MNEs Subsidiary Training and Development and Firm Innovative Performance: The Moderating Effects of Tacit and Explicit Knowledge Received from Headquarters

Abstract

This paper set out to investigate the ways training and development impacts on firm innovative performance as well as the moderating role of knowledge transfer received on training and development and firm innovative performance, using a sample of 229 foreign subsidiaries of multinational enterprises (MNEs) operating in China. We adopt hierarchical linear modeling, and the results of the study reveal that both on-the-job training and development and off-the-job training and development have an influence on the firm innovative performance. Also, the empirical results of the study demonstrate that the moderating effect of tacit and explicit knowledge received on the relationship between both on-the-job training and development and off-the-job training and development and firm innovative performance are stronger. This paper shows that continues updating of skills, ability and knowledge of the workforce through on-the job training and development and off-the job training development programs might boost creativity and innovation of business organizations.