Innovation in multinational firms: Does cultural fit enhance performance?

Using a dataset of 139 R&D laboratories located in 21 countries, this study empirically tests whether a fit among R&D laboratory mission and national culture impacts R&D performance. Specifically, we assume that some cultures possess a natural advantage when it comes to capability augmenting tasks, while other cultures are better suited to host capability exploiting tasks. Where the mission of the laboratory is capability exploiting, our results support a positive effect of culture-mission alignment. However, no relationship between mission-culture alignment and performance can be found in case of capability augmenting laboratories.