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How foreign influence and local managers affect the successful transition of the firm: the case of AGC Flat Glass Czech

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  • Elisa Galeotti
  • Stanley Nollen

Abstract

This article investigates the mechanisms by which a foreign owner influenced the transition of its subsidiary from central planning to market economy, and explores the role of local managers of the privatised company. The subject is AGC Flat Glass Czech (renamed from Glaverbel Czech in September 2007 and formerly Glavunion), a glassmaker that was acquired early in the privatisation process by the Belgian Glaverbel Group (now AGC Group). The article documents the way in which the foreign owner transferred its tacit knowledge to local managers and workers immediately to restructure human capital, and illustrates the collaborative approach between foreign and local managers that was enabled by the favourable objective and psychological traits of the incumbent local managers.

Suggested Citation

  • Elisa Galeotti & Stanley Nollen, 2008. "How foreign influence and local managers affect the successful transition of the firm: the case of AGC Flat Glass Czech," Post-Communist Economies, Taylor & Francis Journals, vol. 20(1), pages 77-95.
    • Handle: RePEc:taf:pocoec:v:20:y:2008:i:1:p:77-95
    DOI: 10.1080/14631370701865748
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    References listed on IDEAS

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    1. Blomstrom, Magnus & Kokko, Ari, 1997. "How foreign investment affects host countries," Policy Research Working Paper Series 1745, The World Bank.
    2. Frydman, R. & Hessel, M. & Rapaczynski, A., 2000. "Why Ownership Matters? Entrepreneurship and the Restructuring of Enterprises in Central Europe," Working Papers 00-03, C.V. Starr Center for Applied Economics, New York University.
    3. Jana P. Fidrmuc & Jan Fidrmuc, 2007. "Fire the manager to improve performance? Managerial turnover and incentives after privatization in the Czech Republic," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 15(3), pages 505-533, July.
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    1. Elisa Galeotti, 2009. "Do Domestic Firms Benefit from Geographical Proximity with Foreign Investors? Evidence from the Privatization of the Czech Glass Industry," Czech Economic Review, Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies, vol. 3(1), pages 026-047, March.

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