Subsidiary country managers and subsidiary development: Upper echelons and resource-based perspectives

Abstract

This article examines the relationship between subsidiary country manager-level factors and subsidiary development. As existing research on subsidiaries in multinational enterprises has focused on the organizational level, thus overlooking the individual level, it offers little insight regarding the role and importance of country managers for subsidiaries. Drawing upon upper echelons theory, resource-dependence theory, and the resource-based view, we argue that subsidiary development is contingent on country manager characteristics, and that country manager assignments are less likely when the host country is perceived as being of limited strategic importance to the multinational enterprise. Survey data from 429 foreign-owned subsidiaries in New Zealand provide support for our hypotheses. We derive some theoretical and managerial implications based on the findings.