Internal relations between parent headquarters - subsidiaries of multinational companies

John, Richard

http://hdl.handle.net/10400.8/3036

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Authors

John, Richard

Advisor(s)

Crespo, Cátia Claudemira Cordeiro Fernandes

Abstract(s)

The subsidiary is the local affiliate of a multinational company typically situated in a distant location from the headquarters. Usually it works as a whole new entity in the target country, with functioning directives from the parent company. The subsidiaries can benefit from the parent firm in terms of sharing of technological know-how, trade-secrets, administrative knowledge, commercial brand name, etc. In turn, they work as a value-adding subunit of the MNC, instrumental in increasing the competitiveness of the parent organizationTherefore, the relationship between the two parts plays a critical role in gaining competitive advantage. The primary aim of the present study was to examine the various facets of association between headquarters and its subsidiary and to. In this study, the internal relations between any headquartesr and its subsidiary in an MNC environment were examined based on resource based view, organizational learning, knowledge sharing, subsidiary competence, centralization, formalization, and network strength along with organizational performance. Regression analysis was conducted to test the hypotheses. Our study demonstrates that the factors Organizational learning, Subsidiary competence, Centralization, Formalization, and Network strength influenced Knowledge sharing of the subsidiary, which further impacted on Organizational performance.