Title: Internationalisation of innovative activity in Finnish multinational enterprises

Authors: Mo Yamin; Rudolf R. Sinkovics; Christopher Richardson

Addresses: Centre for Comparative and International Business Research, Manchester Business School, The University of Manchester, Manchester, M15 6PB, UK ' Centre for Comparative and International Business Research, Manchester Business School, The University of Manchester, Manchester, M15 6PB, UK; Lappeenranta University of Technology, Skinnarilankatu 34, PL 20, 53851 Lappeenranta, Finland ' Graduate School of Business, Universiti Sains Malaysia, 11800 Penang, Malaysia

Abstract: This paper examines two aspects of the internationalisation of innovation in Finnish multinational companies, the growing innovativeness of foreign subsidiaries ('creative subsidiaries') and the phenomenon of 'cross-fertilisation', between R&D labs in Finland and those in foreign subsidiaries, in the innovative process of Finnish MNEs. We review existing literature pertaining to innovation in multinational enterprises and the growing capability of foreign subsidiaries to undertake innovation. Consistent with the general thrust of the literature we develop and examine two hypotheses relating to subsidiary innovation and cross-fertilisation between subsidiaries and the parent for 30 Finnish MNEs between the years 1975-1995, employing patent data from the US patent office. Our findings provide support for the hypotheses. We conclude by pointing out the limitations of the current study and deriving implications from our findings for future research.

Keywords: multinational enterprises; MNEs; innovation internationalisation; cross-fertilisation; research and development; R&D labs; Finland; foreign subsidiaries.

DOI: 10.1504/EJIM.2014.060771

European Journal of International Management, 2014 Vol.8 No.3, pp.310 - 330

Received: 12 Nov 2012
Accepted: 12 Nov 2012
Published online: 14 Oct 2014 *

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