Management of Headquarters-Subsidiary Relationships in Multinational Corporations, pp. 27–76. Gower Publishing, Aldershot (1981)Google Scholar
  9. 9.
    Egelhoff, W.G.: Patterns of control in US, UK and European multinational corporations. J. Int. Bus. Stud. 15, 73–83 (1984)CrossRefGoogle Scholar
  10. 10.
    Delios, A., Beamish, P.W.: Survival and profitability: the roles of experience and intangible assets in foreign subsidiary performance. Acad. Manag. J. 44, 1028–1038 (2001)Google Scholar
  11. 11.
    Birkinshaw, J., Hood, N., Young, S.: Subsidiary entrepreneurship, internal and external competitive forces, and subsidiary performance. Int. Bus. Rev. 14, 227–248 (2005)CrossRefGoogle Scholar
  12. 12.
    Nell, P.C., Ambos, B., Schlegelmilch, B.B.: The MNC as an externally embedded organization: an investigation of embeddedness overlap in local subsidiary networks. J. World Bus. 46, 497–505 (2011)CrossRefGoogle Scholar
  13. 13.
    Inkpen, A.C., Tsang, E.W.K.: Social capital, networks, and knowledge transfer. Acad. Manag. Rev. 30, 146–165 (2005)CrossRefGoogle Scholar
  14. 14.
    Kostova, T., Roth, K.: Social capital in multinational corporations and a micro-macro model of its formation. Acad. Manag. Rev. 28, 297–317 (2003)CrossRefGoogle Scholar
  15. 15.
    O’Donnell, S.W.: Managing foreign subsidiaries: agents of headquarters, or an interdependent network? Strateg. Manag. J. 21, 525–548 (2000)CrossRefGoogle Scholar
  16. 16.
    Knight, L., Harland, C.: Managing supply networks: organizational roles in network management. Eur. Manag. J. 23, 281–292 (2005)CrossRefGoogle Scholar
  17. 17.
    Emerson, R.M.: Social exchange theory. Annu. Rev. Soc. 2, 335–362 (1976)CrossRefGoogle Scholar
  18. 18.
    Burt, R.S.: Bandwidth and echo: trust, information, and gossip in social networks. In: Casella, A., Rauch, J.E. (eds.) Network and Markets, pp. 30–74. Sage, New York (2001)Google Scholar
  19. 19.
    Harzing, A.W., Feely, A.J.: The language barrier and its implications for HQ-subsidiary relationships. Cross Cult. Manag. Int. J. 15, 49–61 (2008).  https://doi.org/10.1108/13527600810848827CrossRefGoogle Scholar
  20. 20.
    London, M., Smither, J.W.: Feedback orientation, feedback culture, and the longitudinal performance management process. Hum. Res. Manag. Rev. 12, 81–100 (2002).  https://doi.org/10.1016/S1053-4822(01)00043-2CrossRefGoogle Scholar
  21. 21.
    Krackhardt, D., Stern, R.N.: Informal networks and organizational crises: an experimental simulation. Soc. Psychol. Q. 51, 123–140 (1988)CrossRefGoogle Scholar
  22. 22.
    Bavelas, A.: Communication patterns in task-oriented groups. J. Acoust. Soc. Am. 22, 725–730 (1950).  https://doi.org/10.1121/1.1906679CrossRefGoogle Scholar
  23. 23.
    Bollen, K.A., Long, J.S.: Testing Structural Equation Models, vol. 154. SAGE Publications, Newbury Park (1993)Google Scholar

Copyright information

© Springer Nature Switzerland AG 2018

Authors and Affiliations

  • Antonina Milekhina
    • 1
  • Elena Artyukhova
    • 1
    Email author
  • Valentina Kuskova
    • 1
  1. 1.National Research University Higher School of EconomicsMoscowRussian Federation

Personalised recommendations