How do decision makers of multinational enterprises (MNEs) appoint general manager (GM) successors in their local-market-seeking foreign subsidiaries? Extant literature suggests that to better address host country business practices and cultures that may contrast markedly with those of the home country, it is sensible to deploy a host-country national (HCN) subsidiary GM. Our field data, however, suggest that using HCN GM successors is not always the best strategy. For HCN GM successors promoted from within the subsidiary, ex post opportunism is likely to arise, resulting in unsatisfactory subsidiary performance. Appointing HCN GMs from outside the subsidiary may limit ex post opportunism, but it may entail divided engagement. Appointing parent-country national (PCN) subsidiary GMs, on the other hand, may beget over-reliance on existing practices. This qualitative inquiry corroborates the value of bounded reliability as a standard micro-foundation in international management research and reveals several managerial safeguards that can economize on bounded reliability.
|Journal||Academy of Management Proceedings|
|Publication status||Published - 2021|
|Event||81st Annual Meeting of the Academy of Management 2021: Bringing the Manager Back in Management - Virtual, Online|
Duration: 29 Jul 2021 → 4 Aug 2021
https://my.aom.org/program2021/ (Online Program)