Factors which cause the greatest resistance during subsidiary evolution as a global strategy is implemented

Abstract

This study describes the factors which cause resistance to subsidiary evolution in twenty-eight geographically dispersed subsidiaries, as a global strategy is implemented by a mature multinational corporation (MNC). The subsidiaries are diverse in terms of the roles they perform within the MNC. Strategic change of this nature requires that subsidiaries roles evolve, in most cases to Implementer of head office decisions. Based on the interplay between subsidiary evolution factors namely; head-office assignment, subsidiary choice and local environments, this study evaluates which factors cause the most resistance to different subsidiary roles as a new MNC structure is implemented. Global Innovators experience the most resistance from headquarter factors, local innovators face the most resistance from subsidiary factors and Implementers experience low levels of resistance from the strategic change.