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Capability, environment and internationalization fit, and financial and marketing performance of MNEs’ foreign subsidiaries: An abductive contingency approach

Dessislava Dikova (Vienna University of Economics and Business, Vienna, Austria)
Arjen van Witteloostuijn (Tilburg University, Tilburg, The Netherlands)
Simon Parker (Richard Ivey School of Business, University of Western Ontario, London, Canada)

Cross Cultural & Strategic Management

ISSN: 2059-5794

Article publication date: 7 August 2017

Abstract

Purpose

Extant work in international business (IB) involves a partial contingency-theoretic perspective: a holistic view of the impact of bundles of contingencies on an outcome variable is missing. The purpose of this paper is to adopt a contingency approach to study multinational enterprise (MNE) subsidiary performance in the appropriate context of European transition economies at the beginning of the current millennium.

Design/methodology/approach

Methodologically, the authors introduce abduction as a line of inquiry into IB and management to develop new theoretical insights, and apply the novel empirical general interaction method to estimate bundle effects. In so doing, the authors contribute to the further development of a theoretical and empirical toolkit to revitalize holistic, or configurational, quantitative research in IB and management.

Findings

The authors find that capability fit is a necessary condition for high MNE subsidiary marketing performance, whilst environment fit is particularly critical for high MNE subsidiary financial performance.

Research limitations/implications

A key limitation is that this is a cross-section study.

Practical implications

This study offers insights as to subsidiary fit into Eastern Europe, indicating fitting entry and establishment modes.

Originality/value

This paper offers a novel holistic approach to IB, both in terms of theoretical and empirical methodology.

Keywords

Citation

Dikova, D., van Witteloostuijn, A. and Parker, S. (2017), "Capability, environment and internationalization fit, and financial and marketing performance of MNEs’ foreign subsidiaries: An abductive contingency approach", Cross Cultural & Strategic Management, Vol. 24 No. 3, pp. 405-435. https://doi.org/10.1108/CCSM-01-2016-0003

Publisher

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Emerald Publishing Limited

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