Author

  • Nik Ab Halim Nik Abdullah

    • School of International Studies, Universiti Utara Malaysia, Malaysia
    • Malaysia

  • Loo Yew Liang

    • School of International Studies, Universiti Utara Malaysia, Malaysia
    • Malaysia

Abstract

Knowledge sharing is a systematic process for creating, acquiring, synthesizing, learning, sharing and using knowledge to achieve organizational goals. It is also a source of competitive advantage especially for multinational companies. The objective of this paper is to discuss the impact of subsidiary manager’s role in knowledge sharing, manager’s compensation system, and the level of cultural differences between home and host country on the level of knowledge sharing between the headquarters and subsidiaries of multinational companies. A study has been conducted at a subsidiary of a large manufacturing company in Malaysia. Data were collected via self-administered survey questionnaire. The respondents consist of 100 executives and managers of the company, and all the questionnaires distributed were filled and returned back for data analysis. Findings indicate that all three factors significantly influence the level of knowledge sharing with the manager’s compensation system has the strongest impact. MNC therefore should clearly define the manager’s role in knowledge sharing and provide attractive rewards and remunerations to encourage knowledge sharing. At the same time, cultural differences should not be considered as a barrier to knowledge sharing as this study indicates that it can be a driver for effective knowledge sharing between headquarters and subsidiaries.

Keywords

References

  • Al-Adaileh, R. M. D. (2011). The Impact of Organizational Culture on Knowledge Sharing: The Context of Jordan's Phosphate Mines Company. International Research Journal of Finance & Economics , 63, 216-228.
  • Al-Alawi, A. I., Al-Marzooqi, N. Y. & Mohammed, Y. F. (2007). Organizational culture and knowledge sharing: critical success factors. Journal of Knowledge Management, 11(2), 22 - 42.
  • Aliei, M., Ashrafi, B. & Aghayan, S. (2011). Studying the Relationship between Organizational Citizenship Behavior and Knowledge Sharing (Case study Knowledge-Based Organizations). Interdisciplinary Journal of Contemporary Research in Business, 3(3), 341-348.
  • Alipour, F., Idris, K. & Karimi, R. (2011). Knowledge creation and transfer: Role of learning organization. International Journal of Business Administration, 2(3), 61-67.
  • Andersson, U., Forsgren, M. & Holm, U. (2002). The strategic impact of external networks: Subsidiary performance and competence development in the multinational corporation. Strategic Management Journal , 23, 979-996.
  • Barkema, H. G. & Gomez-Mejia, L. R. (1998). Managerial compensation and firm performance: A general research framework. Academy of Management Journal, 41(2), 135-146.
  • Bartlett, C. & Ghoshal, S. (1998). Managing Across Borders: The Transnational Solution. Boston: Harvard Business School Press.
  • Bartlett, C. A. & Ghoshal, S. (2002). Managing Across Borders: The Transnational Solution (Vol. 2). United States: Harvard Business Press.
  • Batrol, K. M. & Srivastava, A. (2002). Encouraging Knowledge Sharing: The Role of Organizational Reward Systems. Journal of Leadership & Organizational Studies, 9(1), 64-76.
  • Buckley, P. J. & Casson, M. C. (1998). Analyzing foreign market entry strategies: Extending the internalization approach. Journal of International Business Studies, 29(3), 539-562.
  • Cavana, R. Y., Delahaye, B. L. & Sekaran, U. (2001). Applied business research: Qualitative and quantitative method . Queensland: John wiley & Sons Australia Ltd.
  • Collins, C. J. & Smith, K. G. (2006). Knowledge Exchange and Combination: The Role of Human Resource Practices in the Performance of High-Technology Firms. Academy of Management Journal, 49(3), 544-560.
  • Dunning, J. H. (1993). Multinational Enterprises and the Global Economy . Wokingham, Berkshire: Addison Wesley.
  • Faulkender, M., Kadyrzhanova, D., Prabhala, N. & Senbet, L. (2010). Executive compensation: An overview of research on corporate practices and proposed reforms. Journal of Applied Corporate Finance , 22(1), 107-118.
  • Fey, C. F. & Furu, P. (2008). Top management incentive compensation and knowledge sharing in multinational corporations. Strategic Management Journal, 29(12), 1301-1323.
  • Fong, C. Y., Ooi, K. B., Tan, B. I., Lee, V. H. & Chong, A. Y. L. (2011). HRM practices and knowledge sharing: an empirical study. International Journal of Manpower, 32(5/6), 704-723.
  • Goll, I., Johnson, N. B. & Rasheed, A. A. (2007). Knowledge capability, strategic change, and firm performance/The moderating role of the environment. Management Decision, 45(2), 161-179.
  • Gong, Y. (2003). Toward a Dynamic Process Model of Staffing Composition and Subsidiary Outcomes in Multinational Enterprises. Journal of Management, 29(2), 259-280.
  • Hall, R. (1992). The strategic analysis of intangible resources. Strategic Management Journal , 13(2), 135144.
  • Hansen, M. T. & Nohria, N. (2004). How to Build Collaborative Advantage. MIT Sloan Management Review , 46(1), 22-30.
  • Huysman, M. & Wulf, V. (2006). IT to support knowledge sharing in communities, towards a social capital analysis. Journal of Information Technology (Palgrave Macmillan), 21(1), 40-51.
  • Jung-Chi, P. (2006). An empirical study of the relationship between knowledge sharing and IS/IT strategic planning (ISSP). Management Decision, 44(1), 105-122.
  • Katz, R. & Allen, T. J. (1982). Investigating the Not Invented Here (NIH) syndrome: A look at the performance, tenure, and communication patterns of 50 R & D Project Groups. [ 10.1111/j.14679310.1982.tb00478.x]. R&D Management, 12(1), 7-20.
  • Kazmi, A. & Hasiri, H. (2002). Knowledge Management (Vol. 2). New Delhi: Prentice Hall.
  • Lee, D. J. & Ahn, J. H. (2007). Reward systems for intra-organizational knowledge sharing. European Journal of Operational Research, 180(2), 938-956.
  • Lee, R. P., Chen, Q., Kim, D. & Johnson, J. L. (2008). Knowledge Transfer Between Multinational Corporations' Headquarters and Their Subsidiaries: Influences on and Implications for New Product Outcomes. Journal of International Marketing, 16(2), 1-31.
  • Lin, H. F., Lee, H. S. & Wang, D. W. (2009). Evaluation of factors influencing knowledge sharing based on a fuzzy AHP approach. Journal of Information Science, 36, 25-44.
  • Minbaeva, D. (2007). Knowledge transfer in multinational corporations. Management International Review, 47(4), 567−593.
  • Moosa, I. A. (2002). Foreign Direct Investment Theory, Evidence and Practice . London: Palgrave Macmillan Nelson, E. (2001). P&G Moves to Set Up a System To Share Employee Know-How. Wall Street Journal - Eastern Edition, 237(16), B6.
  • Nien-Chi, L. & Min-Shi, L. (2011). Human resource practices and individual knowledge-sharing behavior - an empirical study for Taiwanese R&D professionals. International Journal of Human Resource Management, 22(4), 981-997.
  • Nohria, N. & Ghoshal, S. (1994). Differentiated fit and shared values: Alternatives for managing headquarters-subsidiary relationship. Strategic Management Journal , 15, 491-502.
  • Ooi, K. B., Cheah, W. C., Lin, B. & Teh, P. L. (2012). TQM practices and knowledge sharing: An empirical study of Malaysia's manufacturing organizations. Asia Pacific Journal of Management, 29(1), 5978.
  • Porter, M. E. (1990). The competitive advantage of nations. New York: The Free Press.
  • Purwanti, Y., Pasaribu, N. R. & Lumbantobing, P. (2010). Leveraging the Quality of Knowledge Sharing By Implementing Reward Program and Performance Management System. Proceedings of the European Conference on Intellectual Capital, 499-503.
  • Schloetzer, J. D. (2012). Process Integration and Information Sharing in Supply Chains. Accounting Review, 87(3), 1005-1032.
  • Syed, S. A., Zaini, A., Noormala, A. I. & Zahariah, M. Z. (2009). Assessing Knowledge Sharing Behaviour among Employees in SMEs: An Empirical Study. International Business Research, 2(2), 115-122.
  • Volberda, H., Morgan, R., Reinmoeller, P., Hitt, M. A. & Ireland, R. D. (2011). Strategic Management: Competitiveness & Globalisation: Concepts & Cases United Kingdom: Cengage Learning.
  • Vora, D., Kostova, T. & Roth, K. (2007). Roles of Subsidiary Managers in Multinational Corporations: The Effect of Dual Organizational Identification. Management International Review (MIR), 47(4), 595620.
  • Weerakkody, W. A. S. & Ediriweera, A. N. (2009). The link between roles of human resource manager and firm performance; with reference to financial firms in Sri Lanka. Paper presented at the Annual Research Symposium 2009: Faculty of Graduate Studies, University of Kelaniya.

Downloads

No downloads have been recorded for this article yet. Figures appear here once readers begin downloading the full text.

How to Cite

Nik Abdullah, N. A. H., & Liang, L. Y. (2013). Knowledge Sharing between Multinational Corporation’s Headquarters and Subsidiaries: the Impact of Manager’s Role, Compensation System and Cultural Differences. Journal of Economics and Behavioral Studies, 5(10), 660-668. https://doi.org/10.22610/jebs.v5i10.439

Share this article

License

Copyright (c) 2013 Nik Ab Halim Nik Abdullah, Loo Yew Liang (Author)

Creative Commons License

This work is licensed under a Creative Commons Attribution 4.0 International License.

Author (s) should affirm that the material has not been published previously. It has not been submitted and it is not under consideration by any other journal. At the same time author (s) need to execute a publication permission agreement to assume the responsibility of the submitted content and any omissions and errors therein. After submission of revised paper in the light of suggestions of the reviewers, the editorial team  edits and formats manuscripts to bring uniformity and standardization in published material.

This work will be licensed under Creative Commons Attribution 4.0 International (CC BY 4.0) and under condition of the license, users are free to read, copy, remix, transform, redistribute, download, print, search or link to the full texts of articles and even build upon their work as long as they credit the author for the original work. Moreover, as per journal policy author (s) hold and retain copyrights without any restrictions.

Keywords

Section

Research Paper

Published in

Vol. 5 No. 10 (2013) Technology, Trade & Development Policy View issue contents

Published

2013-10-20

Submissions

Have research to publish? Journal of Economics and Behavioral Studies welcomes submissions.

Make a Submission