IDEAS home Printed from https://ideas.repec.org/a/eee/iburev/v28y2019i4p638-646.html
   My bibliography  Save this article

From local to global innovation: The role of subsidiaries’ external relational embeddedness in an emerging market

Author

Listed:
  • Isaac, Victor Ragazzi
  • Borini, Felipe Mendes
  • Raziq, Muhammad Mustafa
  • Benito, Gabriel R.G.

Abstract

This study examines factors that influence the development and transformation of local innovations into global innovations from an emerging market subsidiary. We argue that subsidiaries’ relational embeddedness with the external local network is essential for the development of local innovations. Turning local innovations into global ones is the result of the level of innovativeness evoked by the subsidiary located in an emerging market. However, the transformation of local into global innovations is more likely to happen in the case of subsidiaries having previous reverse knowledge transfers in functional areas. Reverse knowledge transfers indicate internal embeddedness, which is essential for local innovation to be transformed into global innovation. We draw on survey evidence from 131 foreign subsidiaries operating in Brazil. Using a Structural Equation Modeling technique, our results support our hypotheses and show that subsidiaries’ relational embeddedness with the external local network is positively associated with local innovation, which is transformed into global innovation, especially when innovation is developed in the subsidiary´s functional areas with previous reverse knowledge transfers. We draw implications for the field of subsidiary management research, specifically to understand the role of local innovation from foreign subsidiaries in emerging markets.

Suggested Citation

  • Isaac, Victor Ragazzi & Borini, Felipe Mendes & Raziq, Muhammad Mustafa & Benito, Gabriel R.G., 2019. "From local to global innovation: The role of subsidiaries’ external relational embeddedness in an emerging market," International Business Review, Elsevier, vol. 28(4), pages 638-646.
    • Handle: RePEc:eee:iburev:v:28:y:2019:i:4:p:638-646
    DOI: 10.1016/j.ibusrev.2018.12.009
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0969593117304894
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.ibusrev.2018.12.009?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Mazboudi, Mohamad & Sidani, Yusuf M. & Al Ariss, Akram, 2020. "Harmonization of firm CSR policies across national contexts: Evidence from Brazil & Sweden," International Business Review, Elsevier, vol. 29(5).
    2. De Marchi, Valentina & Cainelli, Giulio & Grandinetti, Roberto, 2022. "Multinational subsidiaries and green innovation," International Business Review, Elsevier, vol. 31(6).
    3. Scott-Kennel, Joanna & Saittakari, Iiris, 2020. "Sourcing or sharing in MNE networks? National headquarters and foreign subsidiaries as knowledge conduits in SMOPECs," International Business Review, Elsevier, vol. 29(1).
    4. Sarkar, Soumodip & Mateus, Sara, 2022. "Value creation using minimal resources – A meta-synthesis of frugal innovation," Technological Forecasting and Social Change, Elsevier, vol. 179(C).
    5. Bausch, Madeleine & Barmeyer, Christoph & Mayrhofer, Ulrike, 2022. "Facilitating factors in the cross-cultural transfer of management practices: The case of a German multinational in Brazil," International Business Review, Elsevier, vol. 31(2).
    6. Dabić, Marina & Obradović, Tena & Vlačić, Božidar & Sahasranamam, Sreevas & Paul, Justin, 2022. "Frugal innovations: A multidisciplinary review & agenda for future research," Journal of Business Research, Elsevier, vol. 142(C), pages 914-929.
    7. Afriyadi Cahyadi & Róbert Magda, 2021. "Digital Leadership in the Economies of the G20 Countries: A Secondary Research," Economies, MDPI, vol. 9(1), pages 1-15, March.
    8. Jian Du & Shan Zhu & Wen Helena Li, 2023. "Innovation through internationalization: A systematic review and research agenda," Asia Pacific Journal of Management, Springer, vol. 40(3), pages 1217-1251, September.
    9. Zheng, Li & Ma, Pengcheng & Hong, Jacky Fok Loi, 2022. "Internal embeddedness of business group affiliates and innovation performance: Evidence from China," Technovation, Elsevier, vol. 116(C).
    10. Lô, Amadou & Geiger, Martha, 2022. "Managing internal embeddedness in multinational corporations’ R&D subsidiaries: An evolutionary perspective on the automotive industry in Silicon Valley," Technovation, Elsevier, vol. 113(C).
    11. Ferraris, Alberto & Bogers, Marcel L.A.M. & Bresciani, Stefano, 2020. "Subsidiary innovation performance: Balancing external knowledge sources and internal embeddedness," Journal of International Management, Elsevier, vol. 26(4).
    12. Ferraris, Alberto & Degbey, William Y. & Singh, Sanjay Kumar & Bresciani, Stefano & Castellano, Sylvaine & Fiano, Fabio & Couturier, Jerome, 2022. "Microfoundations of Strategic Agility in Emerging Markets: Empirical Evidence of Italian MNEs in India," Journal of World Business, Elsevier, vol. 57(2).
    13. Klaus E. Meyer & Chengguang Li & Andreas P. J. Schotter, 2020. "Managing the MNE subsidiary: Advancing a multi-level and dynamic research agenda," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 51(4), pages 538-576, June.
    14. Klaus E. Meyer & Chengguang Li & Andreas P. J. Schotter, 0. "Managing the MNE subsidiary: Advancing a multi-level and dynamic research agenda," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 0, pages 1-39.
    15. Hutzschenreuter, Thomas & Harhoff, Philippa-Luisa, 2021. "The accelerating effect of institutional environment unfamiliarity on subsidiary portfolio expansion in a new host country," International Business Review, Elsevier, vol. 30(3).
    16. Liu, Ting & Li, Xizhuo, 2022. "How Do MNCs Conduct Local Technological Innovation in a Host Country? An Examination From Subsidiaries' Perspective," Journal of International Management, Elsevier, vol. 28(3).
    17. Jankowska, Barbara & Götz, Marta & Tarka, Piotr, 2021. "Foreign subsidiaries as vehicles of industry 4.0: The case of foreign subsidiaries in a post-transition economy," International Business Review, Elsevier, vol. 30(6).
    18. René Belderbos & Boris Lokshin & Federico Michiel, 2021. "R&D and Foreign Subsidiary Performance at or Below the Technology Frontier," Management International Review, Springer, vol. 61(6), pages 745-767, December.
    19. Callaghan, Christian William, 2021. "Consequences of deindustrialisation for globalisation: Insights for international business," International Business Review, Elsevier, vol. 30(3).
    20. Helene Loe Colman & Birgitte Grøgaard & Inger G. Stensaker, 2022. "Organizational identity work in MNE subsidiaries: Managing dual embeddedness," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 53(9), pages 1997-2022, December.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:iburev:v:28:y:2019:i:4:p:638-646. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/133/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.