Knowledge Flows in International Services Firms: A Conceptual Model

Given the increasing involvement of both internal and external network structures and relationships in the internationalization of business (Johanson and Mattsson, 1988), the investigation of services internationalization that involves both parent and foreign subsidiary operations should lead to greater understanding of the dynamics relating to behaviour and performance of these firms (Gupta and Govindarajan, 2000). A key element of these dynamics involves inter- and intra-organizational flows of knowledge. Increased organizational learning and competency development in both parent and subsidiary units of multinational firms requires the effective flow of knowledge between them. In considering the process of knowledge transfer, the role of the individual (Boisot, 1998) also becomes a critical factor to consider. The individual’s role in knowledge generation and decision-making in the internationalization process of firms has been largely overlooked until recently, with some insightful contributions being made by Andersson (2000) and Edvardsson et al. (1993).