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Product Development In Emerging Market Subsidiaries — The Influence Of Autonomy And Internal Markets On Subsidiary Roles

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  • DIRK MICHAEL BOEHE

    (University of Fortaleza, Av. Washington Soares, 1321, CEP: 60811-905, Fortaleza-CE, Brazil)

Abstract

Emerging market subsidiaries constitute an increasingly important asset for the innovative activities of multinational corporations (MNCs). This study examines how different types of these subsidiaries may be integrated into global R&D using two essential coordination mechanisms — hierarchical control and internal markets (competition among MNC units). Based on a sample of 146 Brazil based MNC subsidiaries, the key results suggest that (1) more innovative subsidiaries have higher autonomy than less innovative subsidiary as long as they have local market scope; (2) subsidiaries which develop new products for global or other emerging markets have competitive relationships with peer MNC units. Likewise, the results provide some preliminary support for an instrument which measures competition among MNC unit. Based on a comprehensive classification framework, the study puts forward some recommendations for MNC technology management regarding how subsidiary product development units may extend their market scope and technological capabilities.

Suggested Citation

  • Dirk Michael Boehe, 2008. "Product Development In Emerging Market Subsidiaries — The Influence Of Autonomy And Internal Markets On Subsidiary Roles," International Journal of Innovation and Technology Management (IJITM), World Scientific Publishing Co. Pte. Ltd., vol. 5(01), pages 29-53.
    • Handle: RePEc:wsi:ijitmx:v:05:y:2008:i:01:n:s021987700800128x
    DOI: 10.1142/S021987700800128X
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    References listed on IDEAS

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    1. Paulo N. Figueiredo, 2001. "Technological Learning and Competitive Performance," Books, Edward Elgar Publishing, number 2373.
    2. Peter J. Buckley & Mark Casson, 1991. "The Future of the Multinational Enterprise," Palgrave Macmillan Books, Palgrave Macmillan, edition 0, number 978-1-349-21204-0, March.
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    Cited by:

    1. Lopez-Vega, Henry & Tell, Fredrik, 2021. "Technology strategy and MNE subsidiary upgrading in emerging markets," Technological Forecasting and Social Change, Elsevier, vol. 167(C).
    2. Dzikowska Marlena & Gorynia Marian, 2020. "Long-term evolution of the subsidiary’s role: a qualitative perspective on a subsidiary located in Poland," International Journal of Management and Economics, Warsaw School of Economics, Collegium of World Economy, vol. 56(1), pages 79-95, March.
    3. Fu, Xiaolan & Sun, Zhongjuan & Ghauri, Pervez N., 2018. "Reverse knowledge acquisition in emerging market MNEs: The experiences of Huawei and ZTE," Journal of Business Research, Elsevier, vol. 93(C), pages 202-215.
    4. Borini, Felipe Mendes & de Miranda Oliveira, Moacir & Silveira, Franciane Freitas & de Oliveira Concer, Ronald, 2012. "The reverse transfer of innovation of foreign subsidiaries of Brazilian multinationals," European Management Journal, Elsevier, vol. 30(3), pages 219-231.
    5. Felipe Mendes Borini & Moacir de Miranda Oliveira Júnior, 2012. "Reverse transfer of corporate social responsibility practices from brazilian subsidiaries of multinationals," Brazilian Business Review, Fucape Business School, vol. 9(Special I), pages 78-101, March.
    6. Dixit Manjunatha Betaraya & Saboohi Nasim & Joy Mukhopadhyay, 2018. "Subsidiary Innovation in a Developing Economy: Towards a Comprehensive Model and Directions for Future Research," FIIB Business Review, , vol. 7(2), pages 109-125, June.

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