Digital transformation is fundamentally changing the business landscape. It is also affecting the roles of top managers within firms. Our survey of more than 160 senior managers in Europe suggests that digitalization, rather than encouraging more decentralized forms of management, will lead to an expanded role for headquarters and further empowerment of top managers. While acknowledging the benefits of the digital transformation, in this Executive Digest we identify five key challenges for newly empowered top managers and offer solutions for these digitalization traps.

We investigate the effect of changing national institutions on relocations of intermediary HQs. Using a dataset of 154 cross-border relocations between the period from 2000 to 2015, we draw on the intermediary HQ’s middle position within the MNC and investigate how a decrease in institutional quality in the HQ’s host country and a change in institutional distance between different MNC units affect the relocation decision. Our findings advance the emergent literature on HQ relocations as well as our knowledge of intermediary HQs and the effect of changing institutions on organizational location choices. Beyond our theoretical contributions, we offer policy and managerial implications.

How will digitalization influence the role of corporate headquarters (CHQs) and their relationships with their operating units? We recently asked 67 senior CHQ managers this question. The results suggest that CHQs expect to become more powerful and more involved in their operating units. These conclusions seem to be driven by perceptions that the ongoing digitalization will provide CHQ managers with more timely and better information. In this “Point of View,” we discuss the potential pitfalls of such a narrative. We also offer ideas for how to avoid mistakes and ensure that CHQs increase their value-added in times of digitalization. In particular, we suggest that CHQs place emphasis on social interactions for data to be effectively collected and analyzed, for decision-making power to be adequately allocated, and for CHQ involvement to be informed and necessary.

How do intermediary headquarters (IHQs) deal with changes in the scope of the multinational corporation (MNC) and in country conditions? To investigate this question, we created a unique panel dataset of 386 IHQ cross-border relocations in Europe between 2000 and 2019. Drawing on extant literature on MNC structures and HQ location choices, we argue that IHQs’ special role as ’hybrid’ units with a middle position between the subsidiaries and the corporate parent puts (potentially) opposing pressures on IHQs. We hypothesize that increasing distance between the IHQ and the frontline subsidiaries as well as between the IHQ and the corporate parent is detrimental for IHQs. We also suggest that IHQs are especially pulled towards countries with highly developed institutions. We find that higher distance between the IHQ and the subsidiaries is related to a higher likelihood of IHQ relocations and that IHQs relocate to countries with a higher institutional quality than their previous host country. In contrast, the distance between the IHQ and the corporate parent does not influence IHQ relocation decisions. With those findings, we contribute to literature on the antecedents of HQ relocations, IHQ structures and configurations in MNCs, and intra-firm networks. Finally, we also offer important implications for managers and policy makers.

What triggers multinational corporations (MNCs) to relocate their headquarters (HQs) across borders? Building on problemistic search and upper echelons theory, I argue that performance feedback, leadership succession, and upper echelon attributes jointly impact a firm’s HQ relocation decision. In particular, I theorize how (i) performance below aspiration level is positively related to the likelihood of HQ relocation and how (ii) CEO outside succession as well as (iii) certain CEO characteristics (i.e., educational background and nationality) moderate the relationship between performance shortfall and likelihood of HQ relocation. I test the hypotheses with a hand-collected multi-country panel dataset of 213 corporate HQ relocations in Europe between 2000 and 2019. In line with my hypotheses, I find that performance below aspiration level triggers HQ relocations and that outside CEO succession and foreign CEOs further strengthen this effect, while the CEO’s educational background does not have an impact. My findings contribute to research on the antecedents of HQ relocations, on organizational change from a behavioral theory of upper echelon decisions, and on the importance of microfoundations in global strategy. Beyond my theoretical contributions, I offer policy and managerial implications.

Many headquarters (HQs) of multinational corporations (MNCs) that have substantial growth outside their home country or region face the problem that they have a limited understanding of their distant business and thus struggle in their value-adding parenting role. The existing solutions to this wide-spread problem, such as building up sophisticated control methods with expatriates, creating additional organizational layers with intermediary HQs, or creating a more diverse top management team, often give rise to new challenges that impair firm performance. In this study, I provide a new perspective on how HQs can deal with shifting market growth to distant host regions and also fulfil their value-adding parenting role to those subsidiaries. By drawing on the unique case of Starwood Hotels Inc., I elaborate a process analysis of how this specific organization temporarily relocated the HQ from the US to Shanghai and Dubai to improve its HQ’s value-added and contribute to the firm’s success in those new growth markets. In particular, I shed light on the process and the multi-level outcomes of this highly innovative undertaking. With my findings, I contribute to literature on HQs and their location choices, new organizational design approaches in MNCs, and strategic organizational change. Additionally, I offer ideas for future research avenues as well as important policy and managerial implications.

Global strategy research and practice is witnessing a notable change in the sentiment towards globalization with increasing skepticism and resistance. Indeed, this is evident in national elections as well as in shifts towards more protectionist measures by national governments, which has consequently led to a slowing down of global trade and increases in economic instability and (geo)political uncertainty. In the light of these developments, prior research suggests that the multinational enterprise (MNE) may need to relocate operations as a means to offset the deleterious effects of their turbulent environments. However, it remains unclear as to when the MNE engages in such behavior and which mechanisms underpin such a response during turbulent times. In this paper, we take a headquarters’ (HQ) perspective to delineate those mechanisms in detail and offer explanations for how MNEs operating in contexts most influenced by the ongoing macro-environmental changes respond to the fleeting uncertainties. We draw upon institutional theory and resource dependency theory to develop an overarching framework which sheds light on how MNEs deal with and respond to the major shifts in their external context. Ultimately, we advance our conceptual understanding of parenting behavior in the context of external uncertainties (viz. anti-globalization)

International business research has produced a wealth of knowledge about how and why firms (re)locate their value-adding activities across borders. In the global knowledge economy, however, tangible location factors are becoming less important, as value is increasingly derived from intangibles. In this project, we turn the attention to perceptual aspects of location, which have received limited scholarly attention to date. We argue that the physical and perceptual facets of location need to be considered jointly to develop a more elaborate understanding of this topic at hand. Our aim is to contribute to the field of international business, economic geography and strategic management by providing an integrative theoretical framework on the shifting meaning of firm location and its implications for policy-makers.

Headquarters (HQs) of multinational corporations (MNCs) play an important role in the economy of a country, since they perform high value-adding activities, employ highly qualified personnel, and yield corporate and tax income. Thanks to its position at the heart of Europe and other characteristics that contribute to make the country particularly attractive for MNCs, Austria is home to several domestic and foreign HQs. With this descriptive report, we aim at providing a comprehensive and detailed overview of the HQ landscape in Austria. Drawing on a database created in 2021 by triangulating data retrieved from “Orbis” (Bureau van Dijk) with other publicly available data from companies’ annual reports and previous reports, we identified 1,439 HQs in Austria. An analysis of the types of HQs, their location, size, sector, and origin unveils interesting findings. First, Austria is home to many domestic corporate HQs, but it also hosts many intermediary HQs of large corporations from foreign countries in Europe (e.g., Germany) and from abroad (e.g., USA). Many of these countries choose Austria to access its neighboring countries, such as Germany and Eastern European countries. Moreover, the HQ landscape in Austria is characterized by a variety of industries and HQ sizes, although small and medium-sized enterprises (SMEs) dominate the scene. Finally, Vienna is clearly the center of Austria’s HQ economy, with 569 HQs located in the capital city.

Austria is home to several intermediary headquarters (HQs) of large multinational corporations (MNCs). With this study, we deep dive into the international HQ landscape of Austria and study its composition and characteristics in terms of types, location, size, sector, and origin of its international HQs. This report is meant to be an addition to our previously published report on “Headquarters Landscape in Austria: An overview” (2022). Therefore, it focuses on a subsample – represented by the population of international HQs in Austria – of the initial database of HQs in Austria. What emerges from the study is that Austria and especially its capital city Vienna is the seat of different types of international HQs: both divisional and regional HQs. Moreover, the countries that are most commonly choosing Austria as an HQ location are the neighboring DACH countries (i.e., Germany and Switzerland) and the US. Finally, even though the number of international HQs is considerably smaller than that of domestic corporate parents, the size of the former is much bigger (with an average turnover of more than 10bn€). This emphasizes the relevance of international HQs for the Austrian economy.

Vienna is at the heart of the Austrian economy, hosting 569 headquarters (HQs). With this study, we deep dive into the Viennese HQ landscape and study its composition as well as characteristics in terms of the types, size, sector, and origin of its HQs. This report is meant to be an addition to our previously published report on “Headquarters Landscape in Austria: An Overview” (2022). Therefore, it focuses on a subsample – represented by the HQ population in Vienna – of the initial database of HQs in Austria. Overall, Vienna emerges as an important hub for the financial sector and the service industry – comprising legal, accounting, management, and consulting activities, among others. Moreover, the HQ population in Vienna is characterized by small and medium-sized enterprises (SMEs), but it also hosts a few remarkably large HQs.

Corporate Headquarters (HQs) of large multinational corporations are important economic actors in the location. Decision-making of those organizations culminates in the Corporate HQ, which is also the provider of high-quality employment and business opportunities for related businesses such as accounting firms, banks, start-ups, or owners of office properties. In this short descriptive study, we compare the cities and metropolitan areas of Vienna, Zurich, and Munich with regards to the number of Corporate HQs it hosts and what kind of firms are governed by those HQs. The key results are twofold. First, Vienna is substantially less densely populated by Corporate HQs of large firms than Zurich or Munich. Second, Vienna’s Corporate HQs run firms that are, on average, considerably smaller than those run from Zurich or Munich. We refrain from interpreting these findings in this report and refer to future studies in which we plan to discuss the findings in greater detail. Yet, our opinion is that our finding is an indicator of Vienna’s competitive disadvantage with negative implications for related businesses (accounting firms, banks, start-ups, etc.).

In this report, we investigate how the digital transformation impacts headquarters (HQs). Drawing on 85 survey responses from corporate and divisional HQ managers in Austria, we find that the digital transformation is expected to fundamentally change the HQ of the future in terms of how the HQ will derive decisions, how it will interact with its subunits, and how the HQ will add value to the firm. The majority of firms see the digital transformation primarily as an opportunity to increase the value-added that the HQ generates for its subunits as opposed to increased cost efficiency. Additionally, the responding HQ managers foresee a much more influential role of HQs vis-à-vis its subunits, based on better and more timely information, as well as more room for strategic thinking. Finally, our results suggest that many firms need to put more effort into digitalizing their HQ. Only 26% of the responding firms seem to have developed a clear idea what the digital transformation means for their HQ. These advanced firms see the highest potential in digitalizing the HQ. To this end, the biggest barrier to stepping up the digital transformation of the HQ seems to be the lack of digital talent.

In this study, we investigate how managers perceive Austria as one of Europe's prime locations for divisional and corporate headquarters (HQ) and how this might change in the context of the ongoing digital transformation. Drawing on our quantitative survey results, we find that Austria as a HQ location will remain attractive and seems to be well prepared for the digital transformation. 74% of our respondents rate the technological infrastructure in Austria as positive. Similarly, the access to digitalization expertise from startups, law firms, consultants, etc. receives good ratings from 67% of our respondents. Consequently, the responding managers from divisional and corporate HQs predominantly predict that Austria will be able to retain or even attract more HQs in the future. The biggest hurdle for Austria appears to be a lack of digitalization talent: 59% disagree or strongly disagree with the notion that "Austria provides sufficient access to digitalization talent".

In this report, we examine how digitalization influences the roles, structures and responsibilities of headquarters (HQs). We draw on 67 survey responses from top managers in corporate, divisional, and regional HQs located in Denmark and find that digitalization is expected to fundamentally change how HQs will operate. The vast majority of study participants spot a wide variety of opportunities arising from HQ digitalization and particularly highlight the potential for increased value creation as compared to cost savings. Enabled by better and timelier information for decision-making, HQs will improve their value-creating activities and will simultaneously involve themselves more in their subunits' businesses. At the same time, HQ managers see potential for efficiency gains through digitalization resulting in slightly smaller HQs and reduced overhead costs. Additionally, HQ managers will also be affected by digitalization through a rise in data-driven decision-making (as opposed to intuition) and personal accountability. Nonetheless, digitalization also entails a multitude of challenges. In this vein, over half of the HQs recognize that they lack not only a clear understanding of how digitalization will affect their HQ, but also crucial resources and capabilities for the digital future, such as digital talent and know-how. Overall, we show that the expectations towards and preparedness to adapt to digitalization differ across HQ types, industries, and organizational levels.

In this study, we deal with the recent phenomenon of headquarters (HQ) relocations and shed light on which factors make multinational corporations (MNCs) relocate their HQs to Austria or from Austria to another country. We draw on a hand-collected dataset of 65 HQ relocations between 2000 and 2017. We find that while HQs in general and divisional HQs in particular have become more mobile over time, Austria still remains an important hub for HQs, as it seems to benefit from more inbound than outbound relocations. The most important location for inbound and outbound relocations of HQs is Germany, but the CEE region matters as well. The relocating firms highlight especially value creation motives, such as higher proximity to important markets and better access to highly qualified employees. Cost reduction motives such as less expensive labor or lower tax expenses play only a secondary role. Based on those findings, we discuss important managerial and policy-maker implications.