Parenting advantage in the MNC: An embeddedness perspective on the value added by headquarters

Nell, Phillip Christopher; Ambos, Björn

doi:10.1002/smj.2058

Cited by 145 publications

(134 citation statements)

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“…Besides showing that the internal embeddedness of innovating subsidiaries matters for the organizational setup of the firm (Meyer et al 2011), our findings provide substance to the idea that the subsidiary's embeddedness in large innovation development networks affects hierarchical involvement in two distinct ways: (a) a larger network triggers broader involvement from the hierarchy on the corporate and the divisional level, and (b), it lets the organization react in a stronger way to intra-/inter-divisional embeddedness. With these findings, we add to previous research that has investigated subsidiary embeddedness effects on parent behavior (e.g., Andersson et al 2007;Nell and Ambos 2013) by highlighting that not only the degree of embeddedness matters (the strength of ties or relationships) but also the type of network in which the subsidiary is embedded, and particularly the network size.…”

Section: Discussionmentioning

confidence: 58%

“…Recent contributions have investigated how headquarters attempt to add value to the organization (Nell and Ambos 2013), for example by transferring knowledge to their subsidiaries (e.g., Nell et al 2016;Parmigiani and Holloway 2011), by enabling the development and the sharing of innovations within the firm (e.g., Ciabuschi et al 2011a;Dellestrand and Kappen 2012;Un and Cuervo-Cazurra 2004), or by managing inter-divisional conflicts and uncertainty (Poppo 2003).…”

Section: Introductionmentioning

confidence: 99%

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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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Section: Discussionmentioning

confidence: 58%

Section: Introductionmentioning

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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“…Second, improving internal knowledge markets requires a greater coordination role to integrate knowledge from separate subsidiaries (Nell and Ambos 2013). This traditionally has underlined the continuing relevance of headquarters (of various types), even where the MNE itself moves towards a network structure.…”

Section: The Perils Of Growing Too Fast: the Mne And The Dispersion-bmentioning

confidence: 99%

Exploring the Paradox of Competence-creating Subsidiaries: Balancing Bandwidth and Dispersion in MNEs

Narula¹

2014

Long Range Planning

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This paper seeks to synthesise the various contributions to the special issue of Long Range Planningon competence-creating subsidiaries (CCS), and identifies avenues for future research. Effective competence-creation through a network of subsidiaries requires an appropriate balance between internal and external embeddedness. There are multiple types of firm-specific advantages (FSAs) essential to achieve this. In addition, wide-bandwidth pathways are needed with collaborators, suppliers, customers as well as internally within the MNE. Paradoxically, there is a natural tendency for bandwidth to shrink as dispersion increases. As distances (technological, organisational, and physical) become greater, there may be decreasing returns to MNE spread. Greater resources for knowledge integration and coordination are needed as intra-and inter-firm R&D cooperation becomes more intensive and extensive. MNEs need to invest in mechanisms to promote wide-bandwidth knowledge flows, without which widely dispersed and networked MNEs can suffer from internal market failures.

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“…Early studies Corporate Headquarters 13 already highlighted that the role of the CHQ in the MNC depends on the characteristics of the international subsidiaries (Rutenberg, 1969) and that a firm's change towards multinational operations leads to changes in its CHQ reporting and control systems (McInnes, 1971). Prior research has focused on diverse characteristics of a firm's international units, including their international subsidiaries' networks and actions (Vahlne, Schweizer & Johanson, 2012), local stakeholders (Crilly, 2011), resource dependence, importance, managers' nationality (Martinez & Ricks, 1989), initiatives and autonomy (Ambos, Andersson & Birkinshaw, 2010), internal and external embeddedness (Ciabuschi, Dellestrand & Martín, 2011a;Nell & Ambos, 2013), ownership arrangements and choices (Chan & Makino, 2007;Martinez & Ricks, 1989), as well as expatriate managers' decision autonomy (Takeuchi, Shay & Li, 2008). For example, Martinez and Ricks (1989) draw upon resource-dependence and control theory and find with a survey of 115 Mexican affiliates of a US-based MNCs that the CHQ's influence is positively related to the affiliate's resource dependence.…”

Section: The Chq and The Operating Units' Characteristics (2-1)mentioning

confidence: 99%

“…Among the other firm characteristics explored in the context of CHQ research are diverse aspects, such as firm's size (Bazzaz & Grinyer, 1981;Berger & Ofek, 1995;Collis et al, 2007;Leontiades & Tezel, 1981), shared identity and values (Ohmae, 1989), work environment (Thurm, 2005), performance (Stubbart, 1982), and embeddedness (Nell & Ambos, 2013). Particularly the number of studies that consider the influence of a firm's size on the CHQ and on its relationship to performance is notable.…”

Section: The Chq and Firm Characteristics (3-1)mentioning

confidence: 99%

What Do We Know About Corporate Headquarters? A Review, Integration, and Research Agenda

2013

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During the past five decades, scholars have studied the corporate headquarters (CHQ) -the multidivisional firm's central organizational unit. The purpose of this article is to review the diverse and fragmented literature on the CHQ and to identify the variables of interest, the dominant relationships, and the contributions. We integrate, for the first time, the existing knowledge of the CHQ into an organizing framework. Based on a synthesis of the literature, we identify major shortcomings and gaps, and present an agenda for future research that contributes to our understanding of the CHQ and the multidivisional firm. KeywordsCorporate headquarters, corporate parent, corporate center, corporate strategy, multidivisional firm, multibusiness firm, multinational corporation. However, since scholars have studied CHQ phenomena from diverse perspectives and have employed different methods, there is a need for a framework that integrates this research in order to advance theory on the multidivisional firm.Specifically, three factors motivated this synthesis of research on the CHQ. First, while there is a substantial amount of research on the CHQ, the insights from these works are diffuse, requiring consolidation to take stock of this body of knowledge. By delineating the evolution of this literature and the different perspectives, we identify the state of CHQ research and enhance our understanding of how research issues have emerged. We also provide an overview of the Corporate Headquarters 2 most frequently explored CHQ phenomena and establish a common vocabulary. Second, research on the CHQ is increasingly disconnected, having developed along four different tracks in the economic, organization, international business, and practice-oriented traditions. This has not only led to different research foci and approaches to studying the CHQ, but also to a lack of understanding of the variables of interest and the relationships between them. An important purpose of the review is thus to provide a first comprehensive framework of CHQ research that integrates the dispersed insights, identifies the most relevant variables of interest, and specifies the dominant relationships between them. Third, while our review reveals the contributions of the literature on the CHQ, it also uncovers several weak, and even unexplored research areas. In addition, the integrative review reveals a potential for cross-fertilization, for example, between the academic and practice-oriented literatures. We therefore identify gaps within and across the different research areas and highlight pressing future research questions that will help advance our understanding of the CHQ and the multidivisional firm.

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Parenting advantage in the MNC: An embeddedness perspective on the value added by headquarters

Cited by 145 publications

References 78 publications

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

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

Exploring the Paradox of Competence-creating Subsidiaries: Balancing Bandwidth and Dispersion in MNEs

What Do We Know About Corporate Headquarters? A Review, Integration, and Research Agenda

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