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The purpose of this paper is to contribute to the literature discussing the internationalization of research and development (R&D) among multinational companies by proposing a process description to capture the development of local R&D capabilities in subsidiaries.

The authors build the conceptualization not only on the prevailing literature on resource management, subsidiary evolution and subsidiary initiatives, but also on empirical observations.

A process in four phases is distinguished to describe the evolution of R&D capabilities in subsidiaries: the identification of an opportunity in the host country that triggers the establishment of local R&D capabilities; the gathering of support – from the host country and from MNC internally – and resources; the bundling of the resources to build capabilities; and finally the leveraging of the capabilities.

By offering a conceptualization of the process through which subsidiaries build R&D capabilities, the authors contribute to the literature on R&D internationalization that hitherto has neglected the central role played by subsidiaries and the fact that a subsidiary needs to develop and manage resources and capabilities to change its R&D related role and/or mandate within the MNC.

By providing a process perspective on MNCs internationalization of R&D focussing on the development and management of R&D capabilities at subsidiaries, the paper adds a more dynamic dimension to the previously rather static view on R&D internationalization.

The purpose of this paper is to contribute to the discussion on how multinational company (MNC) headquarters (HQs) can manage the existing coopetition paradox to ensure innovation within the MNC. In contrast to the rather scarce previous research, the authors argue that HQ needs to solve the coopetition paradox under the sway of a parenting paradox. Hence, HQ faces a dual paradox.

Drawing on the literature on HQ’s role during MNCs’ innovation processes, this conceptual paper revisits the previously suggested HQ measures to enable coopetition among subsidiaries. By applying a sheer ignorance perspective, the authors contribute with a more nuanced understanding of the HQ’s role in innovation activities.

The article identifies four challenges as the HQ faces a parenting paradox that hinders its ability to solve the coopetition paradox: context specificity of subsidiaries’ innovation work, normative expectations of subsidiary managers, potential opportunistic behavior of HQ manager and HQ underestimation of needed resources. The article suggests that HQ needs to become more informed and preferably even embedded in the local innovation networks of its most important subsidiaries and that coopetition should not be managed solely on an HQ level.

Advocating a sheer ignorance perspective, the article pioneers in discussing the role that HQ plays in managing coopetition among subsidiaries in innovation activities.

In this paper, the authors contribute with insights on competition and cooperation in multinational enterprises with a focus on challenges related to these governance mechanisms in a knowledge development context. The mechanisms have been widely recognized as important for developing knowledge, but their contradicting nature implies considerable complexity when it comes to governance. The complexity is further increased as a result of the headquarters-subsidiary relationships. The aim of this paper is to contribute with theoretical and empirical insights on these aspects by focusing on the research question: How and why does competition and cooperation in an MNE emerge over time?

A manufacturing MNE with headquarters (HQ) in Sweden is analyzed on both HQ and subsidiary levels. Interviews with 24 managers in Sweden and India have been performed.

The study illustrates that competition and cooperation are integral aspects in HQ-subsidiary relationships. The results show that both competition and cooperation depend on environmental, organizational and object-related conditions and that these conditions influence the dynamics of the interplay. The importance of including a subsidiary perspective and the interdependencies in an MNE setting are emphasized.

The authors add to the discussion on the interplay between competition and cooperation as they play an important role for knowledge development in MNEs. The results indicate that they do not take place simultaneously, and therefore, the authors suggest that the dynamic can be better understood by focusing on the interplay and analyze the concepts separately.

This paper aims to contribute to the multinational company (MNC) literature by studying the diffusion of a management idea within an MNC and its interaction with the MNC’s corporate immune system (CIS).

The qualitative single case study draws on evidence of how a management idea augments within an MNC and changes its development practice.

The study identifies four phases of the diffusion process and presents the interaction between the management idea and the CIS in each phase.

The more subsidiaries within an MNC that take the initiative to adopt a management idea, the harder will it become for the headquarters (HQ) to reject it. Thus, to ensure that changes in management practices are based on informed and, ideally, deliberate decisions, managers should critically evaluate management ideas immediately at inception.

The study breaks new ground by explaining how the CIS reacts to the diffusion of management ideas in MNCs.

This paper aims to contribute to the subsidiary initiative literature by studying the interaction between a headquarters and its subsidiary during an initiative process that has the potential to “wag the corporate dog” that is, for the global corporation’s promising subsidiary initiative in a strategically important emerging market to question the corporation’s prevailing schemata.

The longitudinal single case study draws on evidence from the Indian subsidiary of Swedish Volvo Bus and its efforts to introduce a value product in India.

The study argues that wag the dog initiatives provoke the corporate immune system independent of the initiative’s potential and the subsidiary’s autonomy and legitimacy. If the idea behind the wag the dog initiative is perceived as strategically important for the multinational corporation, then the corporate immune system tries to engulf – most likely unsuccessfully – the idea within the prevailing schemata. Failed attempts to engulf the initiative weaken the corporate immune system temporarily, thereby opening the organization to revitalization of the original initiative. Resistance, even though weakened, from the corporate immune system continues to exist.

Subsidiary managers need to avoid having their headquarters perceive an initiative as a wag the dog initiative by balancing their need to sell persistently the initiative with avoiding negative attention.

This study is a pioneer in explaining how the corporate immune system reacts towards wag the dog initiatives taken from subsidiaries in large emerging markets.

While the evolution of subsidiaries has received considerable research attention, the framework for understanding it has not evolved much since the late 1990s. The purpose of this paper is to add both clarity and depth to the work on the foundations for – as well as the processes of – capability creation and development as a subsidiary evolves.

This conceptual paper takes as its point of departure the micro-foundation literature, with a specific emphasis on the capability development literature. To describe capability creation and development, both the resource-based view and the resource management perspective are used here.

The paper adds a conceptual layer to the drivers of subsidiary evolution. To add further clarity regarding how capabilities are actually formed, the resources for capability creation and development are specified herein as entities, abilities and capacity. Arguments are also presented for why capabilities ought to be viewed as patterned behavior to decrease the terminological ambiguity surrounding the concept of capabilities. The process of capability creation and development with an emphasis on learning is brought forward. Further, capability typologies, in terms of substantive, managerial and dynamic capabilities, are presented to add specificity to the kinds of capabilities that are created and developed within a subsidiary.

Clarifying the concept of capability and how capabilities are formed by using advancements in the literature is important to add precision to the literature on the evolution of subsidiaries.

The article aims to explain how the drivers of subsidiary evolution influence a multinational company's (MNC) research and development (R&D) subsidiary's evolution over time.

The article draws on insights from a longitudinal comparative case study of three Swedish MNCs' Indian R&D units.

The study shows that the evolution of R&D units is a triangular showdown among headquarter assignments, local market constraints, and opportunities, and that subsidiary choice is an important driver of both mandated extension and stagnation. We summarize our findings in various propositions that emphasize different drivers over time and that highlight the strong impact of a subsidiary's understanding of the corporate immune system on the evolution of that subsidiary's R&D mandate.

Drawing on the common limitations of a case study approach, further research is needed to test the suggested propositions with larger samples, ideally with subsidiaries in other emerging and developed markets.

The study illustrates the risks involved for subsidiary managers when pushing an R&D mandate-related initiative too far and provoking the corporate immune system. For headquarters management, the study highlights the importance of understanding that the development of R&D competence and capability at a subsidiary cannot be guided solely by headquarter assignments and local market characteristics; rather, the subsidiary's initiatives also need to be considered.

The study contributes to the literature on R&D internationalization by showing how the drivers of subsidiary evolution influence a subsidiary's R&D mandates over time and that subsidiary choice is an important driver of both mandated extension and stagnation.

This paper aims to examine the de-internationalization process to determine how different forms of attitudinal commitment influence the de-internationalization process.

Because of the exploratory nature of the study, a case study design is used. Two cases of Swedish companies, which de-internationalize from the French market, are studied.

Different commitment profiles influence the de-internationalization process. In particular, a general commitment profile, in which affective, normative, instrumental and continuance commitment play a role, influences the timing of de-internationalization, while the effort directed toward the execution of de-internationalization is mainly influenced by normative commitment and the extent of de-internationalization mainly by instrumental commitment.

By offering three propositions regarding the four types of commitment and the effects of these commitment types on the process of de-internationalization, the authors contribute to the literature on de-internationalization and the commitment literature.

The findings suggest that there is a risk that managers continue to commit resources to a market for a longer period without clear benefits because of affective and continuance commitment. As local employees persist in committing to the local market because of continuance commitment, offering viable alternatives reduces commitment to the foreign operations.

Distinguishing between different types of commitment, the paper builds on a more fine-grained typology of commitment than previous internationalization literature. Thereby, the paper opens up for new insights in the de-internationalization process.

In the mainstream international business literature on multinational corporations (MNCs), an authoritative central headquarter (HQ) that transfers standardised practices to its subsidiaries remains the norm. This study aims to explore how MNCs coordinate their management practices through principles.

The paper draws on empirical findings from a qualitative in-depth single case study based on evidence-rich qualitative data including observations from how a high-tech MNC headquartered in Sweden coordinates its development practices.

An alternative informal coordination approach (i.e. coordination by principles) is identified. Additionally, antecedents and implications of the approach are presented.

Coordination by Principles may facilitate the internalisation of practices and be a feasible compromise between context adaptation and traditional standardisation, particularly for MNCs with highly heterogeneous research and development operations.

This paper highlights the importance of acknowledging that firm practices often are based on management ideas that HQs adopt to prevent loss of legitimacy. As such, this study contributes to the scarce literature that critically questions the assumption that HQs solely transfer practices to subsidiaries to improve subsidiary efficiency and performance.

Accentuating the concept of management under uncertainty in the Uppsala internationalization process model, the purpose of this paper is to develop a model for describing how managers act while keeping uncertainty at an acceptable level.

The authors perform two empirical studies to underpin the model they construct. First, a survey of 309 chief executive officers and chief financial officers in large, publicly listed international firms in the Nordic region on managerial risk perceptions and, second, a case study of Volvo Car Corporation and its endeavors when developing new car models for the Chinese market on a new platform – a process characterized by unprecedented uncertainty.

The proposed model describing managers’ behavior under uncertainty contains elements such as adjusting/proceeding in small steps, reducing uncertainty via learning, building relationships with important parties in the environment to avoid unforeseen changes and re-dos (i.e. starting all over again) and, perhaps most important, acting despite uncertainty.

The paper highlights a central, though forgotten, concept of the Uppsala internationalization process model, i.e. management under uncertainty, and, thereby, opens a new path for research on how manager behave under the sway of uncertainty.