The (un)predictable factor: the role of subsidiary social capital in international takeovers
Journal of Organizational Effectiveness: People and Performance
ISSN: 2051-6614
Article publication date: 6 June 2016
Abstract
Purpose
The purpose of this paper is to investigate how the implementation of headquarters-originated employment practices affect multinational corporation (MNC) ability to exploit the value of organizational social capital of the acquired subsidiary.
Design/methodology/approach
The authors use qualitative insights collected over 16 years from a Danish company to illustrate how a foreign MNC’s interference with the balanced structure of relations, norms, and roles in a subsidiary jeopardized the value of existing social capital.
Findings
The authors argue that changes in the collective perception of employment practices create the collective response, constructive or destructive, resulting respectively in the gain or loss of the performance benefits arising from organizational social capital.
Practical implications
The authors suggest two guidelines and two general propositions for future research on the value of organizational social capital in international takeovers.
Originality/value
The results indicate that local management and employees could use organizational social capital as a unique feature of the local business system when competing with other subsidiaries in the same MNC.
Keywords
Citation
Minbaeva, D. and Navrbjerg, S.E. (2016), "The (un)predictable factor: the role of subsidiary social capital in international takeovers", Journal of Organizational Effectiveness: People and Performance, Vol. 3 No. 2, pp. 115-138. https://doi.org/10.1108/JOEPP-03-2016-0026
Publisher
:Emerald Group Publishing Limited
Copyright © 2016, Emerald Group Publishing Limited