Introduction
Part (A) examines the evolving role of the multinational subsidiary unit and the factors which have helped to shape this evolution. Delaney (1998) poses the question of whether subsidiaries are “dumb sub-contractors or initiative-takers?” Historically, the literature on the topic has supported the notion that subsidiaries are subordinates of the parent company, carrying out tasks and performing functions as requested from corporate headquarters (Jarillo and Martinez, 1990). In recent years, a trend has emerged whereby subsidiaries are devising their own strategies and themselves determining the work they carry out in an attempt to add value to the overall business (Birkinshaw, 1997). A number of factors have and are shaping this evolving role of the multinational subsidiary unit. In part (b) the importance of an R&D function for subsidiary sustainability is examined along with the importance of having strong network relationships. To gain insights into the importance of these factors in the Irish context, Intel’s Irish subsidiary is used as an example.
Part A
Much of the research carried out on subsidiary evolution contains elements of bias as a result of a tendency of researchers from smaller countries to have a subsidiary perspective while researchers from larger countries tend to have a more corporate point of view (Brock, 2000). Studies from the corporate perspective argue that evolution is driven by the parent company, (Chang, 1995) while studies from the subsidiary side assume that subsidiary initiative is the main driver. Delaney (2000) outlined an 8-step framework for subsidiary evolution. As subsidiaries move toward the latter stages of the framework, they become of more strategic importance to the organisation. Patterson and Brock (2002) classified this evolution into four streams, namely Strategy–Structure, Headquarters–Subsidiary