Kristiina Mäkelä

This paper examines how different internal stakeholders evaluate organizational capabilities in MNC subsidiaries. More specifically, we seek to establish what determines the evaluations of functional and geographical stakeholders with regards to HR capabilities in MNC subsidiaries. We argue that the identification of organizational capabilities is typically based on subjective evaluations of key stakeholders, who may differ significantly in their interests, expectations and evaluations concerning a specific actor. Based on a quantitative analysis of 123 subsidiary HR departments, we find that stakeholder evaluations are a function of two key factors: the expectations the stakeholders have towards the focal actors and the focal actors’ responses to them on the one hand, and the cues that enter the stakeholders’ radar screens combined with possible attention seeking on behalf of the focal actors, on the other.

Firms use different structural arrangements to carry out their internal work, and interunit interactions that take place in the context of these arrangements may have different consequences for knowledge sharing. We explore four contexts of such interunit interaction—interunit meetings, project groups, cross‐border teams, and expatriate/ repatriate interactions—and we examine the extent to which they are associated with social capital and knowledge sharing. Data from structured interviews with multinational corporation (MNC) managers, which we explored using MANCOVA/ANCOVA and regression analysis, showed that cross‐border and expatriate/repatriate interaction contexts are associated with more interpersonal trust and shared cognitive ground than interunit meeting and project group ones, and the expatriate/repatriate context with more shared cognitive ground than all other contexts. The regression results show a significant relationship between the cross‐border team and expatriate/repatriate contexts and knowledge sharing. We also find that affective and cognitive social capital mediate the relationship between cross‐border team and expatriate/repatriate contexts and knowledge sharing.

The purpose of this paper is to examine the level of human and social capital that different archetypes of subsidiary staffing are associated with, and how this influences the management of knowledge stocks and flows within the MNC. We identify four subsidiary staffing archetypes (local–internal, local–external, global–internal, and global–external) and suggest that each of them can be used for different knowledge-related purposes within the organisation. The local-internal archetype may carry a dual role in both exploiting existing knowledge stocks in their local markets and transferring market knowledge to the headquarters, through the co-existence of a high level of market knowledge and external social capital combined with at least some degree of MNC-specific knowledge and social capital. The local-external archetype, in turn, can play a valuable role in the exploration of new non-redundant knowledge. The global-internal archetype serves a key function in transferring knowledge and best practices from the headquarters to the subsidiaries. Lastly, the global-external archetype seems to have limited human- and social-capital related advantages.