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Subsidiary power in multinational corporations: the subtle role of micro‐political bargaining power

Subsidiary power in multinational corporations: the subtle role of micro‐political bargaining power Purpose – As subsidiary power has received relatively little attention in existing research, this paper aims to enhance the understanding of genuine sources of subsidiary power and how they work in headquarters‐subsidiary relationships. Design/methodology/approach – The paper is based on a review of the relevant literature and four illustrative case studies, which are written on the basis of secondary sources. Each case was selected because it adequately represents a particular type of power. This allows for cross‐case comparisons of the strengths and sustainability of different types of power, and facilitates the exploration of the application of subsidiary power in headquarters‐subsidiary relationships. Findings – Four genuine types of subsidiary power are identified. One of these – micro‐political bargaining power – plays a subtle but crucial role, as it is important in the enactment of the three other types of power, i.e. systemic, resource‐dependency, and institutional. Practical implications – As headquarters have unlimited access to formal power, subsidiaries find it necessary to constantly apply micro‐political bargaining power. The empirical material suggests that the effectiveness of micro‐political bargaining power for subsidiary actors is based on two factors: information retrieval from headquarters and the leveraging of such information in issue‐selling or conflict‐handling processes. Originality/value – The paper contributes by theoretically delineating genuine types of subsidiary power and by illustrating the strength, sustainability and interaction of these types of power in headquarters‐subsidiary relationships. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png critical perspectives on international business Emerald Publishing

Subsidiary power in multinational corporations: the subtle role of micro‐political bargaining power

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Publisher
Emerald Publishing
Copyright
Copyright © 2011 Emerald Group Publishing Limited. All rights reserved.
ISSN
1742-2043
DOI
10.1108/17422041111103822
Publisher site
See Article on Publisher Site

Abstract

Purpose – As subsidiary power has received relatively little attention in existing research, this paper aims to enhance the understanding of genuine sources of subsidiary power and how they work in headquarters‐subsidiary relationships. Design/methodology/approach – The paper is based on a review of the relevant literature and four illustrative case studies, which are written on the basis of secondary sources. Each case was selected because it adequately represents a particular type of power. This allows for cross‐case comparisons of the strengths and sustainability of different types of power, and facilitates the exploration of the application of subsidiary power in headquarters‐subsidiary relationships. Findings – Four genuine types of subsidiary power are identified. One of these – micro‐political bargaining power – plays a subtle but crucial role, as it is important in the enactment of the three other types of power, i.e. systemic, resource‐dependency, and institutional. Practical implications – As headquarters have unlimited access to formal power, subsidiaries find it necessary to constantly apply micro‐political bargaining power. The empirical material suggests that the effectiveness of micro‐political bargaining power for subsidiary actors is based on two factors: information retrieval from headquarters and the leveraging of such information in issue‐selling or conflict‐handling processes. Originality/value – The paper contributes by theoretically delineating genuine types of subsidiary power and by illustrating the strength, sustainability and interaction of these types of power in headquarters‐subsidiary relationships.

Journal

critical perspectives on international businessEmerald Publishing

Published: Feb 1, 2011

Keywords: Subsidiaries; Intergroup relations; Politics

References