The effect of experiential learning on subsidiary knowledge and performance

The importance of knowledge in international business is clear; however, little evidence exists on how multinational subsidiaries learn and acquire knowledge in their host country networks. This research presents a conceptual model of experiential learning building on the resource-based view and internationalization theory. The novelty of this research lies in focusing on the subsidiary manager as the learning agent. The study concentrates on technological and market knowledge learning from host country networks. The research contributes to existing literature by providing an experiential learning model (ELM) on subsidiary managers' experiential learning in host country networks, and that experiential learning's influence on subsidiary knowledge and subsidiary's performance. The manager's experiential learning adds to the subsidiary's knowledge, helping improve trust in network relationships and leading to identification of opportunities. The subsidiary, through experiential learning flow, internalizes the knowledge that helps fill the subsidiary's knowledge gap and influences that subsidiary's performance.