Innovation In Multinational Corporations Research Articles

Effectiveness of Employee Training and Development in Increasing Productivity and Innovation in Multinational Companies

This study explores the effectiveness of employee training and development in enhancing productivity and innovation within multinational companies. Utilizing a qualitative approach, this research employs literature review and library research to analyze existing studies and theoretical frameworks related to employee development strategies. The findings indicate that well-structured training programs significantly contribute to increased employee performance, job satisfaction, and overall organizational productivity. Moreover, continuous professional development fosters a culture of innovation by equipping employees with the necessary skills to adapt to rapidly changing market demands. The review highlights various training methodologies, including on-the-job training, mentoring, and e-learning, demonstrating their impact on enhancing workforce capabilities. Additionally, the study underscores thae importance of aligning training initiatives with organizational goals to maximize effectiveness. This research contributes to the understanding of how employee development can serve as a strategic tool for multinational companies seeking to maintain a competitive edge in the global market. Recommendations for future research include examining the long-term effects of specific training programs on employee retention and organizational success. Overall, this study emphasizes the critical role of employee training and development in driving productivity and innovation in multinational corporations.

Managing RKT: The Role of Knowledge Relevance and Impact on Exploitative and Exploratory Innovation

Building on knowledge management theory, this study develops a theoretical model and empirically examines the impact of reverse knowledge transfer on parent companies’ exploitative and exploratory innovation of Chinese multinational corporations (MNCs). The model was tested using survey data obtained from a sample of 197 MNCs. We estimated a structural equation model using AMOS 24.0. Our study suggests that reverse knowledge transfer significantly enhances exploitative innovation and it also have a positive effect on exploratory innovation. Moreover, the association between reverse knowledge transfer and the two types of innovation is moderated by knowledge relevance. There is an insignificant result for the positive moderating effect of knowledge relevance on the relationship between reverse knowledge transfer and exploitative innovation. We also find that the association between reverse knowledge transfer and exploratory innovation is weaker when the level of knowledge relevance is high. These results confirm the significance of reverse knowledge transfer towards innovation in MNCs. In addition, it indicates that to inspire exploratory innovation what is a-priori considered relevant (in terms of the class of primary technologies dominant in the parent firm) is not important. Indeed, ideas for truly new inventions often are discovered in other industries.

Practice creation in multinational corporations: Improvisation and the emergence of lateral knowledge

Lateral collaboration across subsidiaries is beneficial for innovation in multinational corporations (MNCs), such as the creation of new organizational practices, because it helps working towards shared, rather than subsidiary-centric, objectives and creates new knowledge. To instill lateral collaboration, prior research has mainly focused on coordination mechanisms that rely on interpersonal exchanges among dispersed individuals across subsidiaries. However, due to rising concerns over coordination cost and sustainability of international travel, MNCs are increasingly challenged to search for other approaches that require less direct interpersonal interaction across subsidiaries. We, therefore, ask: How can MNCs elicit lateral collaboration during practice creation in a less space-time sensitive way? Drawing on a longitudinal case study, we develop a model of practice creation in MNCs. Our model offers two main insights. First, it details a novel approach for unleashing the benefits of lateral collaboration in globally-linked innovation processes in MNCs. In contrast to emphasizing coordination mechanisms that focus on interpersonal interactions across subsidiaries, our study contributes by detailing the emergence of lateral knowledge through a shared technological artefact as key enabler. Second, our model illuminates how MNCs can innovate new organizational practices that reflect both MNC and local subsidiary needs by adopting an improvisational approach.

Subsidiary innovation performance: Balancing external knowledge sources and internal embeddedness

Abstract The open innovation (OI) literature has focused primarily on OI strategies and external sourcing of knowledge at the organizational level and has paid less attention to the role of subsidiaries in the OI activities of multinational corporations (MNCs). In contrast, International Business (IB) scholars have shown that subsidiaries play an emergent role in MNC innovation activities and have highlighted the relevance of subsidiaries' external and internal linkages. In this paper, we bring together these perspectives by examining OI at the subsidiary level within MNCs and test our hypotheses through an empirical analysis using data from 91 MNC subsidiaries. Our findings show an inverted U-shaped relationship between the openness of subsidiaries to external knowledge sources and innovation performance. Moreover, we find that subsidiaries' internal embeddedness positively moderates the above relationship. Practically, our findings suggest the need for MNC and subsidiary managers to develop mechanisms to manage intra-organizational relations in order to achieve improved innovation performance while leveraging of external knowledge sources at the subsidiary level, thus favoring MNCs' knowledge management (KM) approach. We contribute to different interrelated streams of research by providing compelling evidence to support the assertion that subsidiaries need to balance external and internal openness.

Factors influencing the application of nature as inspiration for sustainability‐oriented innovation in multinational corporations

AbstractNature‐inspired innovation (NII) is an increasingly common innovation strategy, yet little is known about its implementation within corporate innovation settings. This paper asks what factors influence the application of NII in corporate contexts. It combines theoretical perspectives from innovation adoption and sustainability‐oriented innovation to explore factors that influence the implementation of NII. Six case studies of multinational corporations applying NII were analyzed, using data collected through semistructured interviews (N = 45), a review of internal project documents, and publicly available materials. Results indicate that successful implementation depends upon the characteristics of the innovation context, decision‐making units, and the innovation itself, such as an advanced organizational progression of corporate sustainability, senior leadership support of NII, design expertise within innovation teams, flexible innovation management processes, and collaboration with outside enabling stakeholders. NII should be viewed as a longer‐term investment in developing organizational sustainability culture rather than a one‐off approach to innovation.

Engaging Customer Cocreation in New Product Development Through Foreign Subsidiaries: Influences of Multinational Corporations’ Global Integration and Local Adaptation Mechanisms

Efforts to engage customers in cocreating new products have garnered much research attention from studies documenting customer cocreation’s (CC’s) positive impact on firm innovation and performance. Less research, however, has counterbalanced the bright side with the potential dark side of CC, especially as a strategy for multinational corporations (MNCs) operating in foreign markets. This study examines how MNC subsidiaries’ CC affects new product innovativeness and knowledge leakage to competitors. Adopting a broader agency perspective to recognize that subsidiaries often do not perform up to headquarters’ expectations due to both self-serving opportunism and honest incompetence, this study explores how CC effects are contingent on MNCs’ global management mechanisms. Using a dyadic managerial survey of 238 MNC subsidiaries, the authors find that MNCs can control knowledge leakage by implementing proper global integration and local adaptation mechanisms. However, CC may not improve new product innovativeness, except when the subsidiary has low local research-and-development staff influence. This study contributes to the CC literature by showing its benefits, challenges, and boundary conditions as a growing MNC innovation strategy.

Innovation in MNC’S strategy and structure: the (re) emergence of host country headquarters in large emerging markets

Recent trends in the organization of multinational corporations (MNCs) in large emerging markets point to the (re)emergence of a host country headquarters (HCHQ) as a central structural element to the implementation of MNCs’ strategies in these countries. Yet, academic research on the strategy, structure and the organization of MNCs’ subsidiaries in a country has yet to account for this recent structural phenomenon. To help better understand this innovation in MNCs’ structural organization, we develop a new classification scheme, which focuses on the totality of an MNC’s subsidiaries within a single host country as a unit of analysis. As such, we emphasize an HCHQ perspective rather than a corporate headquarters (HQ) or a subsidiary perspective. We motivate this new classification scheme by leveraging the limitations of prior studies as well as considering the opportunities this new perspective offers for research on MNCs and for practice in international management.

Top management team nationality diversity, corporate entrepreneurship, and innovation in multinational firms

Research SummaryWe integrate insights from upper echelon theory and the literature on innovation and multinational corporations (MNCs) to develop a framework explaining when and why nationality diversity in top management teams (TMTs) affects corporate entrepreneurship—as evidenced by diversity in global knowledge sourcing—and through this innovation performance in MNCs. In a panel of 165 manufacturing MNCs based in 20 countries, we confirm that the positive effects of TMT nationality diversity on corporate entrepreneurship and innovation are only unleashed in TMTs with low social stratification and in MNCs located in home countries that are low in national power distance. Our study contributes to opening up the black box of the upper echelon's strategic role in spurring entrepreneurship and innovation in MNCs embedded in different cultures.Managerial SummaryThe internationalization of TMTs in MNCs has been increasing in response to the globalization of markets and sources of knowledge. In this study, we examine under what circumstances MNCs that have TMTs comprised of executives with diverse nationalities exhibit stronger innovation performance. Analysis of leading corporations from 20 countries over a period of 10 years reveals that MNCs with diverse TMTs engage more in corporate entrepreneurship and subsequently see increased innovation performance—but only when these TMTs are operating in environments characterized by equal distribution of power and low hierarchy. The findings underscore the important role of corporate headquarters and TMT composition in the strategic management of modern MNCs.

The Influence of Multiple Knowledge Networks on Innovation in Foreign Operations

Although extant literature has long argued that firm embeddedness within knowledge networks increases innovation, we know much less about how interactions across multiple knowledge networks jointly influence learning and innovation outcomes within firms. This paper contributes to our understanding of global innovation in multinational corporations (MNCs) by exploring how competing tensions across parent, host-country, and third-country knowledge networks in terms of knowledge domain diversity and dominance, organizational bias, and knowledge relevance perceptions influence innovation outcomes. Empirical results from a comprehensive panel of U.S. MNCs reveal different “preferred” combinations of high and low embeddedness across parent, host-country, and third-country knowledge networks for incremental versus radical innovation outcomes, reflecting how competing tensions across knowledge networks can limit or enhance knowledge search for diverse knowledge and influence innovation outcomes in the foreign operations of MNCs.

Innovation in MNC’s Strategy and Structure: The (Re)emergence of Host Country Headquarters

Recent trends in the organization of multinational corporations (MNCs) in large emerging markets point to the (re)emergence of a host country headquarters (HCHQ) as a central structural element to ...

How the parent–subsidiary relationship encourages subsidiary-driven innovation and performance in Korea: the perspective of subsidiary autonomy

ABSTRACTFrom the perspective of subsidiary autonomy, this study addresses what affects subsidiary-driven innovation in multinational corporations (MNCs). This study examines this question from three dimensions: (1) top management team (TMT) leadership, (2) knowledge links and (3) organizational size. Our model is tested using a sample of 250 MNC subsidiaries located in Korea. We found that non-expatriate or entrepreneurship-oriented TMT leadership generally enhances subsidiary-driven innovation. We also found that the level of networking with local knowledge sources is associated positively with subsidiary-driven innovation. In addition, the relative size of the subsidiary shows an inverted U-shaped relationship with subsidiary-driven innovation. Finally, the relationship between subsidiary-driven innovation and subsidiary performance is positively moderated by environmental dynamism. The results suggest that as foreign subsidiaries gain autonomy, the likelihood of subsidiary-driven innovation increases.

The knowledge protection paradox: imitation and innovation through knowledge sharing

Western multinational corporations (MNCs) that want market access in China have to share knowledge with Chinese partners. This may expose them to imitation, so MNCs prefer to protect knowledge resulting in a strategic paradox: MNCs have to both share and protect knowledge. To analyse this paradox, we developed a theoretical conceptual model capturing the tensions and feedback cycles of this paradox. Next, based on data from the shipbuilding industry, a system dynamics model was developed to simulate the long-term effects of sharing and protecting strategies. The results indicate that protection is detrimental to long-term success, because it undercuts the trust of the Chinese supplier and irreparably reduces innovation rates. Knowledge protection thus reduces instead of increases the ability to share (new) knowledge in the future. A sharing strategy increases imitation, but also trust and knowledge sharing by the Chinese partner, such that it enhances the MNC's innovation rate and long-term performance.

Problem solving in MNCs: How local and global solutions are (and are not) created

It is widely acknowledged in the international business literature that subsidiaries can make a strategic contribution to multinational corporations (MNCs). Departing from the common focus on subsidiary role, contexts and organizational MNC factors, this study explores the micro-level details of managers’ actions and interactions. We conducted an in-depth qualitative study into 38 problem-solving processes employed across four subsidiaries. Taking a non-routine problem-solving perspective on how subsidiaries contribute strategically to renewing MNC competences, this paper uncovers four problem-solving approaches: local template adaptation; superior technology creation; local template creation; and global principle creation. The findings depict how the way problems are framed influences knowledge search and solution-finding activities, and how these different activities may result in local and global solutions. The paper extends insights into MNC innovation and subsidiary initiative by detailing how subsidiary managers navigate different problem-solving approaches, and contributes to discussions on the micro-foundations and social aspects of MNC knowledge flows, revealing factors that trigger distance-spanning knowledge search.

Innovation for Inclusive Business: Intrapreneurial Bricolage in Multinational Corporations

abstractIt is often argued that multinational corporations (MNCs) are in a unique position to innovate business models that can help to alleviate poverty. This empirical study into intra‐organizational aspects of pro‐poor business innovation in two MNCs suggests, however, that certain elements of their management frameworks – such as short‐term profit interests, business unit based incentive structures, and uncertainty avoidance – may turn into obstacles that prevent MNCs from reaching their full potential in this respect. We introduce the concept of intrapreneurial bricolage to show how middle manager innovators may promote pro‐poor business models despite these obstacles. We define intrapreneurial bricolage as entrepreneurial activity within a large organization characterized by creative bundling of scarce resources, and illustrate empirically how it helps innovators to overcome organizational constraints and to mobilize internal and external resources. Our findings imply that intrapreneurial bricolage may be of fundamental importance in MNC innovation for inclusive business. In addition to the field of inclusive business, this study has implications for the study of bricolage in large organizations and social intrapreneurship, as well for managerial practice around innovation for inclusive business.

Global Innovation in MNCs: The Effects of Subsidiary Self‐Determination and Teamwork*

The ability of multinational corporations (MNCs) to leverage their innovation competencies across globally dispersed subsidiaries is an increasingly valuable source of competitive advantage. As multinational enterprises turn to foreign subsidiaries for research and development (R&D) and product development, questions arise regarding the most effective organizational structures for global innovation. Although organizational conditions that satisfy the needs for self‐determination and teamwork have long been considered intrinsic motivators, past research has not analyzed the consequences of intrinsic motivators on global innovation. The basic research question is this: In globally dispersed subsidiary R&D units, what organizational conditions and motivators are associated with the highest knowledge output? A sample of 275 globally dispersed R&D subsidiaries were studied from 1995 to 2002. Data were collected from a postal survey, field and telephone interviews, and secondary sources. Subsidiary self‐determination and teamwork were found to have a significant effect on knowledge output, as objectively measured by patent citations. Subsidiary self‐determination on inputs such as sourcing and hiring, and self‐determination on outputs such as marketing and product development, emerged as positive determinants of knowledge generation in R&D subsidiaries. In addition, interteam cooperation and intrateam cooperation were significant determinants of knowledge generation by subsidiaries. These findings highlight the importance of self‐determination, teamwork, and cooperation to knowledge creation and innovations. Managers face the tough challenge of how to motivate globally dispersed knowledge workers to conduct research that will generate knowledge and will strengthen firm performance. The results provide theoretical and practical insights on how MNCs can leverage their innovation competencies across foreign R&D subsidiaries.

Corporate Venturing Units:: Vehicles for Strategic Success in the New Europe

The reality facing multinational corporations (MNCs) is that traditional models of innovation are fast becoming obsolete. Multinationals used to manage innovation either through their centrally located research and development (R&D) activities (on a ‘‘centerfor-global’’ basis) or through the development activities of their individual subsidiaries (on a ‘‘local-for-local’’ basis). Economic changes confronting MNCs, however, bring these approaches into question. Increasingly, these traditional approaches are too slow to provide the necessary rates of innovation. They also fail to adequately recognize the interconnectedness of the corporation’s multiple geographic entities. In Europe, in particular, the reality facing MNCs has been – and continues to be – subject to fundamental political and economic shifts, which mean that the localfor-local model is no longer feasible or appropriate, and the center-for-global model only works for a small subset of cases. New models of MNC innovation are emerging that recognize a new set of ‘‘rules.’’ Under these new rules ideas, skills and initiative can come from anywhere – anywhere inside the company, and outside it as well. While multinationals may still steer innovation from the center, it is increasingly recognized that individuals and units anywhere in the world may be involved, and that the

Book reviews

Books reviewed:R. Woodhead and J. McCuish, Thomas Telford., Achieving Results: How to Create ValueGrazia D. Santangelo, Innovation in Multinational Corporations in the Information Age: The Experience of the European ICT IndustryCharles Edquist, Edward Elgar, The Internet and Mobile Telecommunications Systems of InnovationTakuji Hara, Edward Elgar, Innovation in the Pharmaceutical Industry: The Processes of Drug Discovery and DevelopmentNiko Marcel Waesche, Edward Elgar, Internet Entrepreneurship in Europe: Venture Failure and the Timing of Telecommunications Reform

Innovation in multinational corporations: control and communication patterns in international R&D operations

This paper addresses issues of global innovation in multinational corporations by examining the patterns of communication and control in international RD (2) local and international adaptors both focus their communication on their internal corporate network; and (3) international creators have strong internally and externally oriented networks of relationships. The implications for the management of global innovation are discussed. © 1998 John Wiley & Sons, Ltd.

Innovation in multinational corporations: control and communication patterns in international R&D operations

Innovation in multinational corporations: control and communication patterns in international R&D operations