| This dissertation examines the effects of MNCs' experiential learning, knowledge transfer, and dynamic capabilities on the performance of their subsidiaries. It does so from organizational (un)learning, knowledge transfer and dynamic capability perspectives, drawing upon the literature on organizational (un)learning (Levitt & March, 1988 March, 1991 Tsang & Zahra, 2008), knowledge transfer (Kogut & Zander, 1993 2003), and the dynamic capability perspective (Eisenhardt & Martin, 2000 Priem & Butler, 2001 Teece, Pisano, & Shuen, 1997). In addition, the interlinks between dynamic capabilities and knowledge transfer and that between dynamic capabilities and organizational unlearning are also examined.This dissertation also proposes that MNCs develop different profiles of experience both at the parent firm level and at the subsidiary level, including subsidiary experience, host country experience, cultural cluster experience, developed country experience, developing country experience, and general international experience. These various profiles of experience are a result of the disaggregation of MNC experience along the cultural or the institutional dimension. They impact subsidiary performance through various knowledge transfer mechanisms. Furthermore, it is also proposed that diversity of experience will have a positive effect on subsidiary performance and this relationship is moderated by host country development stage (i.e., developed country vs. developing country).Diversity of experience is reconceptualized as a measure of MNCs' dynamic capabilities in this dissertation and consequently, it will help MNCs better transfer and exploit their various types of experience in a more discerning manner. Dynamic capabilities are also believed to allow MNCs to unlearn and relearn more effectively. As such, it is proposed that an MNC's dynamic capabilities moderate the inverted U shaped relationship between its experience and subsidiary performance. The inverted U shaped relationship will be flatter for MNCs which have higher levels of dynamic capabilities.However, dynamic capabilities cannot help MNCs better transfer and unlearn all types of experience indiscriminately. The role of dynamic capabilities in the transfer and unlearning of experiential knowledge is contingent upon whether the environments from which such experiential knowledge was accumulated share cultural or institutional similarities with the host country environment.It is proposed that the relationship between various types of experience and subsidiary performance will be an upward sloping inverted U shape. Theories of organizational learning suggest that firms acquire experience and develop routines that guide behavior (Levitt & March, 1988) and that capabilities are accumulated and stored as organizational routines (Nelson & Winter, 1982). The exploitation of these routines is generally assumed to enhance firm performance. However, the benefit from additional firm experience is likely to diminish because of redundant information (Johanson & Vahlne, 1977) and knowledge depreciation (Argote, Beckman, & Epple, 1990). In addition, organizations need to unlearn some of their old routines and acquire new ones to keep up with environmental change (Tsang & Zahra, 2008). An organization unable to unlearn may potentially suffer from negative performance implications. Previous studies have not investigated whether experience can become ultimately harmful to subsidiary performance by hindering the development of new experience and the exploration of new routines.In addition, the host country development stage (developed vs. developing) is used as a moderator in multiple hypotheses. It serves as a proxy for the similarities in host country institutional environments. It is proposed that such similarities in institutional environments affect not only the transfer of various types of experiential knowledge but also the curvature of the invert U shaped relationship between host country experience and subsidiary performance.A Japanese dataset based on Toyo Keizai's publications was used in this study. (Abstract shortened by UMI.)Keywords: Multinational corporation (MNC), subsidiary performance, organizational learning, organizational unlearning, knowledge transfer, dynamic capabilities, subsidiary experience, host country experience, cultural cluster experience, general international experience, developed country experience, developing country experience, diversity of experience. |
