MMRCDISCUSSION PAPER SERIES

No. 529

Linking assignment strategy with technology transfer between
parents and subsidiaries of multinational corporations: A case ofdigital still camera in China
Masayasu, NAGASHIMA
mnagashi@fc.ritsumei.ac.jp
Ritsumeikan University
Junjiro, SHINTAKUThe University of Tokyo
Takahiro, TOMINO
Meiji University
May 2020

東京大学ものづくり経営研究センター
Manufacturing Management Research Center (MMRC)
Discussion papers are in draft form distributed for purposes of comment and discussion. Contact the author for
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Linking assignment strategy with technology transfer
between parents and subsidiaries of multinational
corporations: A case of digital still camera in China
Masayasu, NAGASHIMA
Nagashima.masayasu@kochi-tech.ac.jp
Kochi University of Technology
Junjiro, SHINTAKUThe University of Tokyo
Takahiro, TOMINO
Meiji University

Abstract
This paper aims to improve the understanding on how to implement effective technology
transfer, which is difficult for Multinational corporations (MNCs) due to organizational
barriers and market environment. We adopted an exploratory case study approach. A
conceptual framework was introduced and enriched trough a case of a Japanesemanufacturer of digital still camera (DSC).
Our case study explored that technology transfer could be achieved effectively in an
MNC if it considers the subsidiaries’ roles in both the home country and the host country
as a whole enterprise, especially when the global market environment declines drastically.
The study findings can help MNCs to achieve high-performance outcomes througheffective implementation of technology transfer.
Issues about technology transfer in the existing literature are understood mainly fromthe perspective of the role of overseas subsidiary based on an assumption of a stableglobal market environment. They are unable to provide sufficient theoretical insight into
a whole enterprise in actual unstable business environment. To address this knowledge
gap, this study provided the new insights of implementing effective technology transferfrom the perspectives of the subsidiaries’ roles in both the host country and the homecountry, which was scarce in the past research.
Keywords: Multinational corporations (MNCs), assignment strategy, technology transfer,home country, host country, market environment, digital still camera (DSC)

1. Introduction
Technological innovations have become crucial in sustaining market competition and inacquiring competitive advantage. Developing countries face difficulties in gaining
optimum benefits from technology transfer processes (Al-Abed et al., 2014). Technology
transfer in MNCs remains one of the most important subjects for research in international

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business (Buckley, 2002). MNCs as wholesalers of innovation play a significant role indiffusing technological knowledge throughout firms both nationally and internationally.
In this regard, the knowledge for international technology transfer from a parent company
to its subsidiaries is vital for both the parent and the subsidiary (Cui et al., 2006).
The host country where the technology is transferred could generate cash flow. It isalso apparent that technology transfer could promote skills and the formation of humancapital. Therefore, technology transfer brings numerous benefits to the host country.
However, timely and appropriate decision regarding technology transfer is not easy
owing to the barriers in many organizations between the parent and the subsidiaries
pursuing those benefits, since core technology transfer is a source of numerous benefits.
This is the real paradox accompanying by technology transfer.
Although there are numerous studies on technology transfer, the majority address interfirm technology transfer mainly from the perspective of the role of overseas subsidiary
based on an assumption of a stable global market environment such as growth stage. Inthat respect, a majority of cases focus on mass production by the subsidiary in developing
countries, such as China, targeting cheaper cost while the core technology is developedby the subsidiary in the home country. However, numerous industries are now facing adecline stage of the market environment, which requires a more complex management of
intra-firm transfer of technology than before. Therefore, those traditional research
approaches are unable to provide sufficient theoretical insight into an whole enterprise inactual unstable business environment.
This paper contributes to the literature by focusing on the impact of the role ofsubsidiaries in both the home country and the host country on the performance of thetechnology transfer from Japan to China in Company X, a Japanese manufacturer of DSC,
when the global demand declines drastically. DSC was chosen mainly because of frequent
drastic market changes and MNCs in this industry must adapt to those changes to survive.
The subsidiary in China is selected as a recipient of technology transfer because it
targeting cheaper cost for mass production in the past, but now is facing a different stage
to create backward integrated manufacturing. Company X is selected because it is among
the few companies that could successfully transfer the core technology of lens from Japan
to China in the DSC industry.
This paper addresses the following research question: How MNCs could implement
effective technology transfer from the perspective of the subsidiaries’ roles in both thehome country and the host country in actual unstable business environment? In order toexplore our research question, we introduce a conceptual framework modified frommodel of Birkinshaw and Hood (1996). In our discussion of technology transfer, we firstly
argue that intra-firm transfer of technology in MNC should be achieved from theperspective of the subsidiary’s roles in both the home country and the host country as awhole enterprise. In this line of arguments, we will emphasize a focus on how to promote
effective technology transfer. In our case, the focus is on how to build organizational
capabilities of a subsidiary in the host country for the absorption of the transferredtechnology. Under this focus, we draw an insight that the effectiveness of the technology
transfer process is related strongly to the performance of the capabilities of transformationof a subsidiary in the home country. However, the generalization will remain a topic for
future research.

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Our methodology is case-based. Technology transfer under a new framework iscontended in this study. It is expected to contribute both theoretically and practically to
MNCs, hence, enriching the existing literature.
2. Literature Review
The literature on the key factors associated with technology transfer from parent to
subsidiary in MNCs is reviewed. The key factors include strategy of assignment evolution,market environment and technology transfer, the concept of technology transfer, MNCs
and technology transfer, the process of technology transfer in MNCs, and performance oftechnology transfer.
2-1. Strategy of Assignment
Researchers typically assume that ownership advantages are developed at the corporate
headquarters and leveraged overseas through the transfer of technology to a network offoreign subsidiaries (Dunning; 1981; Vernon, 1966). As these overseas subsidiaries
expanded and developed their unique resources, many studies showed that the corporate
headquarters was no longer the sole source of competitive advantage for an MNC. The
earlier literature developed models such as transnational (Bartlett and Ghoshal, 1989) toreflect the critical role played by many subsidiaries in the competitiveness of corporations.
Then, academic attention shifted to understanding the new roles played by subsidiaries.
Implicit in this shift in academic attention has been the concept of subsidiary evolution.
It is well known that subsidiaries evolve over the years, typically through accruing
resources and development ofspecialized capabilities (Hedlund,1986; Prahalad and Doz, 1981).
Several established typologies
exits that suggest varied roles andresponsibilities for subsidiaries(e.g., Bartlett and Ghoshal, 1986;
Gupta, and Govindarajan, 1991,
1994; White and Poynter, 1984).
To understand how subsidiaries
modify their roles, Birkinshaw
and Hood (1996) proposed
generic processes of subsidiaryevolution and identified thecontextual factors expected toinfluence each factor from thehead office assignment, subsidiarychoice, and local environment
determinism
perspective (Figure
Figure 1- Frame of Birkinshaw and Hood (1996)
1).
Although there are several researches on MNCs, they are mainly from the perspectiveof subsidiary’s role in the host country, but not in the home country.
Market Environment and Technology Transfer

3Cui et al. (2006) state that country-specific environments determine the nature andintensity of competition, the mechanism of organizational transactions, and the input–
output motion of local industries. Furthermore, a firm’s strategic initiatives arise directlyfrom the environment within which it operates. Environmental factors form the basic
ingredients based on which firms make strategic decisions. Miles and Snow (1978)
contend that the market environment is responsible for the strategic orientation of a firm.
By aligning certain general strategies with the market environment conditions, the firm
could optimize performance.
In a competitive market, the key garner competitive edge is to provide inimitable andhigh-quality products to local consumers. Technology transfer from the parent company
allows subsidiaries to reduce production costs and prices, adapt product design to thegrowing demands of the local market, and improve product quality, thus, enabling themto compete for market shares (Fazal et al., 2016).
Although the strategic initiatives of a firm for technology transfer are a directconsequence of the market environment, the extant literature largely addresses the issues
related to the growth stage of the product lifecycle in a market environment when MNCs
pursue cost reduction, but are not related to other stages of the lifecycle such as the decline
stage, which requires more difficult management.
2-2. The Concept of Technology Transfer
The process of technology transfer may appear as simple as shifting codified informationfrom one organization to another or as complex because the ability to understand and use
information varies. Farizah and Mohd (2012) state that technology transfer consists ofthree basic stages: planning or strategy building, negotiation, and implementation. This
would result in successful technology transfer and not just exchange of information
between parties. Rahimi et al. (2013) stated that technology transfer is a substitute fordeveloping and adopting technology from others. Minbaeva et al. (2003) define
technology transfer as a process that initiates when the technology-receiving unit begins
utilizing the transferred technology. The key element in technology transfer is not theactual knowledge; instead, it is the extent of a receiver’s capabilities to use the newknowledge in their own operations. Al-Abed et al. (2014) recognized technology transfer
as an extensive and complicated process for both the sender and the receiver oftechnology, whereby the recipient must be able to utilize, reproduce, improvise, and resell
the innovation at the end of the process. In contrast to transferring general goods,
technology transfer is highly specialized and complex because the delivery is successful
only when the transferred technology is used and it adds value to the receiver’s
competencies (Teasley et al., 2005).
However, these researches on the concept of technology transfer focused mainly on thesubsidiary, and did not focus on both the subsidiary and the parent company.
2-3. MNCs and Technology Transfer
MNCs are established as both major manufacturers of technology and as a channel forthe bulk transferring of technology. Technology transfer by multinational organizations
is considered as intra-firm transfer because the property rights are not shared with any
external party. Nune (2012) stated that MNCs can transmit technology to foreign
associates in both tangible and intangible forms. According to Gunter and Philipp (2014),

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MNCs are highly dynamic in making innovative technologies accessible by purchasing
spin-offs or employing them as service providers.
Transfer of core technology has numerous benefits. However, timely and appropriate
decision regarding technology transfer is not easy owing to the barriers in manyorganizations between the parent and the subsidiaries pursuing those benefits, since coretechnology transfer is a source of numerous benefits.
2-4.Performance of Technology Transfer
Waroonkun (2007) defined technology transfer performance as a result obtained by local
counterparts through employing technology transfer projects with foreign affiliates. Froman organizational perspective, Rose et al. (2009) stated that technology transfer
performance comprises learning, acquiring, absorbing, and utilizing capabilities ofinnovative external knowledge and technologies deeply entrenched within the materials
of product, tangible assets, production and procedures, and management skills, and is notjust limited to possessing the capacity of operating, maintaining, or repairing machineries
at the level of production.
Earlier studies categorize technology transfer performance based on four stages(Bradley et al., 1995; Narayanan and Lai, 1993; Santikarn, 1981). The first stage includes
initiation when the technology is transferred to the recipient. In the second stage, the local
workforce should be trained to skillfully employ the technology. The third stage specifies
that technology is transferred only when it is disseminated among the different units of
the recipient company through dynamic distribution activities. The fourth stage stipulates
that when workers are able to adapt the transferred technology to the needs of their
particular business environment, then, technology transfer is deemed successful.
Thus, prior literature on technology transfer performance considers mainly from theperspective of the subsidiary although the success of technology transfer cannot be judged
solely by considering the subsidiary alone.
3. CasesThis paper considers an exploratory case study of supply chain collaboration in the realworld. Yin (1994) claims that case studies are most appropriate for exploratory research.
A Japanese manufacturing Company X makes digital still camera in a product assembly
factory of a subsidiary in China, a lens (aspheric lens and lens units) component factory
in a subsidiary in north Japan, with the R&D head office in central Japan. In Company X,
in-house production of aspheric lens and lens units are defined as black box technology
to achieve the best picture quality, which are regarded as their competitive advantages.
This study highlights technology transfer from one lens factory in Japan to an assembly
factory in China.
The cases represent a series of activities of backward integrated manufacturing in
China with the support of core technology transfer of lens from Japan. This coretechnology transfer helped the factory in China to make significant financial
improvement in 2015, recovering from the past financial deficit while the global market
of DSC declined to almost one-third in quantity and almost half in amount in 2015 versus
2010.
The case study period is categorized into three to illustrate the notable characteristicsof the activities of technology transfer: before 2011 (the time prior to these efforts ofbackward integrated manufacturing), from 2011 to 2012 (the first phase of backward5

integrated manufacturing), and from 2013 to 2015 (the second phase of backward
integrated manufacturing).
3-1. Data used
To confirm the validity and reliability of the research results, three different sources ofdata were used for this case study. First, qualitative data were collected by conducting indepth interviews with 22 diverse executives from Company X from 2015 to 2017. Thoseinterviewed included 5 managers from the head office in Japan, 5 from the lens factoryin Japan, and 12 (6 each Japanese and Chinese managers) from the assembly factory ofCompany X in China. These managers are responsible for planning, R&D, procurement,
production, and marketing as they are in a core position to obtain information to identify
the background, motives, objectives, structures, processes, roles and responsibilities, andperformance evaluation between head office and subsidiaries. Each interview was
documented carefully with their permission. All the interviews were tape-recorded anddocumented in detail. Formal, structured interviews were conducted to maintainconsistency. Post interview analysis included comparison of the multiple interview resultswith the findings of earlier studies and additional questions were probed as needed.
Appendixes A and B summarize the interview details and structured questionnaire.
Second, performance results and evolution of the Company’s X factory in China from2011 to 2015 are used as a key performance indicator of the adequate retaining ability of
beneficiaries to transfer the technology. The comparative figures of the sales, fixed cost,
marginal profit ratio, stock days, and profit ratio during 2011–2015 were collected. Suchlongitudinal case studies allow the examination of the stable and up-to-date evolving setsof manufacturing practices.
Third, to measure the global demand of DSC, the market data from 2009 to 2015 wereobtained from Camera and Imaging Products Association (CIPA) in Japan. The market
share data for Japanese manufacturers in 2011 of GfK, a market demand researchcompany, were also used.
3-2. Digital Still Camera Market
Owing to commoditization of the compact category and decline in total demand, there
has been stiff competition in the digital camera market. Camera-embedded smart phones
have posed a big threat. There has been a sharp decline in the global demand for thecompact category of DSCs since 2010. The global demand in 2015 versus 2010 was at
level of one-third in quantity base, half in amount base (Table 1). Table 1 shows the global
shipment evolution of Japanese manufacturers for DSC from 2009 to 2015 based on datafrom the CIPA in Japan. Since Japanese manufacturers represent a majority of the global
market share for DSCs (77.9% for total DSC, 99% for interchangeable lens camera in2011 based on the Gfk in Table 2), global shipment evolution of Japanese manufacturers
for DSC could indicate the basic trend of the global market demand for DSC.
Table 1-Global demand evolution of DSC (Shipment base by Japanese Manufacturers)

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(Source: data of Camera and Imaging Products Association in Japan)
Table 2-Global market share of DSC by Japanese Manufacturers(Source: Gfk/Jan–Dec 2011)
When the market is in the growth stage, the global assignment between parent andsubsidiary of MNC had been operated mainly based on cost, such as mass production in
China as the host country, because of the cheap cost targeting for more business growth
while the core technology developed in the home country. However, when the global
market environment deteriorates such as in this case, Company X had to redesign thestrategic assignment globally to overcome the challenges.
Contrary to the compact camera category, the demand for interchangeable lens camera
category such as single-lens mirror-less or reflex camera has been increasing, because of
the increased needs created by the development of social network service to capture good
pictures without spending too much money.
Customers look for a product with desired features at the lowest possible price basedon reputation and brand. For manufacturers, the pressure on price was tremendous
because of the severe competition.
3-3. Digital Still Camera manufacturer Company X
Company X is one of the world’s largest electronics manufacturing MNCs. It
manufactures and markets a wide range of products under the Company X brand.
Company X’s head office is located in the center of Japan and operates one coretechnology factory for aspheric lens, lens units, and interchangeable lens camera in northof Japan and an assembly factory for total line up of compact category camera in China.
Compact category camera is now characterized by components having standardized
interfaces, while interchangeable lens camera category includes components that are still7

in close spatial relationship to each other and are highly synchronized and coordinated.
As the compact category is already commoditized, Company X has been focusing on
interchangeable lens camera category and lens units in which Company X could establish
competitive advantages of manufacturing.
3-4. Aspheric Lens
Aspheric lenses technologies are important because they support the features of compact
size, lightweight, and high-quality image of products. To assure a superior image quality
while the reducing size and weight, the lenses of Company X feature a number of asphericlenses that could lead to a smaller and lighter product. However, aspheric lenses are
extremely difficult to produce because they require a high level of accuracy.
There are two kinds of lenses: glass and resin. Reliability is critical for a glass lens thatis used mainly for automotive manufacturers, such as security camera in the car. Resinlens is for middle- to low-end use, such as the compact category of DSC.
3-5. Assembly Factory in China
Company X’s factory in China that assembles DSCs is facing challenges to the
profitability owing to the stiff competition. Although at the maturity stage of digital
camera product lifecycle and stiff cost competition, the subsidiaries of Company X for
DSC manufacturing were operated individually and the global operation from theperspective of total optimization was not executed yet. The factory in China wasenvisaged as a low-cost DSC production facility in the group.
In 2011, Mr. Y was assigned as the new managing director of China factory. He thoughtthat the China factory would face huge problems when the market growth had saturated
because there was no competitive advantage as a manufacturing factory and the major
concerns of the China factory had been how to produce the ordered quantities of products
without examining the customers, market, and competitors. In addition, he thought that
there was no other way than to build a mechanism to clarify the role of each subsidiaryand head office to maximize the strengths of total group to consolidate competitive
advantages.
Under those circumstances, the China factory took up a challenge from 2011 to 2015
to build fundamental organizational capabilities for backward integrated manufacturingwith the support of the transfer of core technology from Japan to China.
3-6. Preparing for Technology Transfer (2011)
First, Mr. Y sensitized all departments to the sense of crisis that the company would
collapse if this situation continued. In parallel, repeated training was conducted toenhance the organizational capabilities for manufacturing. He also changed the wage
system according to the degree of contribution. Hence, a sense of crisis was shared and a
relationship of trust and interdependence was constructed gradually.
He focused on strengthening the factory based on three factors: equipment
implementation, assembly line, and Supply Chain Management (SCM). Regarding
equipment implementation, as equipment was often introduced with highly priced
specification designed by the parent company in Japan, he downsized it locally in China
to low-priced specification and used it exhaustively for 24 hours. Regarding the assembly
line, he designed a line process based on postponement management in which thestandardized parts were shared as much as possible until the finished product was rolled

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out. Regarding SCM, there were significant improvements in the production lead-time(lead-time from the receiving orders to finishing the production) reduced by half as theresults of improvement of purchasing process. All these improvements strengthened thebasic capabilities for manufacturing.
3-7. First Phase of Backward Integrated Manufacturing (2012)
In 2012, an important action taken was the transfer of the lens units and resin lens fromthe lens factory in Japan to China although they were the source of competitive
advantages for the DSC business of Company X. This is because resin lens was requested
for further cutting down of the cost for middle- to low-end use such as compact category
camera of DSC and the strong request for transfer from Mr. Y in China factory was madeto the lens factory in Japan.
Consequently, the China factory could utilize all the support from Japan, including theabundant know-how on molding that, in turn, led to enhancing the organizational
capabilities for backward integrated manufacturing in the China factory.
3-8. Second Phase of the Backward Integrated Manufacturing (from 2013 to 2015)
After establishing the strengths for equipment implementation, assembly line, and SCM,
Mr. Y began to prepare for the development of new capabilities for the molding of lens.
Generally, it takes nearly 10 years to build adequate capabilities with the necessary knowhow to set up the molding business; however, he asked the parent and subsidiary in thehome country to quickly share and transfer all the necessary know-how for molding, andthe home country made the necessary arrangement for them.
After a series of activities of backward integrated manufacturing in China with thesupport of core technology transfer of lens from Japan, the factory in China achieved
significant improvement of financial figures in 2015 (Table 3), recovering from the pastfinancial deficit while the global market of DSC declined to almost one-third in quantityand almost half in amount in 2015 versus 2010.
Table 3- Performance evolution of China factory

Notes: Figures in 2015 are calculated based on the index 100 in 2011
3-9. Lens Factory in Japan
Lens molding and lens units are produced as core technology of Company X in the factoryof north of Japan since 1987.
Behind the important action in 2012 to transfer the lens units and resin lens from thelens factory in Japan to China factory was the challenge of the lens factory in Japan. The
transfer was to focus to produce glass lens technology to promote the diversity of thebusiness from B2C to B2B based on the core technology of glass lens. Consequently, they9

could realize the high reliability of glass lens at the level of heat resistance and durability
requested from B2B customers. To build a competitive advantage, the lens factory inJapan focused on developing B2B customers who appreciate the value of its imaging
products properly.
4. Discussion
Through a series of interviews, we examined the practices of technology transfer of aJapanese manufacturer of DSC that are now facing a drastically declining market
environment. Figure 2 is an application of our model as an analysis frame to our casesthat is modified from the model of Birkinshaw and Hood (1996). It shows how global
assignment evolution in the home and the host country could be managed for effective
technology transfer.
Company X’s behavior in the case can be conceptualized by this new framework,
which enabled it to achieve high-performance outcomes. Effective implementation oftransfer technology depends on not only a function of how well a subsidiary in a hostcountry evolves, but it also depends on how well a subsidiary in a home country (homecountry–based division) evolves, by taking into account of three factors, such as head
office assignment, subsidiary choice, and local environment determinism. As thisframework shows, the dyadic relationships between the home country and the hostcountry in the same MNC are important for the success of transfer technology. Thosedyadic relationships could help to develop new capabilities in the face of changing
environments and evolving competition. MNC will sustain its competitive advantage only
if it can continue to develop new capabilities such as our cases.

This
study
（modified from model of Birkinshaw and Hood (1996)）
explored threeimportantfindings. First, transfer of core technology is related to the source of competitive
advantage in the home country; therefore, a timely and appropriate decision of technology
transfer could not be taken owing to several organizational barriers. However, the transfer

Figure 2- Framework of global assignment evolution for effective technology transfer

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of core technology of lens was made possible in this case because of the organizational
capabilities of transformation of the subsidiary in the home country (home country–based
division).
Second, the role of the home country did not end with technology transfer alone. It
continued to help to build organizational capabilities of the overseas subsidiary withsupport ranging from the molding of resin lenses to human support.
Finally, these organizational capabilities in the home country would become theresources for the next step of growth in the long term as a total MNC, such as future B2B
business of the subsidiary in China.
5. Conclusions
Technology transfer is critical to sustain market competition and acquire competitive
advantage. It remains one of the most important subjects in MNCs research ininternational business (Buckley, 2002). However, owing to the complex process withmany organizational barriers to pursue those advantages and direct influences from thecontext market environment, technology transfer is very complex and difficult for MNCs.
Research on technology transfer focused on the overseas subsidiary’s role based on arather simple assumption of global market environment of growth. However, numerous
industries are now facing a decline stage of market environment, which requires a more
complex management of intra-firm transfer of technology than before. Our case study
explored that intra-firm transfer of technology could be achieved effectively in an MNC
if it considers the subsidiaries’ roles in both the home country and the host country as awhole enterprise, especially when the global market environment declines drastically.
The study findings make some important theoretical contribution. First, to achieve
high-performance outcomes, it is meaningful to discover a new framework for effective
implementation of technology transfer for MNCs who have difficulty in making timely
and appropriate decisions.
Second, the head offices of MNCs should make effective decisions on technology
transfer on how to support to overseas subsidiaries for successful implementation.
Finally, there is a need for stronger initiatives to have an independent ownership in thesubsidiaries in both the host country and the home country to develop new capabilities in
the face of changing environments and evolving competition, which in turn facilitatebuilding competitive advantage for the whole MNC.
The study provided those new insights of implementing effective technology transferfrom both the perspectives, that is, of the subsidiaries’ roles in the host country and in thehome country, which was scarce in the past research.
However, the study has some limitations. First, a sample of cases from various
industries across various countries should be used to test the model outlined and the
propositions made. The case of DSC in consumer electronics helped to test the issue oftechnology transfer and develop new concepts; however, the generalization of the study
findings requires further investigation. Second, the study cases do not explore how asubsidiary in a home country (home country–based division) can build its capabilities oftransformation as the key for success of transfer of core technology. Research on thedesirable states is abundant, but few suggest how to realize such desirable states. This
study would be on the next agenda. Finally, the cases were chosen such that the dyadic
relationships between the home country and the host country in the same MNC could behighlighted. Expanding the present framework to supply chain networks to include the11supplier partners could be a final promising avenue for research to further test theframework and enrich it.
In conclusion, our framework of global assignment evolution for effective technology
transfer introduced in this study is expected to provide meaningful insights from both thetheoretical and practical standpoints. It opens up a new approach to study the impact of
the subsidiaries’ roles in both the home country and the host country on the performanceof the technology transfer process.
Acknowledgments
This study was supported by the grant by Japan Society for the Promotion of Science in2014 (Code: 26380536), 2015(Code: 15H01960 and 15K03669) and 2017 (Code:17H02
568) and 2018 (Code: 18H00888). We sincerely express our gratitude to the Society forthe support.
Appendix A. Interview details (date, organization, department, position andinterview length)
The methodology and execution of the research are designed as follows: The researchteam (at least two people) visited each organization and met the executives at different
times. The scheduling involved structured processes: (1) initial inquiries, (2) explanationsof the purpose of the research, (3) permission from the individuals and their firm, and (4)then the actual interviews. Group interviews are conducted with all core functions of
manufacturing such as Managing Director, R&D, procurement, production, andmarketing when we visited the lens factory and assembly factory to understand the total
flow of value chain for manufacturing. (5) Each interview was carefully recorded anddocumented for accuracy.
To ensure consistency, accuracy, and reliability of information gathered, multiple
interviews for each organization were conducted. Post interview analysis included acomparison of our multiple interview results with the previous literature findings andadditional questions were explored as needed. The interview period extended from 2015
to 2017 because of (1) the nature of the longitudinal project and (2) study of up-to-date
evolving manufacturing practices of the firm. All the interview details are the basis of
this study. To secure the confidentiality with the firm, the names have been changed.

12Appendix B. Structured interview questions
In this interview, the focus of our questions is your firm’s organizational effort toimplement the technology transfer successfully.
(1) Macro-Issues related to technology transfer
1.1 What is the global strategy of DSC including the strategy of both parent and overseas
subsidiaries in your firm?
1.2 What are the competitive advantages for your core technology?
1.3 How head office decides the allocation of activities to several overseas subsidiaries?
1.4 What are the primary reasons for transfer of core technology from parent to overseas
subsidiaries?
1.5 What is the definition for mission and goals of each organization and organizational
processes for transfer of core technology from parent to overseas subsidiaries?
1.6 What kind of supports from parent to overseas subsidiaries are implemented and towhat extent?

13

1.7 What is the evaluation method to measure the performance for parent and overseas
subsidiaries?
(2) Micro-Issues related to parent/subsidiaries and environment
2.1 􏰂What are the specific organizational processes (including organizational decision
processes) for transfer of core technology?
2.2 What are the performance results of parent and overseas subsidiaries?
2.3 What is the global demand evolution of DSC?
2.4 How do you evaluate the current market environment?
2.5 How do you react to market environment changes?
(3) Issues with Implementation of transfer of core technology
3.1 What are the primary obstacles that prevent from successful transfer of coretechnology?
3.2 What factors drive the successful transfer of core technology?
3.3 What is the lead-time to accomplish to transfer of one core technology from parent
to overseas subsidiaries?
3.4 How to develop the organizational capabilities of both parent and overseas
subsidiaries?
3.5 To what extent does your organization share information with yourcounter parts inoverseas subsidiaries (question to parent company)? To what extent
does yourorganization share information with your counter parts in parent
company (question
to overseas subsidiaries)?
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