Absorptive capacity, value creation and new service development in multinational enterprises : the role of knowledge flows between customers, subsidiaries and headquarters

Leposky, Tiina; Arslan, Ahmad; Gölgeci, Ismail; Callaghan, Deborah (2022-01-18)
 
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https://doi.org/10.4337/9781788976114

Leposky, Tiina
Arslan, Ahmad
Gölgeci, Ismail
Callaghan, Deborah
Edward Elgar Publishing
18.01.2022

Leposky, T., Arslan, A., Gölgeci, I., & Callaghan, D. (2022). Absorptive capacity, value creation and new service development in multinational enterprises: The role of knowledge flows between customers, subsidiaries and headquarters. In Z. Khan, S. R. Nair, & Y. K. Lew (Eds.), Research handbook on knowledge transfer and international business (pp. 210-225). Edward Elgar Publishing. https://doi.org/10.4337/9781788976114

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© Editors and Contributors Severally 2022. This is a draft chapter/article. The final version is available in Research Handbook on Knowledge Transfer and International Business, edited by Z. Khan, S. R. Nair, & Y. K. Lew, published in 2022, Edward Elgar Publishing Ltd. https://doi.org/10.4337/9781788976114. The material cannot be used for any other purpose without further permission of the publisher, and is for private use only.
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doi:https://doi.org/10.4337/9781788976114.00019
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Abstract

Absorptive capacity has been widely used in management and international business (IB) studies to explain the way organisations use external information to their benefit in commercial exchanges. This chapter attempts to extend the concept by applying it to the relationships between customer-subsidiary-headquarter (HQ) of multinational enterprises (MNEs), where the subsidiary acts as the focal unit for knowledge flows. We further use absorptive capacity concept to explain the knowledge inflows, in terms of new service development and knowledge outflows, leading to value creation. Based on in-depth theoretical discussions, we present propositions addressing the organisational and social dynamics in the four phases of absorptive capacity, from acquisition and assimilation, to transformation and exploitation.

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