An empirical study of subsidiary strategies using structure-conduct-outcome framework

Abstract

One of the most important issues of multinational operations is the decision making of the global marketing strategy. Managers of multinational corporations (MNCs) must coordinate the implementation of their firms' strategies among various subsidiaries in different parts of the world. This study adopted a structure-conduct-outcome (S-C-O) framework to measure the outcome of strategy by structure variables (centralisation, formalisation, and dependencies) and conduct variables (integration and responsiveness) and to identify the interrelationships among network structure, conduct of subsidiary and outcome of subsidiary. The results of this study indicated that the comprehensive model is valuable and presented that high level of centralisation, formalisation and dependencies will result in better integration and responsiveness, which further enhance the performance of the subsidiary.