Today, many Multinational Corporations (MNCs) generate more turnover abroad than in their home countries. Their value chain activities are spread across the globe (Porter 1986: 23) and foreign subsidiaries play a crucial role in creating value within and for the MNC. While some MNCs are aware of their subsidiaries’ performance, others have only a vague idea. Evaluation of performance, however, is one central aspect in international management. But why is performance evaluation so important for MNCs and their management?
After having introduced the research background and objectives of this study, this chapter clarifies the conceptual background. To this end, central concepts, such as performance evaluation, control and coordination, are defined in section 2.1. Then, the elements of the concept of performance evaluation used in this study are described in section 2.2. This leads to the elaboration of an integrative framework of performance evaluation which is presented in section 2.3.
The discussion of the conceptual background is followed by a review of the relevant literature. Thereby, the earlier publication Schmid/Kretschmer 2006b is extended in this chapter. Section 3.1 sets out the objectives of the chapter and summarizes the methodology of the literature review. The following two sections cover the relevant literature: Descriptive contributions are described in section 3.2, while explanatory studies are addressed in section 3.3. At the end of the chapter, the conclusions and implications of the literature review are summarized in section 3.4.
This chapter aims at establishing the research framework for the present study. First, a contingency framework of role-specific performance evaluation is elaborated in section 4.1. This is followed by a detailed discussion of the relationship between subsidiary roles and performance evaluation in section 4.2. Propositions on rolespecific performance evaluation are then derived.
This section provides details on the design and methodology of the empirical part of the dissertation. Zalan and Lewis as well as Andersen and Skaates argue for more transparency in qualitative methods (Andersen/Skaates 2004, Zalan/Lewis 2004). In accordance with their recommendations, this section includes the justification and
rationale for choosing a qualitative research approach (subsection 5.1.1) and details on the multiple case design (subsection 5.1.2). After these introductory sections more information is provided on the detailed operationalizations of the contingency framework (section 5.2). These operationalizations are essential for the subsequent data collection and data analysis which again need to be explained in detail (Andersen/Skaates 2004: 480-481). First, the data collection via semi-structured interviews is described in section 5.3. The interview guide was elaborated based on the previous operationalizations of the contingency framework. Second, section 5.4 presents how the collected data was handled and analyzed based on a categorization schema deduced from the operationalizations of the contingency framework. Interpretation procedures are clarified in this section, too. The final section concludes with an evaluation of the chosen empirical approach (subsection 5.5).
Proceeding from the description of the research steps and the operationalizations of the elements of the contingency framework, this chapter presents the empirical findings. The first case “Eucom” is described, analyzed and discussed in section 6.1. This is followed by the second case “Gloneer” in section 6.2. Finally, both cases are compared and conclusions are drawn on the empirical findings in section 6.3.
