Boundary-crossing and the localization of capabilities in a Japanese multinational firm

Abstract

We conducted a case study to explore the challenges encountered by a foreign subsidiary of a Japanese multinational firm when localizing its organizational capabilities in China. Drawing on the concepts of boundaries and boundary-crossing, we identify pragmatic and cultural knowledge boundaries, which denied opportunities for the host-country employees to contribute their local expertise to augment the firm's core capabilities within the domains of research and development and operational protocols. However, within those domains that were regarded as complementary to or peripheral to the firm's core capabilities, host-country employees were granted more scope to cross the associated pragmatic boundaries.

Keywords::

• knowledge boundaries
• capabilities
• Japanese MNCs
• China
• foreign subsidiaries
• localization

Acknowledgement

This work was supported by the General Research Fund of the Research Grants Council of Hong Kong [grant number LU341813].

Disclosure statement

No potential conflict of interest was reported by the authors.

Additional information

Notes on contributors

Jacky F.L. Hong

Jacky F.L. Hong is an associate professor at the University of Macau, China. He received his PhD from Lancaster University. His research interests fall into the areas of organizational learning, knowledge management in multinational firms and global transfer of Japanese management practices.

Robin Stanley Snell

Professor Robin Stanley Snell is in the Department of Management at Lingnan University, Hong Kong. He received his PhD from Lancaster University. His research interests include organizational learning, business ethics, leadership education and qualitative methods.