Knowledge Transfer Enablers and Innovation Performance of International Strategic Alliances: An Integrated Framework

Abstract

Dynamics of globalization has amplified the importance of collaborative forms of organizations in international business. Strategic alliance is a result of such demanding business regime. Knowledge is increasingly replacing traditional resources like land, labour, and capital to become the basic economic resource in the modern era. Knowledge transfer is one of the most critical parts of knowledge management process enabling exchange of important information which is essential for efficient working of international joint ventures, mergers and acquisitions and other types of strategic alliances. Thus the purpose of this study is to provide an integrated framework, after doing a structural and systematic and structural literature review, linking knowledge transfer enablers with innovation performance of international strategic alliances. Organizational knowledge transfer enablers have been identified from literature. Research gap has been identified that there is relatively less studies on the topic of impact of knowledge transfer on innovation performance of international strategic alliances, while incorporating the mediating/moderating role of absorptive capacity, especially in Indian context. Thus this study has tried to provide an integrated framework to fill this research gap. All the variables in the framework are explored in detail to identify their items for developing a questionnaire for future empirical testing. The current paper is conceptual in nature and undertakes qualitative research. It uses secondary sources of data including research studies of national and international repute on the subject of knowledge management in international strategic alliances. Systematic and structural review of literature has been done. Various knowledge transfer enablers have been identified from literature. Various items for measuring different constructs of knowledge transfer enablers, transferred knowledge, absorptive capacity of the alliance and innovation performance of international strategic alliances will be identified. These items will be used for developing a questionnaire after experts’ opinion and proper validation process. The questionnaire will be developed after adapting various standardised scales of different variables according to Indian context for future empirical testing in international joint ventures. Top and middle level corporate managers of currently operating international strategic alliances in India since 1992, having knowledge about the concerned area, will form the population for this pan India study. Factor analysis will be applied to confirm various knowledge transfer enablers identified from literature. Smart-PLS will be used to check the various relationships of the research framework and to check the model fit. According to literature, organizational factors like strategy, culture, organizational structure and design and technological factors like IT based systems have a significant impact on knowledge transfer. These variables have been made more specific after extensive structural and systematic literature review. Thus learning strategy, trust culture, flexible organizational structure and design, IT based systems in context of international strategic alliances are included in the proposed research framework. Knowledge transfer dimensions are identified as tacit/personalized and explicit/codified. Dimensions of innovation performance have been explored and identified as product & service innovation, process & technical innovation. All these constructs are used to develop an integrated framework and a questionnaire will be developed for future empirical testing. The paper is conceptual in nature thus lacks empirical evidence. Despite the researchers best attempt some items effecting knowledge transfer might have been left untouched. This study proposes a framework for international strategic alliances like joint ventures and mergers and acquisitions which require rigorous knowledge transfer, future studies may concentrate on other forms of strategic alliances like licensing, franchising, etc. which require different styles of knowledge transfer. It is proposed to be a cross-industry study which may result in general results, thus demanding a need for industry specific knowledge transfer studies. Industry specific studies may yield detailed results as some industries may be more knowledge specific for example software industry in comparison to transport industry. The study has provided a relationship between knowledge transfer and innovation performance but has ignored other important parameters of performance like financial performance, operational performance, etc. which future researchers may take into consideration. Despite these limitations, this study is one of the early attempts in India to study the impact of knowledge transfer on international strategic alliances’ innovation performance. The current paper is an attempt to propose an integrated research framework which can study the impact of knowledge transfer on innovation performance in case of international strategic alliances. Very few researchers have incorporated factors, transferred knowledge, absorptive capacity and innovation performance in a single study. This study emphasizes on the moderating/mediating role played by absorptive capacity in influencing the relationship between knowledge transfer and innovation performance. As per the proposed propositions 1a, 1b, 1c, 1d, the first part of the proposed research framework studies the direct relationship between various knowledge transfer enablers and knowledge transfer in terms of codified and personalized knowledge transfer. An important variable: absorptive capacity is added in the framework to study its role in the relationship of knowledge transfer and innovation performance. Literature has supported moderating role of absorptive capacity as proposed by proposition 2. Thus it is incorporated in the framework but the relationship will be confirmed with empirical testing. As per proposition 3, knowledge transfer has also been directly linked to innovation performance of the business firm. The second part of the framework takes into consideration the relationship between knowledge transfer and international strategic alliances’ innovation performance. The framework is presented diagrammatically in figure. This study will help future researchers as a comprehensive review on the topic and will be useful for alliance managers as well to improve knowledge transfer for better performance. It can also be helpful in improving the survival rate of alliances as effective knowledge transfer helps employees (or strategic alliance partners) to understand each other in a better manner thus improving the co-operation among them which is essential for survival and growth. Thus this review study has many implications for academicians as well as alliance managers. The study is original in nature. It has proposed an original integrated framework to study the impact of knowledge transfer on innovation performance of international strategic alliances in India.