Knowledge Transfer and Absorptive Capacity in Chinese Companies

The paper reports on a research study of knowledge acquisition by Chinese firms involved in collaborative ventures with foreign enterprises. The study uses 152 Chinese businesses located in the cities of Shenzhen and Shanghai and examines how the successful transfer of knowledge into recipient (or learner) companies occurs and whether management interventions in that process can significantly improve successful knowledge absorption and exploitation. The study uses a multivariate modeling approach to examine the impact of a number of factors on successful knowledge transfer. It finds that absorptive capacity (ACAP), as conceptualized by Cohen and Levinthal (1990) and developed by Zahra and George (2002), and the structural antecedents associated with the knowledge to be transferred, have a significant effect on successful knowledge transfer. However the strength of communication relationships adds significantly to successful learning by recipient companies, and this is an important moderating factor on the overall performance relationship. This is similar to the social integration mechanisms proposed Zahra and George (2002), but examines them empirically. These social integration mechanisms are also facilitated by soft and hard systems in the firm. The research found little evidence to show that different national cultures affected transfer, and this may be because individual firm culture predominated in this relationship. For these firms the development of a common organizational culture facilitated knowledge transfer and overcame national cultural differences. In addition, specific MIS system investments also facilitated the social integration mechanisms Information systems and learner firm capability and resources had a strong impact on successful communications but not directly on successful knowledge transfer performance. As predicted by Cohen and Levinthal, a combination of the direct and indirect effects on knowledge transfer performance emphasize the importance of pre-existing conditions and ACAP but also highlight the impact of managerial interventions on this process. Social capital between learner and teacher firm is a critical factor, but for it to become important it requires complementary organizational inputs.