Headquarters value added and subsidiary performance: insights from Thailand

Purpose: The purpose of this study is to understand the impact of network relationship strength and subsidiary initiatives on the headquarters value added and performance in foreign-owned subsidiaries. Design/methodology/approach: Our study is based on survey data collected from foreign-owned subsidiaries located in Thailand. We use symmetric SEM-PLS and asymmetric fsQCA techniques to analyse our data. Findings: We found that intra-organisational relationship strength is one of the key determinants for high headquarter value added. We also found that headquarter value added plays a crucial role in explaining subsidiary performance. The role of subsidiary initiatives seem overall less pronounced than initially thought. Originality/value: The originality of this study lies in the conceptual framework based on networks and subsidiary initiatives. This is one of the few studies that empirically tests headquarters value added determinants in subsidiaries located in an emerging market. Furthermore, we employ SEM-PLS and fsQCA to look beyond more commonly tested symmetric associations