Research On Local Company’s Innovation Process Based On Knowledge Transfer In Developing Countries

Innovation plays an important role in a firm’s survival in the business environment. Innovations can in this context be viewed as a multidimensional concept. Innovation is the application of new knowledge by which a firm is better able to meet the needs of its customers. This concept is given shape by the introduction of new or improved products or by providing a new or an improved service to customers. In this respect a better use of existing knowledge as well as a more effective acquisition and assimilation of new knowledge collected from external sources are very important for a business’ growth. Since knowledge is the key to innovation, it is of great importance for an organization to be able to absorb, assimilate, and utilize knowledge from all available sources.Innovation climates in developing countries are, by nature, problematic, characterized by poor business and governance conditions, low educational levels, and mediocre infrastructure which hinder knowledge to flows from one point to another. This raises particular challenges for the promotion of innovation.Many researches pointed out the link between knowledge transfer and innovation process stated that successful knowledge transfer generates innovation success. In developing countries context, well understanding knowledge transfer process in new product development process is very crucial for the innovation processes to be successfully completed.This research builds a case in China to look to insights for the new innovation process model. It aims to investigate how knowledge transfer takes place in innovation process in the automotive industry. The study seeks to illustrate how innovation teams frame and shape new product knowledge, how they interpret such knowledge, and how they apply knowledge to the innovation process. From that perspective, innovation activities can be seen as transactions that are integrated into an overall system of identifying, assessing, collecting and combining knowledge.The research takes several approaches in order to prospect key characteristics of innovation processes in automobile industry, where the number of models is increasing and the product life cycles are decreasing. The research shows that knowledge transfer is influenced by several factors, positive factors and negative that affects the knowledge transfer process.In general the research outcome helps to understand the value creation potential of knowledge transfer in innovation activities. It put theory and practice together to offer practical indications to enhance knowledge transfer during the innovation process.