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Introduction

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Book cover The Role of the Subsidiary in International Business

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Abstract

The chapter constitutes an introduction to the book focusing on functional responsibilities of the subsidiary within the value network of multinational enterprises. It sets the background to the studied research area and presents its importance to researchers, business practitioners, and policymakers. The importance of functional specialization and discrepancies in the functional responsibilities of subsidiaries has been visible in international management and international business literature for over 35 years. Nonetheless, for years the functional responsibilities of subsidiaries were positioned as a side topic to other aspects of multinational enterprises’ operations, with no uniform approach to studying the issue, except for acknowledging the existence of different value chain functions. The chapter explains the importance of applying a more structured approach to subsidiaries’ functional responsibilities within the multinational enterprise’s value network.

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Notes

  1. 1.

    While working on the concept of the company’s value chain, Porter used inter alia the concept of business systems developed within the McKinsey Company (see, e.g., Gluck 1980; Buaron 1981). Sheehan and Foss (2009) discussed the theoretical background underlying the value chain.

  2. 2.

    Other descriptions of subsidiaries and their responsibilities that reflect on the same phenomenon are provided by inter alia Birkinshaw and Hood (1997) and Dörrenbächer and Gammelgaard (2006).

  3. 3.

    For example, between the years 2002 and 2007 the share of foreign subsidiaries in the turnover of manufacturing companies increased by 7.2% (OECD 2005, 2010). Additionally, between the years 2002 and 2007 the average export and import propensity of affiliates under foreign control increased by 12% and 2.3% for the manufacturing sector (OECD 2005, 2010). Furthermore, there is some evidence showing that the number of value chain activities of foreign subsidiaries located in Poland has increased over time and responsibilities of subsidiaries located in Poland started exceeding the national level and moved to the Central and Eastern European region or even the world (Eckert and Rossmeissl 2007).

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Authors and Affiliations

  1. Department of International Competitiveness, Poznań University of Economics and Business, Poznań, Poland

    Marlena Dzikowska

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  1. Marlena Dzikowska
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Dzikowska, M. (2019). Introduction. In: The Role of the Subsidiary in International Business. Palgrave Pivot, Cham. https://doi.org/10.1007/978-3-030-17527-6_1

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