Barriers to the accomplishment of a subsidiary's strategic role: how location and corporate networks influence subsidiary performance

Abstract

This paper presents the evolution of a multinational's subsidiary, which is located in an emerging country, and aims to uncover barriers encountered during the evolution of the accomplishment of its intended strategic role. Throughout a historical study that goes back 40 years, the paper depicts milestones in the subsidiary's evolution and highlights barriers encountered to developing and deploying capabilities, whether they are transferred from HQ's or emerge from the subsidiary's embedding process. The results of this research point out the barriers a subsidiary faces while accomplishing its role and duties towards the ends of internationalization and evolution typologies that emerge from the interaction between local and corporate barriers.

Interdependence Across a Firm's International Trajectories

“…In bringing the interdependence across the firm's international trajectories to the forefront, we highlight a driving force in the internationalization of the firm that has been neglected in the literature (Fortanier & Tulder, 2009;Salgado, 2011). In doing so, we put forward an alternative, yet complementary (and more nuanced) view of the internationalization of the firm.…”

“…Notwithstanding, as recently remarked by Nachum andSong (2011), Shaver (2013) and C. Welch and Paavilainen-Mäntymäki (2014), inquiry into it is still parsimonious and sketchy. Consequently, the interdependence across the firm's international trajectories remains backstage in accepted explanations of the internationalization of the firm (Fortanier & Tulder, 2009;Salgado, 2011). As a matter of fact, interdependence is only acknowledged, albeit from a static point of view (Estrin, Meyer, Wright, & Foliano, 2008), in the literature of configuration and coordination of a multinational's operations, in particular subsidiary development (Paterson & Brock, 2002).…”