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Building (or not building) dynamic capabilities: the case of Italian subsidiaries in China and India

Published on Dec 10, 2018in The Multinational Business Review
· DOI :10.1108/MBR-11-2017-0087
Giuseppe Tattara9
Estimated H-index: 9
(Ca' Foscari University of Venice)
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Abstract
Purpose The purpose of this paper is to examine the process of capability building at subsidiary level and the forces preventing such process. The paper discusses and tests three propositions governing this process. Design/methodology/approach This research is based on multiple case studies. A case study research is most useful when addressing issues about which little prior theory has been developed or empirical evidence collected. Findings Subsidiaries in Asia operate in a way substantially different from those in the West. Specifically what ways do market specificities in Asian economies serve to either inhibit or positively encourage the development of a subsidiary? What are the circumstances which could induce subsidiaries to outsource production? Research limitations/implications Future research should explore the regional effect on MNE subsidiary types and different flexibilities exhibited in the value chain. What are the specific aspects (macro and micro) that explain variations of business strategies at subsidiary levelboth over time and between countries? Practical implications Multinational enterprises (MNEs) should be aware of the strong potential for capability development at the subsidiary level. This increased awareness ought to induce consideration in MNEs about how best to encourage such know capability development and how to leverage these capabilities for a better MNE performance. Social implications Managers who knew the host country languages and culture, and have outward-looking attitudes, are in advantageous positions to learn about new opportunities. Originality/value The paper offers empirical insights into the state and drivers of subsidiary performance in Asia. Specifically it shows how neglect of external conditions can act to open people’s eyes and foster a capability-building process within subsidiaries.
  • References (83)
  • Citations (1)
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References83
Newest
Published on Jun 1, 2018in Asia Pacific Journal of Management 2.74
Ming Pu1
Estimated H-index: 1
(Harbin University of Science and Technology),
Pek-Hooi Soh13
Estimated H-index: 13
(SFU: Simon Fraser University)
We investigate how subsidiaries exploit the knowledge flows embedded in internal and external networks and support their development in terms of scope (breadth of functional operations) and competence (ability to perform specific activities). We argue that individual subsidiaries have different organizational learning processes, which would influence the way subsidiaries evolve and manage multiple sources of knowledge and adapt their knowledge structure and routines systematically for subsidiary...
Published on Jan 1, 2018in The Academy of Management Annals 12.29
Oliver Schilke20
Estimated H-index: 20
(UA: University of Arizona),
Songcui Hu4
Estimated H-index: 4
(UA: University of Arizona),
Constance E. Helfat33
Estimated H-index: 33
(Dartmouth College)
Although the dynamic capabilities perspective has become one of the most frequently used theoretical lenses in management research, critics have repeatedly voiced their frustration with this literature, particularly bemoaning the lack of empirical knowledge and the underspecification of the construct of dynamic capabilities. But research on dynamic capabilities has advanced considerably since its early years, in which most contributions to this literature were purely conceptual. A plethora of em...
Published on Nov 1, 2017in Journal of Organizational Behavior 5.00
Ulf Elg20
Estimated H-index: 20
(Lund University),
Pervez N. Ghauri40
Estimated H-index: 40
(University of Birmingham)
+ 1 AuthorsSimon Collinson8
Estimated H-index: 8
(University of Birmingham)
Summary A number of studies have analysed how multinational enterprises (MNEs) develop appropriate strategies for managing the institutionally different contexts of various markets. However, we still know rather little about how MNEs manage different institutional pressures when they operate in emerging markets. These markets have a higher level of uncertainty as their values and structures undergo change. This paper investigates the microfoundations and routines that can be part of developing a...
Published on Apr 18, 2017in The Multinational Business Review
Jakob Lauring22
Estimated H-index: 22
(AU: Aarhus University),
Poul Houman Andersen21
Estimated H-index: 21
+ 1 AuthorsHanne Kragh7
Estimated H-index: 7
(AAU: Aalborg University)
Purpose This paper aims to identify antecedents for, and consequences of, low-intensity inter-unit conflict in multinational corporations (MNCs). Inter-unit conflict in MNCs is an important and well-researched theme. However, while most studies have focused on open conflict acknowledged by both parties, much less research has dealt with low-intensity conflicts. Still, low-intensity conflicts can be highly damaging – not least because they are rarely resolved. Design/methodology/approach The auth...
Published on Feb 1, 2017in Corporate Reputation Review
Christian Schnee2
Estimated H-index: 2
(University of Greenwich)
This paper argues for the adoption of reputation as a conceptual prism to discern patterns in political leadership behaviour. The author intends to reach a judgement about the concept’s value for our understanding of leadership by offering a fuller appreciation of reputation itself that is grounded in a recognition of its role in managing followers and entrenching power structures, which makes it critical both to the incumbent leader and challengers. Methodologically, for this analysis both theo...
Published on Jan 1, 2017in IEEE Engineering Management Review
Julian Birkinshaw52
Estimated H-index: 52
,
Gary Hamel1
Estimated H-index: 1
,
Michael J. Mol20
Estimated H-index: 20
Published on Jan 1, 2017in Journal of World Business 5.79
Mila Lazarova18
Estimated H-index: 18
(SFU: Simon Fraser University),
Hilla Peretz5
Estimated H-index: 5
,
Yitzhak Fried4
Estimated H-index: 4
(TTU: Texas Tech University)
In this paper we examine the relationship between subsidiary HR autonomy and subsidiary performance, the mediating role of absenteeism, and the moderating effect of cultural distance and institutional distance. We find that subsidiary HR autonomy is associated with higher subsidiary performance and that this relationship is mediated by employee absenteeism. We also find that the negative relationship between HR autonomy and absenteeism is stronger in the cases of low cultural and low institution...
Published on Dec 1, 2016in Management International Review 2.69
Peter J. Buckley57
Estimated H-index: 57
(University of Leeds)
Historical research methods and approaches can improve understanding of the most appropriate techniques to confront data and test theories in internationalisation research. A critical analysis of all “texts” (sources), time series analyses, comparative methods across time periods and space, counterfactual analysis and the examination of outliers are shown to have the potential to improve research practices. Examples and applications are shown in these key areas of research with special reference...
Published on Dec 1, 2016in Asia Pacific Journal of Management 2.74
Jonas F. Puck15
Estimated H-index: 15
,
Markus K. Hödl2
Estimated H-index: 2
+ 2 AuthorsBenjamin Bader7
Estimated H-index: 7
(Lüneburg University)
Previous studies often associated a specific type of ownership mode with the extent of control a parent firm may have over (strategic) decision-making in a foreign subsidiary, suggesting that parent firms should have higher control over wholly-owned subsidiaries (WoS) than international joint ventures (IJVs). Building on principal agent theory, we argue that in the Chinese context higher ownership levels do not necessarily have a positive effect on the extent of control over the foreign subsidia...
Cited By1
Newest
Published on Jun 3, 2019in The Multinational Business Review
Imtiaz Mostafiz (SHU: Sheffield Hallam University), Murali Sambasivan22
Estimated H-index: 22
(Taylors University),
See-Kwong Goh6
Estimated H-index: 6
(Taylors University)
Purpose This paper aims to investigate the antecedents and outcomes of international opportunity identification (IOI) in export-manufacturing firms. The fundamental question addressed in this research is: How does dynamic managerial capability (DMC) of entrepreneurs contribute to IOI and success of the firms? Design/methodology/approach The research model was tested through structural equation modeling among the readymade garment manufacturing firms in the least developed country, Bangladesh. A ...
Published on Dec 10, 2018in The Multinational Business Review
David Ahlstrom37
Estimated H-index: 37
(CUHK: The Chinese University of Hong Kong),
Xiaohua Yang12
Estimated H-index: 12
(USF: University of San Francisco)
+ 1 AuthorsChangqi Wu1
Estimated H-index: 1
(PKU: Peking University)
Purpose This paper aims to study largely recent aspects of entrepreneurship and innovation in China. It synthesizes the research in the current special issue (SI) of Multinational Business Review (MBR) on this topic. In addition, this paper differs from other work on this topic in examining entrepreneurship and innovation from a more global standpoint with relevant international effects. Design/methodology/approach The paper provides an overview of the literature on entrepreneurship, innovation ...