Abstract
Headquarter-subsidiary relations in multinational firms (MNCs) are important but difficult to manage. This is partly due to differences in managerial perceptions and their impact on decision-making. Perceptions can be interpreted as cognitive constructs or mindsets influenced by an individual’s existing knowledge base. While explicit knowledge components can be easily identified, this is more challenging for the tacit elements. We start with a qualitative approach and use the diary method, which we believe is more prone to eliciting managers’ MNC mindsets. Based on the analysis of twelve diaries, we identify perceived conflicts of subsidiary managers. We content-analyzed the data by using the software tool Leximancer and combine this with rigorous statistical analysis. Building on our analysis, we formulate hypotheses, future research avenues and managerial implications