The transfer and creation of knowledge within foreign invested R&D in emerging markets

Purpose – The paper investigates important impediments to knowledge creation within newly established foreign invested R&D centers in China, and India.
Design/methodology/approach - The paper presents a framework based primarily on knowledge creation theory, in order to better understand barriers for transfer - and creation of innovation related knowledge, within newly established foreign invested R&D units in emerging markets, in particular China and India. The paper utilizes extensive empirical data, collected in a holistic multiple case study, including three globally leading MNCs, originating
from Scandinavia, which have established R&D units in China and India.
Findings – Examples of innovations in China and India within Scandinavian MNCs are presented, which illustrate that innovation is indeed possible in China and India. However, impediments to innovation also exist, especially concerning socialization with the purpose of knowledge creation and innovation. The skills of R&D employees in both China, and India, may be particularly relevant for process innovations, as they require good codification skills.
Originality/value – A synthesis of existing knowledge creation theory is outlined, and applied, in order to compare the R&D knowledge creation skills of Chinese, Indian and Scandinavian engineers, within multinational companies. The framework is relevant in order to understand better, how the knowledge creation potential of countries such as China and India, can be made use of, within foreign invested R&D units in these countries. Implications, especially relevant for managers, working with newly established foreign invested R&D units
in emerging markets, are outlined.