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Headquarters-Subsidiary Exchanges and the Quality of Headquarters-Subsidiary Relationship

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Authors
Li, J.
Jiang, Fuming
Travaglione, Tony
Date
2015
Type
Conference Paper

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Citation
Li, J. and Jiang, F. and Travaglione, T. 2015. Headquarters-Subsidiary Exchanges and the Quality of Headquarters-Subsidiary Relationship: The Moderating Roles of Organizational Identity, Parent’s Ownership, and Entry Mode, in Proceedings of the Strategic Management Society 35th Annual International Conference: Strategy Expanding: Making Sense of Shifting Field and Firm Boundaries, Oct 3-6 2015. Denver, CO: Strategic Management Society.
Source Title
The Moderating Roles of Organizational Identity, Parent’s Ownership, and Entry Mode.
Source Conference
Strategic Management Society Annual Conference
School
School of Management
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Abstract

Through the lens of the social exchange theory, we developed and empirically tested a theoretical framework that contextualizes the effects of two levels of headquarters-subsidiary exchange on quality of headquarters-subsidiary relationship, and how subsidiary manager’s organizational identity, parent’s ownership in subsidiary, and subsidiary’s entry mode interact with these exchanges in shaping the quality of headquarters-subsidiary relationship. Survey data from 305 Chinese MNEs found that managerial and organizational exchanges have positive influences on the quality of headquarters-subsidiary relationship. It also found that the positive influence of managerial exchange is weakened when the subsidiary manager has a stronger organizational identity with subsidiary, and the positive influence of organizational exchange is weakened when subsidiary is wholly owned by parent and the subsidiary is established via greenfield entry mode.