2.7 Managing HQ-Subsidiary relations

Question 1

The Network view

Answer 1

• Many different types of centers (competences)
• Subsidiaries strategic role
• mutual exchange of resources : interdependent
• Integration through corporate culture, company values

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Question 2

Traditional view of subsidiary

Answer 2

• Hierarchial
• competative advantages of origin
• role as an implementater
• responsible for local market
• HQ all decision
• Topdown mng style
• ethnocentric, polycentric, regiocentric mng orientation

Question 3

Network view of subsidaries

Answer 3

• competative advantages of origin or host countries
• role as an important strategic contributor and center of competence
• decentralized decision making
• topdown and bottomup
• towards geocentric orientation

Question 4

Mention two typologies

Answer 4

• Barlett/Ghoshal

- Gupta/Govindarajan

Question 5

Berlett/Ghoshal typology view of subsidiaries

Draw

Answer 5

Y-axel: competence of organization
X-axel: strategic importance of local invironment

1. Implementer: less imortant market, should exploin market and implement strategy
2. Contributor: distinctive capabilites in less important market, use capabilites for compnay wide relevance projects
3. Black hole: lack of capabilities, can we upgrade, training, move employees, relies on local partner
4. Strategic leader: strategicly important market, partner of HQ, develop men implement strategies

Question 6

Gupta/Govindarajan

Answer 6

Y-axel: outflow of knowledge
X-axel inflow of knowledge

Local innovator: not dependent of other knowledge, can be subccessful, country specific knowledge

Global Innovator: not dependen on knowledge, knowledge contributor, good reputation

Implmentor: cont contribute, weak role, only implementing

Integrated player: srong capabilites and song link to rest of compnay, implementation and develop strategies