Evolution of Organisational Structure and Capabilities in Internationalising Banks: The CEE Operations of UniCredit's Vienna Office
Journal
Long Range Planning
ISSN
0024-6301
ISSN-Digital
1873-1872
Type
journal article
Date Issued
2009-10
Author(s)
Abstract
Cross-border integration is the central management issue for banks that expand internationally, and this is especially true in Central and Eastern Europe, where the pace of internationalisation through mergers and acquisitions has been rapid. A critical challenge in cross-border integration is aligning a multinational company's formal organizational structure with the distribution of capabilities across its subsidiary units, and this issue is explored by tracking the co-evolution of organizational structure and capabilities during the internationalisation of a large banking network into this region. Our focus is the Vienna head office of Bank Austria Creditanstalt, which was acquired first by HypoVereinsbank (Germany) and then UniCredit (Italy). Despite its formal role being downgraded during these changes, the unit continued to develop its distinctive capabilities. The key insight our article offers is that managing cross-border integration is not simply about recognizing the value of the distinctive capabilities of individual units and designing formal structures that successfully align with them. It is also about understanding the need for dynamic interaction between formal corporate structure and individual units' desires to retain power and influence, which have significant implications for the development of their organizational capabilities.
Language
English
HSG Classification
contribution to scientific community
Refereed
No
Publisher
Elsevier
Publisher place
Oxford
Volume
42
Number
5-6
Start page
633
End page
653
Pages
21
Subject(s)
Division(s)
Eprints ID
218072