Knowledge management in MNCs: the importance of subsidiary transfer performance

Knowledge transfer and innovation in multinationals: a review of the literature using SCM-TBFO framework

Purpose

Business research has highlighted the importance of knowledge transfer and innovation in multinational firms for better performance outcomes. However, the existing body of literature is characterized by differentiated theories, antecedents and outcomes. This study aims to address this gap by adopting a systematic approach to analyze knowledge transfer and innovation literature from the perspective of multinational organizations.

Design/methodology/approach

This study follows “preferred reporting items for systematic reviews and meta-analyses” (PRISMA) guidelines for conducting a systematic literature review. The study adopts a systematic approach for analyzing the literature using School of thought (S), Contexts (C), Methodologies (M), Triggers (T), Barriers (B), Facilitators (F) and Outcomes (O) framework (SCM-TBFO framework) devised for holistic literature review. The study analyzes 75 articles from reputed journals from 2000 to 2022.

Findings

In general, knowledge transfer and innovation in multinationals is a relatively new area and is evolving rapidly. There are many opportunities to study the various perspectives that are included in the SCM-TBFO framework. The key schools of thought included the evolutionary theory of innovation, institutional theory and internationalization theory. The studies had differing settings or contexts, including China, Europe, the USA and Taiwan. Further, key methodologies that were used included regression, case studies, structural equation modeling (SEM) and theoretical studies. Knowledge transfer and innovation triggers included competitive advantage, competitive pressure, constant requirements for better products and services, foreign direct investment (FDI) and globalization. Knowledge transfer and innovation facilitators were categorized into strategy-related facilitators, organization culture and orientation-related facilitators, and resource-related facilitators. Knowledge transfer and innovation barriers included autonomy, international knowledge dispersion, risk of knowledge leakage, search breadth, ambiguity and institutional voids. Key outcomes of knowledge transfer and innovation in multinationals included financial performance, innovation performance, knowledge flow, transfer effectiveness, patents and new product development.

Originality/value

By synthesizing the literature, the study aims to provide an overview of the current state of research on knowledge transfer and innovation in multinationals. The study develops a holistic model for fostering knowledge transfer and innovation in multinationals. The proposed novel framework can also be applied to perform a holistic assessment of the current literature in various research domains. Further, the study suggests future theory development and research agendas. The study also provides implications for practitioners using the framework to achieve more desirable outcomes.

Mapping Internal Knowledge Transfers in Multinational Corporations

Managing multiple knowledge transfers between headquarters and subsidiaries, among subsidiaries, and also within each of these units is crucial for multinational corporations’ (MNCs) survival. Therefore, this article aims to uncover the main factors influencing internal knowledge transfers in MNCs—including intra-unit knowledge transfers and transfers between units, namely, conventional, horizontal, and reverse knowledge transfers. To achieve this goal, a systematic literature review (SLR) was conducted to synthesize the content of 85 articles. From a set of 1439 papers, only 85 related to knowledge transfer and knowledge sharing were considered. Based on an inductive thematic approach, eight different research categories and 97 topics were identified. Four different internal knowledge transfers (intra knowledge transfer (IKT), horizontal knowledge transfer (HKT), conventional knowledge transfer (CKT), and reverse knowledge transfer (RKT)) are compared across eight thematic categories and 97 topics. According to the results obtained, the depth of the topics analyzed varies, as does the variety of categories, with RKT being more deeply analyzed than IKT. There is a clear dominance of vertical knowledge transfer (CKT + RHT) over HKT. The exercise of power (e.g., size, knowledge base) still dominates CKT and RKT in most of the studies analyzed, which are traditionally affected by the characteristics of MNCs, HQs and subsidiaries. The debate on HKT is affected by the classical perspectives of power-based relations (e.g., expatriates, size, knowledge base) among subsidiaries. Although important, intra-unit knowledge transfer is greatly influenced by characteristics.

Examining knowledge transfer and networks: an overview of the last twenty years

Purpose

Knowledge transfer (KT) has been attracting significant attention from the scientific community. The need to establish collaborative network relationships to achieve effective KT has led to a large volume of studies that attempt to identify how collaborative networks influence KT processes. However, papers, which link KT and networks have not been systematised. This study aims to provide an overview of this academic field and sets an agenda for future research.

Design/methodology/approach

The authors followed the preferred reporting items for systematic reviews and meta-analyses method to conduct a systematic review of the literature published in 2000–2020. The authors sourced the sample from the Web of Science and Scopus databases. The authors screened the references under the management and business categories that were published in the first two quartiles of the Journal Citation Report. This search returned 190 impactful papers across the 53 journals that were analysed.

Findings

The authors present the main results in two sections. First, this paper elaborates a conceptual model of the field; second, the authors review KT between firms and other agents, which allows us to identify KT flows within and between companies, universities and public institutions.

Originality/value

This paper provides the first systematic review of collaborative networks and KT. Five areas of action are identified for future research and are specified in several research questions. The authors also provide several practical implications. In a world in which more and more dynamic agents coexist, it is important to be aware of the needs of organisations that create and disseminate specific knowledge.

The impacts of inward knowledge transfer and absorptive capacity on the turnover of host country nationals in MNE subsidiaries: a multilevel modeling approach

Purpose

This study aims to find how the turnover of host country nationals (HCNs) would be affected by the knowledge transfer from a headquarter to a subsidiary. Knowledge transfer in a multinational corporation (MNC) has been discussed as a critical factor in the MNC’s success. Because HCNs are essential to synergizing with a new knowledge inflow during this knowledge transfer process, their turnover entails negative consequences such as knowledge loss.

Design/methodology/approach

This paper empirically tests the unbalance between knowledge received (KR) and absorptive capacity (AC) as the most critical organizational predictor by using the secondary longitudinal records and survey data of 4,915 employees. Multilevel survival analysis is used to calculate the individuals’ turnover hazard.

Findings

While finding that the primary effect of transferred knowledge is to reduce turnover, the study demonstrates the unbalance between a subsidiary’s AC and KR increases the likelihood of HCNs’ turnover within the organization. The authors also recognize the possibility of nonlinear trends of KR and AC on the turnover hazard.

Originality/value

The authors answer how knowledge transfer shapes a subsidiary’s work environment to prevent or increase turnover, which has been barely examined for HCNs who comprise the crucial demographic group in knowledge transfer. To enhance the originality further, this study empirically observes the actual turnover of HCNs with a conceptually comprehensive view incorporating both learning and political approaches.

Successful replication of knowledge in the growth of service organizations: evidence from Spanish hotel chains

Purpose

This paper aims to identify the main factors affecting the success of the knowledge replication process in service firms when new units/outlets are created or acquired.

Design/methodology/approach

The quantitative approach of the study is based on a survey to the first general managers of new hotels integrated in Spanish hotel chains that implement a strategy of knowledge replication.

Findings

Transfer experience in the region; compatibility between the underlying cultural context of the knowledge and the recipients’ culture; recipients’ absorptive capacity; source’s and recipients’ motivation; and lack of adaptation in the transfer routines are key factors that influence several aspects of knowledge replication success in service firms.

Research limitations/implications

From an academic point of view, this work identifies the determinants of success in replication processes. Moreover, two dimensions in knowledge replication success have been identified: a functional dimension and an economic one. Industry and survey limitations must be considered.

Practical implications

Organizations that face a growth process where they want to replicate their corporate knowledge should consider several aspects that seem to be determinants of success in those projects.

Originality/value

Despite the prevalence of replication-based growth strategies in the service sector, there is a lack of research analyses about this phenomenon in the academic literature. The empirical-based research on knowledge transfer and service firms’ growth is scarce and fragmented. This work provides an integrated view of factors affecting knowledge replication success in new organizational units from an empirical quantitative approach.

Can innovative knowledge management platforms lead to corporate innovation? Evidence from academician workstations in China

Purpose

This paper aims to analyse the role of government-led innovative knowledge management platforms in innovation knowledge management, social network effects and innovative resource clusters in the context of academician workstations in China. Specifically, this paper empirically studies the impact of academician workstations on corporate innovation capabilities and the mechanisms behind this impact.

Design/methodology/approach

This study uses the propensity matching score method and difference-in-differences method to test the relationship between academician workstations and corporate innovation capabilities. Baron and Kenny’s (1986) mediation method is used to test two potential mechanisms.

Findings

Academician workstations significantly improve corporate innovation capabilities because of their contribution to knowledge and innovation management. The facilitation effects are stronger in non-state-owned firms, high-tech firms and firms in industries with low levels of competition. Further, academician workstations enhance corporate innovation capabilities through their funding effect.

Practical implications

This paper encourages policymakers to create a better market environment and stable support policies to facilitate sustainable scientific and technological innovation.

Originality/value

To the best of authors’ knowledge, this study is among the first to empirically analyse the impacts of innovative knowledge management platforms on corporate innovation. It enriches the theoretical perspective of innovation platforms and provides an excellent research perspective for effectively analysing the impacts of innovation platforms. This study also contributes to the literature on the determinants of innovation.

Tracing the evolution of the literature on knowledge management in inter-organizational contexts: a bibliometric analysis

Purpose

Based on the growing interest devoted to knowledge management (KM) in inter-organizational contexts, the purpose of this paper is to systematize existing literature and understand how it developed over time, thus tracing its roots and evolution to unveil gaps and suggest new promising areas for future research.

Design/methodology/approach

This study used bibliographic techniques to analyze a sample of 85 studies along three main periods (1998-2010, 2011-2014 and 2015-2019). In particular, this study focused on co-occurrences of keywords to identify the most dominant themes, as well as connections among these themes.

Findings

Overall, the review shows the main outlets that have published papers on the topic of KM in inter-organizational contexts, as well as the theoretical background this research builds on. The temporal analysis exhibits the core topics that have persisted and grown consistently over time as the links between KM, innovation and networks. In addition, the review highlights new emerging themes, such as the human and social side of KM, and new interesting contexts of study (e.g. coopetition and open/user innovation), which opens exciting avenues for new research opportunities.

Originality/value

This study illustrates the conceptual structure of the field in three distinct periods and contributes to a more nuanced understanding of the key topics and their interrelatedness within the area of KM in inter-organizational contexts. Both researchers and practitioners can profit from the study because it reveals consolidated topics while identifying areas that still need to be investigated to foster KM in inter-organizational settings.

The performance implications of knowledge management and strategic alignment of MNC subsidiaries

Purpose

The purpose of this paper was to investigate antecedents and results of strategic choices of multinational corporation (MNC) subsidiaries in Croatia economy. Hence, the authors examined knowledge management and its association with performance. Additionally, they explored which of the strategies will be most likely chosen by subsidiaries in transitional economies that are characterized by market volatility and uncertainty.

Design/methodology/approach

Data were collected from a survey of 131 MNC subsidiaries operating in Croatia. To test the theoretical correlation between knowledge management capabilities and strategic orientation, the authors used the ANCOVA method and controlled for industry, years in international business and firm size.

Findings

The results pointed out the recognized necessities for a specific alignment between environment, strategy and knowledge management capabilities. The findings also suggest that there is a positive relationship between knowledge management and performance.

Research limitations/implications

As with most of the research, this paper has limitations. First, all data were collected using self-report surveys raising the possibility of response set biases. Additionally, all data were collected at one point in one country specifically in Croatia.

Practical implications

Clearly, there is substantial interaction between the MNC subsidiary’s environment and the MNC subsidiary’s strategic orientation. Most notably, the environment studied here was at the competitive and consumer market level. Firms need to develop a strategic plan for knowledge management based upon the local environmental influences.

Social implications

Other firms from Central and Eastern European and developed countries may compare their own environment, strategy and knowledge management practices in MNCs with findings from Croatia to be aware of similarities and market differences.

Originality/value

The strategic employment of knowledge acquisition, conversion and application are examined across firms using the Prospector, Analyzer, Defender and Reactor strategic orientations.

Knowledge management in franchising: a research agenda

Purpose

This paper aims to offer a comprehensive systematic review of knowledge management (KM) in franchising literature over the past 29 years.

Design/methodology/approach

By means of bibliometric citation analysis, ISI Web of Science (WoS) database is used to analyze articles from 1990-2018. A total of 169 articles by 369 authors across 40 countries published in 113 journals from 200 institutions were clustered and examined through HistCites and VOSviewer.

Findings

The exploration of KM in franchising is associated with 3 factors: governance structure; performance outcome; and franchise network growth. The findings also reveal that KM in franchising is still an emerging discipline encompassing conflicting results which offer potential for future research.

Research limitations/implications

Identified research gaps and contradicting views in the literature offer opportunities for researchers to contribute to this research domain by empirically testing the role of absorptive capacity, replication vs adaptation strategies and new franchising formats, such as micro/social franchising.

Originality/value

This study is unique in its examination of KM in franchising. It also highlights the value of knowledge in franchise chain performance.

Success and failure in international assignments

Purpose

The purpose of this paper is to review the literature on how success and failure for international assignments have been defined, and integrate several proposals for these definitions into a multi-dimensional model that considers task performance, relationship building, contextual performance and retention as all being part of how success or failure should be defined. The authors also discuss two proposed pre-requisites for success – absorptive capacity (operationalized at both the individual and the unit levels) and adjustment. The authors conclude by bringing in literature on performance management and how ideas about performance management must also be integrated into the discussion of the success or failure of international assignments.

Design/methodology/approach

This paper reviews existing proposals regarding the definition of expatriate success and failure, and proposes a multidimensional model of success based on the past literature. Based on this literature the authors also propose two pre-requisites for success and discuss several requisite KSAOs, as well as some suggestions from the literature on performance management.

Findings

The authors argue for a multidimensional model of expatiate success which includes task performance, relationship building, contextual performance and retention as part of what constitutes a successful assignment. The authors also argue that absorptive capacity and adjustment should be considered as pre-requisites for success, and that principles from performance management should be applied to dealing with international assignments.

Research limitations/implications

A more comprehensive definition of success and failure should aid research by providing a better dependent variable, and by leading to research on various aspects of this outcome.

Practical implications

The proposed model and approach can hopefully help practice by clarifying the different dimensions of success and how performance management techniques can be applied to dealing with international assignments.

Originality/value

There has been a lot written about how we should operationalize the success or failure of international assignments. The present paper reviews that literature and integrates a number of ideas and suggestions into a multi-dimensional model which includes information about pre-requisites for success and relevant KSAOs, along with ideas from performance management to help insure the success of these assignments.

Knowledge sharing and social capital in globally distributed execution

Purpose

The purpose of this study is to assess whether social capital explains level and quality of knowledge sharing in globally distributed execution. More specifically, the study examined how knowledge sharing in combined European–Asian teams of a globally operating engineering and construction company was affected by these teams’ social capital.

Design/methodology/approach

Social capital was approached via constructs covering its structural, relational and cognitive dimensions. Data for 325 employees were collected via an online questionnaire and analysed using multiple regression models.

Findings

The analyses confirm that components of social capital offer powerful explanations of both the level and the quality of knowledge sharing. The study also found many differences in how social capital affects the level versus the quality of knowledge sharing and also in how it works in the European versus the Asian situations. No social capital factor appeared to significantly predict both level and quality knowledge sharing in the European and Asian situations alike.

Originality/value

This study is novel in empirically establishing how knowledge sharing in globally distributed execution is affected by teams’ social capital as an integrative construct bringing together individual and group characteristics.

Alternative control methods for exploiting subsidiary knowledge within an MNE: quantity versus quality

Purpose

– The aim of this paper is to expose the power of informal control mechanisms over explicit knowledge transfer through information communication technology (ICT) systems in subsidiaries of a multinational enterprise (MNE).

Design/methodology/approach

– The research used a case study approach consistent with the purpose of exploring control/knowledge transfer relationships. Semi-structured interviews were undertaken with managers across 19 sites in an MNE. Analysed data were thematically organised into two case studies for comparison.

Findings

– The results show that when control is exerted from bottom-up, knowledge transfer barriers are overcome, quality of outcomes is increased and new and incremental knowledge innovation is more likely to become organisational.

Practical implications

– The findings signal a caution for managers to assess the suitability of control type on knowledge transfer incentives to leverage quality knowledge outcomes. By using informal methods, subsidiary managers’ local autonomy and power to resist centralised management objectives was positively moderated.

Originality/value

– The paper exposes alternative control methods for exploiting subsidiary knowledge within an MNE. The research is unique in that it identifies a superior role for bottom-up social control to elicit explicit knowledge sharing behaviours through ICT where bureaucratic reward-based control had failed.

The quasi-moderating role of organizational culture in the relationship between rewards and knowledge shared and gained

Purpose

– The purpose of this paper is to clarify the role of organizational culture and rewards in stimulating the sharing and gaining of knowledge.

Design/methodology/approach

– Hierarchical regression using survey data.

Findings

– The analyses show that rewards and organizational culture of knowledge transfer influence the knowledge shared and knowledge gained. Moreover, culture and rewards interact to influence knowledge gained, but not knowledge shared which leads to the conclusion knowledge gaining can be induced by rewards, even in the absence of a supportive culture.

Research limitations/implications

– The findings are consistent with socio-technical theory (STT) and the discussion positions this perspective as useful for future knowledge management studies. This research confirms that knowledge sharing and gaining are uniquely different activities that respond differently to culture and rewards.

Originality/value

– This study combines the work of different fields by focusing on knowledge sharing and gaining in a single study. Through this process, a bridge between organizational learning theory and STT is revealed.