Subsidiaries as straddling fields and the trade-off between knowledge development and knowledge transfer Online publication date: Thu, 28-Aug-2014
by Christine Holmström Lind
International Journal of Business Environment (IJBE), Vol. 5, No. 2, 2012
Abstract: Drawing from work emphasising that foreign subsidiaries are exposed to a tension between the pressure to adapt to the local environment and the pressure to remain integrated within the organisation, this paper provides empirical evidence of the existence of a trade-off between the external embeddedness of subsidiary knowledge development and subsidiary knowledge transfer. It also explores the moderating effects of intra-organisational power and intra-organisational relationships on this trade-off. The study is based on data from 973 foreign-owned subsidiaries. The findings show that, when treated as moderating variables, subsidiary autonomy reinforces the tension that exists between knowledge development and transfer activities among multinational (MNC) subsidiaries, whereas subsidiary influence and the subsidiary's level of embeddedness in corporate relationships reduce this tension. Implications for managers and suggestions regarding future research are included.
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