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A source of potentially valuable knowledge in multinational enter-prises is foreign marketing knowledgethat is, knowledge from onecountry unit that may offer value and competitive advantage to mar-keting managers in other country units. This article builds on mar-keting and management knowledge transfer research to furtherunderstand both the conditions under which one subsidiary usesexternal knowledge from another subsidiary and the outcomes ofsuch use in the subsidiary's market. Using the theory of value crea-tion and appropriation and field interviews with headquarter andsubsidiary marketing managers, the authors develop a model and

research propositions of the enabling, motivating, and perceivingconditions that affect foreign marketing knowledge use and subse-quent effects on marketing program effectiveness and efficiency,organization identification, and intellectual capital in subsidiaries ofmultinational enterprises.

Knowledge is considered a strategically important resource of a firm(Chini 2004; Foss and Pedersen 2004; Haas and Hansen 2007; Kotabeet al. 2007). Knowledge as a source of competitive advantage is par-ticularly germane to multinational enterprises (MNEs). BecauseMNEs are exposed to highly diverse markets in many countries, theycan develop a storehouse of knowledge from vastly varied contexts(Almeida, Song, and Grant 2002). In turn, the knowledge provides

MNEs with the potential to outperform their domestic counterpartsby creating superior value (Almeida, Song, and Grant 2002). Procter& Gamble provides an example of an MNEs ability to create superiorvalue by combining knowledge developed in multiple countries: Thecompany developed Liquid Tide laundry detergent by combining itsresearch in the United States with technologies it had developed tocope with different operating environments in Europe and Japan(Bartlett and Ghoshal 2003).

Knowledge flows within a firm, especially among the various geo-graphic locations of an MNE, are subject to substantial friction andinefficiency (Bartlett and Ghoshal 1998; Lyle and Salk 2007; Tall-man and Phene 2007; Teece 2000). Therefore, effective use ofknowledge in an organization is not a trivial issue. Thus, we focuson examining the conditions that drive the use of foreign marketingknowledgenamely, how MNE subsidiaries use learning outcomesfrom other subsidiaries. Apart from the practical importance of thisissue, there are several reasons additional research on foreign mar-keting knowledge use in MNE subsidiaries is imperative.

Subsidiary Use of Foreign MarketingKnowledge

ABSTRACT

Keywords:international marketing,marketing strategy, knowledge use,foreign subsidiaries

Martin S. Roth,Satish Jayachandran,Mourad Dakhli, andDeborah A. Colton

Journal of International Marketing

2009, American Marketing Association

Vol. 17, No. 1, 2009, pp. 129

ISSN 1069-031X (print)

1547-7215 (electronic)

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2 Martin S. Roth, Satish Jayachandran, Mourad Dakhli, and Deborah A. Colton

First, previous research of knowledge use in MNEs has typicallyfocused on knowledge sharing at the organizational level (Lordand Ranft 2000; Simonin 1999a; Singh 2007). As Menon andVaradarajan (1992) note, organizational-level focus on knowledgeuse is qualitatively different from that of marketing as a functionalarea. For example, marketing managers at specific subsidiaries orcountry units of MNEs are likely to be more circumspect aboutusing knowledge from foreign sources for control reasons,

whereas corporate- and business-level managers are likely to bemore concerned with increasing the effectiveness of knowledgesharing among the subordinate levels. This difference in the moti-vations of managers at different levels highlights the need to exam-ine the factors that affect the use of foreign marketing knowledge.

Second, examining the use of foreign marketing knowledge inMNEs is important because marketing knowledge tends to be moretacit than other forms of organizational knowledge (Byosiere andLuthedge 2008; Simonin 1999b). Tacit knowledge, which is oftendifficult to articulate and codify, is less amenable to transfer anduse (Grant 1996a). Because of this, the aggregate-level focus of priorresearch might limit understanding of the more specific influences

on the transfer and use of marketing knowledge in MNEs.

Third, previous research on knowledge transfer in MNEs hasfocused on knowledge flows primarily from headquarters to divi-sions and country units or across different functional areas inorganizations (e.g., Gupta and Govindarajan 2000; Simonin 1999a).However, the exigencies of competition may necessitate knowledgeflows in all directions in an MNE (Birkinshaw and Morrison 1995;Teece 2000). Thus, there is a need to emphasize the conditions thatinfluence knowledge transfer and use among subsidiaries or coun-try units of MNEs.

Fourth, little research has focused on the outcomes of the use ofmarketing knowledge transferred from other locations. Although itis widely believed that using knowledge from other locations pro-vides an MNE with competitive advantage (e.g., Almeida, Song,and Grant 2002; Bartlett and Ghoshal 2003), researchers have yet todelineate systematically the marketing outcomes from this advan-tage. A more thorough examination of this issue would help aca-demics and managers assess the usefulness of transferring anddeploying knowledge generated in other locations.

For these reasons, research in this area could benefit from an inte-grated theoretical framework that enables the systematic explo-ration of foreign marketing knowledge use in MNEs. Therefore, we

develop a theoretical framework to delineate the conditions thatinfluence the use of marketing knowledge generated in one countryunit for marketing decisions in another subsidiary. Our model inte-grates prior research on conditions affecting knowledge transferand use in MNEs with insights from depth interviews. The modelis based on grounded theory methodology and emphasizes that themere availability of marketing knowledge developed in other coun-try units does not facilitate its use. Furthermore, the model shedslight on the strategic outcomes of the use of foreign marketingknowledge.

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3Subsidiary Use of Foreign Marketing Knowledge

Our goal is to develop an integrated theoretical framework thatfocuses on the use of marketing knowledge transferred from onelocation to another to add value to marketing strategies at the sub-sidiary level of MNEs. Grounded theory methodology is ideallysuited for theory and model development. Using this method,theory evolves during the research process as data are systemati-cally gathered and analyzed (Strauss and Corbin 1994). Existing lit-erature, archival data, and new data could all serve as sources for

theory development. When existing literature is used as a startingpoint for extending theory, the strategy is to assemble what islearned from extant literature and to compare it with the findingsfrom the field data (Corbin and Strauss 1990). Thus, we used con-ceptual frameworks from extant research to inform our perspectiveand, through comparison with interview data, arrived at the modeldiscussed herein. We examined frameworks pertinent to knowl-edge transfer and use in the MNE marketing context to identifyconstructs for further investigation. Semistructured interviewswere then conducted with MNE managers involved in marketingknowledge transfer, at both MNE headquarters and field locations,in line with Corbin and Strausss (1990) guidelines.

To develop the sample of MNEs for data collection, initially we fol-lowed the systematic replication logic Madhavan and Grover (1998)use to achieve diversity in the types of firms included in the sample.Subsequently, to arrive at theoretical saturation for the relationships,we followed theoretical sampling to generate increasing support forthe emerging theory. Although all 15 firms used were MNEs servingmajor world markets, they competed in industries that vary alongdimensions such as product life-cycle stage, life-cycle duration, tech-nological intensity, product versus service, and consumer versusindustrial customers. The industries included advertising, commer-cial communications, consumer electronics, consumer health care,document management, financial services, housing materials, indus-trial and commercial durables, industrial chemicals, informationtechnology (IT) management solutions, Internet services software,pharmaceuticals, semiconductors, and telecommunications. Theinterview respondents included MNE managers in charge of market-ing in Africa, Europe, North America, and South America. AppendixA provides firm and informant characteristics.

Following the approaches pursued by Eisenhardt (1989) and Mad-havan and Grover (1998), we employed semistructured interviews.We developed an initial discussion guide that evolved as the datacollection and analysis progressed (for the initial interview guide,see Appendix B). The interviews were between 60 and 90 minuteslong. Of the 34 interviews conducted, 23 took place in person and

11 were conducted by telephone. Informants included marketingexecutives (6), marketing and product managers (18), country man-agers (6), and marketing staff support specialists (4). The majorityof interviews were tape-recorded and transcribed. When therespondents did not allow us to record the conversation, we wrotedetailed notes after the interview.

Data collection and analysis were an interrelated process thatinvolved multiple stages. Initially, we employed open coding,which enabled us to develop the broad categories as well as the

RESEARCH METHOD

Interview Process

Data Analysis

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concepts that constituted each category. A concept is a labeled phe-nomenon, whereas categories are higher-level collections of con-cepts. Extant literature as well as the interview data drove thechoice of categories. After we identified the basic categories andconcepts, we employed axial coding (interrelating concepts andcategories) to develop tentative associations between the conceptsand the categories. We did so by looking for patterns in the data. Toensure the quality of the analysis process, two of the authors coded

the data and compared the coding. In addition, we cycled back andforth between open and axial coding to refine and discover rela-tionships. This also enabled us to discover the incomplete pic-turethe ambiguities and uncertainties in the model. To resolvethese uncertainties, we consulted the literature. For issues inwhich the resolution of the uncertainties was tentative, we suggestdirections for further research (see the Research Implicationssection).

Marketing knowledge is acquired by an organization in the processof marketing its products and/or services to customers and can beabout consumers, competition, marketing-mix strategies, and soon. Foreign marketing knowledge is the marketing knowledge gen-

erated in the various country units outside the focal country unit ofan MNE. That is, foreign marketing knowledge is the theory in usein a different market location for enacting a specific marketingstrategy. Foreign marketing knowledge use is the extent to whichany country unit employs this theory in use from a different marketlocation to develop and implement marketing strategy.

Prior research on marketing knowledge utilization reveals thatmanagers can deploy knowledge for various uses. Action-orienteduse (Menon and Varadarajan 1992) is the direct application ofknowledge that affects a users activities, practices, or policies. Forexample, Nissan North Americas success in launching the Xterrasport-utility vehicle in the U.S. market was partly due to innova-tive event sponsorships and Web content targeted at young outdoorsports enthusiasts with no children. Eighteen months later in

Japan, the product management team for the similar X-Trail sport-utility vehicle developed a successful launch strategy using manyof the U.S. strategies and tactics modified for the local market. Par-ticularly noteworthy is that the highly effective X-Trail promotionswere novel in the Japanese market and would not have been devel-oped without the U.S. subsidiary (1) doing so first and (2) sharingits knowledge with the Japanese subsidiary. Although uses of mar-keting information other than action-oriented use have been identi-fied (see Menon and Varadarajan 1992), our emphasis is on theaction-oriented use of external knowledge because of its direct

impact on marketing strategies and tactics at the subsidiary level.

However, the mere existence of this knowledge does not neces-sarily lead to its use by other country units. Moran and Ghoshal(1999) articulate three conditions that must exist before resourcesare deployed for value creation. These conditions, analogous tocategories in grounded theory methodology, are as follows: (1) TheMNE creates enabling conditions that make foreign knowledgeaccessible, (2) the MNEs country units are motivated to seek and

MODEL: SUBSIDIARY USE OFFOREIGN MARKETING

KNOWLEDGE

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deploy external knowledge, and (3) the country units perceive theknowledge available from other country units as relevant to theirspecific needs. These conditions anchor the conceptual model (seeFigure 1) that depicts the relationship between foreign marketingknowledge and its use. Using the interview data and prior research,we examine how the relationships among foreign marketingknowledge, foreign marketing knowledge use, and local subsidiaryoutcomes are moderated by enabling, motivating, and perceiving

conditions.

The model depicts associations among six categories (foreign mar-keting knowledge; foreign marketing knowledge use; foreign mar-keting knowledge use outcomes; and enabling, motivating, andperceiving conditions that affect knowledge use). Each category isdescribed through one or more properties. The properties thatdescribe a category may not be exhaustive but rather captureaspects of the category that are relevant to this study. In addition,we do not claim to describe all possible relationships among theproperties that describe the categories in the model.

Enabling conditions refer to the conditions that allow a resource to

be accessed so that it can be deployed. The extent to which foreignmarketing knowledge is put to use in any given unit depends onthe degree to which it is generally accessible in the organization(Menon and Varadarajan 1992). As such, enabling conditions areorganizational factors that enhance MNE subsidiaries access to for-eign marketing knowledge. We discuss these conditions next.

Shared Dependency. Problems of sharing marketing knowledge inMNEs arise because the incentive for subsidiaries to provide theirknowledge to subsidiaries in other countries is ambiguous (seeCerny 1996). This is so because marketing managers in various sub-sidiaries of MNEs do not necessarily need to share their knowledgeand coordinate their activities in the normal course of work, unlikefunctional managers across the organization. In this scenario, ifknowledge holders are also uncertain of the extent to which they

benefitor can appropriate value, as Grant (1996b) observesfromthe knowledge that they hold, at best they would be apathetic toallowing others to access their knowledge.

In effect, MNE subsidiaries often lack the natural dependency toshare knowledge and underappreciate the cross-market appropria-

bility value of knowledge. Thus, it becomes critical to encouragethe development of shared dependency, a mutual sense ofreliance among MNE subsidiaries in achieving their goals,through cultural mechanisms, such as shared values (Sinkula,

Baker, and Noordeweir 1997) or low-powered incentives (Grant1996b), to enable the use of foreign marketing knowledge. How-ever, specific efforts to generate this shared dependency for for-eign marketing knowledge use in the context of MNE subsidiariesis unique because of the cross-subsidiary importance of knowl-edge flows and the typically low level of natural horizontaldependency between subsidiaries. In MNEs, shared dependencymight be more critical for gaining access to tacit foreign marketingknowledge than to explicit knowledge (Simonon 1999a).

Role of Enabling Conditions

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Enabling

Conditions

Shareddependency

Knowledgesharing

processes

Motivating

Conditions

Marketing

experience

Turbulence

Foreign

Marketing

Knowledge

Explicit

Tacit

Foreign

Marketing

Knowledge

Use

Perceiv

ing

Conditi

ons

Cross-subs

idiary

marketsim

ilarities

Measured

outcomes

ForeignMarketing

KnowledgeUse

Outcomes

Marketingprogram

efficiencyand

effectiveness

Organization

identification

Intellectualcapita

l

Figure 1.Model of Subsidiary Use of

Foreign Marketing Knowledge

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agendas and knowledge hoarding, was a problem. Even when delib-erate knowledge hoarding was not an issue, the lack of a shareddependency led to an excessive focus on own markets, as reflectedin the following comment regarding knowledge from external mar-kets: I think people are so focused on their own market that unlessthey have somebody who is bringing them into a loop or a forumaround sharing, I just dont think that thats top of the mind.

In effect, senior management encouragement and low-poweredincentives can enhance access to foreign marketing knowledge bymore clearly aligning the knowledge holders incentives with thatof knowledge users by creating a sense of shared dependency. Theuse of senior management encouragement is more prevalent thanlow-powered financial incentives in enabling knowledge access inMNEs. In summary, we propose the following:

P1: (a) The relationship between foreign marketing knowledgeand its use in subsidiaries is enhanced by senior manage-ment encouragement and low-powered incentives todevelop shared dependency among subsidiaries of theMNE, (b) the relationship between foreign marketing

knowledge and its use in subsidiaries is enhanced more bythe use of low-powered incentives than by mere encour-agement to develop shared dependency among sub-sidiaries of MNEs, and (c) the relationship between tacitforeign marketing knowledge and its use in subsidiaries isenhanced more than the use of explicit marketing knowl-edge by shared dependency.

Knowledge Sharing Processes. The data suggested that the specificprocesses the MNE implemented to share marketing knowledgeplayed a crucial role in enhancing access to and, thus, use of for-eign marketing knowledge. Prior research has also hinted thatknowledge accessibility in an organization is a function of the shar-ing processes in place (Cohen and Levinthal 1990; Maltz and Kohli1996; Mohr, Fisher, and Nevin 1996; Sinkula 1994). Knowledgesharing processes in an organization can be interpersonal or ITmediated (Sinkula 1994).

Interpersonal knowledge sharing processes represent mechanismssuch as meetings, international assignments, and structured com-munications that are used to share knowledge. Many MNEs usedshort-term relocation of marketing personnel to their foreign officesto impart expertise to local personnel who were not easily teachablethrough training programs and codified databases. In the MNEs inour sample, global marketing councilsthat is, weekly confer-

ence calls among worldwide marketing managers, or some variationof thatseemed to be popular. These marketing conferences wereused to present marketing successes andless frequentlyfailures(It is human tendency to not share what died or not proactivelyshare it, stated one marketing manager) and to develop personalrelationships among managers. Existing personal relationships withmanagers in other subsidiaries create a greater willingness to shareand use marketing knowledge. One subsidiary manager describedhaving an account taken from his office and moved to a neighboringcountry:

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I do not deem any personal incentive in sharing the knowl-edge I have developed. I may give it if I personally knowthe guy whos networking with me. I dont have any corpo-rate reasons to share the information; rather, it is personallydeveloped.

Often, a corporate officebased manager, typically a specialist inthe product, coordinated the knowledge transfer process. The coor-

dinated knowledge transfer process was considered to have theadvantage of focus, thus reducing knowledge overload. A sub-sidiary marketing manager suggested that having a centrally coor-dinated knowledge dissemination process is helpful because coor-dinators ensure that the right knowledge reaches marketingmanagers in other countries. For example, a subsidiary marketingmanager in another MNE suggested that coordinators know whatworks and what does not work. They are the ones that shouldrecommend something instead of us going crazy on the wrongones. Information is good as long as you can manage it. But if youcant, it is a waste of time and money.

Apart from the interpersonal processes to provide accessibility to

knowledge from other markets, many MNEs have adopted IT-mediated approaches, employing databases to which marketingknowledge from multiple locations are forwarded. Advances in IT,such as the Internet, enable firms to transfer knowledge much moreefficiently, and with much greater richness, than was possible evena decade ago (Evans and Wurster 1997). As one intervieweedescribed, the old system of one or two people serving as theknowledge repositories and conduits in an organization was nolonger effective, because of the increasing depth and breadth ofinformation in an MNE, or efficient, because of the lack of timelyinformation flow when the people who have knowledge are ofteninaccessible. In particular, for codifiable knowledge such as thatrelated to product and pricing information, use of IT and databaseswas considered appropriate. In most of the MNEs we studied, theuse of such databases was considered of great importance. As onemanager mentioned, They have everything there. If it is notthere, do you know what, it is not invented.

However, the ease with which IT can transmit knowledge could alsoresult in overloada glut of knowledge that can be laborious anddifficult to use meaningfully. This suggests the need for effectiveknowledge categorization. Some managers mentioned the use ofsearch and filtering techniques that would enable them to find theknowledge appropriate for their needs. One MNE found a produc-tive middle ground by ensuring that product managers approved all

reports that staff personnel entered into the marketing database.Therefore, part of the IT infrastructure for transferring knowledgewould involve attempts to provide an effective knowledge architec-ture that categorizes and formalizes knowledge (see Swift 2001).

Interviewees also pointed out that IT-mediated knowledge transferwas not amenable to sharing less codifiable marketing knowledge.For transferring more tacit types of knowledge, face-to-face meet-ings and interpersonal contacts were considered critical. Empha-sizing this, a respondent stated that databases are more like a

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depository for (codified) knowledge, whereas personal contacts areused to obtain more implicit new ideas and techniques. He sug-gested that these techniques complement each other, but I dontthink there is overlap. This suggests that personal interactionsremain important for the transfer of tacit marketing knowledge.Overall, we propose the following:

P2: (a) The relationship between explicit foreign marketing

knowledge and its use in subsidiaries is enhanced more byIT-mediated than interpersonal knowledge sharing pro-cesses, (b) the relationship between tacit foreign market-ing knowledge and its use in subsidiaries is enhancedmore by interpersonal than IT-mediated knowledge shar-ing processes, and (c) the relationship between foreignmarketing knowledge and its use in subsidiaries isenhanced by coordinated knowledge sharing processes.

Motivating conditions provide subsidiary marketing managerswith the stimulus to seek marketing knowledge from other mar-kets. We discuss the motivating roles of marketing experience andmarket and technological turbulence next.

Marketing Experience. The marketing experience in the subsidiaryshaped subsidiary managers motivation to seek foreign marketingknowledge. Managers repeatedly referred to the lack of experiencein marketing a specific product as a motivator for using knowledgegenerated in other markets. In one company, a piracy problem wasaffecting approximately 80% of the Latin American market. Thecountry manager, who had no experience managing such a prob-lem, looked outside his region to the companys European sub-sidiaries for a solution:

We learned from Europe how to run the antipiracy cam-paign, and thats the way we are doing everything. If theressomething we have no idea how to do it, first of all we take alook at our intranet, who is doing those kinds of things, andthen we just send them an e-mail and they can tell us.

This quotation highlights an additional facet of use of foreign mar-keting knowledge by low-experience units: the propensity to useexplicit knowledge. Databases and other repositories of codifiedinformation provide less experienced managers with immediateaccess to valuable knowledge resources. One marketing managerdescribed the worth of corporate-maintained marketing knowledgedatabases for less experienced units in detail:

If you have new people, it helps to provide them with back-ground. Its very difficult to bring somebody up to speed whenthings have been going on for years with respect to a product inanother market. So a repository helps them look through andsee what has been done in the past, what is currently beingdone in other countries, and to get up to speed a bit faster. Italso acts as a resource that may not be available at the countrylevel. What youre trying to do is leverage the best practicesfrom anywhere in the world that can be duplicated orimproved at the different country levels that are interested.

Role of Motivating Conditions

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This experience sometimes meant that a product was at an earlystage in its life cycle in one market and at a later stage in other mar-kets. As one subsidiary marketing manager said,

The ones that are undeveloped or the ones in which theproduct is at an early stage in the market are more likely touse knowledge generated from another subsidiary. They [theknowledge-generating subsidiary] have the experience.

Theyve been in our situation for probably five or ten years.So they have an advantage and we try to exploit that.

Another manager mentioned that developing markets benefit fromknowledge from experienced markets: What they get is a littlemore strategy, that gets them thinking one or two years out, andthe emerging markets would look to the developed markets tounderstand evolution better.

The impact of higher levels of experience on propensity to seekknowledge from other markets was more complex. On the onehand, the motivation to deploy foreign marketing knowledgeseemed to diminish as the experience marketing a particular prod-uct increased. This belief was succinctly captured by one sub-sidiary marketing managers comment that normally, the moreexperience you have, the less the doubts and, thus, the lower thetendency to seek knowledge from other markets. On the other hand,there was also support for the notion that experience might moti-vate knowledge seeking from other markets. For example, respon-dents in our interviews mentioned the following: They are experi-enced; they can correlate some of the things that are happening inthe marketplace; A person that might be more experienced might

be clear in general on what to do and might want to leverage in theirown country what has been done elsewhere; and cross-nationalproduct teams are better able to distill and assess foreign knowledge

when managers have greater product-level experience on which todraw. According to these viewpoints, experience enables managersto absorb external knowledge, separate the wheat from the chaff,and use knowledge that could add value to their programs.

To gain more insights into this, we referred to prior literature onknowledge use. The lower motivation to use foreign knowledge athigher levels of experience may reflect the lack of survival anxiety(Coutu 2002) or the likelihood that experienced managers mayignore new knowledge that runs counter to their mental maps(Argyris 1991). The higher motivation to use foreign marketingknowledge could be attributable to previous experiences enhanc-ing subsidiary managers ability to evaluate and use outside knowl-

edge (Penrose 1959). Kotabe and colleagues (2007) and Simonin(1999b) suggest that for a unit that seeks knowledge, previousexperience with a particular knowledge domain should improveits level of comfort and familiarity with the foreign knowledge. Ifthe knowledge-seeking unit lacks experience in the domain ofactivity for which the foreign knowledge is relevant, its absorptivecapacity (Cohen and Levinthal 1990) for that knowledge wouldlikely be lower. Thus, easily coded and interpreted explicit foreignknowledge is more readily used than more complex tacit knowl-edge when experience is low.

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From our data, we observed a complex pattern of relationships inwhich low levels of experience seem to increase foreign marketingknowledge use, particularly explicit knowledge, whereas theresponse at higher levels of experience is not the mirror image ofthat at low levels of experience. In summary, we propose thefollowing:

P3: (a) The relationship between foreign marketing knowledge

and its use is enhanced when user subsidiaries have low lev-els of marketing experience; (b) compared with tacit foreignmarketing knowledge, the relationship between explicit for-eign marketing knowledge and its use in subsidiaries isenhanced more when user subsidiaries have low levels ofmarketing experience; and (c) the relationship between for-eign marketing knowledge and its use is enhanced (byabsorptive capacity) or diminished (by the lack of survivalanxiety or rigid mental maps) when user subsidiaries havehigh levels of product marketing experience.

Turbulence. Rapidly changing customer preferences and tech-nology may affect the degree to which marketing managers in a

subsidiary are motivated to use foreign marketing knowledge.Extant literature uses the terms market and technology turbu-lence to refer to rapid changes in customer preferences and tech-nology. Market turbulence refers to the rate of change in customercomposition and the degree of heterogeneity in their respectivepreferences (Han, Kim, and Srivastava 1998; Jaworski and Kohli1993). Technological turbulence reflects the rate of change in tech-nology associated with the development of products (Menon,

Jaworski, and Kohli 1997). The rapid pace of technological changecreates greater managerial uncertainty (Weiss and Heide 1993).Turbulence (market and technological) is likely to force the hand oforganizations by requiring more rapid responses, such as productadaptations or modifications, to satisfy fluctuating customer needs(Jaworski and Kohli 1993), thus making managers more reliant onforeign marketing knowledge generated in other units (Hewett,Roth, and Roth 2003).

This was indeed the case among the firms we studied that competein moderate- to high-technology markets with short product lifecycles. These firms typically faced global competitors thatlaunched global new products nearly simultaneously in the majorworld markets. Managers in all locations were managing short win-dows of opportunity and were eager for corporate and other sub-sidiaries marketing support. For example, an MNE operating inhigh-technology markets followed a strategy of introducing clus-

ters of products on a periodic basis. Faced with turbulent and rap-idly changing markets, this organization had its managers travelingfrequently to different countries, gauging the success of variousmarketing programs and transferring the learning to other markets.Given the rapid changes in their markets, it was not unusual formanagers in this MNE to come across requests such as Oh, didyou run a (market) research study? Give it to me because I donthave time to run one from their counterparts in other countries.Managers operating under these conditions highly valued foreignmarketing knowledge. Therefore, we propose the following:

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P4: The relationship between foreign marketing knowledgeand its use is enhanced by greater turbulence in the usersubsidiaries markets.

The final condition that influences resource deployment is the per-ception that a particular resource is relevant to accomplishing aspecific goal or task. Marketing managers in a specific subsidiarywill employ knowledge generated in other markets only if they per-

ceive that the knowledge can be used in their market for competi-tive advantage. Our interviews revealed two concepts that shapemanagers value perceptions of foreign marketing knowledge: thesimilarity of their market with the market from which the knowl-edge originates and the extent to which the knowledge comes withmeasured outcomes.

Cross-Subsidiary Market Similarities. Several dimensions of simi-larities between user subsidiary markets and those from which for-eign marketing knowledge originates are important in assessing therelevance of the knowledge for a market: shared customers andcompetition, cultural distance, and pursuit of similar marketingstrategy.

First, in terms of shared customers and competition, with increasingglobalization of the worlds economy, many business-to-businessMNEs now have the same customers in multiple countries. Manyfirms manage global accounts, and logically, knowledge from sub-sidiaries in various countries is necessary to provide a consistentlevel of product and service quality to multinational customers. Inmany instances, these customers demand standardized products,pricing, and service (Arnold, Birkinshaw, and Toulan 2001) andoften have well-coordinated international operations. Thus, market-ing knowledge from subsidiaries that share customers is likely to beperceived as more relevant. The following quotations from sub-sidiary marketing managers at two MNEs reflect how cross-marketcustomer similarity affects foreign knowledge use:

All the power customers are international customers. Theyare exposed to what is going on in the U.S. or worldwide, andwe know that a marketing piece that is out there, an adver-tisement that is out there in the States, it would be seen bysomeone in our country. So consistency for me is the keyword here.

You need to follow pretty much the same systems and proce-dures and deliverables as we do in the U.S. because that is thereason for our existence. The clients are international

about 50%, and the other 50% are local. So when we operatewith an international set of clients, they operate by a set ofguidelines, international guidelines, and by the same logicthey expect their advertising agency to follow a similar levelof operational procedures. So now Im talking systems andprocedures and deliverables.

Many of the MNEs we studied compete against other MNEs in mul-tiple national markets. In such situations, subsidiary managers findgreat value in intelligence on their key competitors from their col-

Role of Perceiving Conditions

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sell the product, terms of the sale, ways of doing advertising.So it does depend on what were trying to achieve.

A marketing director located in a Canadian subsidiary describedspecific business environment differences throughout the Ameri-cas and how they affect foreign marketing knowledge use:

I think between Canada and the U.S., the geography and cul-

tures are similar enough that I can expect similar results incertain markets. So for instance, I might look at data fromCalifornia to be very comparable to what I might expect inBritish Columbia, or I might look at Toronto similar to how Imay look at Buffalo. East Coast similarities, West Coast simi-larities, these are things I can see between the U.S. andCanada quite clearly. I wouldnt have the same comparisonfor Latin America.

In summary, it was not uncommon in our interviews for managersto lament their concern about the validity of foreign marketingknowledge emanating from economically and culturally diversemarkets. In general, they were more comfortable using knowledge

from similar (e.g., Western, developed, emerging) markets. Thisphenomenon was found even in regions that a priori are believedto be culturally relatively similar, such as when one intervieweeexpounded on the cross-national knowledge sharing patternswithin Latin America. Despite the Brazilian units market suc-cesses, Argentine and Chilean managers were reluctant to usemarketing programs emanating from Brazil. However, Argentineand Chilean managers would openly share experiences and useknowledge from each others markets because they saw muchgreater cultural similarity between themselves than with Brazili-ans. The perception that marketing knowledge developed in cul-turally dissimilar countries is not relevant to their market mightlimit foreign knowledge use.

The third dimension of cross-country market similarity that affectsthe perceived relevance of foreign knowledge is the strategy con-gruence of the subsidiary with the units from which knowledge is

being leveraged. If the subsidiaries share positioning, pricing,channel, or other common strategies, they will find greater rele-vance and value in the marketing knowledge generated in eachothers markets. Two examples from MNE subsidiary managersillustrate these sentiments:

The U.K. is very similar to our market. Were already onboard with them and theyre the lead country for EMER, the

Europe and Middle East Region. They have adopted a lot ofour programs and strategies. They have very similar channelsto us, and they were already on board. It was some of theFrench and German markets that we had difficulty with.

This is a very globalized market, and our strategies dontdiffer much in our major markets. So I can call [a colleague]up and say, Hey, buddy. I have these difficulties. Didnt youhave the same one a couple of years ago, or can you suggestsomething?

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Areas of strategic similarity ranged from target marketing, brandimage, and positioning to more micro, four Ps issues (e.g., pricing,promotions, marketing processes such as new product develop-ment). For example, one subsidiary marketing manager discussedproduct consistency as influencing foreign knowledge use:

Other subsidiaries may have done similar products so youcan learn from what theyve done before you even put your

plan into development. So thats one of the key times weshare and use information. The other would be after a launch,to find out how, if theyve been working on a product or wehave, to establish some benchmarks or do some benchmarkcomparisons.

When managers cited significant target market and strategy differ-ences between markets, interest in and use of foreign marketingknowledge were low. In summary, we propose the following:

P5: The relationship between foreign marketing knowledgeand its use in subsidiaries is enhanced by (a) greater cus-tomer similarity between knowledge originator and usersubsidiaries, (b) greater competitor similarity betweenknowledge originator and user subsidiaries, (c) greatercultural similarity between the countries in which theknowledge originator and user subsidiaries are based, and(d) greater strategy similarity between knowledge origina-tor and user subsidiaries.

Measured Outcomes. The data showed that another concept affect-ing how subsidiary managers perceive the relevance of foreignmarketing knowledge was the actionability of that knowledgethat is, the extent to which the use of knowledge can be shown toprovide a tangible measured outcome. Measured outcomes associ-

ated with foreign marketing knowledge help reduce what Szu-lanksi (2003) refers to as knowledge stickinesscharacteristicsthat make knowledge transfer difficult. Specifically, when knowl-edge is unproven because of insufficient empirical substantiation,ambiguity about the cost and risks of using such knowledge makesit stickier (Lippman and Rumelt 1982; Szulanski 2003). As themanager of an industrial products MNE stated about his willing-ness to use foreign marketing knowledge,

Now on the other hand, if they find that this is nothing butsome theoretical ideas bouncing back and forth and not get-ting into real implementation, or the ideas are not translatedinto real success stories, then that might affect their enthusi-

asm in some shape or form. So when people see that theres asuccessful practice that has been done, thats been imple-mented, and there are some good results, they would be inter-ested in learning that. But if they are just ideas and ideas andmore ideas without getting anything on action, most peoplewill not be that enthusiastic.

Many MNE managers seemed to recognize the importance of meas-ured outcomes and took steps to prove the viability of the foreign

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marketing knowledge by accompanying it with special analysisdesigned to substantiate its success. For example, as a marketingexecutive in one MNE said,

From a promotion standpoint to see whats working, Ive gotone person in each region who is supposed to be analyzing apromotion. Now, its working best in the U.S. because I havethe smartest person there. She can provide the following

information: This is what the promotion was. This was thegoal of the promotion. This is what it cost us. This is what theactual results were. She does that analysis on every promo-tion that we run on every product in the U.S. So I have thatreally well in place in the U.S., and its currently being sharedwith the other regions.

In the absence of evidence of actionability of the knowledge, manyinformants cited concerns about its perceived usefulness andexhibited the not-invented-here syndrome. Thus, we propose thefollowing:

P6: The relationship between foreign marketing knowledge

and its use in subsidiaries is enhanced by measured out-comes associated with the knowledge.

Researchers agree that the use of knowledge generated in itsdiverse markets can be a source of competitive advantage for MNEs(Ghoshal 1987; Gupta and Govindarajan 2000; Kotabe et al. 2007;Lyle and Salk 2007). However, prior research has devoted littleattention to how the use of foreign marketing knowledge canenhance competitiveness in an MNE. Our research generated sev-eral insights into this issue. We found that foreign marketingknowledge use leads to marketing program efficiency and effec-tiveness. For example, not making the same mistakes, loweringramp-up costs, and implementing better programs can result whenforeign marketing knowledge is productively used in another sub-sidiary. We also found evidence that the MNE can accrue second-order organizational benefits through foreign marketing knowledgeuse. Specifically, we found that foreign marketing knowledge usecan enhance organizational identification and intellectual capital,two strategic resources of MNEs (Kostova and Roth 2002; Nahapietand Ghoshal 1998).

Marketing Program Efficiency and Effectiveness. First, subsidiarymanagers in several MNEs concurred that a crucial advantage theyderive from foreign marketing knowledge is saving on develop-ment and implementation costs. The following statements capture

these efficiency outcomes:

I think that everybodys so resource constrained, budget con-strained, that everybodys looking for ways not to recreate thewheel. And I think there is probably more acceptance nowand our international people have a greater responsibility tomake sure that they understand whats available to them

because, again, we just dont have the time, the money, or theresources to reinvent or recreate.

Outcomes of the Use ofForeign Marketing Knowledge

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When I say that it helps, it does keep implementation costsdown because other subsidiaries have done or gone throughthe project, they know probably what will and will not work.We can see how other operations failed and what not to doand what to expect from customers on certain things. It alsohelps in trying to minimize costs in terms of not having toredesign a certain product.

Now what were doing, another part of my job is were estab-lishing a worldwide marketing database and what that willenable people to do is, up on the database, theyll have eachregion and have [point-of-sale] materials and ads and collat-eral and merchandising, all sorts of things. People can goup and if they need an ad for a certain product, they can go ineach region and see what their ads look like because, if theylike something, then they can very easily request the digitalfiles and save a ton of money without having to duplicate theexact same thing.

Thus, a vital outcome of using knowledge from other markets wasthe greater efficiency that emerged in terms of saving on scarce

resources that were otherwise likely to be wasted by duplicatingefforts also expended in other units of the MNE.

Marketing programs can also be developed and implemented withgreater effectiveness as a result of foreign marketing knowledgeuse. The effectiveness advantages mentioned in our interviewsinclude speed to market, deployment of more creative ideas, andachieving better brand consistency worldwide. As far as new ideasare concerned, managers mentioned the ability to take advantage ofmany more minds at work on a specific problem when they usemarketing knowledge from a foreign market. The following com-ment exemplifies this:

When you have a set of, for example, [70 people] working inmarketing, in different operations, you have a better chance ofhaving better ideas than just depending on one operation try-ing to develop all different products. I mean, they could comeup with similar products, but definitely having a broaderrange of people working on any different product could defi-nitely bring in better results.

There was consistent support for the notion that by allowing sub-sidiaries to tap into the capabilities of other subsidiaries, foreignmarketing knowledge aided the development of more creativestrategies for competing in the local market. As one subsidiary

manager stated,

I believe it does lead to more effective and creative strategieson the ground and improved results, which could both be interms of market share as well as financial results becauseevery mistake costs.

Notably, although the use of foreign marketing knowledgeenhanced the creativity of local market strategies, exposure to for-

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eign marketing knowledge also showed managers that they oftenexaggerated the differences required in marketing programs inother countries. The heightened notion of differences across mar-kets had previously led to excessive adaptation of marketing strate-gies in specific markets, diluting attempts to achieve brand consis-tency. Managers suggested that exposure to marketing knowledgefrom other markets enabled greater brand consistency by dispellingnotions of high levels of dissimilarity across different country mar-

kets. For example, one MNE manager mentioned the following:

For the first time ever we are going to have a worldwide con-sistent look and feel to all our materials. I dont know if youknow the process of putting together a brochure, but it proba-

bly costs about $100,000 just to do the creative, and we woulddo the creative here in the U.S. and the U.S. would use it as itis and everybody else just created their own. They might pickand choose a few things, but they would totally recreate,every region, their own materials because they liked some-thing different. Well, this year is the first year where all of uslook the same. They may all actually leverage exactly what weput out except for localizing the translation. Its really kind

of cool.

When use of marketing knowledge from other subsidiariesincreases, the marketing strategies employed in different sub-sidiaries achieve a greater level of standardization, thus promotinga more global brand image, making marketing processes moreeffective and efficient.

Organization Identification. A second advantage of foreign market-ing knowledge use was its ability to enhance organization identifi-cation among the various subsidiaries of the MNE. Organizationidentification is the the degree to which subsidiary employeesexperience a state of attachment to the parent (Kostova and Roth2002, p. 220). The subsidiary marketing manager of one MNE sum-marized this succinctly by stating that foreign marketing knowl-edge use makes you feel more that you belong to a family than

being isolated. Respondents in several other MNEs echoed thissofter second-order advantage of foreign marketing knowledgeuse at their subsidiaries, as reflected in the following comments:

Well, I think, they have some softer issues, too. I think itdoes impact on your organizations effectiveness side becausewhen people see that theyre not a small team but theyre partof a bigger team, it does kind of infuse a sense of camaraderie,if you will. So there are some pieces which kind of expand

beyond the traditional marketing side.

I think theres just a general sense of whatever entity feelingmore valued and a part of the process, that theres recognitionthat this is a best-in-class process or product or item and sothat probably results in productivity gains. You know, hope-fully, there are financial gains but I think theres just a generalsense of participation and kind of bridging that gap betweeninternational and domestic just being more global.

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In effect, the act of using foreign marketing knowledge engendereda sense of greater organizational identification among the sub-sidiaries. This finding parallels the observation by Mohr, Fisher,and Nevin (1996) that collaborative communication can highlightshared interests and common goals and also create an atmosphereof mutual support and respect. Organizational identification hasseveral beneficial outcomes: greater diffusion of practices, sharingvalues and beliefs embodied in the practices being transferred, and

reduction in the not-invented-here syndrome as practices areviewed as coming from inside rather than outside the organization(Kostova and Roth 2002).

Intellectual Capital. A third outcome of foreign knowledge use isenhancing intellectual capital in the subsidiary. Nahapiet andGhoshal (1998, p. 245) define intellectual capital as the knowl-edge and knowing capability of a social collectivity, such as anorganization, intellectual community, or professional practice.Intellectual capital represents a valuable resource that enablespeople to act in new ways (Coleman 1988). In MNEs, intellectualcapital represents knowledge resources within the organization,including its subsidiaries, that enhance management practices.

Many of the informants were keen to point out how foreign mar-keting knowledge use enhances intellectual capital.

When making difficult decisions, foreign marketing knowledgeprovided managers with resources that made them more secureand confident in decision making. Managers also elaborated on

benefits that accrued to their organizations as well as to their mar-keting programs. Two subsidiary marketing managers (from differ-ent MNEs) observations illustrate the organization facet of intellec-tual capital as a result of foreign knowledge use:

Another advantage of sharing and using knowledge acrosssubsidiaries is that it gives individuals a bigger scope than theirindividual country. They look at the business at the regionallevel, and it gets everybody thinking not only what they can doat the country level but rather how they can maximize resultsat the regional level. So you give them a different scope. Anoutcome of that is you try and identify potential candidates forregional-type positions or for other types of promotion basedon their input, participation, and thought processes.

Knowledge sharing and use also accelerates learning curves.It improves the quality of professionals in the organization. Itexpands the horizons of professionals who have been proba-

bly hired in one country and then over time get exposed to

possibly moving around. It starts with communicating withcolleagues and thinking in new ways.

In summary, we propose the following:

P7: The use of foreign marketing knowledge in an MNE sub-sidiary enhances (a) the efficiency of its marketing pro-grams, (b) the effectiveness of its marketing programs,(c) organization identification in the subsidiary, and(d) intellectual capital in the subsidiary.

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By providing a rich portrait of MNE subsidiary use of foreign mar-keting knowledge, the model offers several academic and manage-rial insights. Several limitations are noteworthy. The theoreticalsampling process cannot be construed as having provided anexhaustive account of all facts from a random sample (see Glaserand Strauss 1967). Thus, the generalizability of the model woulddepend on further research that focuses on verification of the cate-gories, properties, and propositions identified in this study. We

also collected data in person and by telephone. Although wedetected no differences in data quantity or quality, different inter-view methods could have affected our results. In addition, themethod employed does not enable us to explicate complex associa-tions, such as the possible interactive impact of shared depend-ency and knowledge sharing processes on foreign marketingknowledge use. The model development process also does notenable us to capture the diminishing returns that might occur fromthe techniques employed to encourage foreign marketing knowl-edge use and from the knowledge use itself. Further research usingquantitative techniques could provide insights into these issues.

However, the model development process also provided several

advantages. In keeping with the needs of theoretical sampling, thediverse sample of respondents spanned several industries andincluded managers based in four different continents, helping usobtain insights into factors that affect foreign marketing knowledgeuse and its outcomes. The developmental, or process, orientationof the model (see Glaser and Strauss 1967) enabled us to enhanceour understanding of second-order effects of foreign marketingknowledge use, such as organization identification and intellectualcapital. Next, we briefly discuss the implications of the study formanagers and academics.

The primary managerial contribution of this study is in helpingMNEs categorize the organizational and market conditions thatinfluence the use of foreign marketing knowledge. From the per-spective of managers, particularly noteworthy here are the rolesof shared dependency, knowledge sharing processes, and meas-ured outcomes. These variables are amenable to managerial con-trol and can serve as levers to shape foreign marketing knowledgeuse. Subsidiary-related conditions, such as experience and turbu-lence, help managers assess the need for foreign marketingknowledge. The market-based factor, cross-subsidiary marketsimilarity, helps managers focus on specific markets to leverageknowledge that is relevant to their market. Furthermore, bydelineating the outcomes of foreign marketing knowledge use ingreater detail, we provide managers with a broader picture of how

to assess the outcomes of foreign knowledge use. We suggest thatthe second-order outcomes, such as organization identificationand intellectual capital, are particularly intriguing.

The conceptual model affords marketing scholars substantialopportunities to enhance understanding of foreign marketingknowledge use by conducting research on a variety of topics. Themodel advances international marketing literature by (1) providinga grounded theorybased framework that helps managers and aca-demics organize and assess the factors driving foreign marketing

MANAGERIAL AND RESEARCHIMPLICATIONS ANDLIMITATIONS

Managerial Implications

Research Implications

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knowledge use, (2) focusing attention on the use of foreign market-ing knowledge and not merely its transfer, (3) highlighting the needto examine knowledge flows between subsidiaries in addition tothe focus on coordinated knowledge transfer, (4) delineating thefirst- and second-order outcomes of foreign marketing knowledgeuse, and (5) outlining several directions for further research. Wehave detailed several research propositions in the process of dis-cussing the model. Here, we elaborate on a few of the related

research issues.

Relative Roles of Technology and Interpersonal Processes. In themodel, we identified technology-mediated processes as importantto harnessing the marketing knowledge that exists in a splinteredfashion across various units of the MNE. However, there is someevidence that many firms rely excessively on such technology-intermediated processes to share and use knowledge (KPMG Con-sulting 2000). We hasten to note that technology should not be con-sidered a panacea to all knowledge sharing problems. As Peters(1995, p. 6) notes, Getting the psychology and sociology of sharingright is more important than state-of-the-art electronic linkages.As we discussed previously, focusing on the human aspects of

knowledge transfer is particularly important for sharing tacitknowledge. Therefore, marketing scholars should examine the rela-tive roles of technological and interpersonal processes in influenc-ing the use of marketing knowledge.

Marketing Experience and Knowledge Use. We observed that theassociation between previous marketing experience and knowl-edge use was complex. Therefore, efforts to assess the impact ofprevious experience on the use of foreign marketing knowledgewould be particularly relevant. We found that higher levels ofexperience in certain instances discouraged the use of foreign mar-keting knowledge and encouraged its use in other instances. This isan important topic for verification in further research because sev-eral mediating mechanisms seem to operate in affecting foreignmarketing knowledge use under conditions of greater experience.As we discussed previously, whereas absorptive capacity mightmotivate the use of foreign marketing knowledge, a lack of survivalanxiety or rigid mental maps might diminish the motivation to useforeign marketing knowledge. Experimental efforts to delineate therole of these mediators could advance theory in the knowledgemanagement literature.

Legitimacy of Subsidiaries in MNCs. Our research explores man-agers perceptions of external knowledge credibility and useful-ness. Institutional theory suggests that knowledge adoption is more

likely to occur when units in the MNC conform to pressures in thefirms environment and thereby gain legitimacy in relation to thatenvironment (North 1990; Scott 2001; Tolbert and Zucker 1983).Firms that conform to mandated and socially preferred ways ofdoing things will be viewed as legitimate. As Westney (1993)describes, MNEs exert strong isomorphic pulls toward similarityacross the organizational structures and processes of subsidiaries,

but each subsidiary is also operating within a local organizationalfield that exerts a range of isomorphic pulls on its organization.The relational context between headquarters and foreign sub-

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sidiaries is important to consider because this context influenceshow MNC units perceive one another (Hewett, Roth, and Roth2003; Kostova and Roth 2002). Research that explores legitimacyprocesses in MNCs and their effects on external market knowledgeuse can add to our understanding of perceiving conditions.

Examining the Outcomes. Studies that examine the mechanismsthrough which foreign marketing knowledge use leads to competi-

tive advantage would provide additional validity to our findings.The interview data led us to postulate several mechanisms as out-comes of foreign marketing knowledge use: efficiency and effec-tiveness, organization identification, and intellectual capital. Therelative impact of foreign marketing knowledge use on these out-come mechanisms is an empirically important issue that can pro-vide managers with guidelines on what to expect from knowledgetransfer and use initiatives.

MNE Structure. Prior literature has suggested that the structure ofan MNE affects management policies and practices and thereforemay play an enabling role in foreign marketing knowledge useamong its various units. From a structural standpoint, an MNEs

marketing presence in foreign markets can take many forms:wholly owned marketing and sales subsidiaries, joint venture mar-keting and sales organizations, distribution through foreign dis-tributors, franchising, and so forth. As Martin and Salomon (2003)propose, different MNE structures can affect both transferor andrecipient abilities to transfer knowledge. Our sampling procedurewas not designed to assess structural differences systematically.Our nonheadquarter interviews were exclusively with whollyowned marketing and sales subsidiaries. The moderating effects ofstructure on foreign marketing knowledge use enabling conditions(shared dependence and knowledge sharing processes) arenonetheless noteworthy avenues for further research.

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Industries

PositionsandLocations

GeographicResponsibilitie

s

Advertising

Subsidiarylocations:

Subsidiary-basedmanagersworkedinspecificcountriesinAfrica,Europe,North

Commercialcommunications

Countrymanagers

America,andSouthAmerica.

Consumerelectronics

Marketingandproductmanagers

Headquarters-basedmanagershadglobalorregionalres

ponsibilities.

Consumerhealthcare

Corporateorregionalheadquarters:

Documentmanagement

Marketingexecutive

s

Financialservices

Marketingandproductmanagers

Housingmaterials

Marketingstaffsupp

ortspecialists

Industrialandcommercialdu

rables

Industrialchemicals

ITmanagementsolutions

Internetservicessoftware

Pharmaceuticals

Semiconductors

Telecommunications

APPENDIX A.FIRM AND INFORMANT

CHARACTERISTICS

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(We developed this interview discussion guide at the start of theproject. As is typical of grounded theory research, the guideevolved as the interviews were conducted.)

Thank you for speaking with me today. The purpose of thisresearch is to better understand how marketing knowledge is trans-ferred and used in international companies. Specifically, Ill betalking to you about how marketing knowledge from one sub-

sidiary location is transferred and used by managers in other sub-sidiaries. This is part of an ongoing research project led by Profes-sors XYZ at university XYZ. Your name and the name of yourcompany will be held in the strictest confidence and will not bereported in any research reports. Do you have any questions beforewe begin?

I will be asking you a series of questions. To capture your thoughts,I would like to audiotape our interview. The tape will then be tran-scribed and provided to Professors XYZ. Again, your name and thename of your company will be held in the strictest confidence andwill not be reported in any research reports. May I have your per-mission to begin recording our interview?

First, I would like to get a sense of how your company oper-ates and is structured internationally. What is the extent ofautonomy provided to country units in developing market-ing strategy? Are products or other marketing activitiesmodified for specific country markets? If yes, is this donelocally in each market or coordinated globally by the head-quarters? [Probe to determine if the company orientation ismultinational, global, or transnational.]

What are the different types of marketing knowledge that areshared between subsidiaries in your organization? What sys-tematic processes are there for managing this? Does seniormanagement encourage such knowledge sharing? How?What incentives motivate knowledge sharing?

What is the extent to which knowledge can be standardizedand captured in databases in your organization? What aresome examples of database knowledge that has been effec-tively transferred and used between subsidiaries? Howimportant is this knowledge for success in your organization?

Are there examples of valuable knowledge that subsidiariescan share that is not, or cannot be, standardized and cap-tured in databases? How important is this knowledge for

success in your organization?

What is the approach employed by your organization tosharing knowledge across subsidiaries? Do you employintranets or the Internet? Is there a centralized databasethat managers tap into for knowledge about marketingstrategy? Or is knowledge shared mostly through personalcontacts and interactions? Which approach is more domi-nant? How much of subsidiary generated knowledge isshared in your organization? Does knowledge flow across

APPENDIX B: DISCUSSIONGUIDE

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subsidiaries/country units with or without headquarterscoordinating this?

Does the use of information technology enhance subsidiaryknowledge sharing substantially? Are there any drawbacksor obstacles to the management and use of knowledge shar-ing systems in your organization? Do you face knowledgeoverload issues where there is way too much knowledge on

the computerized system that you find difficult to manage?

What factors facilitate or hamper intercountry marketingknowledge sharing?

Under what circumstances are country units more likely touse knowledge from other country units?

How do cultural factors influence knowledge sharing? Forinstance, are there country units that would not use knowl-edge from certain other country units?

How does competition in the marketplace and change in the

marketplace influence use of knowledge developed in othercountries?

Does greater experience in a market [product, manager] leadto greater use or less use of marketing knowledge from othercountry units?

Do subsidiaries need to share certain commonalities inorder for them to effectively transfer and use marketingknowledge?

What is the impact of using knowledge developed in othercountry units? Does it lead to more effective and creativestrategies? Does it lead to greater cooperation among coun-try units? Does it result in more standardized marketingstrategies and programs across countries? Does it lead tofaster responses? Other advantages?

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THE AUTHORS

Martin S. Roth is Professor ofInternational Business (e-mail:[email protected]), andSatish

Jayachandran is AssociateProfessor of Marketing (e-mail:

[email protected]), MooreSchool of Business, University ofSouth Carolina.

Mourad Dakhli is AssistantProfessor of InternationalBusiness, Division of Business &Economics, American Universityof Kuwait (e-mail:[email protected]).

Deborah A. Colton is Assistant

Professor of Marketing, E. PhilipSaunders College of Business,Rochester Institute ofTechnology (e-mail:[email protected]).

ACKNOWLEDGMENTS

This research was funded by a grantfrom the Center for InternationalBusiness Education and Research atthe Moore School of Business,

University of South Carolina. Theauthors thank Kelly Hewitt, KendallRoth, and faculty members fromHarvard Business School, Universityof Connecticut, University ofMassachusetts, and University ofRhode Island for their helpfulcomments.

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