This paper explores five competing theories for technological knowledge sharing within the globally dispersed R&D function of the multidivisional, multinational firm. These five broad explanations for why a knowledge transaction occurs are: (1) economic, (2) technological, (3) organizational, (4) geographic, and (5) sociological. In addition to occurrence, likelihood of knowledge exchange success prompted by various explanations is considered. Ultimately the determination of which argument—or combination of arguments—offers the greatest explanatory power for the sharing of intermediate technological knowledge may be answered empirically.
The organization and management of innovative activities in the multidivisional, multinational firm is the setting for this paper. A growing interest in this issue is at least partly related to the importance of technology in the present competitive environment.1 For a firm with globally distributed R&D operations, issues of coordination and control are of major significance (Ensign, 1999). “In high-technology environments, rapid technological change means that the value of a firm's existing knowledge is quickly eroded” (Hayton & Zahra, 2005: 256). The need to optimize and/or leverage technological knowledge that resides in different individuals or groups is vital. The sharing of resources such as scientific know-how is a major contributor to the achievement of firm growth and survival (Santoro and Saparito, 2006 and Tarn, 2006).
Based on a review of literature, the multidivisional, multinational firm can be conceptualized as a network of transactions.2Gupta and Govindarajan (1991: 770) describe these transactions as: capital flows; product flows; and knowledge flows. Bartlett and Ghoshal (1991: 169–170) also describe three flows in the multinational enterprise (MNE): flow of goods; flow of information; and flow of resources (including the transfer of technology and movement of personnel). The flow of technological knowledge between different R&D groups in an MNE is described here as technological knowledge sharing rather than technology transfer. Technology transfer has usually been used to indicate an exchange involving a finished product, a completed or self-contained parcel of technology (cf. Gopalakrishnan & Santoro, 2004). Technological knowledge sharing is used to represent an exchange of an intermediate good—the transmission or communication of scientific know-how from one context to another.
As Grant (1996: 114) states “transferring knowledge is not an efficient approach to integrating knowledge ….” Iansiti (1998: 2) too insists integration is the proper description; noting that “a technology cannot be separated from other technologies. Technologies act in conjunction with one another”—value is added through integration. Leonard-Barton (1990) indicates that there are shortcomings in the term transfer. Transfer connotes movement from one place to another. In the case of capital flows and product flows there is movement and no change in properties. The same cannot be said of knowledge flows, with the exception, perhaps, of simple explicit knowledge. 3 Knowledge flows involve sharing—defined as using, participating in, joining with others, taking part in, and receiving equally or together—which goes beyond where transfer or diffusion leave off ( Collins & Hitt, 2006). A knowledge transaction involves improvement in knowledge. 4 Our focus is on technological knowledge transactions, described as an exchange involving a source and a recipient. Technological knowledge is conceptualized as intermediate technology, scientific know-how, skills, and capabilities.
The focus of this paper is on understanding the explanations or reasons for technological knowledge sharing between dispersed R&D workers and groups. These are often described as motivations, needs, desires, or reasons why the sharing of technological knowledge occurs in the MNE. We suggest that there are five major competing theories or explanations for the occurrence and success of technological knowledge sharing. These are: (1) economic explanations, (2) technological explanations, (3) organizational explanations, (4) geographic explanations, and (5) sociological explanations (see Fig. 1). In each case, there is recognition of potential benefits that may result from sharing scientific know-how. Though this paper centers primarily on the intra-firm sharing of technological knowledge (Table 1) inter-firm sharing of technological knowledge was considered (Table 2).
This paper has considered various factors that may influence the sharing of knowledge among R&D workers. Stobaugh and Wells (1984) note that variables affecting the transfer of technological knowledge can be manipulated by the administrator. To that end, it is conceivable that the goals or intent of knowledge sharing may cause the manager to influence those parameters that can be dictated—organization systems, structure, etc. While cultural and physical distance may be unalterable, such factors can be taken into account in the design of channels for technological knowledge sharing. Cantwell and Santangelo (1999: 119) find that firms are purposefully “dispersing their R&D facilities over greater geographical distances.” Hagstrom and Chandler (1999: 1) draw attention to the presence of “overlaps (and also some conflicting arguments)” in the various theoretical lenses applied in the study of the multidivisional, multinational firm. Such commonalities and differences in theory are to be “welcomed as they indicate both inquisitiveness and vitality” (Hagstrom & Chandler, 1999: 1). It is hoped that this paper will serve to foster examination leading to reconciliation of the various perspectives. Consideration of one explanation without controlling for the others runs the risk of hard-earned empirical conclusions being discounted.
