Knowledge transfer practices in multinational corporations in China's information technology industry

Abstract

The goals of this study were to explore existing practices used to facilitate knowledge transfer in MNCs in the information technology industry in China, and to investigate the frequency of use and the influence of each practice on knowledge transfer. In addition, this study examined which types of knowledge could be transferred by a given practice. The study used a two-stage method that included two surveys. The first survey was designed to develop an inclusive list of knowledge transfer practices. Thirty-three practices were identified in the first survey. The second survey found: 1) the frequency of use and the influence on knowledge transfer varied from one practice to another; 2) MNCs frequently used those practices with higher influence on knowledge transfer; 3) certain practices are better suited in transferring certain types of knowledge.     

Global innovation performance: Strategic challenges for multinational corporations

In the emerging knowledge economy many companies are forced to access globally dispersed technological and market knowledge to maintain their competitive advantage. A conceptual model is presented to analyze the relationship between the globalization of the innovation function and firm performance. Longitudinal data from 10 multinational companies are used to support the proposed model. The analysis concludes that the relationship between global innovation reach and firm performance is concave and time lagged. The results suggest the strategic importance of globalization decisions. The managerial implications are structured in five distinctive strategic challenges to successfully manage global innovation.     

The impact of distance on knowledge transfer effectiveness in multinational corporations

This paper aims to shed light on the interplay of knowledge transfer mechanisms and distance within the MNC. While it is largely undisputed that cross-boarder knowledge flows contribute to the firm's success, our knowledge on the effects of specific transfer mechanisms is scarce. We examine the impact of different dimensions of distance to test the applicability of personal coordination mechanisms (PCM) and technology-based coordination mechanisms (TCM) in situations of differentiation and dispersion. Data on 324 knowledge transfer relationships of MNC units was used to test our hypotheses. While TCM function relatively context-free, we find that PCM are moderated by distance. Our results support moderating effects of geographic, cultural and linguistic distance, which are vital to our understanding of knowledge transfer effectiveness in MNCs.     

Subsidiary-level determinants of global initiatives in multinational corporations

This article examines subsidiary-level factors that promote global initiatives in MNCs. Global initiatives are a key capability of MNCs that domestic firms do not possess, yet there has been little research on how MNCs promote initiatives on a global basis. I draw principally on the knowledge-based view to develop a model in which three subsidiary-level variables explain the propensity of the MNC to pursue global initiatives. These variables are: (1) inter-unit networking, (2) subsidiary learning from internal and external sources, (3) shared strategic goals. A survey of 118 subsidiary managers, triangulated with interviews with 20 key informants, provides support for the hypothesized effect of subsidiary learning and shared strategic goals on global initiatives. The result for inter-unit networking is less clear. These variables combine to activate initiatives within the MNC and thus act as a source of competitiveness on a worldwide basis. The results have important implications for MNC managers as well as for theory, and these are discussed.     

Top management teams within multinational corporations: Effects of cultural heterogeneity

This research examined the relationship of cultural heterogeneity with team and organizational performance, as mediated by selected aspects of group processes. The study was done with top management teams (TMTs) in international subsidiaries of multinational corporations (MNCs). It was found that cultural heterogeneity within the TMT is positively related to both the level of issue-based conflict the team experiences and to TMT performance. The TMT performance and the subsidiary's performance were positively related. Issue-based conflict affected negatively TMT performance but had a positive effect on subsidiary performance. The hypothesis that cultural heterogeneity would be negatively related to TMT cohesion was not supported. The results provide general support for the importance of cultural heterogeneity for the functioning of TMTs and their international subsidiaries.     

Structural sources of personnel problems in multinational corporations: Third-country nationals

The paper examines the extent to which multinational corporations (MNCs) whose staffing policies approach the genuine multinational model are free of the dysfunctions found by the authors in earlier studies of ethnocentric MNCs. The findings are based on comparative research in 51 MNCs, and intensive diagnostic studies of seven subsidiaries of MNCs operating and headquartered in four continents. The findings may be summed up as follows: (1) certain, but very few, morale problems have indeed been eliminated; (2) others are still present; (3) others are still present and their effect has intensified; and (4) new problems have appeared which are unique to the staffing policy approximating to the genuine multinational model. These findings shed new light on several of the assumptions underlying this model. The general conclusion is that each prevalent type of staffing policy has several sources of morale problems—some inherent in its uniqueness, and others shared by the alternative staffing policies—irrespective of the personal qualifications of the managers. Therefore, it is unrealistic to expect that a change toward the genuine multinational model would solve the basic morale problems prevalent in the dominant type of MNCs.     

Technology development control styles in multinational corporations: a case study

Multinational firms tend to geographically disperse their R&D activities to a larger extent than in the past. International R&D seems to play an increasingly important role within the global process of technological innovation taking place in multinational corporations. As a consequence, firms are challenged to design global R&D organisations and manage foreign units playing a central role in their innovation process. A key managerial aspect is the balance between autonomy and control of foreign R&D units. This case study deals with management control styles over foreign R&D units. It is based on the results of an empirical analysis of 16 multinational firms operating in technology-intensive industries. It proposes a taxonomy of management control styles in foreign R&D and gives the cue for further research in the area of technology development control.     

Managing corporate community responsibility in multinational corporations: Resolving institutional duality

Addressing calls to explore how subsidiaries of MNCs operating in different institutional contexts resolve institutional duality, this paper brings together dual theoretical explanations from legitimacy and neo-institutional theory, to examine how decision-making for corporate community responsibility (CCR) occurs across ten subsidiaries operating in Sri Lanka. Using qualitative data, it shows that while subsidiaries’ implementation of local CCR conform to that of their parents at an aggregate level, those subsidiaries encountering higher levels of institutional conflict in the host-country, are sanctioned by their parent companies to de-couple their local CCR projects. These findings raise interesting questions about the dynamism in subsidiary responses to resolving institutional duality relevant for future scholarly research.     

Strategic opportunity and economic performance in multinational enterprises: The role and effects of information and communication technology

Recent work on multinational enterprises (MNEs) argues that diversity in terms of the markets they serve and the environments they acquire inputs from provides strategic opportunity unavailable to purely domestic firms. However, MNEs are also exposed to higher levels of complexity and uncertainty due to the presence in different locations and confront associated needs to integrate and coordinate activities. This paper suggests that the attendant cost–benefit tradeoff can be influenced by computer-mediated communication. Based on a sample of 88 organizations in the computer products industries, we find that multinationality in itself does not guarantee a higher level of strategic opportunity. Instead, use of information technology to facilitate communication among managers across functional and geographical boundaries enhances coordination of multinational activities in the development of strategic opportunity, which in turn is associated with superior performance.     

Marketing mix standardization in multinational corporations: A review of the evidence

This paper reports the findings of a systematic review of literature on marketing mix standardization in multinational corporations. The objective is to extract and synthesize ‘best evidence’ regarding marketing mix standardization practices in multinational corporations and to identify evidence regarding the performance impact of marketing mix standardization. Beyond relevance to an academic audience, this review could be useful for management practitioners in multinationals seeking to integrate operations across borders. In this context, the paper seeks to make a contribution to evidence based policy and practice.     

Oppurtunities and pitfalls for multinational corporations in a changed political environment

A new era of conflict surrounds MNC operations, especially as they pertain to the Third World countries. This era is accompanied by a rather significant change in the socio-political global environment that makes the direction of future conflict qualitatively different. Historical stereotypes are likely to be irrelevant and may actually lead to erroneous strategies with unfortunate consequences for all concerned. The author looks at some of the more important changes that have recently been taking place in the global economic and political environment.     

How to identify liabilities of foreignness and assess their effects on multinational corporations

This article examines the liabilities of foreignness construct and discusses key methodological and research design issues facing liability of foreignness researchers. After reviewing past studies and more recent liabilities of foreignness research, I discuss definitional issues related to this construct. I then present a two-part research framework designed to first help identify a specific liability of foreignness in a focal country, and then help identify factors that minimize the effects of that specific liabilities of foreignness. I also discuss multinational management issues at the corporation level that likely affect liabilities of foreignness experienced at the foreign subsidiary level.     

Human resource practices of multinational organizations in Belgium

This study uses data from a survey of 117 large organizations located in Belgium to examine the relationship between corporate ownership and personnel practices. Results obtained from multivariate analyses supported the general hypothesis that personnel policies and practices vary as a function of ownership and nationality. For example, foreign-owned firms are found to be more advanced in their adoption of methods to gain employee loyalty and commitment than domestic enterprises. In addition to ownership effects, the moderating effects of some key organizational characteristics were examined. This shows that large differences exist with respect to the human resource practices used in firms as a function of management philosophy, creative strategy and industry sector.     

Work systems in heavy engineering: the role of national culture and national institutions in multinational corporations

This paper is based on an Anglo-German research project of two research groups in both countries. It is based on data collected by qualitative research in the three largest multinational corporations (MNCs) in the lift and escalator industry. The headquarters (HQs) of the three corporations are based in the United States, Finland and Germany, respectively, and all three MNCs each have subsidiaries in Germany and Britain. Our main objects of analysis were change processes in the work systems of these three MNCs.We chose the lift and escalator industry as an example because it has been characterized by strong concentration processes during the last 10 years. Most of these corporations have grown by acquisition and there are strong tendencies in the market towards standardized, globally uniform products.National cultures and institutions, first of all play a role on the HQ level. Important areas were the standardization of products and production technology, the design of management systems and location and relocation decisions for R&D and manufacturing. Second, MNCs take differences in national cultures into account and deliberately “use” them in allocating resources and investment within the multinational group. National cultures and institutions massively shape the very formulation of manufacturing strategies within the multinational groups, as well as the R&D strategies—a particular important field in an industry still relying heavily on small-batch and unit production. National cultures also play a significant role in implementing the global strategies of MNCs in different host countries. Our data reveal striking differences on this level.     

Conflict in foreign subsidiaries of Japanese and western multinational corporations: The impact of cultural distance and differences in home-host country combinations

This article investigates the degree of conflict between different groups of employees in MNC subsidiaries in relation to different home-host country combinations. More specifically, we compared the degree of conflict of Western subsidiaries in Japan and Japanese subsidiaries in the West. We based our comprehensive investigation on data from 617 US and German subsidiaries in Japan as well as Japanese subsidiaries in the USA and Germany (and, for comparative reasons, US subsidiaries in Germany and German subsidiaries in the US). Possibly rather surprisingly, our results indicate that different degrees of cultural distance between home and host country do not lead to different degrees of conflict in MNC subsidiaries. We suggest that expected conflicts, due to substantial cultural differences, induce employees to actively counteract such problems, leading ultimately to a reduction of real conflicts. Furthermore, while previous literature suggested that in particular Japanese subsidiaries in the West are prone to a high degree of conflicts, our findings suggest that Western subsidiaries in Japan are even more conflict-laden. This should caution Western companies against complacency when operating in Japan.     

Psychological capital and the intent to pursue employment with developed and emerging market multinational corporations

The entrance of emerging market multinational corporations (EMNCs) into developed markets and their subsequent demand for western talent is an important new research topic in the field of human resource development (HRD). Upon entering developed markets, EMNCs will find themselves competing with a host of well-established western firms for the same limited pool of talent. Due to possible liability of origin issues, EMNCs may be perceived as less attractive employers. Human resource development professionals tasked with helping these newly arrived firms to recruit necessary talent will find the ability to identify those individuals most likely to pursue employment with an EMNC highly beneficial. In pursuit of this goal, five hypotheses were tested on 703 American and European respondents. Specifically, we examined the interaction between the level of psychological capital of western job seekers and their intent to pursue employment in order to identify possible predispositions for finding EMNCs as attractive employers.     

The diffusion of advanced manufacturing technology in multiplant,multidivisional corporations

This study examines several factors which act as significant predictors of successful intra-firm advanced manufacturing technology (AMT) diffusion. Our findings suggest that the following factors positively impact the diffusion process: previously successful AMT implementations, advanced manufacturing centers, AMT workshops, informal networks, simultaneous R&D of products and processes, and the significance of the impact of AMT on operating performance. One factor—cost and time overruns with previous implementation projects—emerged as a deterrent to successful AMT diffusion. Our results also indicate that the use of an outside consultant as a major source of transfer expertise significantly contributes to AMT diffusion success.