Reasoning a Use of Regional Headquarters in TNCs as Structural Instrument of Coordination

Abstract:     
In our paper we analyze possible effects caused by a use of regional headquarters in transna-tional companies (henceforth: TNCs). We understand regional headquarters as an innovative structural coordination instrument being used to solve the problem of coordinating transnational business activities in an adequate and cost-efficient way. Although the use of regional headquarters seems to be quite common in business practice, the theory of business admini-stration so far widely ignores this new practice-driven approach. Therefore, we try to over-come this shortfall by critically analyzing possible assets of utilizing regional headquarters both on a theoretical and praxeological base. Our main intentions are to put regional head-quarters in the perspective of business administration theory and to reason their existence by showing how their use can beneficial for TNCs.

Keywords: Organizational Structure, Regional Headquarters, Transnational Companies, Information-Cost Approach, Promoter Model, Global-Local-Dilemma

JEL Classification: M1, M19

working papers series