“Of course, cooperation first”: the effect of subsidiary capability and perception gaps for subsidiary development
ISSN: 1525-383X
Article publication date: 13 May 2020
Issue publication date: 21 August 2020
Abstract
Purpose
This study aims to discuss not only the relationship between performance and cooperation but also discusses whether a subsidiary should prioritize performance above cooperation or whether a subsidiary should prioritize cooperation above performance. In addition, because the headquarters-subsidiary relationship influences the subsidiaries, the perception gaps (PGs) between headquarters and subsidiaries are taken as moderators to explore when there are perception differences between headquarters and subsidiaries and the effect on the relationship between subsidiaries’ cooperation (SCO) and performance (SP).
Design/methodology/approach
This study obtained the data through a survey of 170 subsidiaries in China; chief executive officer or senior managers were selected as the data collection sources. AMOS analysis was used to address sophisticated data analysis issues.
Findings
The empirical evidence indicates that subsidiary capabilities have direct impacts on SCO and SP. In addition, SCO and performance have mediating effects. More specifically, SCO has a full mediating effect and SP has a partial mediating effect. For the moderating effects, the PG weakens the effect of SCO on SP.
Originality/value
This study contributes to the literature on subsidiary capabilities by offering a headquarters-subsidiary relationship model. As both the conceptual and empirical research studies on this topic are still underdeveloped, the study provides fresh insights into collaborative management and offers significant theoretical and managerial implications. Specifically, this study focuses on the impacts that subsidiary capabilities and PG have on cooperation and performance.
Keywords
Acknowledgements
The authors are grateful to the Editor in Chief, Chang Hoon Oh, for his invaluable guidance and insightful suggestions and comments, which have improved significantly the quality of this article. The authors also thank the associate editor, Sui Sui, and anonymous reviewers for their constructive feedback through the review process. This research was supported in part by the grant MOST‐105‐2410‐H‐130‐054 from the Ministry of Science and Technology, Taiwan.
Citation
Chen, L.-J. and Tsou, H.-T. (2020), "“Of course, cooperation first”: the effect of subsidiary capability and perception gaps for subsidiary development", Multinational Business Review, Vol. 28 No. 3, pp. 401-426. https://doi.org/10.1108/MBR-10-2019-0125
Publisher
:Emerald Publishing Limited
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