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Chapter 5: Creating Worldwide Innovation and Learning: Exploiting Cross-Border Knowledge Management by Mind Map: Chapter 5: Creating Worldwide Innovation
and Learning: Exploiting Cross-Border
Knowledge Management
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Chapter 5: Creating Worldwide Innovation and Learning: Exploiting Cross-Border Knowledge Management

R&D is becoming more important than ever

As MNE's have matched each other in production efficiency and local responsiveness, the battle has turned towards innovation

Traditional Innovation


new opportunity is sensed in home country and developed there as wellafterwards it is introduced internationally through subsidiaries -Gain input of subsidiaries into centralized activities -Ensure all functional tasks are linked to market needs

Can be improved by, Transfer of responsibilities across development, production and marketing, Panasonic: Transfer People, Ensure that all functional tasks are linked to market needs, Get Input of Subsidiaries, Create links between headquarter and subsidiaries!


subsidiaries sense local opportunities and create their own solutionsPrerequisites are the splitting up of resources and the delegation of authority

Can be improved by, Empowering Local Management, Linking local managers to corporate decision-making processes, Integrating Subsidiary Functions

Transnational Innovation

Locally Leveraged

Special resources and capabilities of each national subsidiary are available to other units as well Product developed by one unit is sold by others as well if that is beneficial

Globally Linked

Combine resources from center and subsidiaries Take idea from A, expertise from B and scarce resource from C or Ideas from A, B and C or any mixture to create product that is then distributed to all

Often blocked by

Simplifying, subconscious rules

Assumption that roles of organizational units responsible for very different things should be uniform, Don't generalize what needs how much standardization!

Assumption that headquarter-subsidiary relationships should have clear patterns of dependence/independence, Build and manage interdependence, Develop integrated network, Create proper inter unit integration

Assumption that corporate management has responsibility to make decisions and control uniformly, Interdependent units require flexible coordination

Important Flows

Flow of Goods

complex connections through which units source their supplies and materials, link flows of components and subassemblies and distribute finished goods

Formalize as much production procedures as is feasible, Formalization of management processes

Flows of financial, human and technological resources

represents the major strategic choices the company makes and therefore must be controlled at corporate level

Only top-level managers can make decisions, Coordination by Centralization

Flow of strategic information and proprietary knowledge

Tacit = can't be formalized, Socialization of local managers

Mobilizing knowledge

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