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Regular version of the site

Book chapter

Organizational networks revisited: Predictors of headquarters-subsidiary relationship perception

P. 39-50.

The problem of effective management of company subsidiaries has been on the forefront of strategic management research since early mid-1980s. Recently, special attention is being paid to the effect of headquarters - subsidiary conflicts on the company performance, especially in relation to the subsidiaries’ resistance, both active and passive, to following the directives of the headquarters. A large number of theoretical approaches have been used to explain the existence of intraorganizational conflicts. For example, Strutzenberger and Ambos (2013) examined a variety of ways to conceptualize a subsidiary, from an individual up to a network level. The network conceptualization, at present, is the only approach that could allow explaining the dissimilarity of the subsidiaries’ responses to headquarters’ directives, given the same or very similar distribution of financial and other resources,  administrative support from the head office to subsidiaries, and levels of subsidiary integration. This is because social relationships between different actors inside the organization, the strength of ties and the size of networks, as well as other characteristics, could be the explanatory variables that researchers have been looking for in their quest to resolve varying degrees of responsiveness of subsidiaries, and – in fact – headquarters’ approaches – to working with subsidiaries. The purpose of this study is to evaluate the variety of characteristics of networks formed between actors in headquarters and subsidiaries, and their effects on a variety of performance indicators of subsidiaries, as well as subsidiary-headquarters conflicts. Data is being collected in two waves at a major Russian company with over 200,000 employees and several subsidiaries throughout the country.