Academic journal article International Journal of Management

A Conceptual Framework of Knowledge Transfer within Multinational Corporations: A Strategic Orientation

Academic journal article International Journal of Management

A Conceptual Framework of Knowledge Transfer within Multinational Corporations: A Strategic Orientation

Article excerpt

This paper develops a theoretical framework to examine the impact of human resource management orientation on the transfer of knowledge within MNCs. Adaptive, Exportive, and Integrative are the three common strategic human resource orientations employed by MNCs to achieve either internal (intra-organization) or external (between organization and environment) or both internal and external consistency. The different types of orientations create different level of cooperation and competition among MNC subsidiaries and headquarter located in different countries. This influences knowledge transfer in MNCs by influencing motivation of exchange partners, transmission channel, level of cultural similarities among units, and quality of the relationship (e.g., trust). Additionally, an MNC's human resource management orientation influences the directionality ofknowledge transfer (upward, downward, and lateral) between subsidiary/ subsidiary and headquarters/subsidiary.

Introduction

Knowledge has been proposed as a potential source of sustainable competitive advantage for firms (Gupta

To date, much of the research in the knowledge management area has focused on inter-organizational transfer ofknowledge either within a country or across boundaries (Bjorkman, Bamer-Rasmussen «fe Li, 2004). Presumably, intra-organization knowledge transfer is easier than inter-organizational knowledge transfer (e.g., Kogut «fe Zander, 1992). However, this assumption oversimplifies the problems faced by MNCs, whose subsidiaries operate across different milieus and in different national cultures. While subsidiaries coexist with the other organizational units in a similar organizational culture, they cannot remain isolated from their local and national environments (i.e., host country cultures) which affects the participating units' culture. The complexities of managing subsidiaries, which are subject to cultural variations in their host countries, may make the intra-organization transfer of knowledge similar to inter-organization transfer of knowledge between organizations. While sharing a common schema with other subsidiaries of a common parent, they are also subject to certain variability among their membership. For an individual subsidiary, everyday market activity exposes it to a host of economic, institutional, competitive, and other pressures extant in the host country's culture. As the focal subsidiary becomes assimilated into the host country's culture, the subsidiary's efforts to accommodate cultural expectations consistent with their specific operating domain may shape or distort their internal environment relative to other subsidiaries. Thus, in an MNC, subsidiaries' organizational cultures may not be exactly the same, even though they share a common parent company. It does not matter whether the resultant variation that occurs reflects intentional (e.g., directed learning) or unintentional coping behaviors, the result is that the knowledge transfer process among subsidiary units in an MNC may closely resemble that of inter-organizational transfers between unrelated businesses. …

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