1998 | OriginalPaper | Chapter
Centres of Excellence in the International Firm
Authors : Luciano Fratocchi, Ulf Holm
Published in: Multinational Corporate Evolution and Subsidiary Development
Publisher: Palgrave Macmillan UK
Included in: Professional Book Archive
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In the last decade there has been increasing recognition that the international firm (in the strict sense of one with operations in both national and international markets) is organised as a heterogeneous entity built up of subunits with specific operative responsibilities and specific interrelated roles (Hedlund, 1986; Bartlett and Ghoshal, 1989; Nohria and Ghoshal, 1994; Malnight, 1996). Thus, certain subsidiaries within the international firm are regarded as being especially competent in one or several functional areas. For instance, because of its competence with a particular product, a foreign subsidiary can become globally responsible for production. Similarly, another subsidiary can be specialised in the development of a product, while a third can have responsibility for marketing and international sales. Having one or several operational competences — interrelated with the operational roles of other units of the firm — the specific subsidiary can become a strategic ‘partner’ of the firm’s headquarters (Bartlett and Ghoshal, 1989), with potential impact on strategic decisions (Astley and Zajac, 1990; Ghoshal and Bartlett, 1990).