MNE Headquarters Disaggregation: The Formation Antecedents of Regional Management Centers

This research examines region?bound headquarters disaggregation in multinational enterprises (MNEs). We link the formation of regional management centres – both dedicated regional headquarters (RHQs) and regional management mandates (RMMs) granted to operating subsidiaries – to the complexity argument underlying organizational information processing theory. We demonstrate how different dimensions of complexity associated with the number and dispersion of an MNE's subsidiary network in a focal region affect whether, and in which form, region?bound headquarters disaggregation takes place. Additionally, we consider boundary conditions affecting RMC formation based on within?region experience, global MNE footprint, and between?region effects. Empirically, we utilize a large global dataset of Japanese MNE foreign investments between 1992 and 2014, which allows us to perform event history analyses