Driving lateral collaboration effectiveness across multinational enterprises: The antecedents and consequences

• Published in: Human resource management journal Vol. 32; no. 2; pp. 406 - 429
• Main Author: Chen, Iris S. Y.
• Format: Journal Article
• Language: English
• Published: Oxford Blackwell Publishing Ltd 01.04.2022
• Subjects: Collaboration; employee engagement; Employee involvement; HQ‐subsidiary relationship; Human resource management; lateral collaboration; Multinational corporations; team alignment
• ISSN: 0954-5395; 1748-8583; 1748-8583
• DOI: 10.1111/1748-8583.12390

In the face of increasing global uncertainty, multinational enterprises (MNEs) have turned to downsizing to maintain profitability while emphasizing lateral collaboration to increase productivity. Here, we establish a conceptual framework and examine from a macro‐to‐micro perspective how the growing subjects of subsidiary role change, team alignment and employee engagement impact lateral collaboration. We used structural equation modelling to analyse the results of 252 surveys given to MNE subsidiaries in the Taiwanese banking industry and found that employee engagement was central to driving lateral collaboration effectiveness, indicating that the subsidiary role is critical for boundary‐spanning activities and building bridges between various teams. These activities in turn enhance subsidiary performance and lead to better people development. Our findings demonstrate that bundling employee engagement with human resource practices is a strategic way of positioning for the evolution of subsidiary management.