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Multinational corporations, inter-organizational networks and subsidiary charter removals

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  • Dörrenbächer, Christoph
  • Gammelgaard, Jens

Abstract

This paper provides insights into the dynamics of a charter removal at a Hungarian subsidiary of the Siemens telecommunication switching division. By using inter-organizational network theory, we investigate how host-country factor endowments, the resource position of a subsidiary and the density of network exchange relationships within the organizational network influence the removal of a multinational corporate subsidiary's charter. The dispersion of resources in a multinational corporation drives intra-firm competition, which will typically lead to the removal of a subsidiary's charter if the subsidiary lacks specialized resources - typically an outcome of host country comparative disadvantages - and simultaneously holds a position on the periphery of the organizational network.

Suggested Citation

  • Dörrenbächer, Christoph & Gammelgaard, Jens, 2010. "Multinational corporations, inter-organizational networks and subsidiary charter removals," Journal of World Business, Elsevier, vol. 45(3), pages 206-216, July.
  • Handle: RePEc:eee:worbus:v:45:y:2010:i:3:p:206-216
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    References listed on IDEAS

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    Cited by:

    1. Yeniyurt, Sengun & Carnovale, Steven, 2017. "Global supply network embeddedness and power: An analysis of international joint venture formations," International Business Review, Elsevier, vol. 26(2), pages 203-213.
    2. Oehmichen, Jana & Puck, Jonas, 2016. "Embeddedness, Ownership Mode and Dynamics, and the Performance of MNE Subsidiaries," Journal of International Management, Elsevier, vol. 22(1), pages 17-28.
    3. Chen, Tain-Jy & Chen, Homin & Ku, Ying-Hua, 2012. "Resource dependency and parent–subsidiary capability transfers," Journal of World Business, Elsevier, vol. 47(2), pages 259-266.
    4. 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.
    5. Achcaoucaou, Fariza & Miravitlles, Paloma & León-Darder, Fidel, 2014. "Knowledge sharing and subsidiary R&D mandate development: A matter of dual embeddedness," International Business Review, Elsevier, vol. 23(1), pages 76-90.
    6. Conroy, Kieran M. & Collings, David G., 2016. "The legitimacy of subsidiary issue selling: Balancing positive & negative attention from corporate headquarters," Journal of World Business, Elsevier, vol. 51(4), pages 612-627.
    7. Igor B. Gurkov & Michael J. Morley, 2017. "Contributions Towards a Renewed Debate on Multinational Headquarter-Subsidiary Relations:Subsidiary Mandates, Corporate Parenting Styles and Collective Psychological Contracts," HSE Working papers WP BRP 55/MAN/2017, National Research University Higher School of Economics.
    8. Gammelgaard, Jens & McDonald, Frank & Stephan, Andreas & Tüselmann, Heinz & Dörrenbächer, Christoph, 2012. "The impact of increases in subsidiary autonomy and network relationships on performance," International Business Review, Elsevier, vol. 21(6), pages 1158-1172.

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