Dynamic capabilities for hire – How former host-country entrepreneurs as MNC subsidiary managers affect performance

Distel, Andreas Philipp; Sofka, Wolfgang; Faria, Pedro de; Ribeiro, António Sérgio

doi:10.1057/s41267-019-00274-0

Cited by 26 publications

(24 citation statements)

References 114 publications

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“…The reality is far more complex; yet very few studies investigate aspects of leadership in the context of subsidiaries (e.g., Sarabi, Froese, Chng & Meyer, 2020). Moreover, MNEs increasingly appoint local people to leadership roles, not only to access local knowledge but to tap into entrepreneurial talent (Distel, Sofka, de Faria, Preto, & Ribeiro, 2019;Muellner, Klopf, & Nell, 2017).…”

Section: Leadershipmentioning

confidence: 99%

Managing the MNE subsidiary: Advancing a multi-level and dynamic research agenda

2020

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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 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, subsidiary management is a multi-level phenomenon that would benefit from more microfoundational research. Second, subsidiary management operates at key interfaces of technology paradigm shifts, and of disruptions in the political and institutional environment. Research into the dynamics of subsidiary management would thus enhance our understanding of international business in a volatile global economy. Journal of International Business Studies (2020) 51, 538-576.

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Section: Leadershipmentioning

confidence: 99%

Managing the MNE subsidiary: Advancing a multi-level and dynamic research agenda

2020

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“…We conduct this study to shed light on the effects of hiring managers from MNCs for the export decisions of domestic firms. Existing literature has focused mostly on the hiring of MNCs from domestic firms [ 28 , 113 ]. However, there is limited understanding of the theoretical mechanisms associated to the hiring of former MNC employees by domestic firms ([ 58 , 114 ] are notable exceptions).…”

Section: Discussionmentioning

confidence: 99%

“…The dataset allows us to identify (a) the population of domestic firms that is not yet exporting, (b) their hiring of managers from MNCs (treatment), (c) a matched control group as well as (d) firms starting to export. We rely on entropy balancing to account for potential biases originating from the selectivity of the hiring decision [ 27 , 28 ]. In line with our theoretical predictions, we find that domestic firms increase their likelihood to start exporting when they hire managers from MNCs and that this effect is weaker for domestic firms that are in their startup phase but stronger for firms with an internationally diverse workforce and a high degree of hierarchical specialization.…”

Section: Introductionmentioning

confidence: 99%

Recruiting strategic human capital from MNCs—Does hiring MNC managers enable exporting in domestic firms?

2021

Self Cite

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Exporting is a central growth strategy for most firms and managers with international experience are instrumental for export decisions. We suggest that such managers can be hired from Multinational Corporations (MNCs). We integrate theory from strategic human capital research into models explaining export decisions. We theorize that hiring managers from MNCs increases the odds of domestic firms to start exporting and this effect depends on the similarities between hiring firms and MNCs. We hypothesize that young firms will benefit comparatively less from hiring MNC managers. In contrast, firms with internationally diverse workforces and with high degrees of hierarchical specialization will benefit the most from hiring MNC managers. We test and support these hypotheses for 474,926 domestic firms in Sweden, which we observe between 2007 and 2015.

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“…Since the present study aims to explore acquisition effects on employee mobility, a potential endogeneity may arise if more (or less) mobile individuals are more likely to choose to work in acquired firms. To account for the potential selfselection biases, we use an entropy balancing approach to pre-balance the data based on observed covariates (Abadie et al, 2010;Distel et al, 2019). Like other matching strategies, the rationale of entropy balancing is to make treatment and control group as "similar" as possible so that the treatment can be assumed as a "random" event conditional on observed characteristics.…”

Section: Empirical Strategymentioning

confidence: 99%

“…We observe that individuals show a lower propensity of departure in acquired firms than non-acquired firms before acquisitions. We use an entropy balancing approach (Abadie et al, 2010;Distel et al, 2019) to account for the self-selection bias where less mobile individuals are more likely to choose to work at acquired firms. Using high-dimensional fixed effects models which account for heterogeneity at both individual and firm levels, we find that acquisitions increase the likelihood of employee departures, mainly in the form of switching to another employer, but the acquisition effects are weaker for employees with technological skills.…”

Section: Introductionmentioning

confidence: 99%

Skill-biased acquisitions? Human capital and employee mobility in small technology firms

Xiao

Dahlstrand

2022

Small Bus Econ

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The purpose of this study is to investigate the relationship between acquisitions and mobility of knowledge workers and managers in small technology companies and how individual skills and capabilities moderate this relationship. Relying on the matched employer–employee data of the Swedish high-tech sectors from 2007 to 2015, we find that acquisitions increase the likelihood of employee departures, mainly in the form of switching to another employer, but that these acquisition effects are weaker for employees with technological competences. By contrast, the acquisition effects are found to be weaker for employees with managerial competences only when acquirers have a strong employee retention motive. When acquirers do not have a strong retention motive, managers, compared to other employees, are more likely to exit the (national) labor market after acquisitions. Our results suggest that the retention motive is a critical condition to explain post-acquisition employee turnover. Both technological and managerial competences are the types of human capital valued by acquirers when they have a strong retention motive.

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Dynamic capabilities for hire – How former host-country entrepreneurs as MNC subsidiary managers affect performance

Cited by 26 publications

References 114 publications

Managing the MNE subsidiary: Advancing a multi-level and dynamic research agenda

Managing the MNE subsidiary: Advancing a multi-level and dynamic research agenda

Recruiting strategic human capital from MNCs—Does hiring MNC managers enable exporting in domestic firms?

Skill-biased acquisitions? Human capital and employee mobility in small technology firms

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