Who Needs to Know What? Institutional Knowledge and Global Projects

Projections for future demand in infrastructure and buildings indicate that there will be increasing opportunities for firms to engage in construction projects around the world. However, international construction projects also face numerous uncertainties. Foreign firms engaged on these projects must work in unfamiliar environments, with differing regulations, norms, and cultural beliefs. This can increase misunderstandings and risks for the entrant firm. To reduce these risks, successful international firms strategically increase their understanding of the local area by collecting knowledge that is important for a given foreign project. This study compiles and analyzes data from 15 case studies of three types of international firms (developers, contractors, and engineers) engaged in international infrastructure development to identify the types of institutional knowledge that informants indicate are important for their international projects. Using institutional theory, we categorize the kinds of knowledge about foreign country operations that managers deem to be important, expanding prior studies by attending to normative knowledge in addition to regulative and cultural knowledge. Finally, we analyze the importance of different categories of knowledge according to firm type. This analysis provides entrant firms a tool to help identify important types of institutional knowledge to collect as they undertake international projects.

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