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Purpose - The purpose of this paper is to advance the understanding of how different forms of digital technologies (i.e. digital communication technologies [DCTs] and digital in situ technologies [DSTs]) have varying effects on subsidiaries' capacities to engage in reverse knowledge transfer (i.e. the flow of knowledge from subsidiaries to headquarters). Design/methodology/approach - The increasing accessibility and sophistication of digital technologies has prompted growing interest in their implications for how multinational corporations (MNCs) organize value-adding activities. This conceptual paper argues that existing international business research has tended to treat digitalization as a uniform process. In contrast, the authors distinguish between DCTs and DSTs, each of which introduces distinct organizational dynamics. Findings - This study develops a theoretical argument suggesting that the type of digital technologies adopted by MNCs configures value-adding activities in ways shaped by opposing forces, namely, centrifugal and centripetal tendencies. These opposing dynamics contribute to variation in subsidiaries' capacity to generate and disseminate knowledge. To explain this heterogeneity, this study proposes a framework and a set of propositions that predict the effects of different digital technologies on the dimensions of disseminative capacity (i.e. ability, willingness and opportunity). Practical implications - Headquarters' adoption of specific forms of digital technologies can influence subsidiaries' action in disseminating knowledge. The conceptual discussion in this paper can benefit managers by clarifying the consequences of adopting different forms of digital technologies to mobilize and leverage MNCs' globally dispersed knowledge base. Originality/value - This paper offers a more fine-tuned perspective on digitalization and its effects on knowledge management in multinational firms. By rejecting the treatment of digitalization as a uniform phenomenon, it provides a stronger theoretical foundation for future empirical work on the strategic management of digital transformation in global contexts.

Conceptual and empirical contributions to network embeddedness have flourished in the last decades within the field of international business (IB). Scholars have used the concept to explain IB phenomena through the lens of business actors' network relationships and positions in their networks. Yet, network embeddedness has been conceptualized and operationalized quite differently across IB. To bring clarity to the field, we conducted a systematic literature review of 182 conceptual and empirical articles published between 1996 and 2025. Our review unpacks the various theoretical perspectives, definitions and operationalizations used in network embeddedness research in IB. Moreover, our findings highlight the limited attention paid to space and time in the conceptualizations and operationalizations of network embeddedness in IB. To improve upon these aspects, we advance a spatio-temporal view of network embeddedness that combines dimensions of geographical space beyond the country level, accounts for social and digital space and incorporates the notion of subjective time. Our proposed view opens new directions for future research in IB, moving and expanding current scholarship in the interface of network embeddedness and internationalization.

This perspective article calls for a conceptual reset of subsidiary strategy research, addressing the fragmentation and semantic ambiguity that have diluted its theoretical coherence. We trace the field’s evolution from static role typologies to dynamic, capability- and knowledge-based views that recognize subsidiaries as active strategists within multinational enterprises (MNEs). In today’s world of deglobalization, geopolitical tension, and technological disruption, we re-anchor subsidiary strategy in the core principles of strategy, where deliberate and emergent choices, the configuration of activities, and the pursuit of sustained advantage are adapted to the MNE’s internal competitive arena. We advance an integrative framework highlighting identity, legitimacy, subsidiary leadership agency and non-market engagement as complementary factors influencing subsidiary strategic trajectories. We propose a future research agenda emphasizing processual, longitudinal, and microfoundational approaches to explain how subsidiaries build influence, reconfigure mandates, and secure survival within evolving global value chains. © 2025 The Authors.

Knowledge creation within multinational enterprises (MNEs) is increasingly driven by subsidiaries, especially those embedded in advanced local clusters. Competence-creating subsidiaries that generate valuable innovations strengthen their strategic importance and survival prospects within the MNE. Yet the processes through which they achieve and sustain a competence-creating role remain underexplored. This study examines foreign-owned subsidiaries in Dublin's financial services cluster to uncover how they develop and enact strategy to become or remain competence creators. Drawing on retrospective and real-time process narratives, we reveal how managers orchestrate a dynamic sequence of choices, decisions, and actions that underpin competence creation and elevate subsidiary influence within the MNE. Our findings advance a more integrative, processual view of subsidiary strategizing by revealing the mechanisms through which competence creation unfolds, specifically, how the interplay of autonomy, initiative, influence, and embeddedness generates and sustains subsidiary capability development. For managers, sustaining such roles requires continually balancing these dimensions to secure long-term strategic relevance and viability.

While scholars widely acknowledge the impact of digitalization on contemporary business, existing research frequently treats digitalization as a unified concept, overlooking its complex, multidimensional nature. Our study addresses this gap by developing a psychometrically sound scale of digital technology adoption to understand the complex phenomenon of digitalization. To obtain a generalizable scale, our study develops and validates 19 items, classifying them into four dimensions defining a firm’s digital technology adoption. By delineating and operationalizing the key technologies that underpin digital technology adoption (i.e., digital communication technology, digital in situ technology, digital data analytics technology, and digital networking technology), we offer a finer-grained understanding of how firms leverage digital technologies. Ultimately, this study seeks to advance theoretical understanding and managerial practice by providing a valid and reliable measurement tool for digital technology adoption.

We analyze the role of Swedish competence-creating subsidiaries in the upgrading of local ecosystems within the Brazilian context. Using multiple cases we highlight the role of subsidiaries for job creation and economic development - via spillovers of knowledge and the critical role of subsidiary learning developed from sustained interactions with local actors. Highlighting how, after the initial investment by the MNE, interactions between competence-creating subsidiaries and institutions, organizations, and individuals in Brazil play a critical role in the emergence and development of local ecosystems. Subsidiaries form networks with both market and non-market stakeholders, contributing to the technological, economic, environmental and societal development in Brazil through both spillovers and their own requirements to collaborate with ecosystem actors to fulfill their competence-creating mandate. We provide managerial implications focusing on the scope of local businesses to collaborate with foreign organizations, to bridge resource and knowledge gaps to foster robust and collaborative business environments.

Foreign subsidiaries seek to gain attention from headquarters, often through strategic issue selling. It is therefore paramount to understand how the packaging of the issue and the process of issue selling affect headquarters’ attention. Cultural distance can influence the effectiveness of issue selling tactics. A study of 342 foreign subsidiaries reveals that when cultural distance is high, emphasizing corporate benefits becomes less effective, possibly due to headquarters' mistrust or misunderstanding. Interestingly, consistency with headquarters' practices matters less in culturally distant cases, offering opportunities for subsidiaries to propose more novel ideas. Joining efforts with other subsidiaries seems to pay off in low cultural distance situations but can backfire when distance is high, as headquarters may fear insurrection. Cultivating social relations with headquarters' executives is crucial for capturing attention, especially in high cultural distance scenarios, as they help bridge trust and compensate for communication gaps. Our sample, obtained from an online survey, contains 342 cases that comprise a broad coverage of 46 different subsidiaries’ countries and 26 different headquarters’ countries. 

The microfoundations perspective offers promising avenues for advancing theoretical and empirical research in international business (IB). However, two key challenges have limited progress so far: first, uncovering micromacro relationships in complex, often nested, IB phenomena; second, applying the multiple theoretical lenses offered by IB to coherently explain relationships. This paper addresses these challenges of applying microfoundations in IB by proposing a modular approach to its foundational framework, Coleman's (1990) bathtub. By breaking down the bathtub into its component parts or modules, each module relates to a specific, independent relationship between two constructs, that can be theorized and tested. We provide clear definitions of how modular (mono, abridged, partial, or full) explanations can be used as a tool for conceptualization and research design. In addition to enhancing our theoretical precision, a modular microfoundations approach also provides the architecture for existing studies to be connectable to new work focusing on other modules. This holds the potential of creating a full microfoundations explanation and thereby a rigorous and cumulative means for theory building in IB. We call for scholars to adopt this modular microfoundations perspective to better tackle the important questions of our time for global business and society.

In multi-unit organizations, such as multinational corporations (MNCs), knowledge developed in one business unit can greatly benefit the performance of another. However, employees and managers compete with others within intraorganizational competitive domains for resources, which may affect the willingness to share knowledge. We conceptualize the multi-unit organization as having multiple competitive domains depending on the main source for resource endowments for the knowledge-sharing actors. Our study draws on data from two surveys done in a global division of an MNC, comprising data from 342 individuals nested in 68 different units, across 24 countries. Our results show that social integration among individuals in different competitive domains boosts knowledge transfer between units, while social integration between individuals within the same competitive domain hampers knowledge transfer. These findings suggest that there is a different and darker side to social integration in multi-unit organizations than the previously established positive side leading to increased knowledge transfer. Our findings show that the willingness to share knowledge also depends on the internal competition for resources between the knowledge-sharing actors. 

Subsidiary networks are defined as webs of specific inter-firm and intra-firm relationships that a foreign subsidiary of an MNC has to host-country actors and units within the MNC, respectively. Network theory offers a pertinent view on critical resources and has shown that the most important resource is the web of specific relationships in which a unit (subsidiary) is embedded. Economic actions and the product of such actions are influenced by the unit’s dyadic relationships and all connected relationships, as are all social activities, which is why utilizing an embeddedness approach helps avoid the atomization of an actor when studying its behavior. Embeddedness is defined as a subsidiary’s interdependence with its network partners and is often specified by distinguishing a subsidiary’s external embeddedness in the host-country environment and its internal embeddedness within the global MNE environment.