Activity Specific Knowledge Characteristics in the Internationalization Process

Purpose – The purpose of this paper is to investigate differences in the characteristics of knowledge, which is very important for the internationalization of different business activities. In particular, the focus is on internationalization in emerging markets such as China and India.
Design/methodology/approach – The paper presents a framework primarily based on knowledge management theory, which is illustrated in relation to interesting cases of four companies that are global leaders.
Findings – An R&D knowledge gap still exists in China and India. Differences across business activities exist in terms of the characteristics of the knowledge, which is most important for the internationalization in emerging markets within multinational corporations (MNCs). The most important knowledge for the internationalization of R&D activities is more tacit than it is for manufacturing activities and international purchasing activities. The source of the most important knowledge for the internationalization of R&D activities, as well as manufacturing activities, is more likely to be the MNC itself, than when marketing activities or purchasing activities are internationalized to emerging markets.
Originality/value – A model is developed that illustrates differences between the most important knowledge for the internationalization of key business activities within MNCs. It is proposed that the technical dimension of tacit knowledge is more easily codified than the cognitive dimension of tacit knowledge. The cognitive dimension of local tacit knowledge is crucial for the internationalization of marketing activities, whereas the technical dimension of tacit R&D knowledge from the home base is crucial for the internationalization of R&D activities.