Divergence theory means the parent company allows for their subsidiaries to adapt their own practices, policies and strategies or modify the practices and policies of the parent company as appropriate for the local requirements. According to this theory, subsidiaries have permission to operate their business considering their own culture and other factors in order to achieve economies of scale.Using the divergence theory, can motivate the local employees and train them easily for obtain the better performance and achieve the organizational goals.
And also, can get the considerable contribution from the employees and minimize the problems those are arised with the convergence theory. As well as, implementing divergence theory, it is difficult to introduce the best practices to the company and unable to maintain the centralized authority further. And also, the management of the parent company difficult to evaluate operations and performance of their subsidiaries, because of they follow the different organizational practices in their countries.s
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