Transfer of Islamic banking knowledge from GCC Islamic bank headquarter to its subsidiary in Malaysia

The Gulf Cooperation Council (GCC) Islamic banks' subsidiaries which have invested in Malaysia have seen the going gets tough. They are strapped by paltry returns and stymied by stiff competition from the local Malaysian banks. Since the increasing competition and the slowdown of the economy have encouraged multinational banks to seek new ways to improve their internal efficiency and their performance, it has given the pivotal importance of knowledge transfer for the competitiveness of multinationals, but the process of transferring knowledge effectively across dispersed units of International Islamic banks has only attracted little and rather fragmented research interest. Thus, there is hardly evidence about how this large-scale knowledge transfer has been achieved and what knowledge has actually been transferred to the GCC Islamic banks investing in Malaysia. Therefore, the aim of this research study is to develop a comprehensive Islamic banking knowledge transfer framework that serves as a basis for future research agenda. The study focused on the cases of the Islamic banks' subsidiaries in Malaysia that are fully owned by GCC Islamic banks. The respondents were the experts who are well aware of their business to answer the survey questionnaire. This study is mixed method type of research study. A survey questionnaire was used as a guideline to compose specific questions related to the conceptual model. This is followed by interviews that were conducted with the respondents to investigate the model’s constructs and then to analyse the generated propositions in order to address the main research questions. This study tested the research propositions and found that, the integration between HQ bank and its subsidiary bank, the strategic role and the ability of the subsidiary bank to engage in Islamic banking knowledge transfer are related to the development of Islamic banking knowledge transfer capabilities. Besides that, the development of Islamic banking knowledge transfer capabilities, as well as organizational and cultural distances between HQ bank and its subsidiary bank are related to the Islamic banking knowledge transfer performance. In short, the findings of this research study have not only contributed to the literature, but also provided valuable information to both managers and policy makers on the matter of transferring the knowledge of Islamic banking. The study recommends the top management to implement KT practices that need to be made known and felt by all levels of bank units' members. Managers have to pay attention to the development of communication technologies, personal contacts, training efforts and relations of trust between the employees, because it is an important factor for a successful knowledge transfer process. Finally, the findings of this study are useful, but need to be strengthened by future research work