A paradoxical perspective on subsidiary autonomy and MNE entrepreneurial initiative support: uncovering the role of organizational complexity and external embeddedness
Cross Cultural & Strategic Management
ISSN: 2059-5794
Article publication date: 10 August 2023
Issue publication date: 14 November 2023
Abstract
Purpose
This study examines the relationship between subsidiary autonomy and the MNE subsidiary initiative collaboration (i.e. entrepreneurial initiative resource support, the subsidiary seeks and receives from the MNE). It proposes some underlying mechanisms as external embeddedness, and MNE organizational structures to explain the relationship between subsidiary autonomy and the MNE subsidiary initiative collaboration. The study draws on paradox theory arguing how at both the subsidiary and the parent MNE levels certain paradoxes are handled.
Design/methodology/approach
Survey data are collected in a time-lagged fashion from 429 foreign subsidiaries in New Zealand. Data are analyzed using structural equation modeling.
Findings
Results show that the relationship between subsidiary autonomy and the receipt of MNE resource support for initiatives is positive, and this is more likely the case where the subsidiary is managed under simple structures (i.e. subsidiary reports to corporate headquarters, regional headquarters or mandated units) rather than complex structures (i.e. a matrix or a network). Furthermore, an increase in subsidiary autonomy positively influences MNE initiative resource-seeking, and this is more likely the case where the subsidiary is less embedded externally.
Originality/value
The study is one of the first of studies that has applied paradox theory to MNE–subsidiary relationships regarding autonomy and MNE collaboration on initiatives. The study extends research on MNE–subsidiary collaboration on subsidiary initiatives as existing research is limited on this domain. The study contributes by showing how external embeddedness, and the complexity of organizational structures determine the relationship between subsidiary autonomy and MNE subsidiary initiative collaboration.
Keywords
Citation
Raziq, M.M. (2023), "A paradoxical perspective on subsidiary autonomy and MNE entrepreneurial initiative support: uncovering the role of organizational complexity and external embeddedness", Cross Cultural & Strategic Management, Vol. 30 No. 4, pp. 733-754. https://doi.org/10.1108/CCSM-09-2022-0151
Publisher
:Emerald Publishing Limited
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