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Distributed innovation in the differentiated network multinational

Author: Ghoshal, Sumantra ; Nohria, NitinINSEAD Area: Strategy Series: Working Paper ; 91/44/SM Publisher: Fontainebleau : INSEAD, 1991.Language: EnglishDescription: 30 p.Type of document: INSEAD Working Paper Online Access: Click here Abstract: This paper offers a reconceptualization of the structure of the multinational enterprise as a differentiated network of three different types of relations: task relations that define the local structure of each national subsidiary; governance relations that link the headquarters and the subsidiaries; and exchange relations that link the subsidiaries to each other. Using this framework a series of propositions are developed about how the structure of these relations influences the innovativeness of the different subsidiaries in a multinational organization. Analyses of data collected from 261 managers in 22 different national subsidiaries of two multinational companies show that all three of these structural effects are important in explaining the extent of innovative initiative and the number and scale of innovations generated by each subsidiary
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This paper offers a reconceptualization of the structure of the multinational enterprise as a differentiated network of three different types of relations: task relations that define the local structure of each national subsidiary; governance relations that link the headquarters and the subsidiaries; and exchange relations that link the subsidiaries to each other. Using this framework a series of propositions are developed about how the structure of these relations influences the innovativeness of the different subsidiaries in a multinational organization. Analyses of data collected from 261 managers in 22 different national subsidiaries of two multinational companies show that all three of these structural effects are important in explaining the extent of innovative initiative and the number and scale of innovations generated by each subsidiary

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