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Do we really know the predictors of competence-creating R&D subsidiaries? Uncovering the mediation of dual network embeddedness

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  • Achcaoucaou, Fariza
  • Miravitlles, Paloma
  • León-Darder, Fidel

Abstract

Many changes have been recorded in the R&D role played by the foreign subsidiaries of multinational corporations (MNCs), to the extent that today many are recognised as key players in the development of firm innovation-related competences. Given this trend, we examine the predictors of a subsidiary's R&D role as a competence-creating contributor to the MNC's long-term success. Traditionally, the predictors of subsidiaries' R&D roles have been sought in the specific features of the internal corporate and external host-country environments. However, we find that favourable corporate- and country-level conditions may not necessarily lead to the enhancement of a subsidiary's R&D role unless dual embeddedness – that is, the subsidiary's embeddedness in the knowledge networks of the MNC (internal embeddedness) and in those of the host country (external embeddedness) – is well established. The main contribution of this paper is the development of a multiple mediation model that disentangles the way in which corporate and host-country environments interrelate with a subsidiary's dual embeddedness in the expected configuration of its competence-creating R&D role. In developing the model, we use the PLS-SEM method to estimate the relationship between these elements and, eventually, to forecast the subsidiary's competence-creating R&D role. The proposed model should help managers shape the fate of the subsidiary's R&D strategic role.

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  • Achcaoucaou, Fariza & Miravitlles, Paloma & León-Darder, Fidel, 2017. "Do we really know the predictors of competence-creating R&D subsidiaries? Uncovering the mediation of dual network embeddedness," Technological Forecasting and Social Change, Elsevier, vol. 116(C), pages 181-195.
  • Handle: RePEc:eee:tefoso:v:116:y:2017:i:c:p:181-195
    DOI: 10.1016/j.techfore.2016.10.019
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    Cited by:

    1. Scott-Kennel, Joanna & Saittakari, Iiris, 2020. "Sourcing or sharing in MNE networks? National headquarters and foreign subsidiaries as knowledge conduits in SMOPECs," International Business Review, Elsevier, vol. 29(1).
    2. Ryan, Paul & Giblin, Majella & Andersson, Ulf & Clancy, Johanna, 2018. "Subsidiary knowledge creation in co-evolving contexts," International Business Review, Elsevier, vol. 27(5), pages 915-932.

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