Purpose: The purpose of this study is to examine the influence of the
structural, relational, and cognitive dimensions of knowledge-sharing in
subsidiaries of MNEs located within Saudi Arabia, and the impact of knowledge
flows on the performance of such subsidiaries.
– Design/Methodology and Approach: A cross-sectional survey research design,
involving the use of questionnaire to acquire the primary data, is adopted.
The analysis is based on 147 completed questionnaires. Descriptive statistics
and multivariate regression analysis are used in the analysis of the data.
Formal control mechanisms are widely used as opposed to informal channels of
control. Knowledge flows are associated with personalised or bureaucratic
controls. Both mechanisms are negatively associated with performance, whilst
output control and informal coordination are positively associated. Increased
local presence and subsidiary R&D is positively associated with
limitations/implications – Research Limitations/Implications: The methodology
adopted for this study can be extended for similar studies in the Middle East
or in GCC countries. Policy makers in host countries in which MNE
subsidiaries operate may find the results as an important leverage for
negotiating with MNEs for R&D to be conducted in their countries.
Possible spill-overs and diffusion effects of such R&D could then also
benefit domestic firms.
– Originality/Value: This is one of few studies of this nature conducted in
the Middle East, and the only one in the context of Saudi Arabia, which has
explicitly investigated the connection between knowledge flows, controls, and