Article Review on Unleash Innovation in Foreign Subsidiaries by Birkinshaw and Hood

1. Article summary (195 words)

The article “Unleash Innovation in Foreign Subsidiaries” by Birkinshaw, J. & Hood, N. (2001) indicates the four incentive tactics to promote innovation in overseas subsidiaries. One intensive attempt of global business is encouraging and making use of brilliant ideas, which are frequently found in remote subsidiaries. To achieve this target, parent companies should consider its foreign units as peninsulas instead of islands. This means that each far-off subsidiary is a not a discrete unit but is the complement of the parent company to acquire the strategic objectives.

There are four key resolutions to boost the local subsidiaries’ liberalization. Firstly, the response to the budgets need of subsidiaries should be allocated wisely. The headquarters can give the subsidiaries the discretion with acceptable budgets to trial practice new ideas. Secondly, the executors need to develop a formal request for proposal (RFP) to foster the competency. Thirdly, the subsidiaries should stand by themselves to operate unusual projects. Finally, launching an international connection is the decisive factor to enable a successful project contributed by various organizational components.

By establishing supportive practices to nurture breakthrough ideas, the foreign subsidiaries would be empowered develop stellar ideas more flexible. Moreover, the communication flow among the central company and its satellites would be improved.

2. Reasons for choosing this article (95 words)

There are many critical factors contributing to the success of a global company. Some significant aspects that I had seized are the global brands (Holt et al., 2004), the distance matter (Ghemawat, 2001), the international strategy (Ghemawat, 20...

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...eview, 82(12), 82-90.

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Ghemawat, P. & Hout, T. (2008). Tomorrow's Global Giants? Not the Usual Suspects. Harvard Business Review, 86(11), 80-88.

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