Re-conceptualizing Bartlett and Ghoshal’s
Classification of National Subsidiary Roles
in the Multinational Enterprise
Alan Rugman, Alain Verbeke and Wenlong Yuan
University of Reading; University of Calgary; University of Lethbridge
We re-conceptualize the Bartlett and Ghoshal typology of national subsidiary roles
in the multinational enterprise (MNE), using a resource bundling perspective. Our view is that
national subsidiary roles can vary dramatically across value chain activities. We focus on the
distinction among innovation, production, sales, and administrative support activities. For each value
chain activity, the subsidiary bundles sets of internal competences with accessible, external location
advantages. We also address the effects of regional integration on national subsidiary roles. Such
schemes may affect substantially the extent to which location advantages of individual
countries can be accessed and bundled with internal competences, thereby typically altering
some national subsidiaries’ roles in specific value chain activities. However, such substantive
changes in specific value chain activities performed by national subsidiaries do not necessarily
lead to any move in conventional subsidiary role typologies, such as the Bartlett and Ghoshal
one, since these typologies only acknowledge aggregate subsidiary role changes, supposedly
valid for the entire value chain.
INTRODUCTION
Many multinational enterprises (MNEs) now function as differentiated networks, rather
than as hierarchically run organizations with national subsidiaries that all play similar
roles (Nohria and Ghoshal, 1994; Rugman and Verbeke, 2003). It has therefore been
argued that an MNE national subsidiary facing a specific external environment with
unique challenges, and commanding an idiosyncratic set of competences, should be
managed differently from other national subsidiaries. Specifically, MNE corporate man-
agement should allocate different charters, and therefore also resources, to different
national subsidiary types (Bartlett and Ghoshal, 1986, 1989). In addition, a number of
researchers (Birkinshaw, 1997, 2000; Cantwell and Mudambi, 2005; Paterson and
Brock, 2002; Rugman and Verbeke, 2001a; Taggart, 1997a, 1997b, 1998) have argued
that national subsidiary management may sometimes have considerable latitude to
Address for reprints: Alan Rugman, Henley Business School, University of Reading, Greenlands, Henley-on-
Thames, Oxfordshire RG9 3AU, UK (a.rugman@henley.reading.ac.uk).
© 2010 The Authors
Journal of Management Studies © 2010 Blackwell Publishing Ltd and Society for the Advancement of Management
Studies. Published by Blackwell Publishing, 9600 Garsington Road, Oxford, OX4 2DQ, UK and 350 Main Street,
Malden, MA 02148, USA.
Journal of Management Studies 48:2 March 2011
doi: 10.1111/j.1467-6486.2010.00969.x