DIVISION HEADQUARTERS GO ABROAD - A STEP IN THE INTERNATIONALIZATION OF THE MULTINATIONAL CORPORATION*

Why are division headquarters of multinational corporations in some cases located abroad? In the multinational corporation the physical location of division headquarters is a problematic issue because of the need for close links both to corporate headquarters and the foreign subsidiaries. This paper develops a model explaining this location as a consequence of power relations associated with the internationalization of the corporation and tests it on a sample of divisions of Swedish multinationals. the results support the view that power relations have an impact on location of division headquarters. One interesting result is the clear indication of countervailing forces, consisting of an attraction force of foreign dominant subsidiaries and a resisting force related to the interests of corporate headquarters.     

Headquarters−Subsidiary Interdependencies and the Design of Performance Evaluation and Reward Systems in Multinational Enterprises

This study investigates the impact of headquarters–subsidiary interdependencies on performance evaluation and reward systems in multinational enterprises. Headquarters–subsidiary interdependencies refer to the extent to which headquarters and subsidiaries depend on each other to accomplish their tasks. When headquarters–subsidiary interdependencies are present, it becomes more difficult to reward the performance of subsidiary managers because these interdependencies induce noise on subsidiary-level accounting performance measures, while at the same time high levels of goal alignment between headquarters and subsidiary managers are required. Based on survey data from 82 foreign subsidiaries operating in Belgium with headquarters in 14 different countries, our partial least squares path modelling results show that as headquarters–subsidiary interdependencies increase, headquarters use more participative performance evaluation and consider more the effects of uncontrollable factors on subsidiaries' performance when rewarding subsidiary managers. More importantly, while prior research suggests that interdependencies induce noise on unit-level accounting performance measures, our results indicate that participative performance evaluation may mitigate the noise so that headquarters still rely on subsidiary formula-based compensation using accounting measures to reward subsidiary managers.     

第三代平衡记分卡在集团公司总部职能部门绩效考核中的应用研究——以中航工业集团公司为例

随着中国经济的快速发展,集团企业越来越多,如何对集团总部定位、如何建立集团总部职能部门绩效考核指标是企业集团所面临的重要课题。本文根据集团公司总部的管控类型,确立职能部门的功能定位,以及工作职责要求,采用第三代平衡计分卡的指导思想,探讨设计集团总部职能部门绩效考核的指标体系。     

A note on the impact of the internal organization on the accuracy of the information transmitted within the firm

We investigate the incentives of sales managers to transmit information on demand conditions to headquarters under different organizational structures and its subsequent impact on firm performance. When headquarters determine quantities of production, sales managers' interests are aligned with that of the firm, and reliable information is transmitted. On the other hand, when the authority of decision making on quantities of production is delegated to sales managers, they prefer not to transmit reliable information; consequently, headquarters set transfer prices given poor information about demand. Due to such difference in the quality of the information available to headquarters, a centralized organizational structure frequently leads to the best performance.     

论在华跨国公司地区总部的法律规制及其完善

21世纪以来,跨国公司地区总部在我国蓬勃发展起来。地区总部在华发展是一柄双刃剑,促进投资的同时也会产生诸多负面影响,需要进一步规范和引导。那么如何对在华跨国公司地区总部实行有效而适度的法律规制呢?本文通过现有的立法现状的分析,认为阻碍其发展的主要制度性问题是缺乏系统性的立法体系、法律内容欠缺和冲突、法律透明度不高以及实施不力。完善这些制度的途径,在于构建跨国公司地区总部的功能性法律制度框架。     

Transferring HR practices within multinational corporations

There is extensive evidence that planned transfers of management practices by the headquarters of multinational corporations (MNCs) to foreign subsidiaries are not always successful. In this article, we outline a model of factors influencing the transfer of HR practices to MNC units abroad. The article has two main contributions. First, we develop a more holistic understanding of the outcome of HR practice transfer as encompassing three dimensions: implementation, internalisation and integration. Second, we expand current explanations of transfers of practices to foreign units. We argue that transfer of HR practices is a social process where the governance mechanisms used by the MNC, characteristics of the subsidiary HR systems, the social relationship between the subsidiary and MNC headquarters, and the transfer approach taken by headquarters management will influence the outcome of the process.     

Direktinvestive internationale Unternehmenst?tigkeit und das GLOCAL-Dilemma:Die koordinative Rolle von Regional Headquarters

Based on the information cost approach we highlight in this conceptual paper the coordinative and cost-related impact of employing regional headquarters in managing cross-border transactions. Thereby the paper enhances existing knowledge by focusing on the up to now widely ignored aspect of how to integrate regional headquarters in traditional types of organizational structures and shows structure-based benefits and boundaries of a use of regional headquarters. Furthermore, we attempt to utilize the gathered insights to allow for an application in business practice and to provide a basis for future empirical research.     

The Bridging Role of Expatriates and Inpatriates in Knowledge Transfer in Multinational Corporations

Drawing on the knowledge‐based view of the firm, this article provides the first empirical study that explicitly investigates the relationship between different categories of international assignees and knowledge transfer in multinational corporations (MNCs). Specifically, we examine (1) the extent to which expatriate presence in different functional areas is related to knowledge transfer from and to headquarters in these functions and (2) the extent to which different categories of international assignees (expatriates vs. inpatriates) contribute to knowledge transfer from and to headquarters. We base our investigation on a large‐scale survey, encompassing data from more than 800 subsidiaries of MNCs in 13 countries. By disaggregating the role of knowledge transfer across management functions, directions of knowledge transfer, and type of international assignees, we find that (1) expatriate presence generally increases function‐specific knowledge transfer from and, to a lesser extent, to headquarters; and that (2) the relevance of expatriates and former inpatriates varies for knowledge flows between headquarters and subsidiaries. Additionally, we discuss implications for research and practice, in particular regarding different management functions and different forms of international assignments, and provide suggestions for future research. © 2015 Wiley Periodicals, Inc.     

浅析我国总部经济发展中的几个认识误区

总部经济作为一种新生的经济形态,在我国的发展才处于刚起步阶段。但各地在规划和发展自己的总部经济时,不同程度地存在着一些认识上的误区。从理论上澄清这些认识上的误区,对于加快我国总部经济的发展,促进区域经济协调具有十分重要的意义。     

Internal Embeddedness,Headquarters Involvement,and Innovation Importance in Multinational Enterprises

In this paper we apply a business network perspective to investigate the effects of internal embeddedness and headquarters involvement on subsidiaries' innovation‐related competencies, and on the perceived importance of innovation in multinational enterprises. A model framed in the innovation context is developed and six hypotheses are tested on 85 innovation projects in 23 multinational enterprises using partial least squares based structural equation modelling. The results suggest that, contrary to predictions of the business network perspective, headquarters involvement in the innovation development process improves subsidiary competencies while internal embeddedness does not. Headquarters involvement, driven by subsidiary internal embeddedness, enhances the innovation impact on the subsidiary, which in turn influences innovation importance at corporate level. Thus, the business network perspective is challenged but at the same time expanded in terms of highlighting the role of, and interplay between, different internal corporate actors, particularly the role of headquarters, in developing competencies and creating competitive advantage.     

The co-ordination of strategic initiatives within global organizations: the role of global teams

Given the growth in the globalization of organizations, the ability to co-ordinate initiatives of the headquarters and subsidiaries is rapidly becoming a major concern of management. The use of global task teams is explored in this paper to address co-ordination in global networks. A theoretical framework is developed to derive a model for the use of global teams as co-ordinating mechanisms of strategic initiatives in a global organization. The use of teams as a means to intervene between headquarters and subsidiaries is explored, illustrating the unique social capital of global teams. In addition, the potential issues in managing task teams in global organizations are discussed.     

母子公司间高管纵向兼任与上市公司资本配置效率

已有研究主要基于母公司或控股股东等委托方利益视角,形成了对纵向高管兼任治理效应的认识。但这种假定忽视了兼任高管作为独立利益主体的利益诉求与私利动机对治理效应的影响。本文基于兼任高管所代表不同利益主体的视角,分析并检验母子公司间高管纵向兼任对上市公司资本配置效率的影响。研究表明,当母子公司间兼任高管代表母公司利益时,母子公司间高管兼任会通过降低子公司代理成本发挥监督效应,进而提升上市公司的资本配置效率;但是当兼任高管代表子公司利益时,母子公司间高管兼任并未发挥治理效应,甚至存在母子公司间高管兼任的上市公司中,代表子公司利益的高管兼任会将争取超额资金异化为寻租渠道,进而降低上市公司资本配置效率。本文将扩展对高管纵向兼任治理效应的理论解释,丰富上市公司资本配置效率决定机理的研究,对完善母子公司结构下的治理机制具有一定的启示意义。     

Overcoming the ethnocentric firm? – foreign fresh university graduate employment in Japan as a new international human resource development method

Abstract

This article analyses a new and, by international comparison, distinct recruitment trend – the systematic hiring of foreign fresh university graduates (FFGs) into Japanese multinational enterprises’ (MNEs) operations in Japan. Our explorative research, which is based on interviews with HR managers and FFGs, offers three major findings related to international HR development methods. Firstly, the inpatriate literature has identified the roles of foreign (subsidiary) staff as knowledge conduits and boundary-spanners between headquarters and subsidiaries. While such objectives do not drive Japan’s FFG hiring trend, we find similar challenges in terms of the absorptive capacities of headquarters. Secondly, following a Varieties-of-Capitalism perspective, we argue that FFG hiring is an institutional answer to the particularities of Japan’s employment system. Aiming at internationalizing headquarters from within, it contributes to resolving the internationalization conundrum of Japanese MNEs, but rather than overcoming the existing ethnocentric HR model it accommodates this orientation. Thirdly, we advance the general HR literature by proposing a new framework that addresses the viability of international personnel development methods in dependence of the workforce diversity and distinctiveness of employment practices in headquarters. We locate FFG hiring, inpatriation and self-initiated assignments within this framework.     

Control of subsidiaries of MNCs from emerging economies in developed countries: the case of Taiwanese MNCs in the UK

There has been considerable research over the past few decades on the process through which headquarters of multinationals from developed economies exercise control over their network of subsidiaries in foreign countries. However, little research has been conducted on multinationals from emerging economies operating in developed countries. In this article, we examine the motives for, and mechanisms by which, headquarters of Taiwanese multinationals exercise control over their subsidiaries in the UK. The article draws on data collected through 66 interviews with top managers and human resource managers from four UK based subsidiaries of Taiwanese multinationals. The study reveals that Taiwanese multinationals use both output control and behaviour control to manage their subsidiaries in the UK.     

Learning remotely: R&D satellites,intra‐firm linkages,and knowledge sourcing

Firms venture abroad not only to access resources and markets but also to learn. Yet there remains limited empirical evidence that headquarters can access geographically remote knowledge by establishing a presence in the remote location. Using U.S. patent data, I show that firm headquarters disproportionately source knowledge from third parties in remote locations where they have an R&D satellite. This “satellite effect” on knowledge flow is economically significant, representing up to 60% of the knowledge‐flow premium associated with collocation. Furthermore, the effect seems to be stronger for recent knowledge, as well as in areas of satellite technological specialization, suggesting that firms can target cutting‐edge knowledge in specific sectors. In addition, the results show that firms with stronger internal linkages between headquarters and satellites, and those that staff satellites with inventors that previously patented while at other local firms, experience a larger satellite effect on knowledge acquisition.     

Structuring Corporate Headquarters: An Investigation of Franchising

This article focuses on the structuring of the corporate headquarters in a franchise organization. Four essential issues that are related to franchisors organizational structure are discussed—homogeneity and heterogeneity of franchisors structure, company-owned and franchise arrangement, the dynamics between strategy and structure, and performing innovative and administrative functions simultaneously in the headquarters. Propositions are given for each issue. The results of qualitative analysis associated with each issue are discussed.     

郑州市郑东新区总部企业集聚策略研究

郑东新区正处在总部企业培育与集聚发展的关键时期,需要通过构建四大总部企业集聚区、实施总部企业集聚发展促进行动、整合与利用区域楼宇资源、加大政府的规划引导以及软硬环境的配套、建立总部企业服务平台、拓展企业总部招商引资以及优化与总部企业集聚发展相适应人才引进措施,促进总部企业集聚发展的高端化、集约化和规模化。     

The agglomeration of headquarters

This paper uses a micro data set on auxiliary establishments from 1977 to 1997 in order to investigate the determinants of headquarter agglomerations and the underlying economic base of many larger metro areas. The significance of headquarters in large urban settings is their ability to facilitate the spatial separation of their white collar activities from remote production plants. The results show that separation benefits headquarters in two main ways: the availability of differentiated local service input suppliers and the scale of other headquarter activity nearby. A wide diversity of local service options allows the headquarters to better match their various needs with specific experts producing service inputs from whom they learn, which improves their productivity. Headquarters also benefit from other headquarter neighbors, although such marginal scale benefits seem to diminish as local scale rises.     

Interference among conflicting institutions and technical-economic conditions: the adoption of the Assessment Center in French,German, Italian,UK, and US multinational firms

We analyze the adoption of the Assessment Center (AC), one of the most complex human resource management techniques, in 161 British, French, German, Italian and US multinational firms both at the headquarters and in their Italian subsidiaries. Combining both quantitative analysis and qualitative accounts, we investigate how different and partially contradictory institutional influences stemming from national business systems and professions, global corporate networks and professions, and different technical-economic conditions affect the adoption of the AC. Our study shows that AC-diffusion is similar at headquarters level in all national contexts, testifying to the paramount importance of transnational institutions of Anglo-American origin for MNCs of any nationality, despite great local variation in the degree of institutionalization of the AC, which ranges from fully-fledged support in culture and the professions as, for example, in Germany, the UK and the USA, to weak or negative backing as in France and Italy. However, the study also reveals how different characteristics of the corporate field of firms with headquarters in different countries, as well as organizational size and labor market conditions, still explain adoption of the AC in their subsidiaries in Italy.     

Knowledge transfer in multinationals: The role of inpatriates' boundary spanning

Viewing knowledge as rooted in individuals, this study investigates knowledge transfer in multinational corporations (MNCs) from an individual‐level perspective. Specifically, the author focuses on inpatriates as a particular group of knowledge actors in MNCs and examines the role of inpatriates' boundary spanning between their home unit and the headquarters for transferring their knowledge to headquarters staff. Based on a sample of 269 inpatriates in 10 German MNCs, the author found that inpatriates' boundary spanning is positively related to inpatriates' individual efforts to transfer knowledge and inpatriates' perceptions of HQ staff efforts to acquire subsidiary‐specific knowledge. Both perceived HQ absorptive capacity and mentoring by HQ staff moderate these relationships. This study's findings contribute to our understanding of the theoretical mechanisms through which MNC knowledge flows occur and highlight key requirements for the design of international staffing practices. ©2011 Wiley Periodicals, Inc.