18 Sep 2013Working Paper Summaries

What Do We Know About Corporate Headquarters? A Review, Integration, and Research Agenda

by Markus Menz, Sven Kunisch and David J. Collis

For the last five decades, research on the multidivisional firm has developed into one of the most important areas of management research. While the majority of this research deals with the firm's portfolio of businesses and international subsidiaries, there is a smaller but significant body of literature on the corporate headquarters (CHQ) - the multidivisional firm's central organizational unit. In this paper, the authors identify major shortcomings and gaps in this research. They then propose five high-priority research opportunities that demand particular attention: (1) The CHQ's nature and boundaries; (2) the CHQ's "functioning"; (3) the CHQ's staff(ing); (4) the CHQ's relationship with the operating units; and (5) the CHQ's impact. Overall, there is a need for a research agenda that builds upon the collective insights from the review but, at the same time, considers the findings of related literature as well as novel ideas from practice. Key concepts include:

Research on the CHQ is increasingly disconnected. It has developed along four different tracks in the economic, organization, international business, and practice-oriented traditions.
The authors of this paper provide the first comprehensive framework of CHQ research that integrates dispersed insights, identifies the most relevant variables of interest, and specifies the dominant relationships between them.
The CHQ is defined as the firm's central organizational unit, (structurally) separated from the operating units (business and geographic units). It hosts corporate executives and staff as well as central staff functions that fulfill various roles for the overall firm.
Research on the CHQ has the unique potential to contribute to our understanding of contemporary organizations.

Author Abstract

During the past five decades, scholars have studied the corporate headquarters (CHQ)-the multidivisional firm's central organizational unit. The purpose of this article is to review the diverse and fragmented literature on the CHQ and to identify the variables of interest, the dominant relationships, and the contributions. We integrate, for the first time, the existing knowledge of the CHQ into an organizing framework. Based on a synthesis of the literature, we identify major shortcomings and gaps and present an agenda for future research that contributes to our understanding of the CHQ and the multidivisional firm.