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A Lighter Shade of Dark: Exploring the Value Adding and Value Subtracting Effects of Headquarters Attention and Involvement in Subsidiary Activities
Uppsala University, Disciplinary Domain of Humanities and Social Sciences, Faculty of Social Sciences, Department of Business Studies.
2018 (English)Doctoral thesis, comprehensive summary (Other academic)
Description
Abstract [en]

Headquarters of multinational corporations are presented with a diverse range of stimuli that influences the issues that they pay attention to and ultimately get involved in. However, headquarters have to prioritize since their attention and resources are limited, and they cannot pay attention to all issues and get equally involved in all subsidiaries. To stand out and attract attention and involvement, subsidiaries can use different issue selling tactics to present headquarters with issues that are strategically important to the subsidiary. While headquarters can add value to their subsidiaries by paying attention and getting involved in subsidiary activities, there is also a risk of headquarters making different prioritizations than the subsidiaries, and instead subjecting them to misguided involvement and value subtraction. Existing research tends to assume that the more attention a subsidiary receives, the better off it will be. However, I reevaluate this assumption, and complement existing research by examining how subsidiaries experience headquarters attention and involvement, and the effects on subsidiary activities.

Data were collected at the subsidiary level, using interviews and a survey to capture the subsidiary perspective of headquarters attention and involvement. More specifically, 115 interviews were conducted with subsidiary managers of European MNCs based in Japan, and survey data was collected from 93 Japanese subsidiaries of European MNCs. The empirical findings highlight circumstances under which headquarters attention and involvement can add or subtract value from subsidiary activities. Furthermore, subsidiaries can highlight strategic issues during their issue selling efforts to attract headquarters involvement that has a beneficial impact on subsidiary activities. I extend the parenting literature by developing an attention-based parenting typology and showing how misaligned priorities risk exposing subsidiaries to value subtraction rather than value added during headquarters involvement. This thesis also contributes to elaborating on the attention-based view by exploring mixed types and levels of attention, as well as circumstances under which negative attention can be perceived as beneficial and value adding by subsidiaries.

By incorporating the attention-based view with the parenting literature and issue selling, this thesis extends our understanding of the headquarters-subsidiary relationship, highlights circumstances under which subsidiaries appreciate attention and involvement, and shows a darker side of headquarters’ parenting in which subsidiaries risk experiencing value subtraction.

Place, publisher, year, edition, pages
Uppsala: Acta Universitatis Upsaliensis, 2018. , p. 94
Series
Doctoral thesis / Företagsekonomiska institutionen, Uppsala universitet, ISSN 1103-8454 ; 197
Keywords [en]
multinational corporation, headquarters-subsidiary relationship, attention-based view, parenting, issue selling
National Category
Business Administration
Identifiers
URN: urn:nbn:se:uu:diva-354091ISBN: 978-91-506-2708-4 (print)OAI: oai:DiVA.org:uu-354091DiVA, id: diva2:1221143
Public defence
2018-10-10, Lecture Hall 2 (Hörsal 2), Ekonomikum, Kyrkogårdsgatan 10, Uppsala, 13:15 (English)
Opponent
Supervisors
Available from: 2018-09-14 Created: 2018-06-19 Last updated: 2018-09-14
List of papers
1. Value Generation in the Multinational Corporation
Open this publication in new window or tab >>Value Generation in the Multinational Corporation
2015 (English)In: The Future of Global Organizing: Progress in International Business Research / [ed] Rob Van Tulder, Alain Verbeke, Rian Drogendijk, Emerald Group Publishing Limited, 2015, p. 39-56Chapter in book (Refereed)
Abstract [en]

Purpose

As markets become increasingly competitive, it is important for multinational corporations to generate value. Both headquarters and subsidiaries are responsible for contributing to value generation, albeit they may do so in different ways. This builds on the notion from the literature that it is possible to discern two separate concepts that relate to the generation of value, namely, value creation and value added. These concepts are often used interchangeably, without a clear distinction what they de facto reflect or what the underlying mechanisms of value creation and value added are.

Methodology/approach

Based on a set of assumptions regarding headquarters–subsidiary relations conceptual arguments related to value generation are developed.

Research implications

Teasing out the differences between the concepts becomes important as it leads to a fuller understanding of what a headquarters do in different situations and of what a headquarters–subsidiary relationship entails for value generation.

Originality/value

In this chapter, it is argued that value-adding activities tend to be conducted by a headquarters, but are dependent on varying knowledge situations of headquarters, while the value creation process tends to take place at the subsidiary level.

Place, publisher, year, edition, pages
Emerald Group Publishing Limited, 2015
Series
Progress in International Business Research, ISSN 1745-8862 ; 10
National Category
Business Administration
Research subject
Business Studies
Identifiers
urn:nbn:se:uu:diva-265559 (URN)10.1108/S1745-886220150000010002 (DOI)978-1-78560-423-2 (ISBN)
Available from: 2015-11-02 Created: 2015-11-02 Last updated: 2018-08-17Bibliographically approved
2. Headquarters Involvement in Subsidiary Activities: When and why do subsidiaries experience value subtraction?
Open this publication in new window or tab >>Headquarters Involvement in Subsidiary Activities: When and why do subsidiaries experience value subtraction?
(English)Manuscript (preprint) (Other academic)
Keywords
Headquarters-subsidiary relationship; headquarters role; parenting advantage; value subtraction; multinational corporation
National Category
Business Administration
Identifiers
urn:nbn:se:uu:diva-354087 (URN)
Available from: 2018-06-19 Created: 2018-06-19 Last updated: 2018-06-19
3. Different Parenting Styles: Examining Supportive and Monitoring Attention from Headquarters to Subsidairies
Open this publication in new window or tab >>Different Parenting Styles: Examining Supportive and Monitoring Attention from Headquarters to Subsidairies
(English)Manuscript (preprint) (Other academic)
Keywords
Attention-based view; parenting; headquarters-subsidiary relationships; multinational corporations
National Category
Business Administration
Identifiers
urn:nbn:se:uu:diva-354085 (URN)
Available from: 2018-06-19 Created: 2018-06-19 Last updated: 2018-06-19
4. Gauging subsidiary influence and performance through strategic issue selling and the involvement of headquarters in subsidiary activities
Open this publication in new window or tab >>Gauging subsidiary influence and performance through strategic issue selling and the involvement of headquarters in subsidiary activities
(English)Manuscript (preprint) (Other academic)
Keywords
Headquarters-subsidiary relationships; multinational corporations; subsidiary issue selling; headquarters involvement; subsidiary influence; subsidiary performance
National Category
Business Administration
Identifiers
urn:nbn:se:uu:diva-354089 (URN)
Available from: 2018-06-19 Created: 2018-06-19 Last updated: 2018-06-19

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