Knowledge, knowledge dynamics, and innovation: Exploration of the internationalization of a multinational corporation

Abstract

Purpose

Knowledge is a strategic resource for firms and it can enable them to achieve competitive advantage. Large companies engaged in internationalization pay particular attention to knowledge as a source of innovation. The purpose of this paper is to investigate current debates in the field: the first is about cumulative vs composite knowledge; the second concerns the degree of diversity and redundancy in knowledge-based dynamics; and the third debate is about incremental vs radical innovation.

Design/methodology/approach

The authors have used an inductive approach to perform a longitudinal case study of multinational corporation-semiconductor (MNC-SC). Total of 13 interviews were conducted over a four-year period. The MNC-SC case study has given the opportunity to analyse knowledge resources, knowledge, and innovation processes in a context of internationalization.

Findings

The findings indicate that in order to achieve technological innovation in a context of internationalization, the company builds knowledge in a cumulative fashion, which can create a path dependency problem. To ensure complementarity between cross-functional teams located long distances from one another, and maximize the utilization of resources, MNC-SC must establish common standards. To maximize returns from composite knowledge, in a context of internationalization, knowledge diversity is preferable over redundancy. However, true knowledge transfer, sharing, and learning are limited. Combinatorial and incremental innovation through internationalization is a process based on trial and error; it maximizes technological performance and enables the company to fulfil needs without diverging from the technological trajectory of the SC industry.

Originality/value

The internationalization process revealed limitations: limited understanding of the content of each knowledge module, competency traps, limited innovativeness, and therefore limited wealth creation.

Citation

Scaringella, L. (2016), "Knowledge, knowledge dynamics, and innovation: Exploration of the internationalization of a multinational corporation", European Journal of Innovation Management, Vol. 19 No. 3, pp. 337-361. https://doi.org/10.1108/EJIM-05-2015-0031