The identity of national subsidiaries of multinational organizations: With special focus on ITC/BAT and HUL/Unilever

Abstract

“Without a sense of identity, there can be no real struggle” – Paulo Freire. Identity is an intriguing concept. It is ever changing – an attribute that makes the concept all the more difficult to grasp. As human beings we strive to create an identity in the early years of our lives, and toil the rest of our lives to try and justify it. Even then, in times of distress or trauma, our identities that are shaped by the very fabric of our personalities, can undergo massive changes. Thus, we can never truly be sure of who we are- we can only hope to have a core set of defining principles that embody the essence that is us. Organizations aren’t any different. They also consciously try to create distinctive identities. But that’s easier said than done. Multinational organizations face a plethora of issues in creating and sustaining identities. It is often difficult for them to create an identity and then stick to it perennially. The reason for this can be attributed to the dynamic business landscape, wherein parent organizations and their subsidiaries operate in completely different environments. Hence, organizations metamorphose and adapt themselves by adjusting their identities over time. During the course of this constant metamorphosis, organizations may at times choose to privilege global integration over local responsiveness & vice versa. How and why such decisions are made are the focal point of discussion of this paper, and would assist us in understanding the nature of identity transition of organizations at different points in timei . In this paper we have studied two FMCG giants with a long operating history in India: HUL and ITC. We have tried to analyse the kind of equation they have shared with their parent organizations Unilever and BAT, respectively, in terms of identity over a period of time. In our endeavour of understanding how the identities of these subsidiaries have changed with respect to their parent organizations, we have analysed the operations of these organizations over several years, and tried to relate their actions or policies with the corresponding influence their parent organizations were exerting on them. Thus, we have essentially tried to observe these two organizations through the lens of their changing identities over a prolonged period of time.