Language, Communication and Knowledge Transfer

How does the use of language affect the communication process of knowledge transfer and the subsequent transfer effectiveness in local subsidiaries of multinational corporations (MNCs)? The transfer of knowledge has been recognized to be often ‘sticky’ (Szulanski, 1996), especially in the context of MNCs. One reason is that MNC knowledge transfers inevitably involve the use and interpretation of different languages. However, the effect of language usages on the effectiveness of MNC knowledge transfers has been under-researched. The current research addresses this limitation. The current research investigates the effectiveness of knowledge transfer within local subsidiaries of MNCs (1) when English (the headquarter language) is used as the communication language among subsidiary workers and (2) when the local language is used as the communication language among subsidiary workers. We argue that the adoption of headquarter language or local language in local subsidiaries embodies different challenges of the encoding and decoding of the target knowledge by individuals, which then affects the effectiveness of the knowledge transfer process. Such endeavor provides a significant but under-researched perspective to study effective MNC knowledge transfer – the communication perspective. It also explores the micro mechanisms of language adoption on individuals’ implementation of knowledge transfer.