Corporate Strategy and Subsidiary Performance: The Effect of Product and Geographic Diversification

2019 ◽  
Vol 16 (5) ◽  
pp. 996-1029 ◽  
Author(s):  
Jie Jiao ◽  
Yang Liu ◽  
Rui Wu ◽  
Jun Xia
Keyword(s):  
Transition Economies ◽  
Multinational Enterprises ◽  
Corporate Strategy ◽  
Joint Effect ◽  
Product Diversification ◽  
European Countries ◽  
Foreign Subsidiaries ◽  
Geographic Diversification ◽  
Subsidiary Performance ◽  
The Relationship

ABSTRACTIn this study, we argue that foreign subsidiaries may benefit from the corporate strategies of multinational enterprises (MNEs) in different ways in terms of knowledge transfer and strategic flexibility. From this viewpoint, we explore the relationship between product diversification and financial performance of their subsidiaries under the condition of MNE geographic diversification. Using panel data on foreign subsidiaries in European countries from 2006 to 2011, we find a U-shaped relationship between product diversification and subsidiary performance and the joint effect of product and geographic diversification. Given the importance of transition economies in international business today, we conducted a subsample test contrasting the results based on the transitional (Central and Eastern European) versus Western European countries. The contrasting results provide important implications for other transition economies like China. We validate the relationship in several ways in our robustness tests.

Effects of two staffing decisions on the performance of MNC subsidiaries

2014 ◽  
Vol 2 (1) ◽  
pp. 85-101 ◽  
Author(s):  
Naoki Ando ◽  
Yongsun Paik
Keyword(s):  
Multinational Corporations ◽  
Foreign Subsidiary ◽  
Foreign Subsidiaries ◽  
Data Set ◽  
Subsidiary Performance ◽  
Content Type ◽  
Host Country Nationals ◽  
Negative Effect ◽  
Curvilinear Relationships ◽  
The Relationship

Purpose – The purpose of this paper is to examine the relationship between foreign subsidiary staffing and subsidiary performance by focussing on two staffing practices: first, the ratio of parent country nationals (PCNs) to foreign subsidiary employees and second, the number of PCNs assigned to the foreign subsidiary. Design/methodology/approach – Hypotheses predicting curvilinear relationships between the assignment of PCNs and subsidiary performance are tested using a panel data set consisting of 4,858 foreign subsidiaries of Japanese multinational corporations (MNCs). Findings – The results demonstrate that the two staffing practices have different effects on subsidiary performance. The ratio of PCNs to foreign subsidiary employees has an inverted U-shaped relationship with subsidiary performance, while the number of PCNs assigned to the subsidiary has a linear and negative effect on subsidiary performance. Research limitations/implications – The results of this study are subject to limitations. First, the sample used in this study consists solely of the foreign subsidiaries of Japanese firms. This research design limits the generalizability of the findings of this study. Second, other decisions related to subsidiary staffing such as the ratio of PCNs in the subsidiary's top management team need to be examined to advance understandings of the relationship between subsidiary staffing and subsidiary performance. Practical implications – MNCs need to identify the appropriate number of PCNs at which they can achieve the optimal trade-off with the PCN ratio to enhance the competitiveness and the performance of a foreign subsidiary. In doing so, they need to take into consideration that an increase in the number of PCNs has an immediate negative effect on the workplace morale of host country nationals. Originality/value – This study incorporates two staffing practices into its analyses and shows that they have different implications for subsidiary performance. The results suggest that focussing on one staffing practice alone limits understanding of the complex relationship between foreign subsidiary staffing and subsidiary performance.

Subsidiary Networks and Foreign Subsidiary Performance: A Coopetition Perspective

2019 ◽  
Vol 15 (1) ◽  
pp. 111-143 ◽  
Author(s):  
Yang Liu ◽  
Jie Jiao ◽  
Jun Xia
Keyword(s):  
Host Country ◽  
Economic Advantage ◽  
Foreign Subsidiary ◽  
Intangible Asset ◽  
Foreign Subsidiaries ◽  
Subsidiary Performance ◽  
And Performance ◽  
The Relationship ◽  
Positive Effect ◽  
Subsidiary Network

ABSTRACTFrom a coopetition perspective, we differentiate between a multinational enterprise's product-similar subsidiary network and product-different subsidiary network in a host country. We argue that the product-similar network will have a curvilinear (inverted U-shaped) effect on foreign subsidiary performance, whereas the product-different network will produce a monotonic (positive) effect. Moreover, we introduce host-country economic advantage and intangible resource of the subsidiary as moderators into the relationship between subsidiary network and performance. Using longitudinal panel data of foreign subsidiaries, we find evidence that when host-country economic advantage is large, and the level of intangible asset intensity is high, the inverted U-shaped effect of product-similar subsidiary network is less pronounced. Moreover, host-country economic advantage and intangible asset intensity both enhance the positive effect of product-different subsidiary network. However, the moderating effect of intangible asset intensity is opposite to our prediction.

Centralization and Effectiveness of Reward Management in Multinational Enterprises

2018 ◽  
Vol 17 (2) ◽  
pp. 55-65 ◽  
Author(s):  
Michael Tekieli ◽  
Marion Festing ◽  
Xavier Baeten
Keyword(s):  
Decision Making ◽  
Social Identity Theory ◽  
Multinational Enterprises ◽  
Role Identity ◽  
Management Decision ◽  
Role Identities ◽  
Management Decision Making ◽  
New Perspective ◽  
Subsidiary Managers ◽  
The Relationship

Abstract. Based on responses from 158 reward managers located at the headquarters or subsidiaries of multinational enterprises, the present study examines the relationship between the centralization of reward management decision making and its perceived effectiveness in multinational enterprises. Our results show that headquarters managers perceive a centralized approach as being more effective, while for subsidiary managers this relationship is moderated by the manager’s role identity. Referring to social identity theory, the present study enriches the standardization versus localization debate through a new perspective focusing on psychological processes, thereby indicating the importance of in-group favoritism in headquarters and the influence of subsidiary managers’ role identities on reward management decision making.

Openness and Self-enhancement are predictors of cultural and economic beliefs: an analysis of European countries across 15 years

2019 ◽  
Author(s):  
Gabriela Czarnek ◽  
Małgorzata Kossowska
Keyword(s):  
Cultural Context ◽  
Cultural Beliefs ◽  
European Social Survey ◽  
European Countries ◽  
Political Beliefs ◽  
Economic Beliefs ◽  
Nationally Representative ◽  
Self Transcendence ◽  
Using Data ◽  
The Relationship

In this study, we investigate the relationship between values and political beliefs and how it varies as a function of cultural context and time. In particular, we analyzed the effects of Conservation vs. Openness to change and Self-transcendence vs. Self-enhancement for cultural and economic political beliefs using data from nationally representative samples of citizens from 34 European countries from eight rounds of the European Social Survey (data spans the 2002–2016 period). We found that the effects of values on political beliefs are moderated by the Western vs. Eastern cultural context and that there is a modest round-to-round variation in the effects of values on beliefs. The relationship between Openness and cultural beliefs was negative and largely consistent across the Western and Eastern countries. Similarly, the effects of Self-enhancement were positive across these Western and Eastern countries. In contrast, the effects of Openness on economic beliefs were positive for the Eastern countries but largely weak and inconsistent for the Western countries. Finally, the effects of Self-enhancement on cultural beliefs are weak for both cultural contexts.

Will rivals enter or wait outside when faced with litigation risk? Patent litigation in complex product industries and international market entry

2021 ◽  
pp. 147612702199825
Author(s):  
Ergun Onoz ◽  
Claudio Giachetti
Keyword(s):  
Market Entry ◽  
International Market ◽  
Joint Effect ◽  
Litigation Risk ◽  
Patent Litigation ◽  
Complex Product ◽  
Patent Strategy ◽  
Negative Effect ◽  
Rival Firms ◽  
The Relationship

A spiral of patent infringement litigation among rival firms is a phenomenon often observed in complex product industries, where products comprise numerous separately patentable elements. Theoretically grounded in the awareness–motivation–capability framework of competitive dynamics, this article contributes to the literature on patent strategy and international market entry by looking at how, in a complex product industry, the intensity of patent litigation in a country affects a firm’s decision to enter that country. Our results show that the intensity of patent litigation in a country is a deterrent for potential entrants and has a negative effect on a firm’s likelihood of entering that country. We also show that a firm’s previous experience with patent litigation ( awareness component), the share of a firm’s current patent applications in a target country ( motivation component), and the size of a firm’s patent stock ( capability component) moderate the relationship between a country’s patent litigation intensity and a firm’s likelihood of entering that country. We thus shed light on the joint effect of macro- and micro-level patent-related variables on a firm’s market entry decisions. We test our hypotheses with a comprehensive panel of patenting and entry strategies of 84 mobile phone vendors and their patent litigation battles in 45 countries, from 2003 to 2015.

scholarly journals Eco-Efficiency and Human Capital Efficiency: Example of Small- and Medium-Sized Family Farms in Selected European Countries

2021 ◽  
Vol 13 (12) ◽  
pp. 6846
Author(s):  
Jan Polcyn
Keyword(s):  
Human Capital ◽  
Agricultural Production ◽  
Efficiency Index ◽  
European Countries ◽  
Family Farms ◽  
Work Hour ◽  
Capital Efficiency ◽  
Environmental Measures ◽  
The Relationship ◽  
Economic Measure

Small- and medium-sized family farms are places to live and sources of income for about half of the population. The aim of this analysis was to determine the relationship between eco-efficiency and human capital efficiency on small- and medium-sized family farms. The analysis was carried out using an economic measure (value of agricultural production per work hour calculated per hectare) and two synthetic measures (human capital and environmental measures). The synthetic measures were determined using the TOPSIS-CRITIC method by defining weights for variables used in the measures. The analysis covered five countries: Lithuania (960 farms), Moldavia (532 farms), Poland (696 farms), Romania (872 farms) and Serbia (524 farms). All of these countries are characterised by a high fragmentation of agricultural holdings. The analysis allowed us to formulate the following conclusions: eco-efficiency and human capital efficiency indices increased with area for small- and medium-sized family farms. An increase in the eco-efficiency index with an increase in farm area suggests that the smaller the farm area, the more extensive the agricultural production that was carried out. In addition, an increase in human capital efficiency with an increase in farm area indicates that there was inefficiency in the utilisation of human capital resources on the agricultural farms studied.

Money Matters: Dissecting the Relationship Between Gender Equality and Female Homicide Victimization Rates in the European Union

2016 ◽  
Vol 13 (5) ◽  
pp. 435-455 ◽  
Author(s):  
Janet P. Stamatel
Keyword(s):  
European Union ◽  
Gender Equality ◽  
European Countries ◽  
Curvilinear Relationship ◽  
Violent Victimization ◽  
The European Union ◽  
Homicide Victimization ◽  
The Relationship ◽  
Gender Specific ◽  
Victimization Rates

This study utilized a fairly new measure of gender equality from the European Union to dissect the relationship between gender-specific homicide victimization rates and different forms of gender equality across a sample of European countries. Results showed support for a curvilinear relationship between financial equality and female and male homicide victimization, providing support for amelioration and backlash theories, but no support for absolute economic marginalization. While there were some similarities between the female and male models, there were enough differences to warrant further investigations of gendered theories of violent victimization.

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