I hold an M.S. degree in economic cybernetics from Kiev State University, Ukraine, and a Ph.D. degree in business administration from the University of Minnesota. I began my academic career studying new product development and employing more quantitative mathematical approaches and methods. My interests gradually shifted towards management issues and theories, organization theory, organizational behavior, and international management. This shift was the result of personal experiences with multiple cultures and international organizations, as well as an exposure to the broad management literature during a year spent as a Fulbright Scholar at UCLA and during my doctoral studies at the University of Minnesota.

  What do you consider the main focus of your research?

Broadly, I study multinational corporations (MNCs). Since MNCs conduct operations across borders, they are faced with tremendous complexity in their external environments as well as their internal organization. Externally, they are embedded in multiple institutional and cultural contexts, which present different and possibly contradictory requirements and business models. Internally, MNCs are characterized by similarly complex organization structures, networks, and processes.

“Since [multinational corporations] conduct operations across borders, they are faced with tremendous complexity in their external environments as well as their internal organization.”

These conditions of complexity, unique to the MNC, challenge traditional management theories, as many of their assumptions and boundary conditions don’t hold in the case of the MNC. Studying MNCs therefore presents opportunities to validate and expand existing management theories and to develop completely new theoretical ideas borne out of this context.

More specifically, I am interested in MNC legitimacy, knowledge management, and social capital and I study these topics with interdisciplinary and cross-level approaches. Theoretically, I draw primarily from MNC theory, institutional theory, and social capital theory. My research bridges the individual, subsidiary, and organizational levels.

This study examined the contextual and intra-organizational factors that facilitate or impede transfer of best practices from MNC corporate headquarters to their foreign subsidiaries. I think there are four main reasons why this paper appeals to a lot of scholars.

First, the task of transferring knowledge across MNC subunits is critically important for MNCs. It provides an opportunity for MNCs to leverage their competencies on a global scale and thus improve their long-term competitiveness. Yet, transferring knowledge is not an easy undertaking especially across national borders. Thus, the study addressed a core research question in international management.

Second, as opposed to past research which had examined contextual factors through culture, my study provided a novel conceptualization of MNC context based on the institutional perspective. I introduced the constructs of Country institutional profile and Institutional distance, which capture the three "pillars" of national institutional environments—regulatory, cognitive, and normative. I studied the influence of pertinent regulations, social knowledge, and social norms in the home and the host country, which is a more comprehensive approach to capturing country environments than the previously employed culture approach. Many international management scholars adopted this view in their examination of various phenomena such as entrepreneurship and foreign market entry.

Third, in addition to the external contextual factors, the study also examined intra-organizational factors influencing the success of transfer of management practices. In particular, I proposed that the relational context that reflects the quality of the relationships between the headquarters and the foreign subunit of the MNC is an important determinant of transfer success. It was argued that the commitment of a recipient subunit to the headquarters, its trust in the headquarters, and the degree to which it identifies with the headquarters, affect the motivation of the subunit to engage in this process and also mediate the complex influences of the home country institutional environment.

Fourth, I introduced a novel conceptualization of transfer success as a two-dimensional construct including formal implementation of the practice and internalization of the practice. The paper argued that the combination of contextual and relational factors could predict the pattern of adoption (i.e., the levels of implementation and internalization) of the practice in the recipient unit. These patterns range from formal ceremonial adoption to full and complete internalization, where employees at the recipient unit are committed to the practice, feel ownership over it, and appreciate its value for their organization.

In summary, the paper addressed an important phenomenon for MNCs and introduced novel concepts and ideas drawing on existing theories, and at the same time, enriching these theories by leveraging the theoretical distinctiveness of the MNC context.

  Where have you taken this research since the publication of the 1999 paper?

The following research has been directly triggered or influenced by the 1999 paper:

1. Kostova T & Roth K, "Adoption of an organizational practice by the subsidiaries of the MNC: Institutional and relational effects," Academy of Management Journal 45: 215-233, 2002.

This paper provided the empirical testing of the model introduced in the 1999 paper. The model, with some extensions, and modifications, was confirmed with survey data from 109 foreign subunits of a US MNC in 10 different countries.

2. Kostova T & Roth K, "Social capital in multinational corporations and a micro-macro model of its formation," Academy of Management Review 28: 297-317, 2003.

This conceptual paper was motivated by our findings about the importance of the relational context in MNCs. The natural question arising from these findings was "How do MNCs create such good relationships between their headquarters and foreign subunits?" In this paper, we conceptualize relational context through the concept of social capital. Drawing from MNC theory and social capital theory, we propose that social capital in organizations exists in a structural and relational form, as well as in the form of private or public good. After discussing the importance of the various forms of social capital for MNCs, we develop a two-stage model of social capital formation. We first propose a model that explains the formation of private social capital of individual boundary spanners in MNCs. Then, we offer a model explaining how the individual social capital of boundary spanners could be transformed into unit-level "public" social capital.

In addition, the 1999 paper and the follow-up empirical and theoretical work described above served as a motivation and foundation for the following two articles.

1. Roth K & Kostova T, "The use of the multinational corporation as a research context," Journal of Management 9(6): 883-90, 2003.

Based on a review of MNC-focused studies in 10 leading management journals, we conclude that the MNC context has been used in three distinct ways for research purposes. First, scholars have used the MNC for the sole purpose of studying MNC-related phenomena (e.g., international joint ventures and alliances, expatriate management, foreign entry mode). In that, they have employed existing theories without challenging their assumptions or boundary conditions and without altering these theories in any significant way. Second, the MNC context has been used for the validation of existing theories, as it provides additional variance related to the external environment, internal organizational environment, and at the individual level. Third, the MNC has been used for significant modifications of existing theories or the development of new theoretical ideas and perspectives. We conclude that shifting from the first towards the third way of using the MNC would increase the theoretical contribution of international management research not only to its field but also to management theory at large. Building on the conceptual distinctiveness of MNCs as organizations allows for significant theoretical extensions of existing theories as well as for novel theory building.

2. Kostova T, Roth K, & Dacin T, "Institutional theory in the study of MNCs: A critique and new directions," Academy of Management Review, 2007 Forthcoming.

This paper is an example of how the MNC context challenges traditional management theories and at the same time presents opportunities for novel theory building. It draws from the stream of research that started with the 1999 article and applies the analysis to institutional theory. In particular, we show how the main tenets of neo-institutionalism (e.g., organization field, isomorphism, legitimacy) do not apply to, or are significantly altered in, MNCs. Then we offer ideas of how institutional theory can be extended with ideas that are highlighted specifically in the MNC context including institutional duality and multiplicity, role of agency, and others.

Tatiana Kostova, Ph.D.
Moore School of Business
University of South Carolina
Columbia, SC, USA