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Fighting the corporate immune system: a process study of subsidiary initiatives in multinational corporations

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  • Birkinshaw, Julian
  • Ridderstråle, Jonas
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    Abstract

    This paper examines subsidiary initiatives, which are entrepreneurial activities carried out by foreign owned subsidiaries in multinational corporations; and the forces that resist them that we refer to as the 'corporate immune system'. The study is based on case study analyses of 44 initiatives, both successes and failures, undertaken by Canadian subsidiary managers. The key finding is that subsidiary initiatives take two different forms. Internally-focused initiatives are based on opportunities identified within the corporation, and are pursued through a traditional bottom-up process. Externally-focused initiatives are based on opportunities in the external marketplace. The most successful ones typically gain allies outside the corporation early on, and only confront the corporate immune system once they are relatively well established.

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    Bibliographic Info

    Article provided by Elsevier in its journal International Business Review.

    Volume (Year): 8 (1999)
    Issue (Month): 2 (April)
    Pages: 149-180

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    Handle: RePEc:eee:iburev:v:8:y:1999:i:2:p:149-180

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    Cited by:
    1. Kyaw, NyoNyo A. & Manley, John & Shetty, Anand, 2011. "Factors in multinational valuations: Transparency, political risk and diversification," Journal of Multinational Financial Management, Elsevier, vol. 21(1), pages 55-67, February.
    2. Igor Gurkov & Sergey Filippov, 2013. "Innovation management in Russia’s foreign manufacturing subsidiaries: a pilot exploration of creation and implementation of effective innovation routines," HSE Working papers WP BRP 07/MAN/2013, National Research University Higher School of Economics.
    3. Sargent, John & Matthews, Linda, 2006. "The drivers of evolution/upgrading in Mexico's maquiladoras: How important is subsidiary initiative?," Journal of World Business, Elsevier, vol. 41(3), pages 233-246, September.
    4. Schmid, Stefan & Dzedek, Lars R. & Lehrer, Mark, 2014. "From Rocking the Boat to Wagging the Dog: A Literature Review of Subsidiary Initiative Research and Integrative Framework," Journal of International Management, Elsevier, vol. 20(2), pages 201-218.
    5. Williams, Christopher & Lee, Soo Hee, 2011. "Entrepreneurial contexts and knowledge coordination within the multinational corporation," Journal of World Business, Elsevier, vol. 46(2), pages 253-264, April.
    6. Williams, Christopher & Lee, Soo Hee, 2009. "International management, political arena and dispersed entrepreneurship in the MNC," Journal of World Business, Elsevier, vol. 44(3), pages 287-299, July.
    7. Lee, Soo Hee & Williams, Christopher, 2007. "Dispersed entrepreneurship within multinational corporations: A community perspective," Journal of World Business, Elsevier, vol. 42(4), pages 505-519, December.
    8. Randi Lunnan & Youzhen Zhao, 2014. "Regional headquarters in China: Role in MNE knowledge transfer," Asia Pacific Journal of Management, Springer, vol. 31(2), pages 397-422, June.
    9. Welch, Denice E. & Welch, Lawrence S., 2006. "Commitment for hire? The viability of corporate culture as a MNC control mechanism," International Business Review, Elsevier, vol. 15(1), pages 14-28, February.
    10. Igor Gurkov & Sergey Filippov, 2013. "Innovation processes in the Russian manufacturing subsidiaries of MNCs – an integrated view from case studies," HSE Working papers WP BRP 11/MAN/2013, National Research University Higher School of Economics.
    11. Yamin, Mo & Andersson, Ulf, 2011. "Subsidiary importance in the MNC: What role does internal embeddedness play?," International Business Review, Elsevier, vol. 20(2), pages 151-162, April.
    12. Yamin, Mo & Sinkovics, Rudolf R., 2009. "Infrastructure or foreign direct investment?: An examination of the implications of MNE strategy for economic development," Journal of World Business, Elsevier, vol. 44(2), pages 144-157, April.
    13. Buckley, Peter J. & Carter, Martin J., 2002. "Process and structure in knowledge management practices of British and US multinational enterprises," Journal of International Management, Elsevier, vol. 8(1), pages 29-48.
    14. Young, Stephen & Tavares, Ana Teresa, 2004. "Centralization and autonomy: back to the future," International Business Review, Elsevier, vol. 13(2), pages 215-237, April.
    15. Dan Li & Manuel Portugal Ferreira & Fernando Serra, 2007. "Technology transfer within MNEs: An investigation of inter-subsidiary competition and cooperation," Working Papers 1, globADVANTAGE, Polytechnic Institute of Leiria.
    16. Dimitratos, Pavlos & Liouka, Ioanna & Young, Stephen, 2009. "Regional location of multinational corporation subsidiaries and economic development contribution: Evidence from the UK," Journal of World Business, Elsevier, vol. 44(2), pages 180-191, April.
    17. Dörrenbächer, Christoph & Gammelgaard, Jens, 2006. "Subsidiary redefinition: Charter loss in a German-owned subsidiary in Hungary," Discussion Papers, Research Unit: Internationalization and Organization SP III 2006-201, Social Science Research Center Berlin (WZB).
    18. Ciabuschi, Francesco & Dellestrand, Henrik & Kappen, Philip, 2012. "The good, the bad, and the ugly: Technology transfer competence, rent-seeking, and bargaining power," Journal of World Business, Elsevier, vol. 47(4), pages 664-674.
    19. Yamin, Mohammad & Forsgren, Mats, 2006. "Hymer's analysis of the multinational organization: Power retention and the demise of the federative MNE," International Business Review, Elsevier, vol. 15(2), pages 166-179, April.
    20. Yvonne Ho & Hongjen Chiu, 2013. "A social network analysis of leading semiconductor companies’ knowledge flow network," Asia Pacific Journal of Management, Springer, vol. 30(4), pages 1265-1283, December.
    21. Yamin, Mo. & Otto, Juliet, 2004. "Patterns of knowledge flows and MNE innovative performance," Journal of International Management, Elsevier, vol. 10(2), pages 239-258.
    22. Dörrenbächer, Christoph & Gammelgaard, Jens, 2006. "Subsidiary role development: The effect of micro-political headquarters-subsidiary negotiations on the product, market and value-added scope of foreign-owned subsidiaries," Journal of International Management, Elsevier, vol. 12(3), pages 266-283, September.

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