Knowledge transfer and absorptive capacity in the context of a small multinational enterprise: a systematic study of the nexus of relationships

Abstract

Knowledge transfer and absorptive capacity of a small firm enhance the use of its existing, typically limited resources and contribute to building knowledge competency and thus sustainable competitive advantage. Existing knowledge on the role of absorptive capacity in knowledge competency enhancement of rapidly internationalizing firms is scarce. Thus, the focus of this study is on knowledge transfer and absorptive capacity in a small multinational enterprise (MNE). Based on a single case study, we analyse the antecedents that increase and/or hinder absorptive capacity of the small MNE and discuss what kind of consequences being a small MNE have on knowledge transfer, and, eventually, on the firm's capability development in its quest for competitive advantage. The results indicate that by utilizing ICT communication and by encouraging informal communication, a small MNE can overcome the resource constraints related to rapid and early internationalization and the problems this creates for knowledge transfer mechanisms.