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The Strategic Impact of External Networks: Subsidiary Performance and Competence Development in the Multinational Corporation

In: Knowledge, Networks and Power

Author

Listed:
  • Ulf Andersson
  • Mats Forsgren
  • Ulf Holm

Abstract

A special feature of multinational firms (MNCs) is the notion that their sub-units (subsidiaries) are embedded in different local networks (Ghoshal and Bartlett, 1990; Ghoshal and Nohria, 1997; Fors-gren, Johanson, and Sharma, 2000). Each subsidiary maintains unique and idiosyncratic patterns of network linkages and consequently is differentially exposed to new knowledge, ideas and opportunities (McEvily and Zaheer, 1999). In fact, this differential exposure has been put forward as one of the basic competitive advantages of the multinational firm, because it increases the breadth and variety of its network resources (Malnight, 1996). It is also in line with recent trends in foreign direct investment theory, in which foreign investments are viewed as series of attempts to selectively tap knowledge linked to specific local business contexts (Cantwell, 1990; Almeida, 1996; Dunning, 1996).

Suggested Citation

  • Ulf Andersson & Mats Forsgren & Ulf Holm, 2015. "The Strategic Impact of External Networks: Subsidiary Performance and Competence Development in the Multinational Corporation," Palgrave Macmillan Books, in: Mats Forsgren & Ulf Holm & Jan Johanson (ed.), Knowledge, Networks and Power, chapter 13, pages 318-343, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-1-137-50882-9_13
    DOI: 10.1057/9781137508829_13
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    Cited by:

    1. Yu Zhang & Jie Wang & Jiakai Chen & Weizhong Liu, 2023. "Does environmental regulation policy help improve business performance of manufacturing enterprises? evidence from China," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 25(5), pages 4335-4364, May.
    2. Scott Dell & Meena Subedi & Maxwell K. Hsu & Ali Farazmand, 2022. "Social Capital and Financial Performance in Nonprofits," Public Organization Review, Springer, vol. 22(1), pages 193-210, March.

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