Management International Review

, Volume 55, Issue 1, pp 23–51 | Cite as

Cross-Border Learning, Technological Turbulence and Firm Performance

  • Liliana Pérez-Nordtvedt
  • Debmalya Mukherjee
  • Ben L. Kedia
Research Article

Abstract

Using knowledge-based view (KBV) and contingency arguments, we develop and test a model that investigates the relationship between the effectiveness and efficiency of cross-border knowledge gained from international business affiliates (IBAs) and the focal (recipient) firm’s performance. We argue that both of these dimensions of learning not only have a direct and positive effect on the performance of the focal firm but also a synergistic one. Also, we suggest that the direct and positive effect of both the effectiveness and the efficiency in learning from the IBA on focal firm performance is moderated by the technological turbulence of the context in which the focal firm operates. Results indicate that the effectiveness of learning, although not the efficiency in learning, positively impacts the focal firm’s performance. However, cross-border learning efficiency and effectiveness jointly improve the focal firm’s performance. Results show that the level of technological turbulence attenuates the positive effect of the effectiveness of learning on the focal firm’s performance. In fact, under high technological turbulence conditions, effective learning becomes detrimental to the focal firm’s performance.

Keywords

Effectiveness of cross-border learning Efficiency of cross-border learning Technological turbulence Firm performance 

Notes

Acknowledgments

We would like to thank Editor Michael-Jörg Oesterle for his guidance during the review process and the two blind reviewers who made this paper become a better product. We would also like to thank the Robert Wang Center for International Business Education and Research (CIBER) for providing the necessary funding to carry out this research.

References

  1. Aguinis, H. (1995). Statistical power with moderated multiple regression in management research. Journal of Management, 21(6), 1141–1158.Google Scholar
  2. Arora, A., Fosfuri, A., & Gambardella, A. (2001). Markets for technology: the economics of innovation and corporate strategy. Cambridge: MIT Press.Google Scholar
  3. Bapuji, H., Loree, D., & Crossan, M. (2011). Connecting external knowledge usage and firm performance: an empirical analysis. Journal of Engineering and Technology Management, 28(4), 215–231.CrossRefGoogle Scholar
  4. Baum, J. (1989). Liabilities of newness, adolescence, and obsolescence: exploring age dependence in the dissolution of organizational relationships and organizations. Proceedings of the Administrative Science Association of Canada, 10(5), 1–10.Google Scholar
  5. Baum, J. A. C., & Ingram, P. (1998). Survival-enhancing learning in the Manhattan hotel industry, 1898–1980. Management Science, 44(7), 996–1016.CrossRefGoogle Scholar
  6. Bhagat, R. S., Kedia, B. L., Harveston, P. D., & Triandis, H. (2002). Cultural variations in the crossborder transfer of organizational knowledge: an integrative framework. Academy of Management Review, 27(2), 204–221.Google Scholar
  7. Bierly, P., & Chakrabarti, A. (1996). Knowledge strategies in the US pharmaceutical industry. Strategic Management Journal, 17(2), 123–135.CrossRefGoogle Scholar
  8. Blomstermo, A., Eriksson, K., Lindstrand, A., & Sharma, D. (2004). The perceived usefulness of network experiential knowledge in the internationalizing firm. Journal of International Management, 10(3), 355–373.CrossRefGoogle Scholar
  9. Bresman, H., Birkinshaw, J., & Nobel, R. (1999). Knowledge transfer in international acquisitions. Journal of International Business Studies, 30(3), 439–462.CrossRefGoogle Scholar
  10. Capron, L. (1999). The long-term performance of horizontal acquisitions. Strategic Management Journal, 20(11), 987–1018.CrossRefGoogle Scholar
  11. Ciabuschi, F., Dellestrand, H., & Kappen, P. (2011). Exploring the effects of vertical and lateral mechanisms in international knowledge transfer projects. Management International Review, 51(2), 129–155.CrossRefGoogle Scholar
  12. Ciabuschi, F., Martin-Martin, O., & Stahl, B. (2010). Headquarters’ influence on knowledge transfer performance. Management International Review, 50(4), 471–492.CrossRefGoogle Scholar
  13. Citrin, A. V., Lee, R., & McCullough, J. (2007). Information use and new product outcomes: the contingent role of strategy type. Journal of Product Innovation Management, 24(3), 259–273.CrossRefGoogle Scholar
  14. Cohen, J., Cohen, P., West, S. G., & Aiken, L. S. (2003). Applied multiple regression/correlation analysis for the behavioral sciences (3rd ed.). Mahwah: Lawrence Erlbaum Associates.Google Scholar
  15. Cohen, W. N., & Levinthal, D. A. (1990). Absorptive capacity: a new perspective on learning and innovation. Administrative Science Quarterly, 35(1), 128–152.CrossRefGoogle Scholar
  16. Daft, R. L. (1998). Organization theory and design. Cincinnati: South-Western College Publishing.Google Scholar
  17. Denrell, J. (2003). Vicarious learning, undersampling of failure, and the myth of management. Organization Science, 14(3), 227–243.CrossRefGoogle Scholar
  18. Dess, G. G., & Robinson, R. B. (1984). Measuring organizational performance in the absence of objective measures: the case of the privately-held firm and conglomerate business unit. Strategic Management Journal, 5(3), 265–273.CrossRefGoogle Scholar
  19. Dhanaraj, C., Lyles, M., Steensma, H. K., & Tihanyi, L. (2004). Managing tacit and implicit knowledge transfer in IJVs: the role of relational embeddedness and the impact on performance. Journal of International Business Studies, 35(5), 456–458.CrossRefGoogle Scholar
  20. Fang, Y., Jiang, G. L. F., Makino, S., & Beamish, P. W. (2010). Multinational firm knowledge, use of expatriates, and foreign subsidiary performance. Journal of Management Studies, 47(1), 47–54.CrossRefGoogle Scholar
  21. Feinberg, S. E., & Gupta, A. K. (2004). Knowledge spillovers and the assignment of R&D responsibilities to foreign subsidiaries. Strategic Management Journal, 25(8/9), 823–845.CrossRefGoogle Scholar
  22. Felin, T., & Hesterly, W. (2007). The knowledge-based view, nested heterogeneity, and new value creation: philosophical considerations on the locus of knowledge. Academy of Management Review, 32(1), 195–218.CrossRefGoogle Scholar
  23. Ghauri, P., & Park, B. (2012). The impact of turbulent events on knowledge acquisition comparison of cross-border acquisitions formed before and after the crisis. Management International Review, 52(2), 293–315.CrossRefGoogle Scholar
  24. Ginsberg, A., & Venkatraman, N. (1985). Contingency perspectives of organizational strategy: a critical review of the empirical research. Academy of Management Review, 10(3), 421–434.Google Scholar
  25. Grant, R. M. (1996). Toward a knowledge-based theory of the firm. Strategic Management Journal, 17(2), 109–122.CrossRefGoogle Scholar
  26. Gupta, A. K., & Govindarajan, V. (2000). Knowledge flows within multinational corporations. Strategic Management Journal, 21(4), 473–496.CrossRefGoogle Scholar
  27. Håkanson, L., & Nobel, R. (2001). Organizational characteristics and reverse technology transfer. Management International Review, 41(4), 395–420.Google Scholar
  28. Heckman, J. J. (1979). Sample selection bias as a specification error. Econometrica, 47(1), 153–161.CrossRefGoogle Scholar
  29. Henard, D., & McFadyen, A. (2005). The complementary roles of applied and basic research: a knowledge-based perspective. Journal of Product Innovation Management, 22(6), 503–514.CrossRefGoogle Scholar
  30. Hinkin, T. R. (1998). A brief tutorial on the development of measures for use in survey questionnaires. Organizational Research Methods, 1(1), 104–121.CrossRefGoogle Scholar
  31. Hoopes, D. G., & Postrel, S. (1999). Shared knowledge, “glitches”, and product development performance. Strategic Management Journal, 20(9), 837–865.CrossRefGoogle Scholar
  32. Inkpen, A. C. (2000). Learning through joint ventures: a framework of knowledge acquisition. Journal of Management Studies, 37(7), 146–165.CrossRefGoogle Scholar
  33. Inkpen, A. C. (2005). Learning through alliances: General Motors and NUMMI. California Management Review, 47(4), 114–136.CrossRefGoogle Scholar
  34. Inkpen, A. C. (2008). Knowledge transfer and international joint ventures: the case of NUMMI and General Motors. Strategic Management Journal, 29(4), 447–453.CrossRefGoogle Scholar
  35. Jaworski, B. J., & Kohli, A. K. (1993). Market orientation: antecedents and consequences. Journal of Marketing, 57(3), 53–70.CrossRefGoogle Scholar
  36. Jiang, X., & Li, Y. (2008). The relationship between organizational learning and firms’ financial performance in strategic alliances: a contingency approach. Journal of World Business, 43(3), 365–379.CrossRefGoogle Scholar
  37. Jiatao, L., & Kozhikode, R. (2009). Developing new innovation models: shifts in the innovation landscapes in emerging economies and implications for global R&D management. Journal of International Management, 15(3), 328–339.Google Scholar
  38. Knight, G., & Cavusgil, T. (2004). Innovation, organizational capabilities, and the born-global firm. Journal of International Business Studies, 35(2), 124–141.CrossRefGoogle Scholar
  39. Kogut, B., & Zander, U. (1993). Knowledge of the firm and the evolutionary theory of the multinational corporation. Journal of International Business Studies, 24(4), 625–645.CrossRefGoogle Scholar
  40. Lam, A. (1997). Embedded firms, embedded knowledge: problems of collaboration and knowledge transfer in global cooperative ventures. Organization Studies, 18(6), 973–996.CrossRefGoogle Scholar
  41. Lane, P. J., & Lubatkin, M. (1998). Absorptive capacity and interorganizational learning. Strategic Management Journal, 19(5), 461–477.CrossRefGoogle Scholar
  42. Lane, P. J., Salk, J. E., & Lyles, M. A. (2001). Absorptive capacity, learning and performance in international joint ventures. Strategic Management Journal, 22(12), 1139–1161.CrossRefGoogle Scholar
  43. Lavie, D. (2006). The competitive advantage of interconnected firms: an extension of the resource-based view. Academy of Management Review, 31(3), 638–658.CrossRefGoogle Scholar
  44. Lee, R. P., Chen, Q., Kim, D., & Johnson, J. L. (2008). Knowledge transfer between multinational corporations’ headquarters and their subsidiaries: influences on and implications for new product outcomes. Journal of International Marketing, 16(2), 1–31.CrossRefGoogle Scholar
  45. Lepak, D. P., Takeuchi, R., & Snell, S. A. (2003). Employment flexibility and firm performance: examining the interaction effects of employment mode, environmental dynamism, and technological intensity. Journal of Management, 29(5), 681–703.CrossRefGoogle Scholar
  46. Levine, S., & Prietula, M. (2012). How knowledge transfer impacts performance: a multilevel model of benefits and liabilities. Organization Science, 23(6), 1748–1766.CrossRefGoogle Scholar
  47. Levinthal, D. A., & March, J. G. (1993). The myopia of learning. Strategic Management Journal, 14(2), 95–112.CrossRefGoogle Scholar
  48. Lichtenthaler, U. (2009). Absorptive capacity, environmental turbulence, and the complementarity of organizational learning processes. Academy of Management Journal, 52(4), 822–846.CrossRefGoogle Scholar
  49. Lindstrand, A., Eriksson, K., & Deo Sharma, D. (2009). The perceived usefulness of knowledge supplied by foreign client networks. International Business Review, 18(1), 26–37.CrossRefGoogle Scholar
  50. Lippman, S., & Rumelt, R. (1982). Uncertain imitability: an analysis of interfirm differences in efficiency under competition. Bell Journal of Economics, 13(2), 418–438.CrossRefGoogle Scholar
  51. Lord, M. D., & Ranft, A. L. (2000). Organizational learning about new international markets: exploring the internal transfer of local market knowledge. Journal of International Business Studies, 31(4), 573–589.CrossRefGoogle Scholar
  52. Lyles, M. A., & Salk, J. E. (1996). Knowledge acquisition from foreign parents in international joint ventures: an empirical examination in the Hungarian context. Journal of International Business Studies, 27(5), 877–903.CrossRefGoogle Scholar
  53. Mahnke, V., Pedersen, T., & Venzin, M. (2005). The impact of knowledge management on MNC subsidiary performance: the role of absorptive capacity. Management International Review, 45(2), 101–120.Google Scholar
  54. Mangaliso, M. P. (1995). The strategic usefulness of management information as perceived by middle managers. Journal of Management, 21(2), 231–250.CrossRefGoogle Scholar
  55. McEvily, S., & Chakravarthy, B. (2002). The persistence of knowledge-based advantage: an empirical test for product performance and technological knowledge. Strategic Management Journal, 23(4), 285–305.CrossRefGoogle Scholar
  56. Mohr, J. J., & Sengupta, S. (2002). Managing the paradox of inter-firm learning: the role of governance mechanisms. Journal of Business and Industrial Marketing, 17(4), 282–301.CrossRefGoogle Scholar
  57. Mukherjee, D., Gaur, A. S., & Datta, A. (2013). Creating value through offshore outsourcing: an integrative framework. Journal of International Management, 19(4), 377–389.CrossRefGoogle Scholar
  58. Nickerson, J., & Zenger, T. (2004). A knowledge-based theory of the firm: the problem-solving perspective. Organization Science, 15(6), 617–632.CrossRefGoogle Scholar
  59. Noda, T., & Collins, D. J. (2001). The evolution of intraindustry firm heterogeneity: insights from the process study. Academy of Management Journal, 44(4), 897–925.CrossRefGoogle Scholar
  60. Nunnally, J. C. (1978). Psychometric Theory (2nd ed.). New York: McGraw-Hill.Google Scholar
  61. Oppenheim, A. N. (1966). Questionnaire design and attitude measurement. New York: Basic Books.Google Scholar
  62. Ozsomer, A., & Gencturk, E. (2003). A resource-based model of market learning in the subsidiary: the capabilities of exploration and exploitation. Journal of International Marketing, 11(3), 1–29.CrossRefGoogle Scholar
  63. Pérez-Nordtvedt, L., Babakus, E., & Kedia, B. L. (2010). Learning from international business affiliates: developing resource-based learning through networks and knowledge acquisition. Journal of International Management, 16(3), 262–274.CrossRefGoogle Scholar
  64. Pérez-Nordtvedt, L., Kedia, B. L., Datta, D. K., & Rasheed, A. A. (2008). Effectiveness and efficiency of cross-border knowledge transfer: an empirical examination. Journal of Management Studies, 45(4), 699–729.CrossRefGoogle Scholar
  65. Podsakoff, P., MacKenzie, S., Lee, J.-Y., & Podsakoff, N. (2003). Common method biases in behavioral research: a critical review of the literature and recommended remedies. Journal of Applied Psychology, 88(5), 879–903.CrossRefGoogle Scholar
  66. Podsakoff, P., MacKenzie, S., & Podsakoff, N. (2012). Sources of method bias in social science research and recommendations on how to control for it. Annual Review of Psychology, 63, 539–569.CrossRefGoogle Scholar
  67. Rindfleisch, A., & Moorman, C. (2001). The acquisition and utilization of information in new product alliances: a strength of ties perspective. Journal of Marketing, 65(2), 1–18.CrossRefGoogle Scholar
  68. Rogers, E. M. (1983). Diffusion of innovation. New York: Free Press.Google Scholar
  69. Sherman, J. D., Berkowitz, D., & Souder, W. E. (2005). New product development performance and the interaction of cross-functional integration and knowledge management. Journal of Product Innovation Management, 22(5), 399–411.CrossRefGoogle Scholar
  70. Siemsen, E., Roth, A., & Oliveira, P. (2010). Common method bias in regression models with linear, quadratic, and interaction effects. Organizational Research Methods, 13(3), 456–476.CrossRefGoogle Scholar
  71. Simonin, B. L. (1997). The importance of collaborative know-how: an empirical test of the learning organization. Academy of Management Journal, 40(5), 1150–1174.CrossRefGoogle Scholar
  72. Simonin, B. L. (1999). Ambiguity and the process of knowledge transfer in strategic alliances. Strategic Management Journal, 20(7), 595–623.CrossRefGoogle Scholar
  73. Simonin, B. L. (2004). An empirical investigation of the process of knowledge transfer in international strategic alliances. Journal International Business Studies, 35(5), 407–427.CrossRefGoogle Scholar
  74. Slater, S. F., & Narver, J. C. (1995). Market orientation and the learning organization. Journal of Marketing, 59(7), 63–74.CrossRefGoogle Scholar
  75. Spencer, J. (2003). Firms’ knowledge-sharing strategies in the global innovation system: empirical evidence from the flat panel display industry. Strategic Management Journal, 24(3), 217–233.CrossRefGoogle Scholar
  76. Srinivasan, R., Lilien, G. L., & Rangaswamy, A. (2002). Technological opportunism and radical technology adoption: an application to e-business. Journal of Marketing, 66(3), 47–60.CrossRefGoogle Scholar
  77. Steensma, H. K., & Lyles, M. (2000). Explaining IJV survival in a transitional economy through social exchange and knowledge-based perspectives. Strategic Management Journal, 21(8), 831–851.CrossRefGoogle Scholar
  78. Stinchcombe, A. L. (1965). Social structure and organizations. In J. G. March (Ed.), Handbook of Organizations (pp. 142–193). Chicago: Rand McNelly.Google Scholar
  79. Szulanski, G. (1996). Exploring internal stickiness: impediments to the transfer of best practice within the firm. Strategic Management Journal, 17(2), 27–43.CrossRefGoogle Scholar
  80. Tallman, S., & Phene, A. (2007). Leveraging knowledge across geographic boundaries. Organization Science, 18(2), 252–260.CrossRefGoogle Scholar
  81. Teece, D. (1986). Profiting from technological innovations. Research Policy, 15(6), 285–306.CrossRefGoogle Scholar
  82. Tushman, M., & Nadler, D. (1978). Information processing as an integrating concept in organizational design. Academy of Management Review, 3(3), 613–624.Google Scholar
  83. van Wijk, R., Jansen, J. J. P., & Lyles, M. A. (2008). Inter- and intra-organizational knowledge transfer: a meta-analytic review and assessment of its antecedents and consequences. Journal of Management Studies, 45(4), 830–853.CrossRefGoogle Scholar
  84. Venaik, S., Midgley, D., & Devinney, M. T. (2005). Dual paths to performance: the impact of global pressures on MNC subsidiary conduct and performance. Journal of International Business Studies, 36(6), 655–675.CrossRefGoogle Scholar
  85. Venkatraman, N. (1989). The concept of fit in strategy research: toward verbal and statistical correspondence. Academy of Management Review, 14(3), 423–444.Google Scholar
  86. Weick, K. E., Sutcliffe, K. M., & Obstfeld, D. (2005). Sensemaking and organizing. Organization Science, 16(4), 409–421.CrossRefGoogle Scholar
  87. Weiss, A. M., & Heide, J. B. (1993). The nature of organizational search in high-technology markets. Journal of Marketing Research, 30(2), 220–233.CrossRefGoogle Scholar
  88. Wiklund, J., & Shepherd, D. (2003). Knowledge-based resources, entrepreneurial orientation, and the performance of small and medium-sized businesses. Strategic Management Journal, 24(13), 1307–1314.CrossRefGoogle Scholar
  89. Yang, Q., Mudambi, R., & Meyer, K. (2008). Conventional and reverse knowledge flows in multinational corporations. Journal of Management, 34(5), 882–902.CrossRefGoogle Scholar
  90. Yli-Renko, H., Autio, E., & Sapienza, H. (2001). Social capital, knowledge acquisitions, and knowledge exploitation in young technology-based firms. Strategic Management Journal, 22(6/7), 587–613.CrossRefGoogle Scholar
  91. Zaheer, S. (1995). Overcoming the liability of foreignness. Academy of Management Journal, 38(2), 341–363.CrossRefGoogle Scholar
  92. Zahra, S. A., Ireland, R. D., & Hitt, M. A. (2000). International expansion by new venture firms: international diversity, mode of market entry, technological learning and performance. Academy of Management Journal, 43(5), 925–950.CrossRefGoogle Scholar
  93. Zander, U., & Kogut, B. (1995). Knowledge and the speed of the transfer and imitation of organizational capabilities: an empirical test. Organization Science, 6(1), 76–92.CrossRefGoogle Scholar
  94. Zhang, H., Shu, C., Jiang, X., & Malter, A. (2010). Managing knowledge for innovation: the role of cooperation, competition, and alliance nationality. Journal of International Marketing, 18(4), 74–94.CrossRefGoogle Scholar

Copyright information

© Springer-Verlag Berlin Heidelberg 2014

Authors and Affiliations

  • Liliana Pérez-Nordtvedt
    • 1
  • Debmalya Mukherjee
    • 2
  • Ben L. Kedia
    • 3
  1. 1.Department of ManagementUniversity of Texas at ArlingtonArlingtonUSA
  2. 2.Department of ManagementCollege of Business Administration, University of AkronAkronUSA
  3. 3.Robert Wang Center for International Business Education and ResearchUniversity of MemphisMemphisUSA

Personalised recommendations