Effects of Critical Knowledge Characteristics on Degree of Inter-Firm Technology Transfer

Abstract

Problem statement: The current issue on inter-firm technology transfer in the developing countries is centered on the efficiency and effectiveness of the transfer process by the Multinationals (MNCs). Thus, organizations in the developing countries are striving hard to collaborate, learn and internalize their foreign partner’s technological knowledge by forming strategic alliances or International Joint Ventures (IJVs) as an efficient mean to increase their competitiveness, technological capabilities and potential for local innovation. Knowledge as the critical element underlying technology has become one of the main factors that affects the success and failure of interfirm technology transfer within IJVs which is measured by the degree of technology transferred. Based on the underlying knowledge-based view perspective, this paper aims to empirically examine the effect of three critical knowledge characteristics: Tacitness, complexity and specificity on degree of technology transfer and its two dimensions: Degree of tacit and explicit knowledge. Approach: The theoretical model and hypotheses in this study were tested using empirical data gathered from 128 joint venture companies registered with the Registrar of Companies of Malaysia. Data obtained from the survey questionnaires were analyzed using the correlation coefficients and multiple linear regression analyses. Results: The results revealed that tacitness and complexity as two critical elements of knowledge characteristics have significant effects on both degrees of tacit and explicit knowledge; with complexity recording slightly stronger effect than tacitness. However, although specificity has a strong theoretical foundation, it did not record significant effect. Conclusion: The study has bridged the literature gaps in such that it provides empirical evidence on the effects of three generic knowledge attributes: Tacitness, complexity and specificity on degree of inter-firm technology transfer and its two dimensions: Degree of tacit and explicit knowledge.