TY  - JOUR
AB  - Purpose The purpose of this paper is to examine the relationships among taking a prospector local-market focus, managerial ties (business ties and political ties) and performance in the Chinese market.Design/methodology/approach This study, using a sample of 371 Taiwanese subsidiaries of multinational corporations (MNCs) in China, applies regression analyses to investigate the following questions: does taking a prospector local-market focus negatively impact performance? Do managerial ties (business ties and political ties) positively impact performance? Do these managerial ties positively moderate the effect of the taking a prospector local-market focus on performance?Findings Taking a prospector local-market focus negatively impacts the performance of MNC subsidiaries. Business ties positively impact the performance of MNC subsidiaries, as do political ties. Finally, the impact of a prospector local-market focus on performance is positively moderated by business ties.Practical implications The Chinese market is still a guanxi exchange business system and political connections usually require significant investment in exchange for advantageous market conditions. Thus, political ties must be carefully considered by MNC subsidiaries when they employ a prospector local-market focus in the Chinese business environment.Originality/value First, this study clarifies the key relationship between the strategic choice of taking a prospector local-market focus and performance of MNC subsidiaries in the Chinese market. Second, it identifies the moderating role of managerial ties (political and business ties) in influencing the relationship between a prospector local-market focus and subsidiary.
VL  - 57
IS  - 3
SN  - 0025-1747
DO  - 10.1108/MD-09-2017-0902
UR  - https://doi.org/10.1108/MD-09-2017-0902
AU  - Lee Po-Yen
PY  - 2018
Y1  - 2018/01/01
TI  - Taking a prospector local-market focus and foreign subsidiary performance: evidence from China
T2  - Management Decision
PB  - Emerald Publishing Limited
SP  - 569
EP  - 582
Y2  - 2024/09/19
ER  -