Purpose – This study aims to overcome the limitations of existing studies, which linearly determine the precedence factors of competency in overseas subsidiaries. The research objectives are as follows. First, what kind of nonlinear effects does the level of control held by Korean headquarters over foreign subsidiaries have in terms of competency in the subsidiaries? Second, what kind of nonlinear effects do the local experiences of overseas subsidiaries have on their competency? Design/methodology – With data on Korean multinational corporations (MNCs), this paper analyzes the effects of control levels of headquarters (HQs) and host-country experiences of foreign subsidiaries regarding competency in overseas subsidiaries. In particular, this study focuses on nonlinear models, differentiating it from previous studies. In order to examine research hypotheses, this study conducted a survey of overseas subsidiaries of Korean corporations. Surveys were conducted through various methods including e-mail, online questionnaires, fax, and telephone calls. Copies of the questionnaire were distributed to a total of 2,246 overseas subsidiaries, and 409 completed responses were collected. Excluding 15 copies that were insufficiently answered, responses from a total of 394 copies were used for analysis. Findings – This study presents the following results. First, there is a U-shaped relationship between levels of HQ control and competency in foreign subsidiaries. This means that higher levels of HQ control negatively impact the competency levels of subsidiaries because strict control undermines autonomy in subsidiaries. However, if the level of HQ control exceeds a certain point, then the transfer of knowledge between HQs and subsidiaries is facilitated. Knowledge transferred from HQs can be used as prior knowledge by foreign subsidiaries to the benefit of all parties. Accordingly, knowledge transfer negates the negative effects of excessive HQ control and positively affects competency in subsidiaries. Second, there is an inverted U-shaped relationship between the local (host-country) experiences of subsidiaries and competency in foreign subsidiaries. This means that foreign subsidiaries can overcome the liabilities of foreignness and contribute to capability building by accumulating unique knowledge about their host countries. However, if local experiences accumulate excessively beyond a certain point, then the host country-specific experiences of foreign subsidiaries will offset the benefits discussed above. Excessive local experiences not only increase organizational inertia, but also create a problem of goal incongruence due to information asymmetry between HQs and subsidiaries. Therefore, excessive local experiences have negative effects on competency in foreign subsidiaries. * This paper was supported by Sunchon National University Research Fund in 2017 (Grant number: 20180002). † Corresponding author: jmpark2@ulsan.ac.kr © 2020 Korea Trade Research Association. All right reserved. Journal of Korea Trade Vol. 24, No. 1, February 2020, 82-98 https://doi.org/10.35611/jkt.2020.24.1.82 ISSN 1229-828X The Effects of Headquarters’ Levels of Control and Subsidiaries’ Local Experiences on Competency in Foreign Subsidiaries: A Quadratic Model Investigation of Korean Multinational Corporations 83 Originality/value – This study suggests the following implications. First, unlike existing studies based mainly on linear models, this study presents important theoretical implications in its focus on nonlinear models and its analysis of the effects of HQ control and local experiences on competency in foreign subsidiaries from perspectives of organizational learning theory and agency theory. Second, in terms of practical implications, the results of this study suggest that optimally raising levels of HQ control and managing the local experiences of subsidiaries without increasing organizational inertia is important for enhancing competency in foreign subsidiaries.

中文翻译：

---

总部的控制水平和子公司的本地经验对外国子公司竞争力的影响：韩国跨国公司的二次模型研究

目的–本研究旨在克服现有研究的局限性，这些局限性线性地确定了海外子公司胜任能力的优先因素。研究目的如下。首先，就子公司的能力而言，韩国总部对外国子公司的控制水平有什么样的非线性影响？第二，海外子公司的本地经验对他们的能力有什么样的非线性影响？设计/方法论–借助有关韩国跨国公司（MNC）的数据，本文分析了总部（HQ）的控制水平和外国子公司的东道国经验对海外子公司能力的影响。特别是，本研究着重于非线性模型，与以前的研究有所不同。为了检验研究假设，本研究对韩国公司的海外子公司进行了调查。通过各种方法进行调查，包括电子邮件，在线调查表，传真和电话。问卷的副本分发给了总共2246个海外子公司，并收集了409个完整的答复。排除15份未得到充分回答的副本，总共使用394份副本进行了分析。调查结果–本研究提出以下结果。首先，总部控制水平与外国子公司的能力之间存在U型关系。这意味着更高级别的总部控制会对子公司的能力水平产生负面影响，因为严格的控制会破坏子公司的自主权。然而，如果总部控制水平超过某个点，则可以促进总部与子公司之间的知识转移。从总部转移来的知识可用作外国子公司的先验知识，从而使各方受益。因此，知识转移抵消了总部过度控制的负面影响，并积极影响了子公司的能力。第二，子公司在当地（东道国）的经验与外国子公司的能力之间存在倒U型关系。这意味着外国子公司可以通过积累有关其所在国的独特知识来克服外国责任，并为能力建设做出贡献。但是，如果当地经验积累到一定程度，则外国子公司在东道国的特定经验将抵消上述收益。过多的本地经验不仅会增加组织的惯性，而且还会由于总部和子公司之间的信息不对称而造成目标不一致的问题。因此，过多的本地经验会对外国子公司的能力产生负面影响。*该论文在2017年获得顺天国立大学研究基金的资助（授权号：20180002）。†通讯作者：jmpark2@ulsan.ac.kr©2020韩国贸易研究协会。保留所有权利。韩国贸易杂志。2020年2月24日第1期，第82-98页https://doi.org/10.35611/jkt.2020.24.1.82 ISSN 1229-828X总部控制水平和子公司的本地经验对外国子公司能力的影响：韩国跨国公司的二次方模型研究83原创性/价值–这项研究提出了以下含义。首先，与现有的主要基于线性模型的研究不同，本研究在关注非线性模型以及从组织学习理论和代理理论的角度分析总部控制和本地经验对外国子公司能力的影响方面具有重要的理论意义。其次，就实际意义而言，本研究的结果表明，在不增加组织惯性的情况下，最佳地提高总部控制水平和管理子公司的本地经验对于增强外国子公司的竞争力至关重要。首先，与现有的主要基于线性模型的研究不同，本研究在关注非线性模型以及从组织学习理论和代理理论的角度分析总部控制和本地经验对外国子公司能力的影响方面具有重要的理论意义。其次，就实际意义而言，本研究的结果表明，在不增加组织惯性的情况下，最佳地提高总部控制水平和管理子公司的本地经验对于增强外国子公司的竞争力至关重要。首先，与现有的主要基于线性模型的研究不同，本研究在关注非线性模型以及从组织学习理论和代理理论的角度分析总部控制和本地经验对外国子公司能力的影响方面具有重要的理论意义。其次，就实际意义而言，本研究的结果表明，在不增加组织惯性的情况下，最佳地提高总部控制水平和管理子公司的本地经验对于增强外国子公司的竞争力至关重要。这项研究从组织学习理论和代理理论的角度，对非线性模型进行了重点研究，并对总部控制和本地经验对外国子公司能力的影响进行了分析，从而提供了重要的理论意义。其次，从实际意义上讲，本研究结果表明，在不增加组织惯性的情况下，最佳地提高总部控制水平和管理子公司的本地经验对于增强外国子公司的竞争力至关重要。这项研究从组织学习理论和代理理论的角度，对非线性模型进行了重点研究，并对总部控制和本地经验对外国子公司能力的影响进行了分析，从而提供了重要的理论意义。其次，就实际意义而言，本研究的结果表明，在不增加组织惯性的情况下，最佳地提高总部控制水平和管理子公司的本地经验对于增强外国子公司的竞争力至关重要。