How do subsidiary managers react when their headquarters’ managers make requests that conflict with the local environment in which the subsidiary operates? Using data from a subsidiary based in Sub-Saharan Africa and headquartered in Europe, we show that subsidiary managers need more time than usually expected to react to headquarters’ demands. Subsidiary managers sometimes postpone or test headquarters’ demands before deciding how to respond to them. In addition, subsidiary managers can implement headquarters’ demands in ways that do not fit the expectations from the headquarters or local actors (e.g., customers and suppliers), thus resulting in additional delays. Headquarters managers must be aware that implementation can take longer than they anticipate, particularly for subsidiaries located in environments that differ substantially from the environment of the headquarters.

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Global Strategy Journal
Department of Strategic Management and Entrepreneurship

Holm, A.E., Decreton, B., Nell, P.C., & Klopf, P.R. (2016). The dynamic response process to conflicting institutional demands in MNC subsidiaries: An inductive study in the Sub‐Saharan African E‐commerce sector. Global Strategy Journal, 7(1), 104–124. doi:10.1002/gsj.1145