The changing role of Regional Headquarters

A Case Study of a Multinational Corporation’s Regional Headquarter

Abstract

The form and roles of regional organization adapted to the regional strategies in MNC are relatively unexplored issue in the existing literature of international management. In particular, most existing research on regional headquarters (RHQs) describes their forms and roles, but few studies discuss changes of them. This paper attempts to reveal the dynamic process of the changing role of RHQs and analyzes its driving forces through a case study. We focus on Asian Regional Headquarter of Japanese multinational automobile supplier. We describe the co-evolution of subsidiaries’ capabilities, regional environment, and the Regional Headquarters’ functions. Through the lens of this evolutionary perspective, unlike with the previous studies, we argue that the functions of Regional Headquarters change all the time. The changes are driven by both the capabilities of associated subsidiaries in the region and the environment of the region, which are in turn, influenced by the activities of the regional headquarters. Furthermore, by showing this dynamic mechanism, we have suggested the impact of regional organizations on the growth of multinational corporations as a whole.