Subsidiary Entrepreneurial Alertness: Antecedents and Outcomes


This thesis brings together concepts from both international business and entrepreneurship to develop a framework of the facilitators of subsidiary innovation and performance. This study proposes that Subsidiary Entrepreneurial Alertness (SEA) facilitates the recognition of opportunities (the origin of subsidiary initiatives). First introduced by Kirzner (1979) in the context of the individual, entrepreneurial alertness (EA) is the ability to notice an opportunity without actively searching. Similarly, to entrepreneurial alertness at the individual level, this study argues that SEA enables the subsidiary to best select opportunities based on resources available. The research further develops our conceptualisation of SEA by drawing on work by Tang et al. (2012) identifying three distinct activities of EA: scanning and search (identifying opportunities unseen by others due to their awareness gaps), association and connection of information, and evaluation and judgement to interpret or anticipate future viability of opportunities. This study then hypothesises that SEA leads to opportunity recognition at the subsidiary level and further hypothesises innovation and performance as outcomes of opportunity recognition. This research brings these arguments together to develop and test a comprehensive theoretical model. The theoretical model is tested through a mail survey of the CEOs/MDs of foreign subsidiaries within the Republic of Ireland (an innovative hub for foreign subsidiaries). This method was selected as the best method to reach the targeted respondent, and due to the depth of knowledge the target respondent holds, the survey can answer the desired question more substantially. The results were examined using partial least squares structural equation modelling (PLS-SEM). The study’s findings confirm two critical aspects of subsidiary context, subsidiary brokerage and subsidiary credibility are positively related to SEA. The study establishes a positive link between SEA and both the generation of innovation and the subsidiary’s performance. This thesis makes three significant contributions to the subsidiary literature as it 1) introduces and develops the concept of SEA, 2) identifies the antecedents of SEA, and 3) demonstrates the impact of SEA on subsidiary opportunity recognition. Implications for subsidiaries, headquarters and policy makers are discussed along with the limitations of the study

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