Managing the multinational enterprise

Stopford, John M.; Wells, Louis T.

doi:10.1002/tie.5060150206

Cited by 246 publications

(137 citation statements)

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“…International diversification does not add to an MNE's stock of knowledge, and should have a negative impact on its profitability, since diverse markets hamper the exploitation of scale economies. Second, if MNEs set up foreign affiliates to exploit the knowledge generated at HQ, then we would expect them to be organized in product divisions, as this is the most efficient organizational structure to exploit scale economies (Stopford/Wells 1972). In such a structure, the firm organizes the global management of its activities by products.…”

Section: The Learning Effectmentioning

confidence: 99%

The theoretical rationale for a multinationality-performance relationship

2007

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Section: The Learning Effectmentioning

confidence: 99%

The theoretical rationale for a multinationality-performance relationship

2007

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“…The main risk that the MNE faces in collaborating with a local firm is the possibility of the local firm absorbing and misappropriating the rents from its proprietary knowledge due to imperfections in the prevailing legal system governing industrial property rights [Hennart 1982;Stopford and Wells 1972]. Such misappropriation can, but does not have to, result from the local firm's breach of some explicit or implicit contractual agreement.…”

Section: Misappropriation Riskmentioning

confidence: 99%

Collaborative Ventures and Value of Learning: Integrating the Transaction Cost and Strategic Option Perspectives on the Choice of Market Entry Modes

1996

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Abstract:This paper employs a simple stochastic model to investigate how transaction cost and strategic option considerations interact to influence a firm's evaluation of collaborative venturing as a market entry mode. After demonstrating how uncertainty about the market and about the potential partner can add to the value of a collaborative venture, the paper explicates a condition under which the option to acquire or sell out generates a positive economic value for both of the partners. The interaction of transaction cost and strategic option considerations is then examined, and a number of testable hypotheses are proposed based on the theoretical analyses of the paper. We are grateful to Paul Beamish, Editor of JIBS, and to three anonymous reviewers for their constructive comments and valuable suggestions. All remaining errors, however, are solely our own responsibility.Published in the Journal of International Business Studies, 27(2): 285-307, 1996. as a market entry mode. After demonstrating how uncertainty about the market and about the potential partner can add to the value of a collaborative venture, the paper explicates a condition under which the option to acquire or sell out generates a positive economic value for both of the partners. The interaction of transaction cost and strategic option considerations is then examined, and a number of testable hypotheses are proposed based on the theoretical analyses of the paper.Collaborative Ventures and Value of Learning: Integrating the Transaction Cost and Strategic Option Perspectives on the Choice of Market Entry Modes. Journal of International Business Studies, 27 (2), 285-307. Publisher's Official Version: http://www.jstor.org/stable/155286 Open Access Version:

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“…Thus, headquarters' need to create value to the firm leads headquarters staff to engage in ''finding, creating, and influencing activities in the day-to-day operations'' (Poppo 2003, p. 404) of their subsidiaries alongside other headquarters if necessary. One principle of the M-form structure is the specialization in decision-making of corporate headquarters and the divisions: corporate headquarters are responsible for fundamental decisions such as the firm's boundaries while the divisions are responsible for business matters (Stopford and Wells 1972). As such, divisional headquarters have resources and capabilities that add to the ones of the corporate headquarters to manage the multibusiness firm.…”

Section: Discussionmentioning

confidence: 99%

“…This type of organization has been termed the ''Mform'' organization (Williamson 1983) and is considered one of the most important organizational innovations. The M-form organization usually goes hand in hand with the establishment of different types of headquarters such as corporate, divisional, and regional headquarters (Stopford and Wells 1972). These headquarters co-exist and it has traditionally been argued that they are responsible for a differentiated set of tasks and activities (Chandler 1991;Foss 1997).…”

Section: Parenting In the Multibusiness Firmmentioning

confidence: 99%

Beyond Simple Configurations: The Dual Involvement of Divisional and Corporate Headquarters in Subsidiary Innovation Activities in Multibusiness Firms

et al. 2017

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We investigate ''dual headquarters involvement'', i.e., corporate and divisional headquarters' simultaneous involvement in innovation development projects hosted by subsidiaries of multibusiness firms. Drawing on selective hierarchical involvement theory and the literature on subsidiary network embeddedness, we analyze 83 innovation projects in 22 multibusiness firms and find that the number of partners in the projects, rather than subsidiary intra-and inter-divisional embeddedness acts as a driver of dual headquarters involvement. We do however find that intra-and inter-divisional embeddedness is positively related to dual headquarters involvement when the number of partners in the innovation project is relatively large. These results lend support to the idea that parenting in complex organizations entail complex headquarters structures. Our results suggest that we need to go beyond simple conceptualizations of headquarters and that considering different dimensions of the innovating subsidiary's network helps in explaining dual headquarters involvement.

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Managing the multinational enterprise

Cited by 246 publications

References 0 publications

The theoretical rationale for a multinationality-performance relationship

The theoretical rationale for a multinationality-performance relationship

Collaborative Ventures and Value of Learning: Integrating the Transaction Cost and Strategic Option Perspectives on the Choice of Market Entry Modes

Beyond Simple Configurations: The Dual Involvement of Divisional and Corporate Headquarters in Subsidiary Innovation Activities in Multibusiness Firms

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