Knowledge Creation of Global Companies

Seija Kulkki

Center for Knowledge and Innovation Research
Helsinki School of Economics and Business Administration

Abstract

The chapter elaborates on the nature of knowledge creation of a global firm through these questions:

• What is local and global knowledge?
• How do global companies create and transform local knowledge into global knowledge and vice versa?
• What are organizational and managerial ways and means that facilitate tapping on local knowledge and bringing about a global scale of innovation over many locations in the global marketplace?
• How do global companies interact with and affect their environments in knowledge creation?

The chapter is organized as follows. First, the relationship of local and global knowledge and knowledge creation are discussed; i.e. the chapter argues for a future-oriented and integrative view of knowledge. Second, the chapter discusses a dispersed and multi-contextual nature of knowledge from the viewpoint of (i) how local knowledge may be created and transformed to global knowledge, and (ii) how local knowledge and actions are inter-linked. The chapter argues that strategy and structure as intertwined with knowledge may constitute an overall renewal and growth capability of a firm. Third, the chapter elaborates on how global companies build their innovation capacity dialectically on many ontological, epistemological and practical levels; i.e. they are in interaction with their environments simultaneously through strategies and structures, as well as through their knowledge and individual actions. Consequently, the chapter argues that the renewal capability of a global firm can be 'anchored' through individual actions to rhythms and speed of change, as well as to discontinuities of markets, competition, and technology within industries subject to change.

The chapter concludes that a global scale of knowledge creation calls for a contextual transparency and flexibility to 'move' spatially in time and space. Global companies have designed forms of organizing where their strategies, structures and actions, as well as knowledge and technology, are in worldwide interplay with social and cultural development, and strategies, structures and actions, as well as knowledge and technologies, of other organizations and institutions.

To appear in "Strategic Management of Intellectual Capital and Organizational Knowledge" edited by Nick Bontis & Chun Wei Choo (Oxford University Press).