Foreign Subsidiary Political Network Intensity Fit and Performance in a Volatile Environment

• Main Authors: White, George O, Fainshmidt, Stav, Galang, Roberto Martin N, Rajwani, Tazeeb
• Format: text
• Published: Archīum Ateneo 2013
• Subjects: organizational imprinting; political and regulatory institutions; political network intensity fit; Business
• Online Access: https://archium.ateneo.edu/leadership-and-strategy-faculty-pubs/23; https://doi.org/10.5465/ambpp.2013.17516abstract
• Institution: Ateneo De Manila University

By integrating organizational imprinting theory with the fit paradigm, we investigate the influence of parent home country political stability and regulatory quality on foreign subsidiary political network intensity. We also consider how strategic fit between MNE parent home country political stability and regulatory quality, and political network intensity will impact foreign subsidiary satisfaction with strategic performance in a volatile institutional environment. We employ data collected from 181 foreign subsidiaries in the Philippines and find that MNE parent home country political stability and regulatory quality, as organizationally imprinted norms, have divergent effects on the intensity of foreign subsidiary political networking. We also find strategic fit between parent home country political and regulatory institutions and the level of a foreign subsidiary’s political network intensity will positively influence strategic performance in a volatile environment. Managerial implications and future research suggestions are discussed.