ࡱ > u v w x y z { | } ~ a bjbj
xJ\xJ\ J " & & v v v T b ' d b1 ~: ( : : : O P 4 LP l v hP K x O hP hP & & : : l X X X hP & 8 : v : Ѽ X hP X X . y \ ^ ! : rc ^X | Ֆ @ 0 X ! ! v 5 ! hP hP X hP hP hP hP hP X hP hP hP hP hP hP hP hP hP hP hP hP hP hP hP hP > : Problem solving in MNCs:
How local and global solutions are (and are not) created
Esther Tippmann
University College Dublin
Quinn School of Business
Belfield, Dublin 4, Ireland
Phone: +353 1 716 4722
Fax: +353 1 716 4762
E-mail: HYPERLINK "mailto:esther.tippmann@ucd.ie" esther.tippmann@ucd.ie
Pamela Sharkey Scott
Dublin Institute of Technology
College of Business
Aungier Street, Dublin 2, Ireland
Phone: +353 1 4027132
Fax: +353 1 4023291
E-mail: pamela.sharkeyscott@dit.ie
Vincent Mangematin
Grenoble Ecole de Management
HYPERLINK "http://www.grenoble-em.com/744-ecole-management-2.aspx" 12 rue Pierre Smard, 38000 Grenoble, France
Phone: + 33 4 76706058
Fax: + 33 4 76825455
E-mail: HYPERLINK "mailto:vincent@grenoble.inra.fr" vincent.mangematin@ HYPERLINK "mailto:vincent@grenoble.inra.fr" grenoble-em.com
Suggested short running title: Problem solving in MNCs
Acknowledgements: We would like to thank Area Editor Professor Paula Caligiuri and the three anonymous reviewers for their insightful comments and suggestions. We are also very grateful for comments on early ideas and drafts of this paper from Julia Balogun, Antonella Zucchella, Ulf Andersson, Charles Dhanaraj, Paul Donnelly, Peter McNamara, Alan Rugman, participants at the EGOS Early Career Workshop 2010, the Global Strategy paper development workshop at SMS 2010 and the strategic management research colloquium at Dublin Institute of Technology. Earlier versions of this paper received the Most Promising Dissertation Proposal Award at the Academy of Management Meeting, International Management Division (2010), Michael Z Brooke Prize for the Best Doctoral Paper at the Academy of International Business UK & Ireland Conference (2010), and was finalist for the Best Practice Implications Award at the Strategic Management Society Conference (2010). The usual caveats apply. We would like to thank the participating organizations and Dublin Institute of Technology for their support of this study.
Problem solving in MNCs:
How local and global solutions are (and are not) created
Abstract
It is widely acknowledged in the international business literature that subsidiaries can make a strategic contribution to multinational corporations (MNCs). Departing from the common focus on subsidiary role, contexts and on organizational MNC factors, this study explores the micro-level details of managers actions and interactions. We conducted an in-depth qualitative study into 38 problem solving processes employed across four subsidiaries. Taking a non-routine problem solving perspective on how subsidiaries contribute strategically to renewing MNC competences, this paper uncovers four problem solving approaches - local template adapting; superior technology creating; local template creating; and global principle creating. The findings depict how the way problems are framed influences knowledge search and solution finding activities, and how these different activities may result in local and global solutions. The paper extends insights on MNC innovation and subsidiary initiative be detailing how subsidiary managers navigate different problem solving approaches, and contributes to discussions on the micro-foundations and social aspects of MNC knowledge flows, revealing factors that trigger distance spanning knowledge search.
Keywords: Multinational Corporations (MNCs) and Enterprises (MNEs), Organizational Learning, Knowledge Seeking Behavior, Knowledge Transfer and Innovation in MNCs/MNEs, Global Learning, Case Theoretic Approaches
Introduction
This paper focuses on non-routine problem solving, which is seen as a critical activity for developing and renewing the knowledge and competence bases of any established organization ADDIN EN.CITE ADDIN EN.CITE.DATA (Cyert & March, 1963; Felin & Foss, 2009; Lampel, Shamsie, & Shapira, 2009; Nelson & Winter, 1982). Zooming in on non-routine problem solving reveals a complex process whereby activities to frame the problem, find and scope a solution, as well as to search for knowledge all interact to shape the final outcome ADDIN EN.CITE ADDIN EN.CITE.DATA (Nickerson, Yen, & Mahoney, 2012; Nickerson & Zenger, 2004). However, the primary focus of much MNC research has been on knowledge sharing and knowledge integration more generally ADDIN EN.CITE Kogut199315cf. 151517Kogut, BruceZander, UdoKnowledge of the firm and the evolutionary theory of the multinational corporationJournal of International Business StudiesJOURNAL OF INTERNATIONAL BUSINESS STUDIESJ. Int. Bus. Stud.625-645244INDUSTRIAL managementINTERNATIONAL business enterprisesCORPORATIONS, ForeignBUSINESS enterprisesINTERNATIONAL marketsMARKETS1993Palgrave Macmillan Ltd.http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=9410051124&site=ehost-live (cf. Kogut & Zander, 1993), requiring a more nuanced view on the intricacies of non-routine problem solving in MNCs in order to capture these micro-level complexities, to disentangle different activity patterns and their implications.
Non-routine problem solving is also a way in which subsidiaries can contribute strategically to their multinational corporations (MNCs), yet little is known about the details of non-routine problem solving processes in MNCs compared to other important and frequently researched processes, such as MNC innovation ADDIN EN.CITE ADDIN EN.CITE.DATA (Bartlett & Ghoshal, 1998; Ghoshal & Bartlett, 1988; Nohria & Ghoshal, 1997) or subsidiary initiative ADDIN EN.CITE ADDIN EN.CITE.DATA (Ambos, Andersson, & Birkinshaw, 2010; Birkinshaw, 1999, 1997; Birkinshaw, Hood, & Jonsson, 1998). This paper addresses this lack of attention by posing two research questions: (1) how do subsidiary managers approach non-routine problem solving processes, and (2) how do the various approaches contribute towards renewing MNC competences?
We conducted an in-depth qualitative study into 38 problem solving processes employed across four subsidiaries to unravel the complexities in activities pursued by subsidiary managers in seeking solutions, contributing to the international business (IB) literature in two important ways. First, by focussing on individuals micro-level actions and interactions in their solution finding efforts, this paper contributes to our understanding of the subsidiarys role in MNC competence renewal, the bottom-up processes of building and changing competences ADDIN EN.CITE Burgelman199113113113117Burgelman, Robert A.INTRAORGANIZATIONAL ECOLOGY OF STRATEGY MAKING AND ORGANIZATIONAL ADAPTATION: THEORY AND FIELD RESEARCHOrganization ScienceORGANIZATION SCIENCEOrgan. Sci.239-26223BUSINESS planningORGANIZATIONAL changeORGANIZATIONAL structureJOB enrichmentORGANIZATIONRESEARCHSTRATEGIC planningINTERORGANIZATIONAL relationsCORPORATE governanceCORPORATE reorganizationsECOLOGYCORPORATE STRATEGYEVOLUTIONARY MANAGEMENTORGANIZATIONAL ECOLOGYSELECFION AND ADAPTATIONINTEL Corp.199108INFORMS: Institute for Operations Researchhttp://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=4433742&site=ehost-live (Burgelman, 1991). This adds to previous MNC innovation and entrepreneurship process frameworks ADDIN EN.CITE ADDIN EN.CITE.DATA (Bartlett & Ghoshal, 1998; Birkinshaw, 1997; Nohria & Ghoshal, 1997). We identify and disentangle the intricacies of the various approaches subsidiary managers pursue to lead their units problem solving efforts: local template adapting, superior technology creating, local template creating, and global principle creating. Importantly, we uncover how some approaches are more likely to develop locally implemented solutions and which approaches create global solutionsand so renew MNC competences. Second, this paper develops insights for the micro-foundations and social aspects of knowledge processes in MNCs, an important theory development area ADDIN EN.CITE ADDIN EN.CITE.DATA (Foss & Pedersen, 2004; Noorderhaven & Harzing, 2009). Analysing managers knowledge search in response to these non-routine problems ADDIN EN.CITE ADDIN EN.CITE.DATA (Cyert & March, 1963; Nickerson & Zenger, 2004), we offer an understanding of how subsidiary managers deal with a central tension inherent in mobilizing knowledge within MNCs whether to search geographically and cognitively close or distant - and what factors trigger distance spanning actions to more likely locate diverse knowledge for recombination into new solutions.
The next section introduces the theoretical background: how investigating problem solving extends previous research on subsidiaries strategic contributions to MNCs, and outlines the main activities and challenges characteristic of problem solving processes. We then discuss our methodology, provide a detailed representation of our findings and our framework of problem solving approaches, before discussing the results in the light of existing theory and drawing implications for management practice and for future IB research.
Theoretical Background
Approaches to Understanding the Strategic Contribution of Subsidiaries
It is acknowledged that subsidiaries are the locus of many strategic activities that create and renew MNCs knowledge and competences, most generally through innovation ADDIN EN.CITE ADDIN EN.CITE.DATA (Bartlett & Ghoshal, 1998; Ghoshal, 1986; Ghoshal & Bartlett, 1988; Nohria & Ghoshal, 1997) and initiatives ADDIN EN.CITE ADDIN EN.CITE.DATA (Birkinshaw, 1999, 1997; Birkinshaw et al., 1998; Rugman & Verbeke, 2001). While a focus on these processes provides invaluable insights into the strategic contributions subsidiaries make to MNCs, we argue that this line of inquiry can be extended in important ways by investigating non-routine problem solving processes1.
Problem solving is a broader phenomenon than innovation or initiative generation. From the perspective of problemistic search ADDIN EN.CITE Cyert19632727276Cyert, Richard M.March, James G.Behavioral theory of the firm1963Englewood Cliffs, New JerseyPrentice Hall Inc.(Cyert & March, 1963), discrepancies between organizational expectations and reality (usually caused by changes in the external environment) motivates adaptive behavioral responses. In particular, such adaptive actions are stimulated by non-routine problems - novel or unique situations for which current organizational practices and routines offer no predetermined responses ADDIN EN.CITE Nelson19823838386Nelson, Richard R.Winter, Sidney G.An evolutionary theory of economic change1982LondonThe Belknap Press of Harvard University PressNelson19823838386Nelson, Richard R.Winter, Sidney G.An evolutionary theory of economic change1982LondonThe Belknap Press of Harvard University Press(Nelson & Winter, 1982). Unlike initiative which is a relatively rare phenomenon that many subsidiaries never actively pursue ADDIN EN.CITE Birkinshaw1997197: 20819719717Birkinshaw, JulianEntrepreneurship in Multinational Corporations: The Characteristics of Subsidiary InitiativesStrategic Management JournalSTRATEGIC MANAGEMENT JOURNALStrateg. Manage. J.207-229183INTERNATIONAL business enterprisesFINANCIAL leverageSTRATEGIC planningENTREPRENEURSHIPMARKETING strategyASSETS (Accounting)SUBSIDIARY corporationsBUSINESS planningMARKET orientation199703http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=12571993&site=ehost-live (Birkinshaw, 1997: 208), or innovation which captures subsidiary successes, non-routine problems regularly occur in subsidiaries operating in todays more dynamic markets.
Non-routine problems are also of strategic value. Interrupting the ingrained and routinized practices and processes that predetermine most organizational activities, these events are powerful occurrences because they unveil weaknesses in current routines and so represent opportunities to engage in productive solution finding activities that can create solutions which renew the organizations competences ADDIN EN.CITE ADDIN EN.CITE.DATA (Felin & Foss, 2009; Lampel et al., 2009; Nickerson et al., 2012).
Focusing on problem solving processes thus allows investigating an important phenomenon of how subsidiaries, without necessarily having a role to innovate, can still contribute strategically to MNCs. It allows us to depart from a focus on subsidiaries with a role or mandate for innovation, including investigations of centres of excellence ADDIN EN.CITE ADDIN EN.CITE.DATA (Frost, Birkinshaw, & Ensign, 2002; Holm & Pedersen, 2000) and superstar subsidiaries ADDIN EN.CITE Blomkvist201016916916917Blomkvist, KatarinaKappen, PhilipZander, IvoQuo vadis? The entry into new technologies in advanced foreign subsidiaries of the multinational enterpriseJournal of International Business StudiesJOURNAL OF INTERNATIONAL BUSINESS STUDIESJ. Int. Bus. Stud.1525-1549419INTERNATIONAL business enterprisesSUBSIDIARY corporationsPATENTSSTRATEGIC planningSWEDENUNITED Statesinnovation and R&Dlongitudinal (or time-series) studiesmultinational corporations (MNCs) and enterprises (MNEs)subsidiary development, expansion, and growthsubsidiary roles20101210.1057/jibs.2010.22http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=55669101&site=ehost-live (Blomkvist, Kappen, & Zander, 2010), from analyzing the influence of organizational MNC factors ADDIN EN.CITE ADDIN EN.CITE.DATA (Bartlett & Ghoshal, 1998; Ghoshal & Bartlett, 1988; Nohria & Ghoshal, 1997), and subsidiary context ADDIN EN.CITE ADDIN EN.CITE.DATA (Birkinshaw, 1999, 1997; Birkinshaw et al., 1998), to addressing calls for detailed examinations at the lower levels of subsidiaries to appreciate the nuances and complexities of different contributory activities and develop more theoretical insights on the nature of these actions and interactions and their impact for wider MNC level outcomes ADDIN EN.CITE ADDIN EN.CITE.DATA (Birkinshaw, Brannen, & Tung, 2011; Rugman & Verbeke, 2001; Rugman, Verbeke, & Wenlong, 2011).
Problem Solving in the MNC
Solving non-routine problems involves a complex and interdependent process, including framing the non-routine problem, the searching for a corresponding solution and solution scoping.
Framing non-routine problems. Once a non-routine event is experienced, subsidiary managers have to frame the non-routine problem: to understand and define its nature, scope and boundaries by building a conceptual interpretation ADDIN EN.CITE ADDIN EN.CITE.DATA (Baer, Dirks, & Nickerson, 2012; Cowan, 1990; Lyles, 1981; Lyles & Mitroff, 1980; Smith, 1989, 1988; Vaccaro, Brusoni, & Veloso, 2011). Initially, due to the ambiguities, complexities and the ill-structured nature of problems ADDIN EN.CITE Simon197332532532517Simon, Herbert A.The structure of ill structured problemsArtificial IntelligenceArtificial Intelligence181-20143-41973http://www.sciencedirect.com/science/article/B6TYF-4810SCJ-1H/2/2a1d2760f17ecdba0541c9d0a3885df9 (Simon, 1973), it can be difficult to comprehend them accurately, or to initiate appropriate actions to stimulate the development of solutions. Outcomes often remain restricted because individuals are biased towards believing that only little can be learned from any particular problem situation ADDIN EN.CITE Starbuck200910510510517Starbuck, William H.Cognitive Reactions to Rare Events: Perceptions, Uncertainty, and LearningOrganization ScienceORGANIZATION SCIENCEOrgan. Sci.925-937205UNCERTAINTYEXOGENEITY (Econometrics)ORGANIZATIONAL learningINDUSTRIAL efficiencyORGANIZATIONAL changeEXPERIENTIAL learninglearningrare eventsreliable datauncertainty200909http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=45016078&site=ehost-live (Starbuck, 2009). Yet subsidiary managers who take the trouble to gain a richer understanding of non-routine problems, and to interpret the various different aspects of such complex situations are more likely to enable organizational learning ADDIN EN.CITE Beck200910610610617Beck, Tammy E.Plowman, Donde AshmosExperiencing Rare and Unusual Events Richly: The Role of Middle Managers in Animating and Guiding Organizational InterpretationOrganization ScienceORGANIZATION SCIENCEOrgan. Sci.909-924205ORGANIZATIONAL learningMIDDLE managersORGANIZATIONAL changeDECISION makingINDUSTRIAL managementHIERARCHIESmiddle managersorganizational interpretationorganizational learning200909http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=45016077&site=ehost-live (Beck & Plowman, 2009). Such challenges make high demands: their local and global complexities need to be disentangled, and the problem decomposed into more or less familiar and interdependent sub-problems ADDIN EN.CITE ADDIN EN.CITE.DATA (Newell, Shaw, & Simon, 1958; Simon, 1962; Simon & Barenfeld, 1969). Social interactions with peers, who can draw on their own expertise, usually help to define the problem space more accurately ADDIN EN.CITE ADDIN EN.CITE.DATA (Cross & Sproull, 2004; Dunbar & Garud, 2009) and so facilitate more productive solution finding.
Solution finding activities, including search for knowledge. Solution finding activities are the actions for identifying and developing solutions which incorporates knowledge search ADDIN EN.CITE ADDIN EN.CITE.DATA (Cyert & March, 1963; Nickerson & Zenger, 2004). Knowledge search is defined as all the actions of looking for and identifying what knowledge can potentially be accessed ADDIN EN.CITE Hansen199941414117Hansen, Morten T.The search-transfer problem: the role of weak ties in sharing knowledge across organization subunitsAdministrative Science QuarterlyADMINISTRATIVE SCIENCE QUARTERLYAdmin. Sci. Quart.82-111441SOCIAL networksORGANIZATIONAL structureMANUFACTURING processesPRODUCT managementNEW productsKNOWLEDGE management199903Administrative Science Quarterlyhttp://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=1706994&site=ehost-live (Hansen, 1999), where the term knowledge refers to know-how, expertise or best practices/routines ADDIN EN.CITE ADDIN EN.CITE.DATA (Gupta & Govindarajan, 1991, 2000) and may be tacit or codified ADDIN EN.CITE Polanyi19662424246Polanyi, MichaelThe tacit dimension1966Garden City, New YorkDoubleday and Co.(Polanyi, 1966). Search involves balancing the time and effort spent seeking and evaluating knowledge ADDIN EN.CITE Hansen200540404017Hansen, Morten T.Mors, Marie LouiseLvs, BjoernKnowledge sharing in organizations: Multiple networks, multiple phasesAcademy of Management JournalACADEMY OF MANAGEMENT JOURNALAcad. Manage. J.776-793485SOCIAL networksNEW productsTEAMS in the workplaceKNOWLEDGE managementORGANIZATIONAL behaviorSOCIAL groups200510Academy of Managementhttp://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=18803922&site=ehost-live (Hansen, Mors, & Lvs, 2005) with the search pattern depending on what kind of solution is intended to be developed ADDIN EN.CITE ADDIN EN.CITE.DATA (Gray & Meister, 2006; Haas & Hansen, 2007). Although managers may prefer to copy existing solutions ADDIN EN.CITE Spender19891031031036Spender, J. C.Industry recipes: An enquiry into the nature and sources of managerial judgement1989OxfordBlackwell(Spender, 1989), the novelty of non-routine problems often requires them to gather knowledge for solution creation by developing new combinations of existing knowledge ADDIN EN.CITE ADDIN EN.CITE.DATA (Galunic & Rodan, 1998; Henderson & Clark, 1990; Kogut & Zander, 1993). If solution creation is required, subsidiary managers need to be willing and able to access the MNCs distributed and diverse knowledge pockets to increase their chances of identifying dissimilar but suitable knowledge for recombination.
The proximity perspective of economic geography provides a useful framework to consider the dynamics of knowledge search when the knowledge required may be highly heterogeneous and/or highly dispersed ADDIN EN.CITE ADDIN EN.CITE.DATA (Audretsch & Feldman, 1996; Morgan, 2004), and aligns with observations that multiple dimensions of distance matter to MNC functioning ADDIN EN.CITE ADDIN EN.CITE.DATA (Dellestrand & Kappen, 2012; Ghemawat, 2001; Nachum & Zaheer, 2005; Tsang & Yip, 2007; Zaheer, Schomaker, & Nachum, 2012). Proximity is multi-dimensional ADDIN EN.CITE Boschma200528228228217Boschma, RonProximity and Innovation: A Critical AssessmentRegional Studies61-74391ECONOMIC geographyTECHNOLOGICAL innovationsORGANIZATIONCOOPERATIONLEARNINGGEOGRAPHYGeographyInnovationLearningNetworksProximity200502Routledgehttp://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=15644553&site=ehost-live (Boschma, 2005), and one dimension is the geographic proximity, the physical distance between knowledge searcher and knowledge holder. Located at the corporate periphery, subsidiary managers usually only have access to a limited pool of geographically co-located knowledge sources ADDIN EN.CITE ADDIN EN.CITE.DATA (Gupta & Govindarajan, 2000; van Wijk, Jansen, & Lyles, 2008), although they are likely to have peers, seniors, direct reports and other colleagues dotted around the globe with whom they interact as part of their normal operations. To search the distributed spectrum of MNC knowledge, managers need to span geographic space but studies demonstrate that geographic distance impedes knowledge flows in MNCs ADDIN EN.CITE ADDIN EN.CITE.DATA (Hansen & Lvs, 2004; Monteiro, Arvidsson, & Birkinshaw, 2008) because it involves less frequent and intense interpersonal interactions which normally provide a valuable channel for knowledge search.
In addition, the novelty of the non-routine problem may necessitate crossing the boundaries of the units own specific domain. This relates to the second dimension of proximity cognitive proximity a similarity in the knowledge base and expertise between knowledge searcher and holder ADDIN EN.CITE Boschma200528228228217Boschma, RonProximity and Innovation: A Critical AssessmentRegional Studies61-74391ECONOMIC geographyTECHNOLOGICAL innovationsORGANIZATIONCOOPERATIONLEARNINGGEOGRAPHYGeographyInnovationLearningNetworksProximity200502Routledgehttp://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=15644553&site=ehost-live Nooteboom200030430430417Nooteboom, BartLearning by interaction: absorptive capacity, cognitive distance and governanceJournal of Management and Governance69-9241/22000(Boschma, 2005; Nooteboom, 2000). Knowledge search, however, tends to be localized ADDIN EN.CITE Cyert19632727276Cyert, Richard M.March, James G.Behavioral theory of the firm1963Englewood Cliffs, New JerseyPrentice Hall Inc.(Cyert & March, 1963), with managers primarily scanning sources that resemble their own cognitive settings. Search across cognitive distance requires trans-specialist understanding, to be able to assess what other disciplines might offer valuable knowledge ADDIN EN.CITE Postrel200211911911917Postrel, StevenIslands of Shared Knowledge: Specialization and Mutual Understanding in Problem-Solving TeamsOrganization ScienceORGANIZATION SCIENCEOrgan. Sci.303-320133INFORMATION sharingEXPERTISEPROBLEM solvingTEAMS in the workplacePRODUCT designINDUSTRIAL designPRODUCT managementMANAGEMENTPRODUCTION functions (Economic theory)VERTICAL integrationOPERATIONAL definitionsSEMANTICSBusiness StrategyIntegrationShared CognitionSpecialization200205INFORMS: Institute for Operations Researchhttp://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=6654875&site=ehost-live (Postrel, 2002), as well as searching knowledge of increased perceived novelty, which adds substantial complexity and ambiguity to the process ADDIN EN.CITE ADDIN EN.CITE.DATA (Carlile, 2002). Despite these challenges, cognitively distant search may be more likely to reward the effort, as it can enable creating innovative solutions if valuable related knowledge can be identified and recombined ADDIN EN.CITE ADDIN EN.CITE.DATA (Nooteboom et al., 2007; Wuyts et al., 2005).
Figure 1 summarizes how knowledge searches are characterized both by geographic proximity/distance and cognitive proximity/distance. In addition to internal sources, solution finding activities may draw on existing relational links with external organizations ADDIN EN.CITE ADDIN EN.CITE.DATA (Andersson, Forsgren, & Holm, 2002; Meyer, Mudambi, & Narula, 2011). Subsidiary managers may act as a boundary spanners, searching both within ADDIN EN.CITE ADDIN EN.CITE.DATA (Kostova & Roth, 2003; Mudambi & Swift, 2009) and beyond the firm ADDIN EN.CITE Tushman198131631631617Tushman, Michael L.Scanlan, Thomas J.Boundary Spanning Individuals: Their Role in Information Transfer and Their AntecedentsAcademy of Management JournalACADEMY OF MANAGEMENT JOURNALAcad. Manage. J.289-305242ORGANIZATIONAL learningINFORMATION resourcesDECISION makingKNOWLEDGE managementPROBLEM solvingBUSINESS -- ResearchDECISION theoryCORPORATE cultureORGANIZATIONAL sociologyWORK environment198106Academy of Managementhttp://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=4377159&site=ehost-live (Tushman & Scanlan, 1981), bridging different functional, geographic and organization boundaries, to search for and recombine previously unconnected knowledge.
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Scoping of solution. Obviously, the urgency and downside threat of most non-routine problems requires subsidiary managers to develop a solution which remedies the initial, locally observed challenge but the kind of solution created and its potential for renewing MNC competences by producing solutions that modify or develop routines or technologies across the MNC can vary considerably. Building on observations that subsidiaries can create knowledge that is then shared and adopted across the MNC ADDIN EN.CITE ADDIN EN.CITE.DATA (Ambos, Ambos, & Schlegelmilch, 2006; Edwards & Tempel, 2010; Gupta & Govindarajan, 2000; Qin, Mudambi, & Meyer, 2008; Yamin, Tsai, & Holm, 2011), scoping of the solution refers to the subsidiary managers activities in shaping the benefits and diffusion of the solution within the MNC.
Most research into MNC knowledge processes has taken an aggregated, organization-unit focus, leading to repeated calls to explore the actual activities that promote new knowledge combinations in MNCs ADDIN EN.CITE ADDIN EN.CITE.DATA (Buckley & Carter, 2004; Tallman & Chacar, 2011). As the interplay of proximity and distance in knowledge search are fundamental to understanding MNC knowledge processes, it is important to examine more precisely how individuals deal with these tensions in practice, and what triggers them go beyond their locality and span distance in their searches. Such insights will contribute towards developing theory on the micro-foundations ADDIN EN.CITE Foss200448484817Foss, Nicolai JuulPedersen, TorbenOrganizing knowledge processes in the multinational corporation: an introductionJournal of International Business StudiesJOURNAL OF INTERNATIONAL BUSINESS STUDIESJ. Int. Bus. Stud.340-349355INTERNATIONAL business enterprisesKNOWLEDGE managementORGANIZATIONAL behaviorORGANIZATIONAL changeknowledge processes in the MNCorganizational control and design20040910.1057/palgrave.jibs.8400102http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=14732964&site=ehost-live (Foss & Pedersen, 2004) and social constitution ADDIN EN.CITE Noorderhaven200919219219217Noorderhaven, NielsHarzing, Anne-WilKnowledge-sharing and social interaction within MNEsJournal of International Business StudiesJOURNAL OF INTERNATIONAL BUSINESS STUDIESJ. Int. Bus. Stud.719-741405INTERNATIONAL business enterprisesINFORMATION sharingCOMMUNICATION in organizationsSOCIAL interactionSOCIAL learningLEARNINGknowledgelearningmultinational enterprisessocial interaction20090610.1057/jibs.2008.106http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=42095281&site=ehost-live (Noorderhaven & Harzing, 2009) of MNC knowledge processes.
To summarize, despite considerable research on the strategic contribution of subsidiaries to MNCs, there is limited theoretical or empirical understanding of the multi-facetted, micro-level actions and interactions that constitute knowledge search and problem solving processes in the MNC: we need to understand more in these areas, especially in terms of what implications solutions may have for MNC competence renewal.
Methods
Research Design, Research Setting and Sampling
We adopted a research design which involved detailed, inductive qualitative investigations ADDIN EN.CITE Eisenhardt198936363617Eisenhardt, Kathleen M.Building theory from case study researchAcademy of Management ReviewAcademy of Management Review532-5501441989(Eisenhardt, 1989) as being particularly suited to this exploratory study, which aimed to unravel the micro-level complexities of problem solving processes. This enabled us to conduct a close examination of the often overlooked micro-processes that occur within MNCs ADDIN EN.CITE Birkinshaw201122822822817Birkinshaw, JulianBrannen, Mary YokoTung, Rosalie L.From a distance and generalizable to up close and grounded: Reclaiming a place for qualitative methods in international business researchJournal of International Business StudiesJOURNAL OF INTERNATIONAL BUSINESS STUDIESJ. Int. Bus. Stud.573581422011Balogun201124124124117Balogun, JuliaJarzabkowski, PaulaVaara, EeroSelling, resistance and reconciliation: A critical discursive approach to subsidiary role evolution in MNEsJOURNAL OF INTERNATIONAL BUSINESS STUDIESJOURNAL OF INTERNATIONAL BUSINESS STUDIESJ. Int. Bus. Stud.765786426primary data sourcestrategic changestrategy processesdiscourse analysiscase studyMNE integration2011(Balogun, Jarzabkowski, & Vaara, 2011; Birkinshaw et al., 2011). In line with previous studies ADDIN EN.CITE Ghoshal198623923923932Ghoshal, SumantraThe innovative multinational: A differentiated network of organizational roles and management processesHarvard Business School1986Boston, MAUnpublished PhD dissertationBirkinshaw199719719719717Birkinshaw, JulianEntrepreneurship in Multinational Corporations: The Characteristics of Subsidiary InitiativesStrategic Management JournalSTRATEGIC MANAGEMENT JOURNALStrateg. Manage. J.207-229183INTERNATIONAL business enterprisesFINANCIAL leverageSTRATEGIC planningENTREPRENEURSHIPMARKETING strategyASSETS (Accounting)SUBSIDIARY corporationsBUSINESS planningMARKET orientation199703http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=12571993&site=ehost-live (Birkinshaw, 1997; Ghoshal, 1986), we studied a larger number of processes 38 in all. Importantly, and in significant contrast to other studies, we did not identify certain instances or outcomes, but allowed subsidiary managers from diverse settings to select the specific problems on which they reported, an approach which gained us detailed insights into the diverse spectrum of their problem solving approaches.
The research setting was the Irish subsidiaries of four MNCs, and we focused on a single industry - the ICT sector - to increase the comparability of our findings, and because it offered the advantage of being a dynamic industry ADDIN EN.CITE Brown199799917Brown, Shona L.Eisenhardt, Kathleen M.The Art of Continuous Change: Linking Complexity Theory and Time-paced Evolution in Relentlessly Shifting OrganizationsAdministrative Science QuarterlyAdministrative Science Quarterly1-34421ORGANIZATIONAL changeSUCCESS in businessCOMMUNICATION in managementSTRATEGIC planningBUSINESS forecastingCHANGE management199703Administrative Science Quarterlyhttp://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=9706191514&site=ehost-live (Brown & Eisenhardt, 1997) where we could expect subsidiary managers to encounter novel situations regularly, increasing our opportunities to study our phenomenon of interest. As a platform for our in-depth study of a range of problem solving processes and to strengthen emerging theory, we selected four subsidiaries (on the theoretical sampling principle) that represented a range of different parameters at the corporate, subsidiary and managerial levels. Our four chosen subsidiaries were all wholly owned by their parent organizations and - given our interest in studying subsidiary managers actions and interactions - had to be large enough to employ a sizeable number of managers. For study purposes, we label these organizations Epsilon, Gamma, Omega and Sigma: specific details of their locations, products/services, as well of the non-routine problems they report are disguised or changed to preserve anonymity.
Although our chosen MNCs were alike in being more successful than their direct competitors, and in emphasizing technology and innovation leadership as strategic priorities, they still exhibited considerable variation in their organizational variables, adding constructive variance to our sample (see table 1). At the MNC (corporation) level, the companies served varying business domains (including hardware, software, solution provision and services) while at the subsidiary level, our focal units differed in their size in terms of number of employees - an indicator of their knowledge stocks - and in the number and nature of their mandates - an indicator of range and concentration of knowledge ADDIN EN.CITE ADDIN EN.CITE.DATA (Gupta & Govindarajan, 1991; Hansen & Lvs, 2004; van Wijk et al., 2008). To further strengthen the transferability of our findings, the study included diverse subsidiary units - including R&D, operations, sales, services and support units which also differed in the scope of their mandates, ranging from local, regional to global responsibilities, and in their levels of autonomy, indicating different degrees of flexibility in terms of crafting solutions.
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Data Collection
Access to the four subsidiaries was negotiated with their top management, and we assured confidentiality to encourage extensive data access and to gain more open and detailed answers from respondents. Employing a range of techniques for collecting data - interviews with subsidiary middle and senior managers and study of archive materials - we investigated 38 problem solving processes of specific non-routine problems encountered by the subsidiary managers we interviewed. (The initial data set comprised 42 processes, but 4 were excluded due to insufficient detail in certain aspects.)
We conducted 34 semi-structured interviews - ranging from 60 to 75 minutes - with subsidiary middle managers. The middle management perspective was particularly effective for the purpose of this study for a number of reasons. First, middle managers are closer to front-line operations where environmental change is experienced early and non-routine problems occur regularly, so they can facilitate the interpretation of such problems in ways that trigger organizational learning ADDIN EN.CITE Beck200910610610617Beck, Tammy E.Plowman, Donde AshmosExperiencing Rare and Unusual Events Richly: The Role of Middle Managers in Animating and Guiding Organizational InterpretationOrganization ScienceORGANIZATION SCIENCEOrgan. Sci.909-924205ORGANIZATIONAL learningMIDDLE managersORGANIZATIONAL changeDECISION makingINDUSTRIAL managementHIERARCHIESmiddle managersorganizational interpretationorganizational learning200909http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=45016077&site=ehost-live (Beck & Plowman, 2009). Second, their knowledge related activities can lead to exploitative and explorative outcomes ADDIN EN.CITE Mom200773737317Mom, Tom J. M.Van Den Bosch, Frans A. J.Volberda, Henk W.Investigating Managers' Exploration and Exploitation Activities: The influence of top-down, bottom-up, and horizontal knowledge inflowsJournal of Management StudiesJOURNAL OF MANAGEMENT STUDIESJ. Manage. Stud.910-931446INFORMATION resources managementRESEARCHCOMMUNICATION in organizationsMANAGEMENT scienceEXECUTIVESPSYCHOLOGYEXECUTIVES -- Rating ofEXECUTIVES -- Attitudes200709Blackwell Publishing Limited10.1111/j.1467-6486.2007.00697.xhttp://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=26218946&site=ehost-live (Mom, Van Den Bosch, & Volberda, 2007), new knowledge creation ADDIN EN.CITE ADDIN EN.CITE.DATA (Hedlund, 1994; Nonaka, 1994), and innovation ADDIN EN.CITE Kanter198268686817Kanter, Rosabeth MossThe middle manager as innovatorHarvard Business ReviewHarvard Business Review95-105604MIDDLE managersINNOVATIONS in businessWORK environmentNEW productsEXECUTIVE ability (Management)QUALITY of productsBUSINESS enterprisesBUSINESS -- ResearchCROSS-functional teamsUNITED States198207Harvard Business School Publication Corp.http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=3868058&site=ehost-live (Kanter, 1982). Third, they are regarded as drivers of capability development and modification as they operate at a position within large organizations where the contradicting forces of top-down stability and emergent, bottom-up change intersect ADDIN EN.CITE ADDIN EN.CITE.DATA (Burgelman, 1983; Floyd & Lane, 2000; Floyd & Wooldridge, 1999). Especially in large and distributed organizations like MNCs, where corporate top management is more removed from front-line operations, the onus is increasingly placed on middle managers to contribute strategically ADDIN EN.CITE ADDIN EN.CITE.DATA (Balogun & Johnson, 2004; Mantere, 2008; Wooldridge & Floyd, 1990), in the case of problem solving by leading and driving solution-finding actions. Drawing on Wooldridge et al.s ADDIN EN.CITE Wooldridge200838: 1192383817Wooldridge, BillSchmid, TorstenFloyd, Steven W.The middle management perspective on strategy process: contributions, synthesis, and future researchJournal of ManagementJournal of Management1190-1221346MIDDLE managersMANAGEMENT scienceSTRATEGIC planningORGANIZATIONAL changeDECISION makingPERSPECTIVE (Philosophy)middle management perspectivemiddle managersstrategy formationstrategy process200812http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=35538841&site=ehost-live (2008: 1192) definition of middle managers, we interviewed various mid-level professionals, all of whom had both access to top management and operational knowledge, including line managers and other project based executives whose job requirements included driving improvements. The interviewed managers had different company tenures (one up to 18 years) thus exemplifying different time spans for developing interpersonal networks and social capital. Most sampled managers were host country nationals, some had expatriate experience, and fewer were home country or third country nationals.
The interviews gathered information on particular aspects of one or two specific non-routine problem(s) dealt with by the subsidiary managers - Table 2 provides a breakdown of the various kinds of problems reported. The interviews followed a standardized core which asked all informants to first provide a detailed description of the problem which they encountered, followed by details relating to their knowledge search and solution development activities. We also gathered data on the solution and managers further involvement in implementing and replicating the solutions (where applicable) towards the end of the interview. Within these categories, we ensured the interviews remained very open to allow managers sufficient scope to report their specific actions and interactions, and used prompts when necessary to encourage detailed and exhaustive accounts. Our initial contacts with subsidiary top management and archival material study gave us a broad understanding of the subsidiaries strategies and main challenges, which then helped us to relate to the managers in the interview and formulate specific prompts and probes. To guard against retrospective bias, we asked subsidiary managers to describe a concrete non-routine problem that had happened during the last twelve months, a recent enough timeframe to allow for accurate recollection ADDIN EN.CITE ADDIN EN.CITE.DATA (Huber & Power, 1985; Miller, Cardinal, & Glick, 1997), and sought to further increase the accuracy of their accounts by focusing on managers specific actions rather than their intentions, beliefs or opinions ADDIN EN.CITE ADDIN EN.CITE.DATA (Golden, 1992; Miller et al., 1997).
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We explored subsidiary and MNC strategies and their typical knowledge exchange patterns in seven interviews with subsidiary senior managers, typically subsidiary Directors and General Managers, and also used these interviews (where possible) to collect complementary data on the scope of the non-routine problems and the outcomes. This data was supplemented by our review of archival material, which included selected internal reports, project updates, communications, strategy documents, and intranet information.
Data Analysis
The main aim of the analysis was to inductively build theory from the 38 problem solving processes ADDIN EN.CITE Welch201110910910917Welch, CatherinePiekkari, RebeccaPlakoyiannaki, EmmanuellaPaavilainen-Mntymki, EriikkaTheorising from case studies: Towards a pluralist future for international business researchJournal of International Business StudiesJournal of International Business Studies740-762425case theoretic approachessecondary data sourcetheorymethodintersection2011(Welch et al., 2011). The original focus of this study was on activities in response to non-routine problems, and was introduced as such to informants to emphasize our interest in their actions and interactions. The fact that the theoretical scope of this study was subsequently broadened to analyze the whole problem solving process (including problem framing, solution finding activities, searching for knowledge, and scoping of solution) helped to reduce potential concerns about respondent bias (e.g. respondents reporting on more impactful global non-routine problems/solutions rather than local problems/solutions so including a range of different cases).
NVivo9 was used to build and maintain a database and manage data analysis in a systematic and consistent manner. Although the data were coded manually, the software was especially useful for fragmenting and recoding the data, as well as for managing emerging codes to generate findings iteratively. We used four steps to analyze problem solving processes: (1) examination of micro-level activities, (2) analysis of different patterns, (3) examination of micro-level knowledge search, (4) investigation of problem solving processes in relation to the actual scope of the non-routine problems.
Step one: Micro-level problem solving activities. To analyze the complete problem solving process, we broke down each process into three aspects: framing the non-routine problem, solution finding activities, and solution scoping taking a micro-level focus throughout the analysis. In terms of how non-routine problems were framed, we coded all instances where the nature of the problem and envisioned solution finding was described. Then, to analyze the solution finding activities, we followed the empirical focus of an activity perspective, examining actual doings in the social world ADDIN EN.CITE ADDIN EN.CITE.DATA (Jarzabkowski, 2005; Johnson, Melin, & Whittington, 2003; Whittington, 2003), taking care to ensure we only coded specific actions and interactions rather than intentions or beliefs. In the following step, we analyzed all the instances where solution scoping the characteristics, benefits and diffusion of the solution - were described, taking information from interview data and triangulating it wherever possible against data from senior management interviews and archives ADDIN EN.CITE Jick197914141417Jick, Todd D.Mixing qualitative and quantitative methods: triangulation in actionAdministrative Science QuarterlyAdministrative Science Quarterly602-112441979(Jick, 1979). We employed inductive qualitative techniques to develop in vivo codes reflecting the language the respondents used to generate a detailed representation of this data (first order concepts) and then aggregated similar and recurring codes thematically under broader categories (second order themes): Table 3 gives a graphical representation of these theme building steps. Using multiple data sources to analyze solution scoping and outcomes also allowed us to conclude on the relative effectiveness of each problem solving process.
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Step two: Different problem solving patterns. Our initial understanding of the data pointed towards complex patterns of problem framing, solution finding activities and solution scoping. Step two of the analysis aimed to describe the interdependencies between these three aspects: we examined the patterns of the occurrences and linkages of second order themes identified in step one for each problem solving process (within-case analysis), and then compared those patterns across the 38 processes (cross-case analysis). This analysis led us to identify four different problem solving approaches local template adapting, superior technology creating, local template creating, and global principle creating the final, aggregate categories of the inductive analysis (see table 4). Drawing on Baden-Fuller and Winter ADDIN EN.CITE Baden-Fuller200795959534Baden-Fuller, CharlesWinter, SidneyReplicating knowledge practices: Principles or templates?2007LondonCass Business School, City UniversityWorking paper(2007)s terms templates (how something is done) and principles (why something works) - to classify organizational-level knowledge replication strategies, we used the ideas behind their terms to describe activities during the problem solving process. We use the word global loosely, incorporating various levels of international scope. As we were interested in explaining shared patterns, the analysis in Table 4 includes only the second order themes observed in at least three processes of each problem solving approach.
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Step three: Micro-level knowledge search. In this third step, we were interested in exploring in more detail the knowledge search actions pursued as part of the solution finding processes. For each problem solving process, we coded all the instances of knowledge search: internal, inter-personal knowledge search instances were then coded under literature based codes that reflected the geographic and cognitive proximity of the knowledge sources targeted (corresponding to the four boxes of figure 1); internal knowledge located on a corporation database or intranet was coded under the repository category; and outside MNC knowledge sources under the external category (see Table 5 for representative data for each of these codes). We then compared the relative frequency of these different knowledge search categories across the four problem solving approaches and attached the labels low, moderate, high and very high to summarize the patterns we observed (see tables A1, A2, A3 and A4 in Appendix A).
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Step four: Non-routine problem solving process in relation to actual problem scope. Finally we summarized our findings in a framework, illustrated as Figure 2. The insights gained in previous analysis steps revealed that the problem solving processes could be described in very broad terms by their local and/or global orientation of micro-level activities (shown as the vertical axis in Figure 2), while the second dimension (the horizontal axis) represents the non-routine problems actual scope. Juxtaposing these two dimensions revealed the extent to which the solving process matched the problems scope, which we assessed by triangulated data from the interviews and archival sources, carefully interrogating the problem explanations for references to global dimensions. Significantly, the problem might be framed as local, although the actual scope of the challenge is global (see local template creating, Figure 2) or the problem solving process might be global although the original problem was a local one (see superior technology creating, Figure 2). Overall, the 38 problem solving processes were distributed among the four approaches as follows: 15 (39 per cent) illustrated the local template adapting approach, 9 (24 per cent) local template creating, 3 (8 per cent) superior technology creating, and 11 (29 per cent) global principle creating.
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We used a number of techniques to strengthen the trustworthiness of our qualitative research ADDIN EN.CITE Lincoln19854242426Lincoln, Yvonna S.Guba, Egon G.Naturalistic inquiry1985Beverly Hills, CASageLincoln19854242426Lincoln, Yvonna S.Guba, Egon G.Naturalistic inquiry1985Beverly Hills, CASage(Lincoln & Guba, 1985), including: confidentiality of information, triangulation, several iterations of data analysis, constant circling between data and theory, and verification of the validity of the initial findings with respondents, incorporating their comments into the further analysis.
Findings
As noted above, our data suggested four problem solving approaches, which we introduce in detail here, outlining the specific findings regarding the framing of the non-routine problem, micro-level solution finding activities and knowledge search, as well as solution scoping. Table 6 presents additional data for each theme, and Table 7 a comparison of the knowledge search patterns, which are explained in detail in the following sections.
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Local Template Adapting
This approach involves searching for a template which can be replicated to address a local non-routine problem. The basic template structure will be one that has worked effectively elsewhere, and which managers, while following how the practice was implemented at the originating unit, can blend with other, more socially embedded and context-specific knowledge to address the units need in implementing what is essentially a local solution.
Framing the problem. In this situation the non-routine problem is local: it is seen as unique to the focal unit, but may well resemble problems previously experienced by sister units. Thinking that other units or colleagues could provide a solution, the managers specifically frame the problems as local challenges, which is reflected in their description of how they affected the immediate units: We were trying to get more out of lines that werent made to be run up to that standard. Management knew we had huge amounts of downs. (Omega, process 2).
Solution finding activities. Local template adaptation actions typically take the form of searching for existing knowledge to solve the problem, and where it is suspected other MNC units have experienced similar situations before, managers make targeted attempts to locate existing solutions to find knowledge templates which can be leveraged. Broader knowledge searches usually cease when an apparently appropriate solution is found. Initially, managers approach their co-located peers (high geographically proximate, cognitively proximate knowledge search), and - if a solution template is not available locally - sometimes extend their search to peers at internationally distributed sister sites (moderate geographically distant, cognitively proximate knowledge search). Another solution-locating activity involves approaching (usually co-located experts) to access specialist expertise to supplement the solution template (moderate geographically proximate, cognitively distant knowledge search). Once a suitable template is located which has proven effectiveness in the context where it is found, managers aim to replicate such knowledge structures as closely as possible: We used that, I suppose, as a basic structure (Gamma, process 5). Despite efforts to copy closely, additional expertise from the front-line focal team is often sought to undertake adaptations to certain aspects of the template to respond to specific local needs: We took ideas from them. We looked at how they do it [at HQ]: their template. And then we filled it with our own knowledge (Sigma, process 2). Although certain problem solving processes are characterized by a collective approach, with the search for knowledge and solution finding being conducted by (often informal) teams with the help of experts input (collective addressing of knowledge needs), knowledge searches still generally concentrate on local and cognitively close sources, in a moderately intense search pattern, with managers only rarely searching geographically distant/cognitively distant and/or external knowledge sources.
Solution scoping. The adapted template becomes embedded in the focal units knowledge system, and interviewees often described how the solution is their (units) own and works well in the focal unit (local solution): Im happy with the progress so far. Yes, we have come a long way (Epsilon, process 2); They [local senior managers] would have seen the huge decrease in downtime and they were very happy (Omega, process 2). Echoing other work on the replication of MNC practices in subsidiaries ADDIN EN.CITE Becker-Ritterspach201089898917Becker-Ritterspach, Florian A. A.Saka-Helmhout, AyseHotho, Hasper J.Learning in multinational enterprises as the socially embedded translation of practicesCritical Perspectives on International Business8-37612010Saka-Helmhout200912112112117Saka-Helmhout, AyseAgency-based View of Learning within the Multinational CorporationManagement LearningMANAGEMENT LEARNINGManage. Learn.258-2744032009(Becker-Ritterspach, Saka-Helmhout, & Hotho, 2010; Saka-Helmhout, 2009), this approach draws attention to the social nature of knowledge transfers, the importance of individual agency in mobilizing and enacting practices, and the link between these micro-level activities and the degree of organizational learning achieved at the subsidiary ADDIN EN.CITE Saka-Helmhout201010110110117Saka-Helmhout, AyseUniv Surrey, Sch Management, Surrey GU2 7XH, England.
Saka-Helmhout, A, Univ Surrey, Sch Management, Surrey GU2 7XH, England.
a.saka-helmhout@surrey.ac.ukOrganizational learning as a situated routine-based activity in international settingsJournal of World BusinessJ. World Bus.JOURNAL OF WORLD BUSINESSJ. World Bus.JOURNAL OF WORLD BUSINESSJ. World Bus.41-48451Knowledge transferOrganizational learningMultinationalcorporationsRoutinesInstitutional contextMULTINATIONAL-CORPORATIONSUS MULTINATIONALSBUSINESSSUBSIDIARIESSYSTEMSFIRMPERSPECTIVESSTRATEGIESCAPITALISMINNOVATION2010Jan1090-9516ISI:000272898800006Article<Go to ISI>://000272898800006 10.1016/j.jwb.2009.04.009English(Saka-Helmhout, 2010).
Superior Technology Creating
The superior technology creating approach also relates to a non-routine problem of local scope. Despite this local problem scope, the problem solving is global, integrating diverse external and internal knowledge to develop a technological solution of international scope.
Framing the problem. The local frame of the problem can be pinpointed as the core technology involved which might be quite advanced for the MNC - only operates in that form at the focal unit. One subsidiary manager recalled: We had 100% failure. Every part was failing. A significant challenge. It brought the area pretty much to a halt (Omega, process 5). Being in a subsidiary specific situation, such problems are defined as local challenges.
Solution finding activities. As the problem is technologically advanced, and thus new to the global organization, the problem cannot be solved by searching for a template to replicate rather requires creating a new solution, which involves design and innovation activities: The goal is to develop this material (Omega, process 7), and may encompass changing existing knowledge structures (core technologies and accompanying processes) to develop the tool and the process (Omega, process 6). The underlying technical and operational complexities can mean multi-facetted knowledge requirements, so that sourcing diverse knowledge components usually requires the coordinated efforts of a number of people: there would be a team working on it. Its not just one person (Omega, process 7), collaborating as a team to collectively address knowledge needs.
Given the need for knowledge creation, knowledge search shows characteristics which promote innovation generation. Knowledge search typically exhibits a very high intensity and focuses initially on immediate team members and management peers in order to understand the exact reasons underlying the problem, and then repeatedly consult their knowledge during solution finding (high geographically proximate, cognitively proximate knowledge search). As the problems typically exhibit considerable technological complexity, it is often necessary to mobilize cognitively distant knowledge and to search extensively for specialist expertise and skills (very high geographically proximate, cognitively distant knowledge search). Importantly, the geographic location of the required knowledge seems to become less important (very high geographically distant, cognitively distant knowledge search). In overall terms, these activities involve extensive searching for knowledge across cognitive distance, so we can characterize this knowledge search pattern as negotiating cognitive boundaries.
Solution development can be enhanced by drawing on specific technological knowledge held externally. A unique feature of this problem solving approach is that additional expertise and skill is searched extensively from external organizations, both located locally and worldwide (very high external knowledge search), helping to create new knowledge that is globally beneficial. Our study indicates that the interdependence of the problem with external players and the specificity of the knowledge involved are what most often motivate such cognitively distant external search.
Another characteristic activity in creating superior technology is involving global stakeholders in the problem solving process. Driven by a sense of urgency and the potential the problem has for impacting business adversely, updates for global senior management on the progress of solution development are common. In addition, global senior managers and other worldwide organizations may also represent valuable knowledge sources, and be approached for their advice on the possibility and implications for developing global solutions: They [global senior management] started to see the potential of it. It wasnt probably at a viable stage where it could be used for mass production ... But we had the test runs, we proved that concept. (Omega, process 6). In that case, consulting global senior management was important, as the unit not only received financial support to develop a solution suited to high-volume production, but the problem solving efforts included global management input to explore the potential for creating a global solution and what features that might require. The involvement of global stakeholders has a triple effect, in making the corporate level aware of the subsidiarys solution finding efforts, in securing their buy-in, and in incorporating knowledge from important global stakeholders.
Solution scoping. Solutions represent innovative technological knowledge, and while the non-routine problem may only be of local scope, these problems provide the opportunity to develop new technological knowledge that is sufficiently generic and compatible to be seen as superior to currently used knowledge at the international level. The global solution that is crafted can be expanded to other technologies: let's qualify that on the other product lines (Omega, process 5), and applied in other regions: that tool was actually used across Omega sites worldwide after it was developed (Omega, process 6). As the superior technology is scalable, the outcomes of this approach do not just solve the initial problems, but lead to solutions that diffuse across the wider MNC, and so represent standardized solutions one worldwide recipe (Omega, process 5) - that can be implemented internationally across the organization and thus achieve an impact across a larger segment of the business (Omega, process 7).
Local Template Creating
In contrast to the two previous situations of local non-routine problems, the challenges here are global in scope, but problem solving processes are nevertheless focused locally, mobilizing mainly close knowledge to develop a subsidiary specific solution.
Framing the problem. Importantly, the subsidiary managers also recognize the global dimension of problems one noted explicitly: Epsilon is a very security conscious organization. One of the challenges was in the spread of information so that the core business remains secure (Epsilon, process 3), and another described how similar problems not only occurred in the focal unit but across Epsilon (Epsilon, process 7). Despite this explicit awareness, subsidiary managers nevertheless define the problem as local challenge, primarily addressing difficulties encountered at their focal units: We wanted to work on the challenges that we have here (Gamma, process 8).
Solution finding activities. Although some solution finding efforts are organized in teams collectively addressing knowledge needs subsidiary managers generally pursue independent approaches to finding solutions (siloed problem solving): I would have discussed it with my manager, but it was pretty much my own idea. If it works, well tell people. If not, we just learn our lesson, and we move on. (Epsilon, process 4); We could accuse ourselves of being very much silo based, of doing our own things you are very much in your own head (Epsilon, process 3). Solution finding involves only a limited number of sources in low intensity knowledge search, preferring to isolate problem solving from broader inflows of diverse knowledge. Generally, few knowledge sources are targeted, and are mainly co-located management peers or team members (high geographically proximate, cognitively proximate knowledge search). Only on rare occasions does knowledge searches look at more diverse locally and globally distributed knowledge sources, either internal or external to the MNC (low geographically distant, cognitively proximate; low geographically proximate, cognitively distant; low geographically distant, cognitively distant; low external knowledge search patterns). We can summarize these knowledge searches as generally being trapped in local rigidities, building primarily on the locally accumulated organizational knowledge. Knowledge thus sourced is then integrated with the managers own expertise to create solutions which mostly represent new or improved processes, practices or routines - We made improvements (Epsilon, process 7) - that prove effective when implemented at the focal subsidiary.
Solution scoping. The outcomes of this approach tend to be local solutions - as one respondent acknowledged explicitly: We have innovated. innovation at the local level (Sigma, process 5). In six of the nine problem solving processes in our data set, the solutions remained within the subsidiary units. But in the other three cases, when the MNC recognized the solutions positive performance impact, it attempted to replicate this superior knowledge at other units worldwide, an activity we can label globalizing of local solutions. This involves the subsidiary managers presenting the solution to global management peers: We are certainly promoting the way we are doing it. (Epsilon, process 7); We piloted it in EMEA, and I told all the other managers. We had informed everyone who we have in the management team [globally] (Sigma, process 4), sharing their local best practices to facilitate global trials of the knowledge they have developed locally.
As the primary goal is to tackle local challenges, this approach generally neglects requirements for a solution that might have non-location bound potential, and subsidiary managers show little understanding of why the solution they created might or might not work in other contexts. Although they are open in terms of sharing their local solution with global peers, this sharing focused on explaining how the exact steps of the routine are performed locally, activities which led the solution to become what we can term a template. This approach mainly creates location-bound, situation-specific solutions ADDIN EN.CITE ADDIN EN.CITE.DATA (Rugman & Verbeke, 1992, 2001) rather than proactively tackling the recognized global challenges.
Global Principle Creating
Similar to the local template creating approach, the non-routine situation is of global scope, yet the problem solving process is explicitly geared towards developing a global solution, mobilizing and integrating diverse knowledge for designing a generic solution that is diffused within the wider MNC.
Framing the problem. Problem framing in this approach involves discrete steps, which generally start by defining the problem as a local challenge: I worked in one specific area in one country. But it is a key question across the [subsidiary] organization (Gamma, process 13). When further inquiries establish that similar non-routine problems have occurred at sister units, subsidiary managers recognize the global dimension of the problem: What we also see is that usually your business question is not unique to you, it is something that is not only shared, but is also happening in other places (Gamma, process 13); My two [Asian] peers would also be singing the same problem. So this [solution finding] was of much benefit for the group, the department in general (Omega, process 8).
Importantly - and in contrast to the local template creating approach - when considering what kind of solution should be developed, the leading subsidiary managers consciously envision a global solution for the problem which can work in other markets or technologies: setting this out as a [globally] aligned project (Gamma, process 9); They [solutions] have to be backward compatible as well as forward invented (Omega, process 9). The goal is then no longer just to develop a solution that is specific to the focal units problem: It doesnt make sense for us to have something that is just specific to that one market (Gamma, process 14), and which may avoid management peers developing different solutions to a similar global problem: Those activities can be centralized into the one source. Otherwise the teams would be duplicating everything (Gamma, process 10). In contrast to the actions typical of the local template creating approach, these managers also define the problem as global challenge, and proactively take ownership of and drive the development of solutions that lead to scalable, high-level outcomes: It is all about scale in some way. In this area, it is really about identifying a challenge, see how it is working within our remits, in my case in my countries, in my region. And then, once I have a fair understanding of it: how does it also occur in other regions? You can actually scale it (Gamma, process 13); You look from a helicopter view (Gamma, process 12); Everybody had to gain at the end this process would be a benefit to those guys [in the US] and that was the plan (Omega, process 8). This approach actively embraces the challenges of the wider organization rather than only seeking solutions to specific local difficulties.
Solution finding activities. Managers following this approach recognize that solving global non-routine problems adds additional complexity to the solution finding process, both in terms of the knowledge required for its development and in terms of coordinating the various local and international colleagues involved. In our cases, these complexities are usually addressed by working as a team to collectively address knowledge needs, distributing the different solution development components and also incorporating a range of expertise: how can we best share best practices and work together? Because we would develop a better outcome (Gamma, process 11); We actually work as a group, but obviously, you can lead it (Gamma, process 13). These collaborative actions typically involve intense searches for knowledge and expertise from the immediate team and among co-located management peers and units (high geographically proximate, cognitively proximate knowledge search). Specific, problem related knowledge is also mobilized, both from other specialist subsidiary units (moderate geographically proximate, cognitively distant knowledge search) as well as from global stakeholders. Managers also tap into relevant knowledge and expertise of global sister units, ensuring a broader collaborative effort spanning across different locations: Ireland was the core team that made connections with the West coast [of US, where certain global responsibilities are located] (Omega, process 9); What is there that other teams [worldwide] can offer? Can we collaborate? (Gamma, process 9); It wouldnt make sense if we work in isolation (Gamma, process 11), so those units that would be affected by the solution are also involved in finding and creating it.
Solution finding activities also include obtaining investment, visibility, support and global approval of the solution idea from other global stakeholders (often brokered through immediate management): We did get that approval [from Gammas Executive Management]. So we nailed down the solutions on a very high level (Gamma, process 11); and Without that support it probably wouldnt happen because it requires the interaction of different groups. So Ireland can try and drive it, but if the US arent aligned, or if Asia arent aligned you need alignment from senior management It would take a lot without that support. (Omega, process 9).
Involving global stakeholders allows subsidiary managers leading solution-finding actions to demonstrate that their proactive efforts are aligned with the MNCs priorities, an important factor if they are not to be seen as merely self-interested endeavors ADDIN EN.CITE Birkinshaw199811: 236111117Birkinshaw, JulianHood, NeilJonsson, StefanBuilding firm-specific advantages in multinational corporations: The role of subsidiary initiativeStrategic Management JournalSTRATEGIC MANAGEMENT JOURNALStrateg. Manage. J.221-241193SUBSIDIARY corporationsINTERNATIONAL business enterprisesSTRATEGIC planningRESOURCE managementINDUSTRIAL managementBUSINESS planningMANAGEMENT scienceENTERPRISE resource planningCOMPETITIONentrepreneurshipmultinational corporationsubsidiary199803John Wiley & Sons, Inc. / Businesshttp://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=402410&site=ehost-live (Birkinshaw et al., 1998: 236). This global orientation results in geographically distant knowledge searches within the same functional domain (moderate geographically distant, cognitively proximate knowledge search). In addition, managers efforts to find worldwide solutions are characterized by strong attempts to locate and mobilize the most advanced and most applicable knowledge, which involves them targeting diverse MNC expert units located anywhere worldwide (very high geographically distant, cognitively distant knowledge search). Such intense knowledge search across different MNC units represents an approach that negotiates geographic distance, and in some cases, also includes external knowledge sources (low external knowledge search). Overall, this approach exhibits a high intensity knowledge search.
Solution scoping. The diverse knowledge sources are then blended to create new solutions, usually new or improved ways to conduct processes or practices: There is a logistical end-to-end process design piece (Gamma, process 12); or It [the solution] also involves a lot of change for Omega. It is a different supply and a different application technology (Omega, process 9). The solution substantially modifies existing routines, or develops new ones which are first implemented at the focal subsidiary unit, and then rolled out as global solutions to worldwide sister units, expanding both to other regions and across to other technologies: We expanded it out of the pilot regions into more regions We are feeding that back in the Homeland teams (Gamma, process 14); or Its at the stage now where we have a clean process, where we have rolled it out to all the teams (Omega, process 8).
A certain level of standardization may be required to achieve this replication and scalability: By keeping it in a standardized way of approaching our business that means that we have approached that problem in all regions; it means that it also works in Homeland. If we had it too localized to the way how we work in EMEA, it probably wouldnt work for the Homeland team. But we kept it [solution] pretty generic and pretty mechanic (Gamma, process 14). It is important that actions are geared towards creating a solution around this standardized core to take account of the fact that certain country- or technology-specific adaptations will be needed to achieve wider relevance and thus facilitate international scalability. More generally, in creating global solutions, the leading managers need to develop their understanding both of the nature of the local problem and how it is manifested in other locations/technologies. In developing a solution that addresses these multiple requirements, they demonstrate how certain solutions can avoid becoming location- or technology-specific and thus fulfill multiple requirements: Its a common process [for all Omega]. And thats the way it should be (Omega, process 8). As an understanding is developed of why certain solutions can work globally, which is then reflected in the kind of solutions that are developed, we can term such solutions principles: their outcomes not only resolve local problems, but lead to solutions that diffuse across the wider MNC.
Effectiveness of problem solving approaches. Although this paper is primarily concerned with examining the different ways subsidiary managers respond to non-routine problems, and the four problem solving approaches cannot be ranked as such, the analysis of solutions implemented and their extent of diffusion within the wider MNC allows conclusions with regard to their relative effectiveness. First, given the urgency, down-side potential and business risk of most non-routine situations, all problem solving approaches are effective to the extent that a solution is implemented and retained which remedies the initial non-routine problem at the subsidiary level, i.e. can be deemed as effective from a subsidiary viewpoint. This may involve solution creation, but also the leveraging of existing MNC knowledge templates - as in the local template adapting approach which delivers an adequate, locally effective response. Second, certain problem solving approaches generate additional outcomes in developing solutions that diffuse beyond the focal unit (superior technology creating and global principle creating), and can thus be seen as relatively more effective from the viewpoint of the MNC in comparison to an approach whereby subsidiary managers develop local solutions to an actual global issue (local template creating). As the solutions mostly modify or develop new routines or generated novel technology knowledge, if diffused within the wider MNC, these solutions build and renew the competences of the MNC in a bottom-up manner.
Discussion
Strategic Contribution of Subsidiaries to the MNC
A major contribution of this study is to develop theory on MNC problem solving, an increasingly important phenomenon, and, as suggested by our findings, also a process through which subsidiaries can contribute strategically to the MNC by developing solutions that renew MNC competences. Such decentralized problem solving, driven by subsidiary managers, allows the MNC to respond to its current and anticipated renewal needs. We undertook detailed qualitative work for the study, so as to be able to unravel the nuances of subsidiary managers micro-level activities and knowledge search as well as the outcomes of four main problem solving approaches - local template adapting, superior technology creating, local template creating, and global principle creating - as summarized in figure 3. In the same way as previous research has observed that identifying opportunities can trigger certain subsidiary-led responses (internal, local, global, global-internal hybrid market initiatives Birkinshaw, 1997; local-for-local or local-for-global innovation Ghoshal, 1986), we find typical problem solving approaches in response to the local vs. global scope of non-routine problems. Identifying which activities are pursued to solve locally identified non-routine problems and which go on to create global solutions and indeed contribute to MNC competence renewal will be of particular interest to MNCs and IB scholars.
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Insert Figure 3 about here
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In the local template creating approach a global problem may be framed as local: we call such problems veiled global, in that, although the subsidiary managers usually became aware of the problems true (global) scope while framing it and seeking an answer, they still approached solution finding from a local perspective. In contrast, global principle creating not only means understanding a problems global scope, but going on to envision and deliver a global solution. The concept of veiled global problems has important implications, as it suggests that subsidiary middle managers are often familiar with global operations and their interdependencies with their own subsidiary operations, and are thus aware of the global interdependencies of local challenges. There has been an assumption in the MNC literature that it is sufficient for lower-level managers to have global or transnational awareness because actual managerial interventions relating to such interdependencies are handled by their senior managers ADDIN EN.CITE Bartlett19987:246776Bartlett, Christopher A.Ghoshal, SumantraManaging Across Borders: The Transnational Solution2nd1998LondonRandom House Business BooksPrahalad19879:244-5996Prahalad, C. K.Doz, Yves L.The Multinational Mission: Balancing Local Demands and Global Vision1987New YorkThe Free Press(Bartlett & Ghoshal, 1998:246; Prahalad & Doz, 1987:244-5). Our findings suggest, rather, that not only do subsidiary middle managers need to have such an awareness but also that their actions and behaviors need to reflect that awareness if global interdependencies are to be managed effectively.
The three problem solving approaches local template creating, superior technology creating and global principle creating loosely resemble the local-for-global innovation process ADDIN EN.CITE Ghoshal198623923923932Ghoshal, SumantraThe innovative multinational: A differentiated network of organizational roles and management processesHarvard Business School1986Boston, MAUnpublished PhD dissertation(Ghoshal, 1986), but again reveal previously unnoticed subtleties. While Ghoshal and colleagues suggest that local-for-global innovation is entirely developed at the subsidiary level and subsequently found to be applicable in multiple locations ADDIN EN.CITE Nohria1997182: 28, 291821826Nohria, NitinGhoshal, SumantraThe Differentiated Network: Organizing Multinational Corporations for Value Creation1997San Francisco, CAJossey-Bass Publishers(Nohria & Ghoshal, 1997: 28, 29), our detailed work sheds light on the global interactions, broad knowledge searches and foresight, vision, and proactive effort which are required from early in the problem solving process if a global impact is to be achieved (particular in the superior technology creating and global principle creating approaches). Slow or failed diffusion may be due to the resistance of other units to adopting new innovations ADDIN EN.CITE ADDIN EN.CITE.DATA (Kostova & Roth, 2002; Nohria & Ghoshal, 1997). Subsidiary managers try to engage peers and senior managers globally during the solution finding process to anticipate and pre-empt such resistance, rather than only involving such sources later, and if an opportunity for post-hoc leverage emerges. Indeed, the solution finding activities of the local template creating approach show how problem solving processes can become isolated and reliant only on subsidiary-level support, and so developing solutions that are context-specific and which only diffuse globally with difficulty some while later (if ever).
In addition to these differences in the solution finding actions, the two approaches to solving global non-routine problems - local template creating and global principle creating - also differed substantially from each other in terms of how subsidiary managers mobilized knowledge at the micro-level. Our detailed analysis reveals that creating a local template (a context-specific solution) requires less intense and less geographically and cognitively distant knowledge search than creating a global principle - a generic, worldwide applicable solution which requires understanding both the various local and global dimensions of the problem and the reasons why a certain solution could also work in a wider range of contexts which (as our data shows) necessitates much more intense and broader knowledge search that spans both geographic and cognitive distance. Thus, not only do our results uncover important variations in the local-for-global innovation processes (local template creating, global principle creating, superior technology creating), they provide some significant clues towards answering the question of which subsidiary-driven activities are more likely to generate local or global solutions.
There are two further implications that warrant more detailed discussion. First, we found that the subsidiary managers pursue different problem solving processes at different occasions, and also that subsidiary units may pursue multiple problem solving approaches simultaneously. This lends additional support to our argument that micro-level managerial activities matter, and add an important dimension to previous studies which focused more on generic processes and organisational-level contingencies.
Second, our study makes it evident that the distinction between problem solving, initiative and innovation processes can become blurred. This is especially true for the superior technology creating and global principle creating approaches, both of which detail how non-routine problems encountered in local units, when addressed by proactive subsidiary-level efforts, can trigger solution finding activities that lead to global outcomes. Rather than HQs perceiving these activities as dangerous and self-interested endeavors ADDIN EN.CITE Birkinshaw199811111117Birkinshaw, JulianHood, NeilJonsson, StefanBuilding firm-specific advantages in multinational corporations: The role of subsidiary initiativeStrategic Management JournalSTRATEGIC MANAGEMENT JOURNALStrateg. Manage. J.221-241193SUBSIDIARY corporationsINTERNATIONAL business enterprisesSTRATEGIC planningRESOURCE managementINDUSTRIAL managementBUSINESS planningMANAGEMENT scienceENTERPRISE resource planningCOMPETITIONentrepreneurshipmultinational corporationsubsidiary199803John Wiley & Sons, Inc. / Businesshttp://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=402410&site=ehost-live (Birkinshaw et al., 1998), the data shows how subsidiary managers usually work collaboratively with management peers and seniors globally to create solutions that can create positive effects for their MNCs. Of course these subsidiary managers needed to solve their local problems - but their efforts extend beyond this to build solutions that diffuse to achieve an impact within the wider corporation. These two approaches contribute, similarly to subsidiary initiatives and innovation, to enhancing MNC competences ADDIN EN.CITE ADDIN EN.CITE.DATA (Birkinshaw et al., 1998; Rugman & Verbeke, 2001) and promoting worldwide rather than fragmented organizational learning ADDIN EN.CITE Ghoshal198623923923932Ghoshal, SumantraThe innovative multinational: A differentiated network of organizational roles and management processesHarvard Business School1986Boston, MAUnpublished PhD dissertationBartlett19981741741746Bartlett, Christopher A.Ghoshal, SumantraManaging Across Borders: The Transnational Solution2nd1998LondonRandom House Business Books(Bartlett & Ghoshal, 1998; Ghoshal, 1986). Creating new solutions where existing routines or technologies are modified, or new ones emerge brings subtle shifts in MNCs competences, and represent an evolutionary change that contributes to their strategic renewal.
Micro-Foundations of Knowledge Flows in MNCs
Responding to the need to further understand micro-foundations ADDIN EN.CITE Foss200448484817Foss, Nicolai JuulPedersen, TorbenOrganizing knowledge processes in the multinational corporation: an introductionJournal of International Business StudiesJOURNAL OF INTERNATIONAL BUSINESS STUDIESJ. Int. Bus. Stud.340-349355INTERNATIONAL business enterprisesKNOWLEDGE managementORGANIZATIONAL behaviorORGANIZATIONAL changeknowledge processes in the MNCorganizational control and design20040910.1057/palgrave.jibs.8400102http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=14732964&site=ehost-live (Foss & Pedersen, 2004) and the social constitution of MNC knowledge processes ADDIN EN.CITE ADDIN EN.CITE.DATA (Noorderhaven & Harzing, 2009; Tallman & Chacar, 2011), the findings of this study offer important insights into how individuals deal with the challenges of geographic and cognitive boundaries that are characteristic of MNC knowledge processes especially when innovative outcomes are desired. Building on a functional view of geographic space, where distance within MNCs is treated as a structural, organizational level factor beyond the individuals immediate influence, geographic distance has been found to hinder MNC knowledge flows ADDIN EN.CITE ADDIN EN.CITE.DATA (Hansen & Lvs, 2004; Monteiro et al., 2008), leading to the problematic situation where distant search may be highly desirable for locating dissimilar knowledge to aid the generation of innovative outputs, but is hindered by the less frequent interpersonal interactions involved. Although all subsidiary managers we observed searched intensively for geographically and cognitively close knowledge (table 7), some also actively mobilized knowledge across greater distances. Specifically, we find that local template creating approaches may be characterized by becoming trapped in local rigidity, mostly searching co-located and cognitively close knowledge, whereas the global principle and superior technology creating approaches usually involve negotiating distance to also search distantly located knowledge. This supports the notion that space in the MNC is perceived subjectively rather than simply being an objective physical distance measure ADDIN EN.CITE ADDIN EN.CITE.DATA (Piscitello, 2011; Zaheer et al., 2012). Our study contributes to this emerging line of thinking in suggesting conditions for the emergence of this far-but-close situations ADDIN EN.CITE Wilson200835: 979353517Wilson, Jeanne M.Boyer O'Leary, MichaelMetiu, AncaJett, Quintus R.Perceived Proximity in Virtual Work: Explaining the Paradox of Far-but-CloseOrganization StudiesOrganization Studies979-1002297ORGANIZATIONAL behaviorSOCIAL structureINDUSTRIAL organization -- ManagementPERCEPTIONGROUP identityKNOWLEDGE, Theory ofdistancedistributed workperceived proximityteamsvirtual20080710.1177/0170840607083105http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=34159555&site=ehost-live (Wilson et al., 2008: 979): one seems to be the ability of knowledge searchers to envision a global and innovative purpose for their search outcomes (broadening the solution space); another a strong perception that solution-relevant knowledge exists and can be explored through interpersonal exchanges. These conditions seem to lead to a subjectively-constructed feeling of closeness that enables the mobilization of cognitively and geographically distant knowledge.
Implications for Practice
The value added by solutions generated in subsidiaries cannot be underestimated. How subsidiary managers drive problem solving processes deserves acknowledgement: the global principle/superior technology creating approaches, in particular, move beyond just tackling local problems to creating global solutions. Achieving global solutions poses high demands on the problem solving processes. Although empirical examinations of the reasons behind this behavior are beyond the scope of this paper, it is likely that, even when a problem is recognized as having a global dimension, operational performance pressures may often point solution finding efforts more towards immediate solutions than to exploring global possibilities. Interactive global problem solving requires a longer term perspective, intense and wide knowledge search, as well as the involvement of global stakeholders: it takes time and creates costs. Subsidiary managers workload will need to be managed to allow them to dedicate the necessary time and other resources and their evaluation criteria may need to expand to include notions of contributing to the wider group/line of business if their interest in acting interdependently and beyond their immediate subsidiary is to be fostered.
Our findings reveal that creating a global solution involves holistic engagement and building relationships with management peers, senior management and other expert units globally. This is a critical element in a subsidiarys ability to exchange knowledge and develop strategic importance ADDIN EN.CITE Gnyawali200984848417Gnyawali, Devi R.Singal, ManishaMu, Shaohua "Carolyn"Knowledge ties among subsidiaries in MNCs: A multi-level conceptual modelJournal of International ManagementJournal of International Management387-400154INTERNATIONAL business enterprisesSUBSIDIARY corporationsKNOWLEDGE managementENTREPRENEURSHIPCORPORATIONSBUSINESS intelligence20091210.1016/j.intman.2008.02.003http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=45071698&site=ehost-live (Gnyawali, Singal, & Mu, 2009), and engaging with global management is a channel through which a subsidiarys voice may be heard ADDIN EN.CITE Bouquet200810710710717Bouquet, C.Birkinshaw, J.Weight versus voice: How foreign subsidiaries gain attention from corporate headquartersAcademy of Management JournalACADEMY OF MANAGEMENT JOURNALAcad. Manage. J.577-6015132008Jun0001-4273ISI:000257297100010<Go to ISI>://000257297100010 (Bouquet & Birkinshaw, 2008) and HQ can engage in subsidiary innovation processes ADDIN EN.CITE Ciabuschi201128728728717Ciabuschi, FrancescoForsgren, MatsMartin, Oscar MartinRationality vs ignorance: The role of MNE headquarters in subsidiaries' innovation processesJournal of International Business StudiesJOURNAL OF INTERNATIONAL BUSINESS STUDIESJ. Int. Bus. Stud.958-970427INNOVATIONS in businessINTERNATIONAL business enterprisesSUBSIDIARY corporationsCORPORATIONS -- HeadquartersCREATIVE ability in businessINNOVATION managementbounded rationalityheadquartersinnobation processesperformancesheer ignorancesubsidiary20110910.1057/jibs.2011.24http://search.ebscohost.com/login.aspx?direct=true&db=bth&AN=66742589&site=ehost-live (Ciabuschi, Forsgren, & Martin, 2011). From a subsidiary perspective, to fully appreciate the benefits of a globally oriented solution finding means recognizing these positive, longer-term networking and profile building effects. Also, subsidiary managers need to be aware that how a problem is framed can influence solution finding activities: the global scope of the non-routine problem may help to negotiate distance, but a local scope does not mean that solution findings must inevitably be trapped in local rigidities. Searches may be biased towards a local focus, but managers can overcome possible negative effects by remaining open to the idea of tapping into MNC-wide knowledge pockets.
Limitations and Implications for Future Research
As with all exploratory research, further studies are needed to establish the generalizability of our findings, but we expect they will have broader relevance. First, the phenomenon under investigation subsidiary driven problem solving processes is very likely mirrored in other industries, more frequently in sector with moderate and high environmental dynamism. Second, all subsidiary managers need to deal with the dispersion of knowledge, a basic attribute of any MNC, which implies that the nature of the challenges to knowledge search is the same and might lead to similar response patterns (being trapped in local rigidities vs. negotiating geographic and cognitive distance). Third, our replication research design allowed us to extend theory by taking account of a range of different aspects at MNC, subsidiary, and middle management level (see table 1 and research design section), which strengthens our emergent insights.
A potential limitation of this study is that subsidiary managers could nominate the non-routine problem. Although the urgency and down-side potential of most non-routine problems requires that a solution is implemented and measures were taken to mitigate bias, we cannot fully rule out success bias in that managers chose to talk about problems which they resolved successfully at the subsidiary level. In addition, in the situations where local solutions were found to global non-routine problems, our data does not permit us to determine exactly when the global problem dimension was noticed (before, during or after the solution was found). However, we do not believe this influences our conclusions, because our findings indicate that searching broadly is also important to finding solutions to local problems as it will help to determine the scope of the challenge more accurately and reformulate the problem, where meaningful, in more multi-dimensional ways ADDIN EN.CITE Cross200411611611617Cross, RobSproull, LeeUniv Virginia, Mcintire Sch Commerce, Charlottesville, VA 22904 USA. NYU, Stern Sch Business, New York, NY 10012 USA.
Cross, R, Univ Virginia, Mcintire Sch Commerce, Monroe Hall,POB 400173, Charlottesville, VA 22904 USA.
robcross@virginia.edu lsproull@stern.nyu.eduMore than an answer: Information relationships for actionable knowledgeOrganization ScienceOrgan Sci.ORGANIZATION SCIENCEOrgan. Sci.446-462154informationknowledgeproblem solvingrelationshipsABSORPTIVE-CAPACITYNETWORK STRUCTUREWORKORGANIZATIONPERFORMANCEPERSPECTIVEBOUNDARIESINNOVATIONMANAGEMENTACCURACY2004Jul-Aug1047-7039ISI:000223151600005Article<Go to ISI>://000223151600005 English(Cross & Sproull, 2004).
This research shows the strategic role which subsidiaries can play in driving global solution development, suggesting the value of pursuing this research agenda further. Our unit of analysis was the problem solving process and our empirical interest in micro-level activities; further research could adopt a multi-level research design to examine the impact of MNC governance mechanisms ADDIN EN.CITE Foss201015515515517Foss, Nicolai J.Husted, KennethMichailova, SnejinaGoverning Knowledge Sharing in Organizations: Levels of Analysis, Governance Mechanisms, and Research DirectionsJournal of Management StudiesJOURNAL OF MANAGEMENT STUDIESJ. Manage. Stud.455-482473RESEARCHINFORMAL organizationFORMAL organizationMANAGEMENT scienceOPERATIONS researchKNOWLEDGE transfer (Communication)20100510.1111/j.1467-6486.2009.00870.xhttp://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=48452452&site=ehost-live (Foss, Husted, & Michailova, 2010). We sampled subsidiary managers rather than problem solving networks, but it also seems worthwhile to investigate the influence of social networks on problem solving efficiency and effectiveness in more detail. More explorative work is also required to uncover how subsidiary managers actually sell their ideas and local solutions to global managers and the managerial competencies such actions require ADDIN EN.CITE Rouleau201112712712717Rouleau, LindaBalogun, JuliaMIDDLE MANAGERS, STRATEGIC SENSEMAKING AND DISCURSIVE COMPETENCEJournal of Management StudiesJOURNAL OF MANAGEMENT STUDIESJ. Manage. Stud.9539834852011(Rouleau & Balogun, 2011).
We observed that problem solving approaches not only involve sharing final solutions (local template creating), but also solution ideas (global principle creating, superior technology creating). Further research may explore if these different approaches attract different levels of headquarter attention ADDIN EN.CITE Bouquet200910610610617Bouquet, C.Morrison, A.Birkinshaw, J.International attention and multinational enterprise performanceJournal of International Business StudiesJOURNAL OF INTERNATIONAL BUSINESS STUDIESJ. Int. Bus. Stud.108-1314012009Jan0047-2506ISI:000262267800008<Go to ISI>://000262267800008 10.1057/jibs.2008.64(Bouquet, Morrison, & Birkinshaw, 2009), which can be a critical factor in developing the subsidiarys influence vis--vis peer units ADDIN EN.CITE Ambos201011811811817Ambos, Tina C.Andersson, UlfBirkinshaw, JulianWhat are the consequences of initiative-taking in multinational subsidiaries?Journal of International Business StudiesJOURNAL OF INTERNATIONAL BUSINESS STUDIESJ. Int. Bus. Stud.1099-11184172010(Ambos et al., 2010). The significance of problem framing for how problem solving processes unfold means we also need to understand more about how subsidiary managers make sense of challenges and formulate relevant solution spaces. The affective element of problem formulation ADDIN EN.CITE Lyles198031431431417Lyles, Marjorie A.Mitroff, Ian I.Organizational Problem Formulation: An Empirical StudyAdministrative Science QuarterlyADMINISTRATIVE SCIENCE QUARTERLYAdmin. Sci. Quart.102-119251PROCESS optimizationORGANIZATIONPROBLEM solvingORGANIZATIONAL behaviorDECISION theoryMANAGEMENT -- Research198003Administrative Science Quarterlyhttp://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=3985867&site=ehost-live (Lyles & Mitroff, 1980) means individuals may frame their local solution space for reasons such as problem avoidance, fear, political and internal competition: again, these aspects call for further exploration.
Conclusion
Examining non-routine problem solving broadens our perspective on the various ways subsidiaries can contribute strategically to MNCs. We have argued that all subsidiary units regularly encounter non-routine problems, and the ability of the MNC to mobilize its managers to pursue effective problem solving approaches is important in ensuring the continuous renewal of MNC competences. This study represents a further step in understanding problem solving in the MNC by explicating four problem solving approaches - local template adapting; superior technology creating; local template creating; and global principle creating - and their micro-level dynamics and outcomes.
Endnote
1 The terms non-routine problem solving and problem solving are used interchangeably for reasons of parsimony. This paper is concerned with problem solving as a response to non-routine events rather than other forms such as new product development or innovation management.
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Table 1: Characteristics of sample organizations
AttributesDomain of MNC within ICT industryCharacteristics of focal subsidiary Characteristics of subsidiary unit(s) used for data collectionEpsilonSolutions and servicesServices, R&D mandates
More than 1,500 employeesR&D unit with global responsibilities and high autonomyGammaServicesSales mandate
Less than 1,500 employeesSales unit with regional responsibilities and high autonomyOmegaHardware, software, solutions and servicesSales, Services, R&D, Operations mandates
More than 1,500 employeesR&D and Operations units with regional and global responsibilities and moderate autonomy SigmaSoftware solutions and servicesSales, Services and Support, R&D mandates
Less than 1,500 employeesSales, Services and Support units with local, regional and global responsibilities and low autonomy
Table 2: Summary of problem solving processes: Non-routine problem data set
Nature of non-routine problemNumber of processesTotal number of processesEpsilon GammaOmegaSigmaDeal with unique instances
(the non-routine problem was a special case which fell outside of the standard operating procedures / practices) 1315Design internal processes
(resolving the non-routine problem required to modify or create internal practices / processes)334414Develop sales business
(resolving the non-routine problem involved further developing the sales related practices / processes)44Optimize and automate processes
(resolving the non-routine problem required to optimise / automate existing practices / processes)3339Outsourcing management
(resolving the non-routine problem required to modify or develop outsourcing practices / processes)314Resolve technical escalation
(the non-routine problem was a technical escalation; resolving the non-routine problem required to investigate / develop technical and / or process related solutions)22Total number of processes7149838
Table 3: Progression of theme building
First order (informant) conceptsSecond order themesFraming non-routine problemsThe problem is
Defining problem as local challengeMy / our ownChallenge of subsidiary Part of model / question across subsidiary The problem exists / is
Recognizing global dimension of problemAcross (MNC) organizationNew to (MNC) organizationThe solution should
Envisioning global solution for problemWork for other technologies / markets Not be specific to one technology / marketAvoid duplicationThe solution finding
Defining problem as global challengeIs scalable / high levelLooks across MNC organization Solution finding activitiesSet up / work as group / teamCollective addressing of knowledge needsHave experts in teamSort out myselfSiloed problem solvingDo my / our own thingInvolve other organizations
Involving global stakeholdersWork with global senior managementSenior management reviewSuperimpose / move model and adaptUndertaking adaptations Take as basic structure and localizeDevelop / design / come up with / build / figure out / innovate
Creating New idea / thing / wayDrive / make changes / improvements Solution scoping Our own solution Local solution At the local levelPresent solutionGive best practicesGlobalizing of local solution Try it globallyExpand to other regions / technologiesScale / standardise solutionGlobal solutionImplement across the organization
Table 4: Data structure
Second order themesAggregate categories(a) Defining problem as local challenge(e) Collective addressing of knowledge needs(f) Siloed problem solvingLocal template adapting (h) Undertaking adaptations(j) Local solution(a) Defining problem as local challenge(e) Collective addressing of knowledge needs(g) Involving global stakeholdersSuperior technology creating(i) Creating(l) Global solution(a) Defining problem as local challenge(b) Recognizing global dimension of problem(e) Collective addressing of knowledge needs(f) Siloed problem solvingLocal template creating(i) Creating(j) Local solution(k) Globalizing of local solution(a) Defining problem as local challenge(b) Recognizing global dimension of problem(c) Envisioning global solution for problem(d) Defining problem as global challenge(e) Collective addressing of knowledge needsGlobal principle creating(g) Involving global stakeholders(i) Creating(l) Global solution Table 5: Representative data for knowledge search
A priori codes for knowledge searchRepresentative dataGeographically proximate and cognitively proximateWithin our department there are seven of us that are line managers. And we would all have various levels of experience. So, we would meet as a group once or twice on how to do things. (Epsilon, process 6)Geographically distant and cognitively proximateI reached out to some people, saying: do you know who does this? So you drop a few emails, send a few feelers, and I eventually got a guy who is working in Germany. (Sigma, process 4)Geographically proximate and cognitively distantWe were trying to have knowledge, for example, from one specialist team. (Gamma, process 13)Geographically distant and cognitively distantWe then also worked with the quantitative marketing team in the US. Thats a highly skilled team of PhDs, statisticians, mathematicians who use mathematical models, decision-tree approaches to figure out why customers are doing what they are doing. (Gamma, process 14)RepositoryIt would be documented in different documents or in PowerPoint slides. There is no overall document which documents how the overall thing comes together. But there will be documents here, here, here, and here of each of the individual subcomponents within the overall process. (Epsilon, process 2)External There was an Irish entrepreneur, and he had a company. They helped us develop the tool we [also] worked with a laser company in America. They helped us develop stronger, more powerful lasers (Omega, process 6)
Table 6: Additional representative data for second order themes
Second order themesRepresentative dataFraming of non-routine problemDefining problem as local challengeI said that we [local team] will have our own thing. Well get lots of emergencies next year, and well control our own destiny. (Epsilon, process 4)
This was an internal drain on our [subsidiary] resources because whether we processed 1,000 of these internal messages or 100, we got no recognition because it is not the core business. It is something that supports the core business. Our productivity was how many remote services we delivered at the end of the year. So, they [senior management team of focal subsidiary] didnt care how much time we spent supporting that. (Sigma, process 5)Recognizing global dimension of problemIt [non-routine problem] is very new to Gamma. (Gamma, process 11)Envisioning global solution for problemIt is a continuous effort with other regions to link up. So that we just dont need to duplicate work, because we dont really believe in that. (Gamma, process 9)
And we are now piloting it for our unit with a view of tracking all of our sign offs [globally] This is the ultimate goal. (Sigma, process 7)Defining problem as global challengeIf you just look at one country, we will not have an analytic perspective of the issue. How does it behave, for example, in other countries or in other regions? Does it allow you to benchmark and to find patterns? Because at the end of the day, in such a global business, you want the question also to be treated globally. (Gamma, process 13)Micro-level solution finding activitiesCollective addressing of knowledge needsAnd the amount of information that is associated with each area is so vast, is so complex that we, if we talk in university terms, that you have a professor for Sociology; you have another professor for Ethnology. Its so complex and there are so many issues involved with each of these bundles of information that we need experts. There are people in the team who know more or some they know less about certain aspects. (Gamma, process 9)Siloed problem solvingEveryone is trying to sort out the issue as best as they can for their area. (Epsilon, process 3)Involving global stakeholdersYou cannot work on your own, because there are a lot of dependencies so you actually need to have agreement from other key stakeholders and leverage them to a certain extent. You need to involve other stakeholders in order to have your business question sorted out. (Gamma, process 13)Undertaking adaptationsWe take this model and see can we apply it to this situation? And then we adapt the model if necessary to make it the most efficient way possible. (Epsilon, process 1)
There is actually a lot of material there that can be taken. It doesnt need to be created from scratch; it can be localized to the different markets. (Gamma, process 4)Creating They [developed practices] were very new to the site; very new. And nobody was doing them at the time. (Omega, process 4)
We kind of had to start pretty much from zero in developing that project which nonetheless made it also easier because we could go where we wanted. (Gamma, process 11)Scoping of solutionLocal solutionThe tool that was delivered locally was about really understanding where we were spending our time, where the weak points were. (Sigma, process 5)Globalizing of local solutionWe presented this exact same information to the other centers. Our Global Director, he has used this information, and now he can access it. And we have given our best practices. (Sigma, process 5) Global solutionWe now expanded it out of the pilot regions into more regions. And we have started to create specialist roles and new role career paths within Gamma to do this type of work. (Gamma, process 14)Table 7: Analysis of knowledge search for each role in MNC learning
Local template adaptingSuperior technology creatingLocal template creatingGlobal principle creatingInternal Geographically proximate, cognitively proximatehighhighhighhighGeographically distant, cognitively proximatemoderaten.a.lowmoderateGeographically proximate, cognitively distantmoderatevery highlowmoderateGeographically distant, cognitively distantlowvery highlowvery highRepository lown.a.lown.a.External lowvery highlowlowIntensity moderatevery highlowhigh
Figure 1: MNC knowledge sources and implications
Cognitive DistanceCross-functional knowledge search, across different focal subsidiary sub-units
High innovation potential
Cross-functional knowledge search, within other MNC unit(s)
Very high innovation potentialCognitive ProximityLocal knowledge search, within same focal subsidiary sub-unit
Danger of inertia, low innovation potential Knowledge search within same function, within other MNC units
Moderate innovation potential Geographic
ProximityGeographicDistance
Figure 2: Framework of MNC problem solving approaches
Global
Micro-level activities of problem solving process
Local
Superior
Technology
Creating
Global
Principle
Creating
Local
Template
Adapting
Local
Template
Creating
LocalGlobal Actual scope of non-routine problem
Figure 3: Framework of MNC problem solving approaches: Summary of findings and outcomes
Global
Micro-level activities of problem solving process
Local
Superior Technology Creating
Negotiating of cognitive boundaries locally as well as globally
Integrating of numerous diverse external and internal knowledge for new knowledge creation
Developing of global outcome: solution diffused within wider MNC
Global Principle Creating
Negotiating of geographic distance
Integrating of numerous diverse internal knowledge sources for new knowledge creation
Developing of global outcome: generic principle that is diffused within wider MNC
Local Template Adapting
Reusing of existing MNC knowledge (solutions) for adaptation
Achieves a local outcome, but contributes to MNC knowledge leverage
Local Template Creating
Veiled global non-routine problems
Becoming trapped in local rigidity as mostly co-located and cognitive close knowledge is mobilized, under- utilizing other internal and external knowledge pockets
Developing of mostly local outcome: Danger of siloed knowledge development in the MNC as limited or no diffusion, solutions mostly remain subsidiary-level or context-specificLocalGlobal Actual scope of non-routine problem
Appendix A
Table A1: Knowledge search of local template adapting approach
No.ProcessIntensityDistance analysis
(in brackets: number of occurrences if more than one)1Gamma, process 13Geographically proximate, cognitively proximate Geographically proximate, cognitively distance Repository2Gamma, process 22Geographically proximate, cognitively proximate (2)3Gamma, process 32Geographically proximate, cognitively distantExternal 4Gamma, process 42Geographically proximate, cognitively proximateGeographically proximate, cognitively distant5Gamma, process 52Geographic proximate, cognitively proximateGeographically distant, cognitively distant6Gamma, process 62Geographically proximate, cognitively proximate Geographically proximate, cognitively distant7Gamma, process 72Geographically distant, cognitively proximate (2)8Epsilon, process 11Geographically distant, cognitively proximate 9Epsilon, process 24Geographically proximate, cognitively proximate Geographically proximate, cognitively distant (2)Repository10Omega, process 14Geographically proximate, cognitively proximate (2)Geographically distant, cognitively proximateGeographically proximate, cognitively distance11Omega, process 22Geographically proximate, cognitively proximate Geographically distant, cognitively proximate12Omega, process 31Geographically distant, cognitively proximate13Sigma, process 11Geographically proximate, cognitively distant14Sigma, process 25Geographically proximate, cognitively proximateGeographically distant, cognitively proximateGeographically distant, cognitively distant RepositoryExternal15Sigma, process 33Geographically distant, cognitively proximateGeographically distant, cognitively distantGeographically proximate, cognitively proximateAverage intensity a:
2.4 (moderate)Relative frequency b:
Geographically proximate, cognitively proximate: 0.80 (high)
Geographically distant, cognitively proximate: 0.47 (moderate)
Geographically proximate, cognitively distant: 0.60 (moderate)
Geographically distant, cognitively distant: 0.20 (low)
Repository: 0.20 (low)
External: 0.13 (low)a The average intensity was labelled as low if smaller than 2, moderate if in between 2 and 4, high if in between 4 and 6, and very high if greater than 6.
b The relative frequency was labelled low if smaller or equal to 0.33, moderate if in the range 0.34 0.66, high if in the range 0.67 and 1, and very high if greater than 1.Table A2: Knowledge search of local template creating approach
No.ProcessIntensityDistance analysis
(in brackets: number of occurrences if more than one)16Gamma, process 82Geographically proximate, cognitively proximateGeographically proximate, cognitively distant17Epsilon, process 32Geographically proximate, cognitively proximate (2)18Epsilon, process 40n.a.19Epsilon, process 54Geographically distant, cognitively proximate Repository External (2)20Epsilon, process 62External Geographically proximate, cognitively proximate 21Epsilon, process 71Geographically proximate, cognitively proximate22Omega, process 41Geographically proximate, cognitively proximate23Sigma, process 43Geographically proximate, cognitively distantGeographically distant, cognitively distant (2)24Sigma, process 51Geographically proximate, cognitively proximateAverage intensity a:
1.8 (low)Relative frequency b:
Geographic proximate, cognitively proximate: 0.78 (high)
Geographic distant, cognitively proximate: 0.11 (low)
Geographic proximate, cognitively distant: 0.22 (low)
Geographic distant, cognitively distant: 0.22 (low)
Repository: 0.11 (low)
External: 0.33 (low)a The average intensity was labelled as low if smaller than 2, moderate if in between 2 and 4, high if in between 4 and 6, and very high if greater than 6.
b The relative frequency was labelled low if smaller or equal to 0.33, moderate if in the range 0.34 0.66, high if in the range 0.67 and 1, and very high if greater than 1.
Table A3: Knowledge search of superior technology creating approach
No.ProcessIntensityDistance analysis
(in brackets: number of occurrences if more than one)25Omega, process 58Geographically proximate, cognitively proximateGeographically proximate, cognitively distant (3)Geographically distant, cognitively distant External (3)26Omega, process 66Geographically proximate, cognitively proximate (2)Geographically proximate, cognitively distant (2)External (2)27Omega, process 79Geographically proximate, cognitively proximateGeographically proximate, cognitively distant (3)Geographically distant, cognitively distant (2)External (3)Average intensity a:
7.5 (very high)Relative frequency b:
Geographically proximate, cognitively proximate: 1.33 (very high)
Geographically distant, cognitively proximate: 0 (n.a.)
Geographically proximate, cognitively distant: 2.67 (very high)
Geographically distant, cognitively distant: 1.00 (high)
Repository: 0 (n.a.)
External: 2.67 (very high)a The average intensity was labelled as low if smaller than 2, moderate if in between 2 and 4, high if in between 4 and 6, and very high if greater than 6.
b The relative frequency was labelled low if smaller or equal to 0.33, moderate if in the range 0.34 0.66, high if in the range 0.67 and 1, and very high if greater than 1.
Table A4: Knowledge search of global principle creating approach
No.ProcessIntensityDistance analysis
(in brackets: number of occurrences if more than one)28Gamma, process 95Geographically proximate, cognitively proximate (2)Geographically distant, cognitively proximateGeographically distant, cognitively distant (2)29Gamma, process 102Geographically distant, cognitively distant (2)30Gamma, process 117Geographically proximate, cognitively proximateGeographically distant, cognitively distant (4)External (2)31Gamma, process 125Geographically proximate, cognitively proximate (3)Geographically proximate, cognitively distantGeographically distant, cognitively distant32Gamma, process 135Geographically proximate, cognitively proximate (2)Geographically distant, cognitively proximateGeographically proximate, cognitively distantGeographically distant, cognitively distant33Gamma, process 146Geographically proximate, cognitively proximate (2)Geographically proximate, cognitively distant (3)Geographically distant, cognitively distant34Sigma, process 62Geographically distant, cognitively proximate (2)35Sigma, process 74Geographically distant, cognitively distant (4)36Sigma, process 83Geographically distant, cognitively proximate (2)Geographically distant, cognitively distant37Omega, process 82Geographically distant, cognitively proximateGeographically proximate, cognitively distance38Omega, process 93Geographically proximate, cognitively proximate Geographically distant, cognitively distantExternalAverage intensity a:
4.0 (high)Relative frequency b:
Geographically proximate, cognitively proximate: 1.00 (high)
Geographically distant, cognitively proximate: 0.64 (moderate)
Geographically proximate, cognitively distant: 0.55 (moderate)
Geographically distant, cognitively distant: 1.55 (very high)
Repository: 0 (n.a.)
External: 0.27 (low)a The average intensity was labelled as low if smaller than 2, moderate if in between 2 and 4, high if in between 4 and 6, and very high if greater than 6.
b The relative frequency was labelled low if smaller or equal to 0.33, moderate if in the range 0.34 0.66, high if in the range 0.67 and 1, and very high if greater than 1.
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