Integration and Governance Mechanisms: A Multilevel Analysis of Knowledge Adoption in MNCs

Purpose:
This paper aims to examine employees’ adoption of knowledge sourced from other multinational company (MNC) units. From a contingent approach, it analyzes how the fit between the integration mechanisms directed toward the MNC units (i.e. centralization, formalization and socialization) and three knowledge governance mechanisms directed toward the employees (incentives, networks and information and communication technology systems) affects knowledge adoption from other organizational units.

Design/methodology/approach:
Within one MNC, a multilevel model was developed and tested on 341 individuals nested in 70 departments worldwide. Two sources of information were used: the employees’ survey provided information on knowledge adoption and the applied knowledge governance mechanisms, and the department managers’ survey provided information about the integration mechanisms at the corporate level.

Findings:
The results confirm that integration mechanisms by themselves have no direct effects on knowledge adoption, but they influence the context where this process occurs by affecting the contextual conditions of ambiguity, uncertainty and flexibility. The applied knowledge governance mechanisms will only lead to increased knowledge adoption if a fit exists between the integration and knowledge governance mechanisms.

Originality/value:
While much of the knowledge-based view literature has focused on MNCs’ transfer of knowledge across units, this study focuses on the effective adoption or use of the transferred knowledge, known as knowledge effectiveness. In addition, this study adopts multilevel modeling and contributes to the knowledge governance approach by showing that the effectiveness of knowledge governance mechanisms is contingent on their fit or misfit with the integration mechanisms applied at the corporate level.