Strategy implementation in the transnational MNC : A critical realist investigation of European and Indian unit collaboration

Abstract

Inter-unit collaboration in transnational multinational corporations (MNCs) is central to unlocking MNCs' competitive advantage. We find that managing multilevel interaction of macro-level (social structures within and outside the MNC) and micro-level (individual interpretations and behaviors) factors ensures the implementation of strategic goals regarding inter-unit collaboration. In a case study of Finnish, Russian, and Indian unit collaboration in one European-origin transnational MNC, we observe that individual ascriptions of social identity to Indian colleagues (micro-level factor) affect the MNC's strategy implementation (SI) process and outcomes (macro-level factors). Building on the latter observations, critical realist theory of identity, and the idiosyncratic Indian context, we develop the currently inadequate multilevel theorization on the SI process in the MNC and expand perspectives on social identity in International Business literature. For MNC managers from Western countries, the paper offers insights into factors that should be considered to succeed in strategic and operational inter-unit collaboration with India.