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The Changing Role of Subsidiaries Within Multinational Corporations Copenhagen Business School IB 40 - Fall semester 2004 Instructor Lars Håkanson Guðmann Ólafsson, 050176-4043 Kasper Ørtvig, 040877-2907 December 8, 2004 1 INDEX 1 INDEX 2 2 INTRODUCTION 3 3 HOW HAS THE ROLE OF THE SUBSIDIARY CHANGED? 5 3.1 THE ADMINISTRATIVE HERITAGE 5 3.1.1 The Multinational Company - The Decentralized Federation 6 3.1.2 The International Company - The Coordinated Federation 6 3.1.3 The Global Company: The Centralized Hub 7 3.2 GLOBAL CHANGES 8 3.2.1 Governments and Legal Systems 9 3.2.2 Communications 9 3.2.3 Logistics 9 3.3 STRUCTURAL CHANGES - TOWARDS AN INTEGRATED NETWORK STRATEGY 10 3.4 THE DRIVERS OF SUBSIDIARY EVOLUTION 11 3.4.1 Parent-based Drivers 11 3.4.2 Subsidiary-based Drivers 12 3.5 THE CENTERS OF EXCELLENCE 13 4 CASE PRESENTATION - LM ERICSSON 15 4.1 THE LM ERICSSON MNC 15 4.2 LM ERICSSON DENMARK 16 4.3 COMPETENCE DEVELOPMENT WITHIN LMD 17 5 CASE ANALYSIS AND DISCUSSION 20 5.1 LME´S MULTIDIMENSIONAL STRUCTURE 20 5.2 DRIVERS OF SUBSIDIARY EVOLUTION 21 5.3 CENTERS OF EXCELLENCE 22 6 CONCLUDING THOUGHTS 23 7 REFERENCES 24 2 INTRODUCTION One can pick any random business related book published after 1990 at a good library, open it on page one...
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