Based on a sample of 169 subsidiaries of MNCs operating in USA, Russia, and China, this paper investigates the relationship between MNC subsidiary HRM practices, absorptive capacity and knowledge transfer. The paper makes two key contributions. First, the paper examines the relationship between the application of specific HRM practices and the level of the absorptive capacity. Second, the paper suggests that absorptive capacity should be conceptualized as being comprised of two dimensions—ability and motivation. Further, results indicate that the interaction of ability and motivation (absorptive capacity) significantly facilitate transfer of knowledge from other parts of the MNC.
Introduction: Recent research emphasizes that the ability to create and transfer knowledge internally is one of the main competitive advantages of multinational corporations (MNCs) compared with their domestic counterparts. Indeed, Kogut and Zander (1993) emphasized that the MNCs’ ability to transfer knowledge more effectively and efficiently than the market is the primary reason for their existence. The MNC is considered to be a “differentiated network”, where knowledge is created in various parts of the MNC and transferred to several interrelated units (Hedlund, 1986; Bartlett and Ghoshal, 1989). The conceptualization of MNCs as differentiated networks has inspired a recent stream of research on the creation, assimilation and diffusion of internal MNC knowledge.
Author: Dana Minbaeva, Torben Pedersen, Ingmar Bjoerkman, Carl F. Fey, H.J. Park
Source: Copenhagen Business School
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