Academic journal article Management International Review

Headquarters' Influence on Knowledge Transfer Performance

Academic journal article Management International Review

Headquarters' Influence on Knowledge Transfer Performance

Article excerpt


* This paper investigates headquarters' value-adding role in knowledge transfer. Transfer performance is considered in terms of both efficiency and effectiveness, and a model that includes headquarters' distribution of decision-making rights, resource allocation, and direct intervention is tested on 141 innovation transfer projects.

* The findings indicate that headquarters have both positive and negative influences on the efficiency and effectiveness of transfer processes. There is thus a need to consider the inherent trade-offs in the choices made in promoting knowledge transfer.

Keywords: Headquarters * Knowledge transfer * Efficiency * Effectiveness * Transfer performance


The strategic imperative of multinational companies (MNCs) is often characterized by coordinating and leveraging dispersed knowledge-based assets (Kogut and Zander 1992; Doz et al. 2001). Headquarters play a critical role in coordinating, promoting, and sustaining interunit knowledge transfer (Chandler 1962, 1991; Foss 1997). This paper investigates how headquarters can add value by influencing knowledge transfer performance.

We consider three areas where headquarters have the discretion to promote knowledge transfer. The first is through the distribution of decision-making rights, i.e., defining the overall organization and establishing unit responsibility (Ghoshal and Bartlett 1988; Foss 1997). The second area of headquarters activity is resource allocation (Ghoshal and Bartlett 1988), as knowledge transfer often requires greater resources in terms of capital, supporting technology, managerial capacity, and specific competence. Finally, we consider the effect of direct headquarters participation in the transfer project.

We formulate and test six hypotheses, using partial least squares multivariate analysis, on a sample of 141 technology transfer projects. The results indicate that headquarters' actions affect knowledge transfer performance, but that there are trade-offs between efficiency and effectiveness that must be taken into account.

Our study contributes in two main ways. First, we shed light on how headquarters may add value by enhancing subsidiary knowledge transfer performance. Second, we develop and test a conceptual framework focusing on transfer performance; this goes beyond previous work that focuses on aggregate knowledge sharing in multi-unit organizations (Gupta and Govindarajan 2000; Hansen 2002; Tsai 2002; Bjorkman et al. 2004) and connects to recent research examining the successful transfer of best practices in MNCs (Kostova 1999; Kostova and Roth 2002).

Theoretical Framework and Hypotheses

In this section, we model how headquarters can affect knowledge transfer performance through the distribution of decision-making rights, resource allocation, and direct intervention. We start by specifying what knowledge transfer entails, noting especially the differences between modelling aggregate knowledge flows and specific transfer efforts. Next, we discuss performance in the context of knowledge transfer. We argue that performance is productively addressed in two dimensions---efficiency and effectiveness-that headquarters must consider in efforts to promote knowledge leveraging in their organizations. Following this, we formulate six hypotheses regarding how headquarters can affect knowledge transfer.

Knowledge Transfer Performance

The transfer of technology, know-how, and innovations has traditionally been seen as an important predictor of foreign direct investment in international business theory (e.g., Vernon 1966; Buckley and Casson 1976). In the present paper, we consider knowledge as the skills, routines, and information that relate to specific applications of industrial production. Through the transfer of knowledge, organizations attempt to close the gap between what is known and what is put to use (Cool et al. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed


An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.