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Subsidiary entrepreneurship, internal and external competitive forces, and subsidiary performance

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Abstract

The Multinational Subsidiary is conceptualized as a semi-autonomous entity with entrepreneurial potential, within a complex competitive arena, consisting of an internal environment of other subsidiaries, internal customers and suppliers, and an external environment consisting of customers, suppliers and competitors. The relative strength of these competitive environments shapes the subsidiary's options; and it is then up to subsidiary manager to take the initiative to respond to the threats and opportunities to secure the subsidiary's performance. The paper, therefore, emphasizes the interplay between subsidiary entrepreneurship and the subsidiary's competitive environment--it shows how certain subsidiary attributes emerge as a function of these factors, and how they ultimately affect the performance of the subsidiary. Specific hypotheses are developed and tested on 24 Multinational Subsidiaries in Scotland.

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