Knowledge sharing challenges within Western MNE subsidiaries and headquarters in China

This article sheds light on the presently unexplored area of underlying challenges to knowledge sharing under contrasting subsidiary mandates. This is achieved through 75 interviews made to manager and employees during an eight-month research stay at two Western subsidiaries in China. The findings illustrate that Western subsidiaries with a competence-exploiting mandate face increased challenges that relate to headquarters’ commitment, mistrust, lack of host country understanding, and less consideration to national culture differences in comparison to subsidiaries with a competence-creating mandate. The findings contribute to the evolutionary perspective of subsidiary mandate change and to the resource dependence theory in transforming economies.