HOW SOCIAL CAPITAL CAN AFFECT POSITIVE HEADQUARTERS’ ATTENTION IN THE SUBSIDIARY-HEADQUARTER RELATIONSHIP

Abstract

Nowadays Multinational Corporations (MNCs) are expanding their business and establishing subsidiaries abroad. Therefore, this paper analyses the subsidiary-headquarter relationships of ten MNCs. In more detail, the focus is to discover how social capital is able to influence the positive attention that Italian subsidiaries try to capture from their foreign headquarters, and – at the same time – to highlight other elements that may influence this positive attention, using a bottom-up perspective. The latter approach has been adopted because most previous research has proposed a top-down approach, trying to capture the knowledge sharing from the headquarters point of view. A qualitative method has been used; in particular, ten semi-structured interviews with Italian subsidiary managers have been performed via Skype. The main idea is that the attention gained from the headquarters is a result of the elements of social capital: relational, structural and cognitive capital. Moreover, during the interviews performed, some other influential factors emerged. They are evidently considered to be able to increase the positive headquarters’ attention. The findings could be useful for managers who may learn how to improve the performance of their subsidiaries by leveraging the social capital.