Subsidiary Capability Upgrading and Parent-Subsidiary Relationship: Insights from a Chinese Acquisition in the United Kingdom

Abstract

Purpose

This study aims to explore capability upgrading of EMNE’s subsidiaries in developed countries and how the parent-subsidiary relationship influences such upgrading.

Methodology/approach

The study adopts an interdisciplinary approach to capability upgrading of EMNEs subsidiaries in developed countries. It employs a single case study to explore this under-research area.

Findings

The analysis challenges the orthodox view and suggests broad-based capability upgrading has taken place in the EMNE-acquired subsidiaries ranging from product, process, functional to intersectoral. In addition, the capability upgrading was contingent on the degree of subsidiary autonomy and subsidiary mandates.

Originality/value

This study represents one of the first to examine capability upgrading and parent-subsidiary relationship in the context of EMNEs’ internationalisation activities.

Citation

He, S. and Khan, Z. (2015), "Subsidiary Capability Upgrading and Parent-Subsidiary Relationship: Insights from a Chinese Acquisition in the United Kingdom", The Future of Global Organizing (Progress in International Business Research, Vol. 10), Emerald Group Publishing Limited, Leeds, pp. 127-141. https://doi.org/10.1108/S1745-886220150000010012