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From “Toyotas hybrid technology will be Domestic” to see Subsidiaries of foreign parent knowledge transfer to ChinaToyota (China) put Core component of the hybrid system, including two core components of the battery and electric motor, into production to china, which has been an identified plan. However, the specific time of the project is still in discussion stage. This is the first Toyota put the core components of hybrid technology into the overseas production, Toyota will be the first foreign companies to take the energy saving technology into China. Industry analysts point out that Toyota selected core parts in China, reflecting its importance to the Chinese market and the determination of the Chinese market.Subsidiaries of foreign parent knowledge transfer to ChinaAmong all the resources in the enterprise, knowledge is the most strategic resource. Knowledge to provide enterprise mobility, new knowledge provides organizations with the ability to update. In this paper attention been put to Chinas joint venture in the foreign parents knowledge transfer.Willingness to transfer knowledge of foreign parentThe will of Transfer of knowledge of the parent company determine the extent of knowledge transfer. Multinational companies to transfer knowledge to the subsidiary depend on the following three factors: First, the Chinese subsidiary importance; Second, the number of shares in the subsidiary; Third, intellectual property protection. Joint venture partnership between the partners will carry out knowledge transfer of foreign parent company will have some impact.The importance of Chinese subsidiaryEven if the companys internal knowledge transfer also requires a lot of cost. Obviously, the cross-border knowledge transfer, this cost is higher, because of cultural, economic, and political and other differences make knowledge transfer more difficult. Multinationals can be seen as a network consisting of its subsidiary, the parent companys global strategy, a subsidiary of the position occupied by the severity of each is different. Because of limited resources can be allocated, usually the parent company to invest more resources in the knowledge transfer to its global network of subsidiaries play an important role, for example, is responsible for the global market development, production and marketing of new products subsidiary. Accordingly, the status is not so important where a subsidiary from the parent company will receive the attention and support is very limited. That Chinese subsidiary been put in an important position by the parent company will usually get more management and technical support. For example, Motorola believes it is essential to operate in China. In a word, the parent company of the overseas investment project depends on the projects importance for the company.The number of shares heldPrevious studies have shown that the parent companys stake in the subsidiary to its direct impact on how much the transfer of knowledge to the subsidiary level. Has entered a joint venture or other forms (such as technology licensing) compared to the parent, the parent company has owned enterprises are more willing to transfer its experience to the subsidiary. In contrast to joint ventures, multinational companies in China for its wholly-owned company shifted more advanced knowledge.Wholly owned and joint ventureWith the Chinese government hopes to establish a joint venture runs counter to the desire to promote knowledge transfer, and compared to the parent company has a joint venture with the parent company of wholly owned companies are more willing to transfer its experience to the subsidiary. There are three reasons: First, if there is no interference of appoint officers by Chinas parent company, foreign parent transfer of knowledge, culture and values to the Chinese subsidiaries, will be relatively easy. In addition, the wholly-owned subsidiary of parent company makes a high degree of control over a subsidiary does not worry about the technology being transferred to the leak, and therefore more willing to transfer more advanced technology to a subsidiary. In the joint venture, the technical risk of leakage is relatively high, because the transfer of foreign parent can not control the whole process. Second, knowledge transfer need to be trained, in the case of wholly-owned, foreign subsidiary of the parent company may decide spent on staff training expenses. If a joint venture with other companies, it will need to be discussed with partners. Third, if a sole proprietorship, the transfer of management and technical experience all the benefits of the full enjoyment by the foreign parent company, without sharing with other Chinese partners, which also encourage technology transfer from foreign parent wishes.The majority of shares, the average shares and minority joint ventureAnd hold a minority interest and equity of the foreign parent company, compared to the average, the foreign parent company holds a majority stake in its management will be more willing to transfer experience and technology to China subsidiary. This is due to hold a majority stake in a subsidiary of the foreign parent company is usually able to get the daily operation and management, and therefore more active in technology transfer.Protection of intellectual propertyCompanies may fear leakage of core technology and loss of competitive advantage not to have the transfer of key technologies. On the other hand, companies may worry that the hard-won experience to the subsidiarys success does not necessarily get the corresponding reward or anxiety boomerang attack. If a subsidiary of the countries in which have serious violations, the parent company will not invest in which requires establish high-tech industries or facilities with the latest technology, and the will of transfer of high technology will also be greatly reduced.Although China has had the development of intellectual property protection in recent years, but the link is still relatively weak. As Chinas intellectual property legislation and enforcement is not perfect, the foreign company to transfer advanced technology to protect the property rights very difficult. As a result, the foreign parent is not willing to transfer advanced technology to China subsidiary(White Paper on American Business in China, 2001)。PartnershipGood working relationship will help build understanding and trust between partners. After the study of informal relationships, the status of IPR protection in China and other factors, Trust between the partners for the long-term success of joint venture projects have an important role. While High degree of trust once established, partner will not fear each other to have much speculation and self
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