Handbook of Research on International Strategic Management
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Handbook of Research on International Strategic Management

Edited by Alain Verbeke and Hemant Merchant

The Handbook provides an impressive state-of-the-art overview of the international strategic management field as an area of scholarly inquiry. The great strength of the work is the thoughtfulness of the messages conveyed by the expert team of authors.
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Chapter 8: Initiative in multinational subsidiaries

Julian Birkinshaw and Shameen Prashantham


Multinational corporations (MNCs) are complex, multifaceted entities. They can be studied through any number of conceptual lenses, and to some degree we, as researchers, are likely to see in them whatever we are looking for. MNCs have formal structures and control systems; they can be modeled as social networks; they are an arena for political and power games; they exhibit cultural disconnects. MNCs are also organic entities that evolve with the changing business environment, often with highly porous boundaries. The view of the MNC we are interested in here is an entrepreneurial one; that is, we are concerned with how individuals (within the MNC) actively pursue new opportunities without regard to the resources they control (Stevenson and Jarillo, 1990). Moreover, we are particularly interested in entrepreneurship that comes from managers of foreign subsidiaries that are relatively limited in their resources and/or their degrees of freedom. By focusing on these somewhat unusual individuals, and the initiatives they pursue, we are able to open up important broader issues regarding the way that MNCs evolve over time, and their sources of competitive advantage. This entrepreneurial perspective is one the first author mapped out almost 20 years ago in his doctoral thesis (Birkinshaw, 1995). This research was conducted in Canada in the aftermath of the Free Trade Agreement with the USA, and it documented issues and challenges that managers of foreign-owned subsidiary companies in Canada were preoccupied with.

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