Requisite variety of subsidiary mandates and environmental turbulence


This study examines the impact of requisite mandate variety on subsidiary performance in a dynamic environment. According to the law of requisite variety, we identify that possessing a requisite number of mandate variety increases the organisational capacity to deal with environment volatility thereby enhancing subsidiary performance in a dynamic environment. Further, we pay particular attention to the requisite attributes of mandate variety. Subsidiaries that implement local-specific mandates, especially focusing on market-seeking mandates, are more likely to achieve higher profitability in the unpredictable local market.