نقش محیط‌های محلی در ایجاد صلاحیت در شرکت‌های چند ملیتی

This paper examines the competence development of subsidiaries in multinational enterprises. We analyze how local subsidiary environments affect the development of technological and business competencies among other units in the multinational enterprise. We test our predictions using data from 2,107 foreign-owned subsidiaries located in seven European countries, by means of structural equation modeling — namely, LISREL. By bringing the local environment to the fore, we contribute to the literature on the emergence and determinants of firm-specific advantages. We link local subsidiary environments to the development of the competencies of other units in the multinational enterprise. The role of the multinational enterprise is characterized as integrative, as it may bridge local competencies and environments that are conducive to competence creation, and as it facilitates the use of resources residing locally throughout the organization. Thus, we contribute to an enhanced understanding of location as a determinant of the creation of units of competence and centers of excellence within multinational enterprises. In other words, we demonstrate that country-specific advantages are beneficial for competence creation in units other than the local subsidiary. We thereby link country-specific advantages to the creation of firm-specific advantages in the multinational enterprise — i.e., the multinational enterprise can build and augment firm-specific advantages by making the most of country-specific advantages.

Knowledge and resources reside in the host locations of subsidiaries of multinational enterprises (MNEs). Such knowledge and resources can be conceptualized as country-specific advantages (CSAs) (Rugman and Verbeke, 2001). For the subsidiary located in the host-country environment, the presence of such knowledge and resources creates an opportunity to upgrade its own competencies, and to evolve (Birkinshaw and Hood, 1998). This evolution, in turn, can create subsidiary-specific advantages (SSAs) that if used by the entire MNE can become firm-specific advantages (FSAs) (Rugman and Verbeke, 2001). This echoes the argument that the local contexts of subsidiaries can be of critical importance for competence creation (Meyer et al., 2011 and Rugman et al., 2011). Indeed, Bartlett and Ghoshal (1986) emphasized the strategic importance of the local environment of subsidiaries, which can benefit the entire MNE (Meyer et al., 2011). The advantages stemming from a subsidiary's local environment may or may not be bound by location, meaning that such advantages may influence the entire MNE or only the focal subsidiary operating in the specific environment. However, the MNE has been described as an organization positioned to make better use of the resources dispersed in its units compared to individual firms' possibilities through the market. In fact, the abilities to make use of globally dispersed resources and to take advantage of the multiplicity of environments in which their subsidiaries operate constitute two of the distinctive advantages of the MNE (Cantwell, 1989, Kogut and Zander, 1993 and Penrose, 1959). However, resources and competencies that reside locally in subsidiaries are often difficult to implement in other MNE units. Furthermore, benefiting from locally-situated competencies on a global scale is one of the greatest strategic challenges for MNEs (e.g., Gupta and Govindarajan, 2000 and Szulanski, 1996). Research has commonly investigated either competence creation at the subsidiary level or competitive advantages at the MNE level, but rarely studied their relation. This study identifies two distinct CSAs — market conditions for competence development and competitive dynamics in the local market — and how they affect the competencies of other MNE units in the technology and business dimensions (FSAs). This allows for an investigation into drivers of MNE competence creation and factors underlying competitive advantage. We thereby empirically elucidate the issue of CSAs leading to FSAs for the entire MNE. This corresponds to an empirical investigation of selected parts of the framework developed by Rugman and Verbeke (2001).1

In this study, we show how MNEs and their subsidiaries can build competencies and competitive advantages through the international integration of local environments. This enhances our understanding of the location advantages (Dunning, 1988) of subsidiaries and how those advantages can benefit the MNE. We contribute to the understanding of how subsidiary locations contribute to the competence development of sister units within the MNE. The MNE can build and augment FSAs by making the most out of CSAs. Our findings have important managerial and policy implications. MNE managers should carefully consider the CSAs of host locations. Furthermore, MNEs must remember that these CSAs can be utilized by the host-country unit and ensure that transfer mechanisms are in place for the global diffusion of local competencies. The MNE needs to bundle local resources with FSAs, a move that will benefit subsidiaries on a global scale. This is in line with the view of the MNE as a differentiated network in which subsidiaries play a multitude of roles (Nohria and Ghoshal, 1994, Rugman and Verbeke, 2001 and Rugman et al., 2011). One limitation of this study is that we do not empirically test the organizational mechanisms that link the locally situated subsidiary and its environment with the competence development of other units. However, other research provides insights into what mechanisms that are related to issues of knowledge transfer. We can observe that this link exists, but we cannot analyze the mechanisms that facilitate or impede these processes. Nevertheless, it has not been our intention to shed light on the organizational processes that connects to knowledge transfer and learning. Instead, we leave those issues for future research. Another limitation of the present study is that we make use of self-reported, single-source data, which implies that common method bias may influence our results. However, we have controlled for this possibility ex post, and the large sample size should attenuate method bias concerns. In addition, the extent to which subsidiary managers are able to assess competence creation throughout the MNE remains unknown. We believe these managers are in a favorable position to make such assessments due to their proximity to ongoing business operations in their respective units and beyond. A final limitation pertains to the spatial distribution of our sample in that it emanates mainly from northern Europe. Future studies could explore subsidiaries located in emerging countries, and also investigate the regional effects of location and competence creation. This study has elucidated location determinants of subsidiary competence creation, showing that location advantages and locally developed subsidiary competencies are of use for other MNE units. It therefore enhances our understanding of location as an important determinant in MNE competence creation and in the development of competitive advantages. Locational dispersion, and the drivers of value creation and competence development have received an increasing amount of attention in the literature (Cantwell and Santangelo, 1999). Our results indicate that MNEs can enhance their competitive advantages by dispersing subsidiary activities to dynamic markets. MNEs benefit from operating in such markets, which provide the building blocks for developing FSAs in terms of business and technology competencies.