Interdependence
Interdependence indicates the extent to which various units of a MNC are
dependent on each other and hence gives an impression of the level of inte-
gration within the MNC as a whole. It is therefore an important element of
MNC structure. We distinguish three different levels of interdependence. First
independence, that is the subsidiary is not or hardly dependent on headquar-
ters or other subsidiaries and is operating very much as a stand-alone company.
Second dependence, that is the subsidiary is mainly dependent on head-
quarters. Finally, interdependence: the subsidiary, headquarters and otherStrategy and Structure of Multinational Companies 53Typologies of multinational companies
Organizational Strategy Multidomestic Global Transnational
Organizational design &
subsidiary role
- Decentralized federation High Low Low
- Network structure Low Low High
- Inter-subsidiary flows Low Low High
- HQ’s pipeline Low High Low/medium
- Centres of excellence Low Low High
Interdependence
- Total level of interdependence Low High High
- Level of HQ dependence Low High Medium
(dependence) - Level of subsidiary dependence Low Low High
(interdependence)
Local responsiveness
- Local production High Low Medium
- Local R&D High Low Medium
- Product modification High Low High
- Adaptation of marketing High Low/ High
Medium
Level and type of control
- Total level of control Low High Medium
- Level of personal centralized Low High Low
control - Level of bureaucratic formalized Low High Medium
control - Level of output control Medium Medium Medium
- Level of control by Medium Medium High
socialization and networks
TABLE 2.3