HQ-Subsidiary Relationships in MNCs

Research program 2: MNC typologies, entry modes, country-of-origin, subsidiary typologies, MNC knowledge flows, and language in HQ-subsidiary relationships

Anne-Wil Harzing - (updated Tue 2 Jan 2024 12:49)

The main objective of this research programme, which started as the core of my PhD studies, was to investigate various aspects of HQ-subsidiary relationships. Blogposts summarizing research in this program include:

1990s: Managing the multinationals: MNC typologies, entry modes, and country-of-origin

Managing the Multinationals

The full results of my PhD were published in Managing the Multinationals (Edward Elgar, 1999). The book has reached a very large audience (> 600 Google Scholar citations).

Subsequent journal articles in top international journals such as Journal of International Business Studies, Strategic Management Journal and Organization Studies expanded the analysis and focused in more detail on topics such as MNC typologies, management of entry modes and the country-of-origin effect.

The latter received the Roland Calori prize for the best paper published in Organization Studies 2003-2004. A second article providing a conceptual review of the country-of-origin effects was published in Management International Review.

2000s: Subsidiary typologies & management, MNC knowledge flows, and country-of-origin revisited

In 2002, I collected data for 175 subsidiaries of MNCs headquartered the US, Japan, France, Germany, UK and the Netherlands with Niels Noorderhaven. We published several papers from these data.

  • The first large-scale empirical test and extension of what is the most influential typology in the field of subsidiary management: the Gupta & Govindarajan typology of subsidiaries based on knowledge flows, published in International Business Review.
  • A paper the Asia-Pacific Journal of Management on the role of geographical distance on the management of subsidiaries, comparing Australian and New Zealand subsidiaries to subsidiaries all over the world.
  • A paper in Journal of International Business Studies investigating the determinants of knowledge flows in MNCs, pointing to the increasing role of inter-subsidiary flows in this field.
  • A final paper comparing the impact of country-of-origin on HQ-subsidiary relationships for German, Japanese, British and US MNCs at two points in time (1995 and 2002), providing a much-needed large-scale empirical test (and dismissal) of the claim that management practices in MNCs are converging towards an Anglo-American model. A related paper with Markus Pudelko (Edinburgh University, UK) looked at management practices in Europe and assessed the extent to which a common European model is present.

2010s and beyond: The role of language in HQ subsidiary relationships

More recently, my research interests include a focus on the role of language in HQ subsidiary relationships (see programme 5). An interview-based study in Japanese subsidiaries of German MNCs has led to an article in Journal of World Business identifying a range of solutions to overcome the language barrier in HQ-subsidiary relationships.

A large-scale survey in a wide range of host countries (Australia/NZ, China, Japan, Korea, France, Germany, Spain, UK, Denmark, Finland, Norway & Sweden) resulted in an article in Journal of World Busienss, the second most cited in the journal that year, that proposes four home country clusters (Anglophone, Asian, Continental European and Nordic) that show substantial differences in terms of language competencies, policies and practices.

A further paper dealing with language and communication was published in The International Journal of HRM, whereas a paper investigating the role of language in knowledge transfer was published in Journal of International Business Studies.

Finally, in a paper published in Human Resource Management Journal with Sylwia Ciuk and Martyna Śliwa, we applied an EDI (Equality, Diversity, and Inclusion) lens to linguistic diversity in multinational companies. We show how the application of key concepts such as fluidity and reciprocity can move us from linguistic exclusion to linguistic inclusion.

2010s and beyond: Knowledge transfer revisited

With various co-authors I returned to the theme of knowledge transfer from 2015 onwards. First, a paper in Journal of International Business Studies investigated the role of language in knowledge transfer. Second, I also returned to my earlier work on the strategic role of international assignments (see my research program on International HRM & Staffing Policies) with papers on the differential roles of different types of international assignments in knowledge transfer.

The first paper - based on survey research in over 800 subsidiaries in 13 countries and published in Human Resource Management - compared expatriation and inpatriation. The second paper - based on detailed qualitative research in a single HQ-subsidiary relationship and published in Journal of World Business showed how different types of international assignments (long term expatriation, short term expatriation, inpatriation) transfer different types of knowledge (declarative, procedural, axiomatic, relational), in different directions (both from and to HQ), and at different times (both during and after the assignment).

A paper with Heejin Kim and Sebastian Reiche, published in Journal of International Business Studies demonstrates the process through which inpatriates’ knowledge transfer contributes to subsidiary capability building and subsidiary evolution over time, and explains why successive inpatriation is thus critical to enhance subsidiary performance.

In two papers with my Middlesex colleagues published in Asia Pacfic Journal of Management and International Business Review, I also branched out to the generation of knowledge using a historical longitudinal case study of a global pharmaceutical MNE, AstraZeneca, in China between the period of 1993 and 2017, and qualitative work with local R&D projects of eleven MNCs in Bulgaria.

Specifically, we focused on exploring the process by which the MNE’s low-value-adding operations in China are transformed into high-value-adding R&D operations and constructed a framework of evolution consisting of four major waves of R&D internationalization and corresponding R&D objectives and the heterogeneity and dynamic and multi-faceted nature of knowledge sourcing in emerging economies.

Publications

Online papers - Full list of publications

  1. Ciuk, S.; Śliwa M; Harzing, A.W. (2023) Implementing the EDI agenda in multinational companies: A framework for the management of (linguistic) diversity, Human Resource Management Journal, vol 33, no. 4, pp. 868-888. Available online... - Publisher's version (free access) - Related blog post
  2. Dodourova, M.; Zhao, S.; Harzing, A.-W. (2023) Ambidexterity in MNC knowledge sourcing in emerging economies: a microfoundational perspective, International Business Review, vol. 32, no. 2, 101854. Available online... - Publisher's version (free access) - Related blog post
  3. Kim, H.; Reiche, B.S.; Harzing, A.W. (2022) How does successive inpatriation contribute to subsidiary capability building and subsidiary evolution? An organizational knowledge creation perspective, Journal of International Business Studies,vol. 53, no. 7, pp. 1394-1419. Available online... - Publisher's version (free access) - Related blog post - Short video
  4. Zhao, S., Gooderham, P. N., Harzing, A.W., & Papanastassiou, M. (2021) Do Multinational Enterprises Contribute to, or Reduce Global Inequality? Critical Perspectives on International Business, vol. 17, no. 1, pp. 1-7, Available online... - Publisher's version - Related blog post
  5. Zhao, S.; Tan, H.; Papanastasiou, M.; Harzing, A.W. (2020) The internationalization of innovation towards the South:  A historical case study of a global pharmaceutical corporation in China (1993-2017), Asia-Pacific Journal of Management, vol 37, no. 2, pp. 553-585. Available online... - Publisher's version (read for free) - Related blog post
  6. Duvivier, F.; Peeters, C.; Harzing, A.W. (2019) Not all international assignments are created equal: HQ-subsidiary knowledge transfer patterns across types of assignments and types of knowledge, Journal of World Business, vol. 54, no. 3, pp. 181-190. Available online... - Publisher's version (free access!) - Related blog post
  7. Zhao, S.; Tan, H.; Papanastasiou, M.; Harzing, A.W. (2018) The internationalization of innovation towards the South: A historical case study of a global pharmaceutical corporation in China (1993-2017), paper presented at the 45th annual meeting of the AIB-UKI, 12-14 April, London, UK.
  8. Harzing, A.W. (2016) From Europe to Asia, part of a Middlesex panel on Knowledge creation and diffusion: South-North and East-West perspectives, panel presentation at the 43rd annual meeting of the AIB-UKI, 7-9 April, London, UK.
  9. Zhao, S.; Tan, H.; Papanastasiou, M.; Harzing, A.W. (2016) From innovation transfer to emerging economies to innovation sourcing from emerging economies: The historical evolution of a global pharmaceutical corporation in China (1993 - 2014), paper presented at the 43rd annual meeting of the AIB-UKI, 7-9 April, London, UK.
  10. Harzing, A.W.; Pudelko, M.; Reiche B.S. (2016) The bridging role of expatriates and inpatriates in knowledge transfer in multinational corporations, Human Resource Management, vol. 55, no. 4, pp. 679–695. Available online... - Publisher's version (free access!) - ESI top 1% most Highly Cited Paper
  11. Reiche B.S.; Harzing, A.W.; Pudelko, M. (2015) Why and how does shared language affect subsidiary knowledge inflows? A social identity perspective, Journal of International Business Studies, vol. 46, no.5, pp. 528-551. Available online... - Publisher's version (free access!)  [Also incorporated in a JIBS collection on Language and selected as one of 9 articles reprinted in Language in International Business. Developing a Field.]
  12. Harzing, A.W.; Pudelko, M. (2014) Hablas vielleicht un peu la mia language? A comprehensive overview of the role of language differences in headquarters-subsidiary communication, International Journal of Human Resource Management, vol. 25, no. 5, pp. 696–717. Available online...
  13. Harzing, A.W.; Pudelko, M. (2013) Language competencies, policies and practices in multinational corporations: A comprehensive review and comparison of Anglophone, Asian, Continental European and Nordic MNCs, Journal of World Business, vol. 48, no. 1, pp. 87-97. Available online...
  14. Reiche, B.S., Harzing, A.W., & Pudelko, M. (2013) The sensitivity of subsidiary knowledge in- and outflows to language proximity, paper presented at the 70th Academy of Management annual meeting, August 9-13, in Lake Buena Vista (Orlando), Florida, USA.
  15. Reiche, B.S., Harzing, A.W., & Pudelko, M. (2012) The role of formal and informal headquarters-subsidiary relations in multinational corporations, paper presented at the 2011 Annual Meeting of the Academy of International Business, June 30-July 3, Washington, DC, USA.
  16. Harzing, A.W.; Pudelko, M. (2011). Language policies, competencies, and problems in multinational companies: Comprehensive evidence from nine countries/regions, conference proceedings of the 37th EIBA conference, Bucharest, 8-10 December.
  17. Harzing, A.W.; Köster, K.; Magner, U. (2011) Babel in Business: The language barrier and its solutions in the HQ-subsidiary relationship, Journal of World Business, vol. 46, no. 3, pp. 296-304. Available online...
  18. Noorderhaven, N.G.; Harzing, A.W. (2009) Factors influencing knowledge flows within MNCs, Journal of International Business Studies, vol. 40, no. 5, pp. 719-741. Available online...
  19. Harzing, A.W.; Noorderhaven, N.G. (2008) Headquarters-subsidiary relationships and the country-of-origin effect, in: Feldman, M.P. & Santangelo, G.D. (2008) New Perspectives in IB Research - Progress in International Business Research, Volume 3, pp. 13–40. Available online...
  20. Neyer, A.-K.; Harzing, A.W. (2008) The impact of culture on interactions: Five lessons learned from the European Commission, European Management Journal, vol. 26, no. 5, pp. 325-334. Available online...
  21. Harzing, A.W.; Noorderhaven, N.G. (2008) Headquarters-subsidiary relationships and the country-of-origin effect, paper presented at the EURAM Annual conference, Ljubljana May 15-17 2008.
  22. Harzing, A.W.; Feely, A.J. (2008) The language barrier and its implications for HQ-subsidiary relationships, Cross Cultural Management: An International Journal, vol. 15, no. 1, pp. 49-60. Available online...
  23. Pudelko, M.; Harzing, A.W. (2007) How European is management in Europe? An analysis of past, present and future management practices in Europe, European Journal of International Management, vol. 1, no. 3, pp. 206-224. Available online...
  24. Harzing, A.W.; Noorderhaven, N.G. (2007) Australian and New Zealand subsidiaries: Victims of their geographical isolation?, in: Merrett, D.T.; Dick, H., The Internationalisation Strategies of Firms: The Australian Experience in Global Economics, Cheltenham: Edward Elgar.
  25. Noorderhaven, N.G.; Harzing, A.W. (2006) Factors influencing knowledge flows within MNCs, paper presented at the 66th annual meeting of the Academy of Management, Atlanta, August 11-16.
  26. Harzing, A.W.; Noorderhaven, N.G. (2006) Knowledge flows in MNCs: An empirical test and extension of Gupta & Govindarajan's typology of subsidiary roles, International Business Review, vol. 15, no. 3, pp. 195-214. Available online...
  27. Harzing, A.W.; Noorderhaven, N.G. (2006) Geographical distance and the role and management of subsidiaries: The case of subsidiaries down-under, Asia-Pacific Journal of Management, vol. 23, no. 2, pp. 167-185. Available online... - Publisher's version (read for free) [reprinted in International Human Resource Management, Editors: Pawan Budhwar, Randall S. Schuler, Paul R. Sparrow, Sage Publications 2009]
  28. Harzing, A.W.; Noorderhaven, N.G. (2005) MNC subsidiaries down-under: Victims of their geographical isolation?, conference proceedings of the ANZIBA annual meeting, November 10-11, Melbourne, Australia. [Winner of the Best Paper Award in the International Management Stream.]
  29. Harzing, A.W.; Noorderhaven, N.G. (2005) Knowledge flows in MNCs: A typology of subsidiary roles, paper presented at the 65th annual meeting of the Academy of Management, Honolulu, August 5-10.
  30. Harzing, A.W.; Noorderhaven, N.G. (2004) Knowledge flows in MNCs: An empirical test and extension of Gupta & Govindarajan's typology of subsidiary roles, conference proceedings of the 30th EIBA conference, December 5-8, 2004, Ljubljana, Slovenia.
  31. Feely, A.J.; Harzing, A.W. (2004) The language barrier and its implications for HQ-subsidiary relationships, paper presented at the 64th annual meeting of the Academy of Management, New Orleans, August 6-11. Available online...
  32. Noorderhaven, N.G.; Harzing, A.W. (2003) The "Country-of-Origin Effect" in multinational corporations: Sources, mechanisms and moderating conditions, Management International Review, vol. 43, special issue 2, pp. 47-66. Available online...
  33. Harzing, A.W.; Sorge, A.M. (2003) The relative impact of country-of-origin and universal contingencies on internationalization strategies and corporate control in multinational enterprises: World-wide and European perspectives, Organisation Studies, vol. 24, no. 2, pp. 187-214. Available online... [Roland Calori Prize for the best paper published in Organization Studies 2003-2004]
  34. Harzing, A.W.; Sorge, A.M.; Paauwe, J. (2002) HQ-subsidiary relationships in multinational companies: A British-German comparison, in: Geppert, M.; Matten, D.; Williams, K. (eds.) Challenges for European Management in a Global Context - Experiences from Britain and Germany, Basingstoke, London, New York: Palgrave. Available online...
  35. Harzing, A.W. (2002) Acquisitions versus greenfield investments: International strategy and management of entry modes, Strategic Management Journal, vol. 23, March, pp. 211-227. Available online...
  36. Harzing, A.W. (2001) Acquisitions vs. greenfield entry strategies: Exploring the impact of the MNC's international strategy on the choice and management of different entry modes, paper presented at the 2001 annual meeting of the AIB, November 16-19, Sydney.
  37. Harzing, A.W. (2000) An empirical test and extension of the Bartlett and Ghoshal typology of multinational companies, Journal of International Business Studies, vol. 31, no. 1, pp. 101-120. Available online...
  38. Harzing, A.W. (2000) Acquisitions versus greenfield investments: exploring the impact of the MNC's international strategy, conference proceedings of the 26th EIBA conference, Maastricht, 10-12 December.
  39. Harzing, A.W. (2000) Societal embeddedness of internationalization strategies and corporate control: World-wide and European close-quarter perspectives, paper presented at the 60th annual meeting of the Academy of Management, Toronto, 4-9 August.
  40. Harzing, A.W. (2000) Societal embeddedness of internationalization strategies and corporate control: World-wide and European close-quarter perspectives, conference proceedings of the 27th Annual Conference of the UK Chapter of the AIB, Glasgow, 14-15 April, pp. 439-478.
  41. Harzing, A.W. (1999) Managing the multinationals: An international study of control mechanisms, Cheltenham: Edward Elgar, 425 pp. ISBN 1-84064-052-9. More about this book...
  42. Harzing, A.W. (1999) The European monolith: another myth in international management?, paper presented at the ESRI Thematic Research Workshop on Economic Actors, National Systems and International Contexts, September 21-24, Copenhagen, Denmark.
  43. Harzing, A.W. (1999) Plans, procedures and bumble-bees, an international study of control mechanisms in multi-national companies, paper presented at the 59th annual meeting of the Academy of Management, Chicago, 8-11 August.
  44. Harzing, A.W. (1998) Configuration analysis in international management: the way forward?, conference proceedings of the 25th Annual Conference of the UK Chapter of the AIB, London, 3-4 April, pp. 264-289.
  45. Harzing, A.W. (1998) Plans, procedures and bumble-bees, an international study of control mechanisms in multi-national companies, paper presented at the 24th EIBA conference, Jerusalem, 13-15 December.
  46. Harzing, A.W. (1998) - Integration within MNCs: from multidomestic to global and transnational firms?, in: Mirza, H.R.: Global Competitive Strategies in the New World Economy, Multilateralism, Regionalization and The Transnational Firm, Cheltenham: Edward Elgar, pp. 313-326.
  47. Harzing, A.W. (1998) Acquisitions versus greenfield investments: both sides of the picture, paper presented at the 1998 annual meeting of the AIB, October 7-10, Vienna, Austria.
  48. Harzing, A.W. (1995) Internationalization and the international division of labour, in: Harzing, A.W.; Van Ruysseveldt, J. (eds.), International Human Resource Management, London: Sage Publications, pp. 1-24.
  49. Harzing, A.W. (1995) Strategic planning in multinational firms, in: Harzing, A.W.; Van Ruysseveldt, J. (eds.), International Human Resource Management, London: Sage Publications, pp. 25-50.
  50. Harzing, A.W. (1994) Organizational bumble-bees: international transfers as a control mechanism in multinational companies, paper presented at the doctoral tutorial of the 20th annual meeting of the European International Business Association, Warsaw, 11-14 December.

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Anne-Wil Harzing is Emerita Professor of International Management at Middlesex University, London. She is a Fellow of the Academy of International Business, a select group of distinguished AIB members who are recognized for their outstanding contributions to the scholarly development of the field of international business. In addition to her academic duties, she also maintains the Journal Quality List and is the driving force behind the popular Publish or Perish software program.

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