R&D transfer from Europe to Asia: Towards global R&D complementarity benefiting innovation performance

Purpose – The paper investigates foreign invested radical innovations, and related impediments, in China and India, in order to better understand impediments and requirements for radical innovation in China. Design/methodology/approach - The paper presents a framework based on theories on knowledge creation, innovation and networking, which is relevant in order to understand impediments and opportunities for radical innovation in China. The paper also draws on extensive empirical data collected from a holistic multiple case study including three MNCs based in Scandinavia, which have established R&D units in China and India. Findings – Examples of radical innovations in China and India within Scandinavian MNCs are presented, illustrating that radical innovation is indeed possible in China. However, impediments to radical innovation also exist. A knowledge gap, as opposed to an information gap, exists in China and India. Originality/value – A deficiency with the existing distinction between information and knowledge is identified. A new distinction between knowledge and information is proposed, which embraces the tacit nature of complex explicit knowledge - or tacit information. Skill requirements, for creating and understanding information and knowledge respectively, are outlined. The framework is relevant in order to understand better, requirements in order for China to step further up the learning curve and innovate in radical ways. Policy implications, relevant for governmental bodies as well as managers in China, suggesting further emphasis on the development of socialization skills and opportunities for experiential knowledge creation, are outlined