Ambidexterity in MNC knowledge sourcing in emerging economies: A microfoundational perspective

Innovation performance of multinational corporations (MNCs) derives from access to and utilization of a combination of explorative and exploitative knowledge across heterogeneous settings. These settings increasingly encompass flagship industries in emerging economies. There is limited research, however, that scrutinizes the processes of knowledge sourcing within such dynamic host environments, taking into account MNCs' differing location capabilities. We draw on the concept of ambidexterity - the combination of exploration and exploitation - and the microfoundations approach to study eleven MNCs in the Bulgarian software development industry by focusing on their local R&D projects. We extend the explanatory capacity of ambidexterity at the micro level and clarify the relationship between exploration and exploitation by identifying four types of ambidexterity: global knowledge differentiator, global-local knowledge integrator, emerging local-global integrator, and local knowledge integrator. Our typology is underpinned by three specific dimensions of R&D capabilities: technical know-how, scope of expertise, and market potential.

Automated summary

The innovation performance of multinational corporations depends on their access to and utilization of diverse explorative and exploitative knowledge in various settings, including flagship industries in emerging economies. However, there is limited research on knowledge sourcing processes within dynamic host environments and the location capabilities of MNCs. This study examines eleven MNCs in the Bulgarian software development industry and extends the explanatory power of ambidexterity theory at the micro level, identifying four types of ambidexterity - global knowledge differentiator, global-local knowledge integrator, emerging local-global integrator, and local knowledge integrator - based on three dimensions of R&D capabilities: technical know-how, scope of expertise, and market potential.