Regional Headquarters and Their Impact on Knowledge Transfer Processes in Transnational Companies - A 'Small World' Network Perspective

What role do regional headquarters (RHQ) play in the process of spreading knowledge in the internal and external network of transnational companies (TNC)? In our paper we approach this topic based on an understanding of TNC as ‘small world’ networks – a concept from the field of social psychology introduced by Milgram (1967). We employ this concept to show that RHQ as knowledge hubs foster knowledge transfer and competence building within TNCs. The main contribution of our paper is that we develop a formalized approach that provides a proof that RHQ can considerably influence information and knowledge transfer processes in TNCs. By doing so, we try to reduce a gap in research on RHQ.