Strategic management staffing decisions among German subsidiaries in Japan

This study discusses the composition of strategic management teams in foreign subsidiaries beyond decisions solely about the general manager, i.e. encompassing third-country nationals; locally hired “foreigners” as well as managers on short-term assignments. We extend the discussion about expatriates by developing hypotheses about those issues based on the resource-based view of the firm and the principal agent theory and find that both are important for understanding staffing decisions. This research analyses these issues by means of a data set on German subsidiaries in Japan and shows that recent changes in the global environment are providing multinationals greater latitude when staffing foreign-based subsidiaries, including choices that have not been given due weight in IHRM literature.