Knowledge Transfer in Multinational Corporations

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Effective knowledge transfer requires deliberate managerial action, particularly in multinational organizations formed through mergers and acquisitions. These organizations face unique challenges as individual subunits are influenced by their local environments and often exhibit distinct organizational cultures, administrative histories, and work practices. Research on mergers and acquisitions highlights the significant obstacles to achieving synergies through knowledge sharing in such contexts. The foundation of current literature on knowledge and its transfer can be traced back to seminal works by Nelson and Winter, and further developed by Winter's exploration of tacit versus codified knowledge, along with contributions from Kogut and Zander. This literature views the multinational firm as a social community focused on knowledge creation and transfer. The concept of 'higher order organizational routines' and employee 'identifications' enables firms to transfer knowledge, particularly tacit knowledge, more efficiently and cost-effectively than through external means like licensing or imitation. This perspective explains the existence of firms without relying on notions of opportunism or transaction costs, which has contributed to its widespread acceptance.