A Knowledge System Approach to the Multinational Company: Conceptual Grounding and Implications for Research

Abstract

The role of knowledge, organizational learning, and innovation as levers of competitive advantage is now a commonly acknowledged insight in research in international management. However, while the agglomeration of insights of described as the "knowledge-based view" is a promising theoretical lens, insights are not organized into a unifying framework and there are significant holes in the understanding of how knowledge may be turned into a source of competitive advantage for MNCs. In order to advance the knowledge-based theory of the MNC, we develop the notion of the MNC as a global knowledge system linking local knowledge structures and combining local knowledge elements that are complementary to confer strategic advantage, and relate this to the theory of complex systems deriving from the work of Herbert Simon. These ideas are used to frame the changing environments, strategic intents, and learning stances that characterize MNCs, and to derive a set of research challenges for MNC research. KEYWORDSKnowledge-based view of the MNC, knowledge structure, complementarities, complex systems.2

Knowledge Transfer from TNCs and Upgrading of Domestic Firms: The Polish Automotive Sector

“…The debate over the impact of TNCs on host country development is extensive (see Meyer, 2004 for a review), and different streams of literature bring complementary insights into factors facilitating knowledge transfer, acquisition, and the use of externally acquired knowledge by local suppliers. The international business literature emphasizes that TNCs possess superior knowledge in foreign markets (Caves, 1996), in part because they operate complex knowledge systems, with inflow and outflow of knowledge internally and externally (Foss & Dos Santos, 2011). Development studies contributions on TNCs' linkages (Hirschman, 1958), focus on voluntary and involuntary knowledge transfer (Narula & Zanfei, 2005, chap. 12), which lead to an improvement in supplier performance and competencies (Lorentzen et al, 2003).…”

“…For this reason, several studies point to the positive outcome of technological intensity in foreign affiliates and backward linkages creation (Belderbos, Capannelli, & Fukao, 2001;Lorentzen et al, 2003;Jindra et al, 2009). Thirdly, extant literature on foreign affiliates demonstrates that the greater the extent of affiliate autonomy, the better the ability of the affiliate to form favorable, external network linkages with other companies and institutions in its local environment (Forsgren, Holm, & Andersson, 2005;Foss & Dos Santos, 2011), and thus have a positive impact on local vertical business partners (Jindra et al, 2009;Hansen et al, 2009, 125).…”

Development of Knowledge Economy Framework in the Life Science Sector in the Kingdom of Saudi Arabia

“…The current situation of dispersed technologies over the world means that reliance on in-house R&D as the only way to competitive advantage no longer accepted, which entails firms adopting internal and external approaches to develop new products and services that match customers' values and expectations (Augier & Teece, 2007). With This approach requires specific managerial skills and capabilities to facilitate the exploring and exploiting processes (Foss & Santos, 2011). Among the managerial skills and with respect to the nature of different cultures and values relevant to the concept of sharing knowledge between the MNEs employees, MNEs should develop organizational cultures to mitigate the differences of culture values among employees, and this issue should be taken into account in the staffing process (Sandhu & Ching, 2014).…”