Control Mechanisms In The Chinese Subsidiaries Study

The purpose of this research is to study the control mechanism of the subsidiaries of multinational corporations (MNCs) in China. The study is organized from the angle of strategy of MNCs. First,the article proposes the control model based on the organization strategy of the multinational corporation,and analyzes the crucial factors including the internationalization strategy of parent company,the degree of resource interdependence,strategic roles of subsidiaries and environmental factors in China. Based on the analysis of control model,the control to subsidiaries of MNCs is classified as administrative control,culture control,human resource control and knowledge resource control,and analyzed in detail further.In the purpose of appraising the subsidiary-control performance,we develop a performance evaluation system. The study concludes five aspects of operation performance:operation layer,market layer,human resource layer,financial layer and customer layer. Based on the five layers,this study proposes a performance evaluation model that combines Fuzzy Integral with Analytic Hierarchy Process (AHP). Finally,we draw some conclusions by quantitative analysis. The statistic results indicate that there is significant relationship between subsidiaries' performance with both the strategic role and the control way. Additionally,it reveals that the stage of internationalization and the native environment have little effect on the control tendency,but the proportion of holding share has significant impact on the control tendency of MNCs' headquarters.