Global competitiveness through foreign subsidiaries’ differentiation : the moderating roles of competitive dynamics and mandate

• In order to increase a foreign subsidiary’s contribution to the global competitiveness of an industrial firm, an awareness of the boundaries to the subsidiary’s strategy of differentiation that may hamper the subsidiary’s performance is essential. Drawing on the contingency perspective of strategy, this article extends current understanding of relationships between the differentiation strategy of the industrial firm’s foreign subsidiary and its performance. A conceptual model is developed in which the differentiation strategies of innovativeness and customer responsiveness build on dynamic capabilities. Contingency factors consist of type of local competitive dynamics and the value-adding mandate assigned to the subsidiary. The model is illustrated by subsidiaries of four industrial firms operating on the US market. Five propositions are developed regarding direct effects of the strategies on performance, and contingency effects of combinations of rivalry and relational competitive dynamics and upstream and downstream activities of the subsidiary.

Ämnesord

SAMHÄLLSVETENSKAP  -- Ekonomi och näringsliv -- Företagsekonomi (hsv//swe)

SOCIAL SCIENCES  -- Economics and Business -- Business Administration (hsv//eng)

Nyckelord

Företagsekonomi

Business administration

Publikations- och innehållstyp

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