Creation, Adoption and Diffusion of Innovations by Subsidiaries of Multinational Corporations

Abstract

This paper reports some of the findings of a multi-phased, and multi-method study on the organizational attributes that facilitate creation, adoption, and diffusion of innovations by subsidiaries of multinational companies. Comparison of results obtained through case research in nine companies, multiple-respondent questionnaire surveys in three companies, and a single-respondent survey in 66 North American and European multinationals reveal unambiguous and positive impacts of normative integration through organizational socialization and dense intra- and inter-unit communication on an MNC subsidiary's ability to contribute to the different innovation tasks. The findings are less consistent with regard to the effects of local resources and autonomy and it appears that the influences of these two attributes are strongly mediated by the levels of normative integration and organizational communication.