Managing the Contemporary Multinational
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Managing the Contemporary Multinational

The Role of Headquarters

  • New Horizons in International Business series

Edited by Ulf Andersson and Ulf Holm

Managing the Contemporary Multinational explores the role of headquarters in different structures of multinational firms and shows how this role is affected by the complexity of contemporary research.
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Chapter 4: Commander-in-Chief or Absentee Landlord? Key Perspectives on Headquarters in Multinational Corporations

Wilhelm Barner-Rasmussen, Rebecca Piekkari, Joanna Scott-Kennel and Catherine Welch

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4. Commander-in-chief or absentee landlord? Key perspectives on headquarters in multinational corporations Wilhelm Barner-Rasmussen, Rebecca Piekkari, Joanna Scott-Kennel and Catherine Welch INTRODUCTION The multinational corporation (MNC) represents a longstanding area of research in international business (for example, Stopford and Wells 1972). Its role has been so central in international business research that the entire field has sometimes been equated with the study of the MNC (Shenkar 2004). Recent years have seen the burgeoning of research into subsidiary roles (for example, Birkinshaw and Hood 1998) and inter-unit knowledge transfer in the MNC (for example, Foss and Pedersen 2004). Scholarly interest in headquarters during the same period has, by contrast, been rather limited. In this chapter, we compare and contrast four key perspectives on the MNC headquarters: namely, the design, the network, the institutional and the critical perspectives. Overall, these perspectives provide an interdisciplinary approach to theorizing about the MNC by incorporating research from fields such as economics, strategy, international business, industrial networks, sociology, organizational theory and anthropology. Our comparative analysis uncovers two extreme views of MNC headquarters which we argue are captured in the metaphors underlying classic ‘design’ and emergent ‘critical’ perspectives respectively. While the former has been characterized as drawing on a military metaphor of headquarters as commander-in-chief of a conquering army (Forsgren et al. 2005), the latter portrays the headquarters as ‘an absentee landlord who is not only ignorant, but who destroys rather than creates value’ generated by foreign subsidiaries (Kristensen and Zeitlin 2005, p. 234). The network and...

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