Cultural fit, knowledge transfer and innovation performance: a study of Malaysian offshore international joint ventures

Research on joint ventures suggests that cultural fit between ally organizations facilitates knowledge transfer, while knowledge transfer enhances their innovativeness. Yet, from the perspective of developing nations, the antecedents and consequences of knowledge transfer remain underexplored. This study examined the mediating effect of knowledge transfer on the relationship between cultural fit and joint-venture innovation performance among Malaysian offshore international joint ventures. It made two contributions, first by examining three different constructs of innovation, namely market, strategic and behavioural; and second by using bootstrapping to test the mediating effect. The results affirm that both organizational and national cultural fit are positive determinants of knowledge transfer. However, knowledge transfer mediates the effect of cultural fit only on market and strategic innovativeness, while behavioural innovativeness is not significantly enhanced. The findings suggest that in developing countries, the effect of knowledge transfer on behavioural innovativeness is possibly moderated by other factors such as internal managerial values and government policies.