Institutional and resource-based explanations for subsidiary performance

Hughes, M.; Powell, T.H.; Chung, L.; Mellahi, K.

Abstract

Addressing calls to integrate insights from institutional theory and the resource-based view, we bring together dual theoretical explanations from institutional theory and the resource-based view to examine the effectiveness of transfer of practice and human capital development as two routes to subsidiary performance. Our study of Hong Kong firms with subsidiaries in Mainland China shows that both routes positively affect subsidiary performance. However, our data show that our sampled firms struggled to successfully transfer practices from their parents. We attribute an explanation for this to the characteristics of practices as organizational capabilities in which transfer is made harder by the difficulty in replicating such capabilities. Consequently, developing subsidiary human capital is an important ally to practice transfer as a means to achieve superior subsidiary performance. Our results raise interesting questions about practice transfer and the resource-based view relevant to future scholarly research.

Citation

Hughes, M., Powell, T., Chung, L., & Mellahi, K. (2016). Institutional and resource-based explanations for subsidiary performance. British Journal of Management, 28(3), 407-424. https://doi.org/10.1111/1467-8551.12169

• Journal Article Type: Article
• Acceptance Date: Mar 4, 2016
• Online Publication Date: May 27, 2016
• Publication Date: May 27, 2016
• Deposit Date: Mar 10, 2016
• Publicly Available Date: May 27, 2018
• Journal: British Journal of Management
• Print ISSN: 1045-3172
• Electronic ISSN: 1467-8551
• Publisher: Wiley
• Peer Reviewed: Peer Reviewed
• Volume: 28
• Issue: 3
• Pages: 407-424
• DOI: https://doi.org/10.1111/1467-8551.12169
• Public URL: https://durham-repository.worktribe.com/output/1417479