Adoption of Practices by Subsidiaries and Institutional Interaction within Internationalised Small- and Medium-Sized Enterprises

Hsiang-Lin Cheng () and C.-M. J. Yu
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Hsiang-Lin Cheng: National Chung-Cheng University
C.-M. J. Yu: National Cheng-Chi University

Management International Review, 2012, vol. 52, issue 1, No 5, 105 pages

Abstract: Abstract This study examines the “intra-organisational dynamics” of the adoption of internal practices by subsidiaries of internationalised small- and medium-sized enterprises (SMEs) from the perspective of institutional theory. Based on a survey of 149 foreign subsidiaries of Taiwanese SMEs, the findings show that parent-firm executives of SMEs who are deeply involved in subsidiary operations will assess strong pressure from their home-country institution to adopt internal standard practices within a subsidiary. However, subsidiary executives of SMEs who assess heavy pressure from the host-country institution will resist this adoption. When executives of SME parent firms and subsidiaries concurrently assess high pressure but from opposing sources, creating a case of “institutional interaction” within SMEs, the subsidiary will either partially adopt a limited but sufficient level of all internal practices or only adopt internal managerial practices while forgoing internal production practices.

Keywords: Internationalised SMEs; Institutional theory; Internal practices adoption (search for similar items in EconPapers)
Date: 2012
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DOI: 10.1007/s11575-011-0117-9

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