The importance of competence-based instruments for steering foreign manufacturing subsidiaries of multinational automotive companies in the new growth markets

Harald V. Proff and Heike Proff

International Journal of Automotive Technology and Management, 2017, vol. 17, issue 3, 270-293

Abstract: The need for competence-based coordination within multinational companies (MNCs) is continuously demanded in the literature. In order to take account of the required focus on competences, multinational companies have to use more competence-based steering for their subsidiaries. This article examines, specifically for the example of the automotive industry, how far this essential development towards increasingly competence-based steering of subsidiaries has already taken place. Explanations of the steering of subsidiaries in multinational companies will be deduced and hypotheses on the importance of specifically competence-based steering instruments will be developed which will be tested in an empirical study at 75 subsidiaries of German automotive companies in Brazil, India, China, Russia and Mexico. The study shows that so far multinational automotive companies are steering their subsidiaries in the new growth markets much less on the basis of competence than would be expected after perusing the literature.

Keywords: multinational companies; subsidiaries; emerging markets; competence-based steering; automotive industry. (search for similar items in EconPapers)
Date: 2017
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