Selection and Development of Language Resources in Subsidiaries: The Case of Japanese MNCs in Asia

Abstract

Although there have been conceptual and theoretical works that describe how multinational companies (MNCs) can leverage the multilingual environment, we still know little about how MNCs deal with language diversity in their foreign subsidiaries. To address the research gap, we conducted a qualitative case study with 83 subsidiaries of Japanese MNCs in 9 Asian countries as a preliminary investigation and 34 subsidiaries of Japanese NNCs in China as a more in-depth examination. We found that in the MNCs’ multilingual environment that includes parent language, local language, and English as the three main language options for the subsidiaries, the subsidiaries select their functional language based on the strategic and knowledge sourcing perspectives. The subsidiaries then mobilize and allocate managerial resources to develop distinctive language resources. Based on the findings, we developed a model that integrates strategy-oriented language selection and incremental development process of language resources in MNCs’ foreign subsidiaries. The findings and the proposed model support the view that language diversity in MNCs can be valuable resources and provide the deeper understanding about how MNCs’ foreign subsidiaries develop distinctive language resources tuning to their strategic mission and knowledge source.