Co-parenting through subsidiaries: A model of value creation in the multinational firm

What is it about?

We analyze a novel way to configure and manage multinational networks and propose a model of "co-parenting", characterized by the sharing of parenting roles and distribution of responsibilities between two units. We develop our argument around the notion of the springboard subsidiary, an operating subsidiary which assumes headquarters’ functions since it shares greater institutional closeness with both the headquarters’ country as well as with the host region. Based upon qualitative data, our inductive model revolves around three stages: establishment, consolidation and maturity, each of which reflects distinct roles and loci of decision making among the three actors involved: headquarters, springboard subsidiary and local subsidiary. Overall, our study sheds distinct light on when and how headquarters add value by matching parenting to context.

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