MNC Headquarter monitoring mechanism and the subsidiary’s marketing strategy in China : Case study of Volvo and Ford

Abstract: Multinational Corporations (MNCs) commence expansion worldwide and adopt local adaptation or global standardization marketing strategies in foreign countries. This thesis is to study whether there is any relationship between the subsidiaries’ marketing strategies and headquarters’ (HQ) monitoring mechanism, focusing on the China. How adaptation/standardization strategy affects the entire firm, how monitoring mechanism influences the relationship between subsidiary and HQ have been paid increasing attention to, but the connection between marketing adaptation/ standardization and HQ monitoring mechanism is barely discussed, especially in real-life cases. Therefore, two comparison cases (Volvo and Ford in China) with different marketing strategies are analyzed. This research is conducted through subsidiaries’ perceptions on HQ monitoring and local marketing strategies. The result shows that their HQs monitoring intensity are very close. However, according to our result, their monitoring form is not completely same, one meets the characteristics of both ‘Bureaucratic monitoring’ and ‘Cultural monitoring’ while the other one is merely ‘Bureaucratic monitoring’. Additionally, the thesis also casts lights on managers’ real attitudes towards the HQ monitoring mechanism and local marketing strategy through in-depth interviews.