the process of external knowledge transfer to developing...
TRANSCRIPT
The process of external knowledge transfer to developing countries An empirical research about its main influencing factors & barriers
Authors: Christian Fauss Adrian Schwenke
Tutors: Philippe Daudi
Mikael Lundgren
Program: Master’s Program in Leadership and Management in International Context
Subject: Leading knowledge transfer and organizational learning
Level and semester: Masterlevel Spring 2008 Baltic Business School
i
ABSTRACT
In the purest sense of the term, the transfer of knowledge deals with certain activities that attempt to
pass on knowledge to another unit. In the course of globalization, companies seek nowadays the
collaboration with other companies or organizations in developing countries, in order to benefit
from several advantages like reduced labor costs. Next to that, a myriad of companies or
organizations carry out projects with partners that are situated in developing countries, only with the
attempt to fill the gap of knowledge between developed and developing world – knowledge that is
particularly needed in those countries in order for them to reach certain standards of living and to
keep up with the rapid development that takes place in other parts of the world.
This paper investigates with the help of five selected cases the impact of the main influencing factors
and barriers on the success of this type of knowledge transfer, as they are perceived by companies
from developed countries. Thereby, this paper aims at providing information about their importance
in the corresponding contexts and at giving inspiration on the ways these factors can be dealt with.
The exploratory results suggest that by covering specific aspects from the beginning, the companies
or organizations involved can overcome the majority of the factors and barriers. Furthermore, it is
pointed out that the importance of each factor varies heavily depending on the context: the process
of internal knowledge transfer requires the companies to concentrate their attention on different
aspects than in the context of external knowledge transfer.
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ACKNOWLEDGEMENTS
“Learning for life and not for work”
Are commonly known as wisdom words,
But describing what we’ve learned these weeks,
Is inestimable knowledge
We’ll forever keep.
Provided us a look inside
In their knowledge processes global wide,
We’d like to thank the following,
Companies, organizations, women and men:
Swedfund, Arne Georgzén,
Kalmar Kommun, Anders Engström,
Tetra Pak, Gert Ekdahl,
Borlänge Energi, Ronny Arnberg,
Nutek, Nadja Berger,
Without whom the work would not look the same.
Expressing our gratitude
To our tutors
For their supporting attitude.
Philippe Daudi and Mikael Lundgren,
With giving feedback, critique and ideas.
In times of desperation,
They gave relieving thoughts of motivation
Which kept us from defeat
To make our work complete
Finally, a thankful word,
To family and friends for their support.
Endowing us inspiration, time and understanding,
Enabling us to let it splendidly ending.
Christian Fauss Adrian Schwenke
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TABLE OF CONTENTS
LIST OF FIGURES ............................................................................................................................... v
LIST OF TABLES ................................................................................................................................vi
LIST OF ABBREVIATIONS ............................................................................................................. vii
1. INTRODUCTION ............................................................................................................. 1
1.1 Background ........................................................................................................................................................ 1
1.2 Problem discussion ........................................................................................................................................... 5
1.3 Research Question ............................................................................................................................................ 6
1.4 Classification of the research objects ............................................................................................................. 7
1.4.1 Knowledge transfer ...................................................................................................................................... 8
1.4.2 Developed countries .................................................................................................................................... 8
1.4.3 Developing countries and emerging markets ........................................................................................... 9
1.5 Purpose and Objective .................................................................................................................................. 10
1.6 Scope and Limitations ................................................................................................................................... 11
1.7 The disposition of this paper ....................................................................................................................... 12
2. THE KNOWLEDGE BEHIND KNOWLEDGE AND ITS MANAGEMENT ............ 13
2.1 Knowledge ....................................................................................................................................................... 14
2.1.1 Data, information and knowledge .......................................................................................................... 14
2.1.2 Definition of knowledge .......................................................................................................................... 16
2.1.3 Forms of knowledge ................................................................................................................................. 17
2.2 Knowledge management .............................................................................................................................. 24
2.2.1 Definition of knowledge management ................................................................................................... 25
2.2.2 Theoretical approaches towards knowledge management ................................................................. 26
2.3 Summary .......................................................................................................................................................... 34
3. THE KNOWLEDGE BEHIND KNOWLEDGE TRANSFER ...................................... 36
3.1 Definition of knowledge transfer ................................................................................................................ 36
3.2 The process of knowledge transfer ............................................................................................................. 37
3.2.1 The communication model ...................................................................................................................... 37
3.2.2 Spiral model by Nonaka and Takeuchi .................................................................................................. 39
3.3 Stages of knowledge transfer ........................................................................................................................ 44
3.4 The ten knowledge strategy issues .............................................................................................................. 47
3.5 The barriers and influencing factors of knowledge transfer ................................................................... 50
3.5.1 The influencing factors and barriers of internal knowledge transfer (Szulanski) ............................ 52
3.5.2 Additional overview of potential barriers inhibiting internal knowledge transfer .......................... 55
3.5.3 Possible main influencing factors and barriers of external knowledge transfer .............................. 57
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3.6 Summary .......................................................................................................................................................... 62
4. METHODOLOGY ........................................................................................................... 64
4.1 Research philosophy – Positivism and Interpretivism ............................................................................. 64
4.2 Research approach ......................................................................................................................................... 66
4.3 Data collection ................................................................................................................................................ 67
4.3.1 Primary Data .......................................................................................................................................... 67
4.3.2 Secondary Data ..................................................................................................................................... 67
4.3.3 Quantitative and qualitative research ................................................................................................. 68
4.4 Applied approach: The qualitative interview ............................................................................................. 69
4.4.1 The Interview ............................................................................................................................................. 69
4.4.2 Data analysis ............................................................................................................................................... 80
4.5 Trustworthiness of the research .................................................................................................................. 82
5. EMPIRICAL FINDINGS AND RESULTS ..................................................................... 84
5.1 Case descriptions ............................................................................................................................................ 84
5.1.1 Swedfund .................................................................................................................................................... 85
5.1.2 Kalmar Kommun ...................................................................................................................................... 86
5.1.3 Tetra Pak ..................................................................................................................................................... 89
5.1.4 Borlänge Energi ......................................................................................................................................... 90
5.1.5 Nutek ........................................................................................................................................................... 91
5.2 The influencing factors and barriers ........................................................................................................... 92
5.2.1 Strong ties ................................................................................................................................................... 92
5.2.2 Organizational factors ............................................................................................................................... 98
5.2.3 Knowledge characteristics ...................................................................................................................... 103
5.2.4 Knowledge management factors ........................................................................................................... 108
5.2.5 Individual factors ..................................................................................................................................... 111
5.2.6 Further findings ....................................................................................................................................... 113
5.3 Summary ........................................................................................................................................................ 117
EXHIBIT: Internal vs. external knowledge transfer ..................................................................................... 120
CONCLUSION ................................................................................................................................. 124
6. FINAL DISCUSSION AND OUTLOOK ...................................................................... 126
BIBLIOGRAPHY .............................................................................................................................. 132
APPENDIX 1: The interview questions ....................................................................................... 139
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LIST OF FIGURES
Figure No. 1.1 The connection between the research questions ........................................................... 7
Figure No. 1.2 The disposition of the paper .......................................................................................... 12
Figure No. 2.1 Data, Information and Knowledge ............................................................................... 15
Figure No. 2.2 Continuum of data-information-knowledge ................................................................ 16
Figure No. 2.3 The different forms of knowledge ................................................................................ 18
Figure No. 2.4 Declarative and procedural knowledge ......................................................................... 21
Figure No. 2.5 Individual, collective and organizational knowledge .................................................. 22
Figure No. 2.6 The knowledge bearers in an organization ................................................................... 24
Figure No. 2.7 Building blocks of knowledge management ................................................................ 27
Figure No. 2.8 The knowledge management value chain ..................................................................... 31
Figure No. 2.9 A framework for strategic knowledge management ................................................... 32
Figure No. 2.10 Summary of Chapter 2 .................................................................................................. 35
Figure No. 3.1 The communication model by Shannon ...................................................................... 38
Figure No. 3.2 The spiral of knowledge .................................................................................................. 41
Figure No. 3.3 Stages of the knowledge transfer process ..................................................................... 44
Figure No. 3.4 The stages of knowledge transfer .................................................................................. 46
Figure No. 3.5 The ten knowledge strategy issues ................................................................................. 48
Figure No. 3.6 The barriers of knowledge transfer ............................................................................... 55
Figure No. 3.7 Influencing factors and barriers of external knowledge transfer .............................. 58
Figure No. 3.8 Summary of Chapter 2 +3 .............................................................................................. 63
Figure No. 4.1 The research model derived from the theory .............................................................. 78
Figure No. 4.2 The analysis framework ................................................................................................... 81
Figure No. 5.1 Swedfund logo .................................................................................................................. 85
Figure No. 5.2 Kalmar Kommun logo .................................................................................................... 86
Figure No. 5.3 Tetra Pak logo .................................................................................................................. 89
Figure No. 5.4 Borlänge Energi logo ....................................................................................................... 90
Figure No. 5.5 Nutek logo ........................................................................................................................ 91
Figure No. 5.6 Strong ties .......................................................................................................................... 92
Figure No. 5.7 Organizational factors ..................................................................................................... 98
Figure No. 5.8 Knowledge characteristics ............................................................................................ 103
Figure No. 5.9 Knowledge management factors ................................................................................. 108
Figure No. 5.10 Individual factors .......................................................................................................... 111
Figure No. 5.11 Further findings ............................................................................................................. 113
Figure No. 5.12 The connection between the influencing factors ..................................................... 118
Figure No. 5.13 The main influencing factors of internal knowledge transfer................................. 121
Figure No. 5.14 Relative importance of barriers based on the statistical analysis ............................ 122
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LIST OF TABLES
Table No. 2.1 Definitions of knowledge management ......................................................................... 25
Table No. 2.2 Strategic levers ................................................................................................................... 34
Table No. 3.1 Summary of factors affecting knowledge transfer ........................................................ 57
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LIST OF ABBREVIATIONS
CAGR Compound Annual Growth Rate
CKO Chief Knowledge Officer
e.g. exempli gratia: for example
E-Mail Electronic mail
et al. et alii: and other
FDI Foreign Direct Investment
GDP Gross Domestic Product
HDI Human Development Index
ICT Information and Communication Technology
i.e. id est: that is
IMF International Monetary Fund
LVRLAC Lake Victoria Region Local Authorities Cooperation
MBA Master of Business Administration
No. Number
p. page
R&D Research & Development
SECI Acronym out of Socialization, Externalization, Combination, Internalization
SIDA Swedish International Development Cooperation Agency
SME Small and Middle sized enterprises
UBC Union of Baltic Cities
WTO World Trade Organization
vs. versus
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1. INTRODUCTION
The introduction chapter will provide information about knowledge transfer, its impacts on the development of emerging
markets and about the background of the investigation. The aim is to enlighten the reader about the research problems
at hand, the corresponding questions under study, its purpose and objectives as well as the scope and limitations of the
research area. Finally, the disposition of this paper will be presented.
“All men by nature desire to know”
(Aristotle)
1.1 Background
Nowadays, relationships between organizations are getting more important than ever, since the
world is getting more circumscribed, negotiated and competitive in tight networks caused by the
globalization process (Contractor and Lorange in Reuer, 2004). “In many situations, the
international firm is better seen as a coalition of interlocked, quasi-arms-length relationships”
(Contractor and Lorange in Reuer, 2004, p. 21). Thereby, companies are working together in various
alternatives: Licensing agreements, joint ventures, technology sharing or coproduction were
traditionally seen as second-best solutions compared to the alternative of growing bigger all by
oneself (Contractor and Lorange in Reuer, 2004), but are common practice in today’s business world
when it comes to collaborate with another organizations. Since these types of collaboration
presuppose a mutual agreement on working together in order to gain advantages, mergers and
acquisitions, especially hostile takeovers, can be seen as a form of “involuntary” collaboration. Yet,
the acquired firm has to adapt to the intended strategic orientation of its new parent company and to
collaborate with its departments and employees. Another form of connecting business activities with
each other can be seen in outsourcing activities as they are carried out by a myriad of small, middle-
sized and large companies all over the world. Especially two specific forms of outsourcing stand in
the spotlight of this issue, namely outsourcing nearshore and outsourcing offshore. According to
Chakrabarty (in Harbhajan, 2006) nearshoring takes place when the service provider’s country is
geographically close situated to the client’s country while offshoring, however, deals with contracting
service providers that are located far away from the client’s country (Chakrabarty in Harbhajan,
2006).
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While in the context of outsourcing relationships companies often outsource production processes
or services where they lack proper knowledge and skills to produce by themselves, most of other
cooperative agreements are undertaken to create actual synergies on both sides. The reasons that
drive companies to build up relationships with other companies are manifold. Based on Adam
Smith’s ideas, in the globalized world and within its international markets, modern companies are
interested to use their resources in the most productive way (Brown and Wilson, 2005). They claim
that by striving for maximum profit, the firms remain competitive, and the consumer site benefits
from this strategy in terms of cheaper goods and services, and higher standard of living at lower
costs. The idea of cooperative relationships between organizations emanate from this philosophy as
it is seen as a means to reduce operating costs and with it to boost earnings. Further benefits of
venture cooperation are, according to Contractor and Lorange (in Reuer, 2004), the reduction of
risks through product portfolio diversification, the achievement of economies of scale due to lower
costs from larger volume, and the decrease of possible competition by increasing the costs for third-
party companies aiming at entering the market. Organizational collaboration in the form of
outsourcing also brings with it a multitude of reasons that advocate the establishment of such
relationships. Beaumont (in Harbhajan, 2006) stresses that benefits of outsourcing are, among
others, the improved quality of service, the reduced production time and the avoidance of risk, while
Brown and Wilson (2005) show further reasons like the ability for the outsourcing company to
acquire new skills, to focus on their core functions and strategy, to avoid major investments and to
save costs.
Due to increased globalization, collaborations are not restricted to a national level anymore. Instead,
the establishment and fostering of relationships with other organizations beyond borders are much
more facilitated through fast developing technology in form of information- and communication
technologies, the liberalization of trade and regulation systems, and decreasing transport and
communication costs. In that context, a lot of companies make use of this trend and seek vicinity to
especially developing countries, since they attract western companies by offering significant lower
costs of labor and better skilled employees to collaborate with. This does not necessarily have to
take place within an outsourcing relationship, but can also manifest itself in a western company’s
intention to build new plants for its production of certain goods or services, for example, in China.
Thereby, in order to take advantage of the more profitable conditions that are provided in
developing countries, the western companies have not only to collaborate with local engineering and
construction workers, but also have to employ local workers, who then can gain a lot of knowledge
and insight about the western production styles and process.
3
These types of cooperative arrangements to emerging markets are predicted to grow further in the
future, since companies attempt to generate competitive advantages due to restructuring,
organizational learning and organizational change in general. Assumed that arrangements between
the business partners and the maintenance of the relationships are conducted properly, both sides
are going to profit from the arrangements. While the companies from industrialized markets can
derive their benefits from reduced costs and higher skilled employees, the organizations and
workforce of the developing countries gain, above all, from the relationship to western companies in
terms of knowledge.
According to Nonaka and Teece (2001), knowledge is nowadays not only the key to business and
corporate success, but also to economic progress. The World Development (World Bank Group,
1998) report argues that knowledge is critical for development, since everything we do depends on
knowledge. The report points to the importance of knowledge for developing countries by stating
that knowledge has become the perhaps most important factor that determines the standard of
living - more important than land, tools or labor. In that connection, western companies and
countries play a major role in closing the knowledge gap between developed and developing world
by transferring required knowledge.
There are several ways how knowledge can be transferred to developing countries. In the context of
outsourcing, for example, the offshore companies draw profit from higher efficiency and
productivity, provided by new capital, technology, new business models and management skills that
the foreign companies are bringing in when they contract out, for instance, specific business
processes. The World Development Report (World Bank Group, 1998) lists additional four channels
through which developing countries can acquire new knowledge from the western world:
1.) International trade
Intensive trade relations with international suppliers and customers facilitate the acquisition
of knowledge, since imported goods and services embed the knowledge required for their
manufacture.
2.) Foreign Direct Investments (FDI)
(Large) Multinational corporations are the largest and most promising source of knowledge.
The worldwide dissemination of their knowledge represents important means to pass on
knowledge to developing countries. Thereby, the knowledge of the organizations is
transferred through learning effects to the employees, the local suppliers, and through the
selling of “knowledge products”, e.g. patents. The companies’ trade and investment policies
4
as well as the economic frameworks and regulations set up by the government determine the
extent to which developing countries benefit from FDI.
3.) Technology licensing
As FDI, the impacts of technology licensing can rather be observed in the long than in the
short run. Learning effects created by utilizing advanced technologies can play a key role
when it comes to closing knowledge gaps.
4.) Travel and migration
While some developing countries imported knowledge by hiring foreign experts, others
experienced a large inflow of skilled immigrants that brought specialized knowledge.
Another way through which developing countries may acquire knowledge can be found in
the migration of workers that later return with new insights and enhanced capabilities.
As indicated, the ongoing trend of organizational arrangements worldwide, together with increasing
FDI on part of the multinational companies, does not only limit its impacts on stand-alone
businesses, but it also affects the development of an entire economy or market. For instance, with
the entrance of companies like Ford Motor, General Motors, and Honda Motor into the Chinese
market, the price for passenger cars fell during the years from 1995 until 2001 about 30%. In India,
prices for air conditioners, television sets and washing machines decreased by around 10%, while the
prices for cars have declined during the 1990s around 10% per year and the availability of different
car types increased, leveraging the automobile sector in India to a compound annual growth rate
(CAGR) of 15%. (Samulevičius and Samonis in Harbhajan, 2006)
In general, the Chinese and Indian markets serve as excellent illustrations for the economic
development of developing countries, which got stimulated by collaboration with and attraction of
companies from the western business world. When China, for example, opened up its gates and
borders towards companies from western industries, the Chinese government forced them by law to
work in close contact with the local companies, so that they learned the technical methods and
procedures, so that they might be capable of producing these goods on their own in the future
(China9, 2008). Due to this learning process over the years, together with investments that came
from companies and organizations all over the world, China is caught up with the global export
leaders Germany and USA, and is even expected to overtake them in 2008 to become global export
champion (BFAI, 2007). This shows the positive impact of knowledge transfer processes on the
development of developing nations.
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“Successful development thus entails more than investing in physical capital, or closing the gap in
capital. It also entails acquiring and using knowledge - closing the gaps of knowledge” (World Bank
Group,1998, p. 25). In this connection, it is crucial to guarantee that the developing countries are
capable of absorbing and properly using the knowledge. This, however, presupposes that knowledge
has been successfully, efficiently and effectively transferred from the western companies to the
developing and emerging markets.
1.2 Problem discussion
The transfer of knowledge takes time, and incurs costs and uncertainty (Szulanski, 2003). But
whenever companies or organizations are supposed to work together, they need to exchange
knowledge in order to benefit. There are several reasons why companies choose to collaborate with
each other. Nowadays, in these fast changing times, companies need to develop new products with
which they have to penetrate new markets constantly, while being under enormous time pressure to
remain competitive in the turbulent market environment (Hamel, Doz and Prahalad in De Wit and
Meyer, 2004). They stress that this is one of the reasons why companies should seek collaboration
with a partner, since it is nearly impossible to survive on the market by going the whole way on their
own. To avoid this, companies and organizations can revert to several alternatives to collaborate
with another firm. This includes common agreements and joint ventures, but also mergers and
acquisitions, and outsourcing. The information and the knowledge that are going to be exchanged
with the attempt to create a win-win situation between the two parties have to be managed in a
concrete way, because otherwise, the installment of a successful and mutual benefiting relationship is
much likely to fail. Unfortunately, the process of knowledge transfer is littered with problems,
challenges and barriers that negatively influence the outcome of the transfer.
Taking a closer look at outsourcing, for example, reveals that a critical factor closely connected to a
successful and efficient outsourcing relationship can be found in effective knowledge transfer. Lee
(as quoted in Angela Lewis, 2006), investigated in the context of an empirical study the connection
between knowledge transfer and the success of outsourcing relationships and found a positive
correlation, stating that knowledge sharing and transfer is one of the major predictors for
outsourcing success.
But not only relationships based on outsourcing are affected by inefficient and ineffective
knowledge transfer. If, for instance, a company decides to built up production facilities in another
country, but falls short in explaining the local workers how to operate the machines, the transfer
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costs of knowledge will skyrocket and with it, the success of the entire undertaking will be
jeopardized. All types of collaboration are facing the challenges and barriers the process of
knowledge transfer entails. If both sides are not able to overcome these challenges, the desired
values and objectives are not likely to be accomplished. In that regard, momentous mistakes can be
made during all the different stages of collaboration. While one party, for instance, may not receive
sufficient or incomplete information about the project’s requirements or specifications, the other
side may lack the ability to integrate and store the customer’s knowledge. The importance of
successful and for both sides rewarding knowledge transfer is observable throughout the whole
collaborating process and its supporting activities like the common development of new technology
and experience. It is crucial for the two contractors to set up general frameworks that facilitate the
exchange of information, data and progress reviews. Through the establishment and persistent use
of such communication systems, the promotion and acceleration of transferring knowledge from
one partner to another, and with it a successful relationship, can be assured more probably.
It goes without saying that the success of knowledge transfer largely depends on the geographical
distance between the sender and recipient of the knowledge. Within the context of an collaboration
and the corresponding inevitable transfer of knowledge, frequent and intensive communication as a
key factor is exacerbated when both parties are geographically separated and when cultural or
linguistic idiosyncrasies team up to raise a huge barrier. Therefore, the successful knowledge transfer
from western companies to distant developing countries is particularly fragile. But, as pointed to
above, especially these developing countries are in need of knowledge, a situation that calls for
effective, efficient and successful knowledge transfer and corresponding countermeasures
concerning the key factors and barriers that affect this process and that the companies involved have
to anticipate and to ultimately cope with in order to guarantee mutual successful knowledge transfer.
1.3 Research Question
In this connection, the important questions to raise and to be investigated are:
1) To what extent do companies face the main influencing factors and barriers of knowledge transfer in real-life
transfer processes between a company or an organization from an advanced economy and from a developing
country?
2) In which way do the involved partners deal with these factors and how decisive and important are they for the
overall success?
7
3) Are there any additional factors that are disregarded in the examined literature?
Following figure should serve to enlighten the connection between these three questions under
study and the concluding thoughts concerning the impacts that knowledge transfer can have on
developing economies.
1.4 Classification of the research objects
For the purpose of this research, the fundamental terms knowledge transfer, developed countries
and developing countries have to be classified and their understanding in the sense of this paper
have to be explained in more detail. This will be taken care of in the following paragraphs.
THE PHENOMENON:
Knowledge transfer between developed and developing world in selected cases
Impacts of knowledge transfer on the developing country
Factors affecting the process of knowledge
transfer (Theory)
Influencing factors and their treatment between companies
(Practice)
Examination
Evaluation
Interpretation
Figure No. 1.1 The connection between the research questions
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1.4.1 Knowledge transfer
In the most common sense, knowledge transfer can be understood as the process of passing on
knowledge from one unit to another. However, for the purpose of this research, the term has to be
narrowed down.
Within the scope of this paper, knowledge transfer is perceived as interorganizational and external
transmission of knowledge between a preferably developed country (see 1.4.2) or industrial nation
and a developing country (see 1.4.3), whereby this process involves a collaboration or business
connection for various purposes.
Since there exists only a limited spectrum of corresponding literature regarding the particular issue
of external knowledge transfer, use will be mainly made of literature that deals with different aspects,
forms and ways of knowledge transfer (e.g. internal/intraorganizational knowledge transfer).
1.4.2 Developed countries
According to the United Nations Statistics Division (2008), there are no established conventions for
the designation of developed countries. Generally, the term is used for countries with developed
economies in which the tertiary and quaternary sectors of industry dominate. Typical characteristics
of developed nations are a high GDP, high income per capita and a high Human Development
Index (HDI). Commonly used and heard synonyms are advanced countries/economies,
industrialized countries, more developed countries, more economically developed countries, global
north countries and post-industrial countries.
The United Nations Statistics Division (2008) generally considers Japan in Asia, Canada and the
USA in North America, Australia and New Zealand in Oceania and Europe as being developed
economies. Thereby, countries emerging from the former Yugoslavia are treated as developing
countries, while countries of Eastern Europe and the former USSR are not included under either
developed or developing regions, but are seen as transition economies that started with rearranging
their systems towards democracy and free market economy (International Monetary Fund :1, 2008).
9
1.4.3 Developing countries and emerging markets
As with the term developed countries, there are no common or fixed definitions for developing
countries. The World Trade Organization (2008), for instance, remarks that its members announce
for themselves whether they are developed or developing. In order to prevent countries from
declaring themselves as “developing” in order to receive provisions, other members of the WTO
can challenge the declaration.
In contrast to developed countries, a developing country is typically characterized by relatively low
standards of living, an undeveloped industrial base, and a moderate low HDI and per capita income.
A developing economy usually translates into a high unemployment rate, poor infrastructure and
capital resources and very often mass poverty and undernourishment. Yet, it is in a phase of
economic development. Developing countries that experienced sustainable economic growth over
years and that additionally show promising economic potential are occasionally called emerging
markets. According to the Yale University Library (2008), the big ten emerging markets are: Brazil,
Russia, India, China, Egypt, Mexico, Poland, South Africa, South Korea, and Turkey. A clear line
has to be drawn between developing countries, emerging markets and least developed or failed
states. While, as mentioned before, developing countries are experiencing economic growth, least
developed or failed states are still suffering from prolonged periods of economic decline.
The International Monetary Fund (2008:2) lists approximately 160 developing and emerging
countries, whereby most of them are located in Africa and Asia (including, for instance, India and
China). In this connection it is important to mention that the comprehensive list by the IMF also
includes countries that are listed as least developed countries elsewhere (see UN-OHRLLS, 2008).
The IMF therefore only classifies the world into two major groups: advanced economies, and
emerging and developing economies.
It can be seen that there are no standardized definitions and differentiation of developed,
developing, less developed, emerging countries and so forth. The lists published by several
international organizations very often contradict themselves, since different criteria could have been
used for evaluation. In order to avoid confusion concerning this matter, the understanding of
developing countries in the context of this study is simply concentrated on the countries and given
economic conditions as they can be seen in the countries named on the according list by the IMF.
This infers that the terms developing countries, emerging markets and less developed countries will
be used synonymously. However, the expression least developed countries will not be used.
10
1.5 Purpose and Objective
The main objective of this research paper is to investigate selective cases, where knowledge transfer
took place between companies from developed countries and organizations in developing countries.
The primary focus is put on examining and sorting out, in which way the collaborating involved
firms are dealing with general barriers and influencing factors that affect the outcome and success of
knowledge transfer. To achieve that, the most cited and described factors were generated from the
used literature in order to practically evaluate and interpret their actual appearance, treatment and
importance in the context of the investigated cases. Thereby, the discovered research findings
hopefully allow for drawing conclusions and interpretations of their overall importance in today’s
business life.
It is important to remark once more that nearly every theoretical paper or book, which has been
used for establishing the theoretical framework of this study, exclusively deals with the process of
internal knowledge transfer, i.e. within corporations, companies or organizations. The emphasis of
this study, however, is put on the external side of knowledge transfer. Due to this reason, the
researchers also intend to enrich the theory-based list of influencing factors and barriers by adding
further practically relevant factors that are found out in the course of the research and therefore
primarily apply to external knowledge transfer to developing countries only.
With the results of the performed analysis of the gathered material, the researchers aim at providing
insightful consolidated findings about different practices, approaches and challenges regarding
knowledge transfer as they are carried out and dealt with by the corresponding companies in the
selected cases. Next to that, the outcome of the analysis can also provide other companies and
organizations with a factual overview of main influencing factors that are derived from theory as
well as from practice. This helps companies, which maybe intend to engage themselves in external
knowledge transfer, and curious readers to develop an understanding and idea of possible barriers
and challenges they should anticipate during the process of external knowledge transfer.
Additionally, it is intended to demonstrate the main factors for successful external knowledge
transfer and with it to point out, especially regarding the inspected cases, how important they are,
how to prioritize them, in which way they can be dealt with, what possible mistakes can be made
and which problems exist that can appear during the process of external knowledge transfer.
11
1.6 Scope and Limitations
Information and knowledge are exchanged through a wide range of channels, e.g. from individual to
individual, from department to department or from organization to organization and their various
combinations. Therefore, the choice for appropriate examples is huge, which makes it inevitable to
narrow down the scope of this study by setting up limitations.
In order to stress it once more, this research will only take into account external knowledge transfer
between foreign companies from developed countries and from developing countries, excluding
intra-organizational knowledge transfer on national and international level. This also rules out the
transfer of knowledge from subsidiaries located in developed countries with those running their
operations in developing countries.
Another restriction has to be set up concerning the direction in which the transferred knowledge is
headed. As this process undoubtedly necessitates at least two participants, namely one that transfers
the knowledge and another one that receives it, it would go beyond the scope of this research to
shed light onto both sides of this procedure. Due to this reason, the core investigation will purely
center on the knowledge that flows from the developed world directly or indirectly to companies
situated in developing countries. Mutual benefits in form of knowledge received by the companies
from advanced economies as well will therefore not be elucidated in detail.
Although there is a high number of advanced economies and with it a myriad of different companies
suitable to investigate, the research will only consider the examination of cases in companies that are
located in Sweden and that are engaged in transferring knowledge to collaborating companies or
organizations in the developing world. This is a necessary step with regard to time and budget
restrictions the research has to undergo. On the part of the developing country, however, the focus
is less on a particular country or region, but rather on building up an interesting portfolio of
dissimilar cases that involve different developing countries (see Chapter 4.4.1: Choice of
respondents).
The fundament of this paper, constituted by the importance of transferring knowledge to
developing countries to stimulate their economic development, also has to endure limitations. The
impacts on both developed and developing economies that emerge from a successful knowledge
transfer in such a relationship are manifold, but the thesis will only focus on the impact that
knowledge transfer can have on the development of developing countries. Caused by time
restrictions, this aspect is not going to be discussed in detail, but will serve as a concluding outlook
at the end of the thesis.
12
1.7 The disposition of this paper
.
Figure No. 1.2 The disposition of the paper
Chapter 1: Introduction
Chapter 2: The knowledge behind knowledge and its management
Chapter 3: The knowledge behind knowledge transfer
Part I: Theoretical Framework
Part II: Empirical Research
Chapter 4: Methodology
Chapter 5: Empirical findings and results
Chapter 6: Final discussion and Outlook
Part III: Summary
13
2. THE KNOWLEDGE BEHIND KNOWLEDGE AND ITS MANAGEMENT
Chapter 2 will focus on the terms knowledge, knowledge management and their meanings and importance for today’s
organizations. This will be achieved by providing the most commonly used definitions of knowledge and by explaining
different models and approaches toward knowledge management and its constituting components. The additional
objective is to provide the reader with sufficient information in order to understand the connection between knowledge
management and the role the particular process of knowledge transfer plays in this context.
“In an economy where the only certainty is uncertainty, the one sure source of lasting competitive advantage is
knowledge”
(Ikujiro Nonaka)
Basically, companies need resources to produce goods and services, and to carry out various
activities. The resource base of a firm “includes all means at the disposal of the organization for the
performance of value-adding activities” (De Wit and Meyer, 2004, p. 242). The emerging
knowledge-based view of the firm, firstly articulated by Grant (1996), claims knowledge to be the
most strategically important resource a firm can have at its disposal. It is seen as an outgrowth of the
resource-based view, which “perceives the firm as a unique bundle of idiosyncratic resources and
capabilities where the primary task of management is to maximize value through the optimal
deployment of existing resources and capabilities” (Grant, 1996, p. 110). Knowledge as a resource
within a firm’s resource base encompasses enlarged experience in the field of market insight,
competitive intelligence, technological expertise and the understanding of political and economic
developments (De Wit and Meyer, 2004).
Today’s understanding of knowledge does not only perceive knowledge as a competency by itself,
like a manufacturing process or human resource practice, but also a potential for achieving
competitive advantages (Inkpen and Dinur,1998). Davenport and Prusak (1998) even took one step
further by claiming that “in a global economy, knowledge may be a company’s greatest competitive
advantage” (p.13). They see a knowledge advantage as a sustainable advantage, since it generates
increasing returns and continuing advantages. Competitors are, after some time, always able to
imitate the market leader’s product or service in terms of quality and price. By the time this happens,
only the company rich in knowledge and corresponding knowledge management can have
progressed to the next level of quality and innovation. Furthermore, Davenport and Prusak (1998)
14
point to another fact that makes knowledge indispensable and more important than material assets
for every company: While the value of material assets decreases with ongoing use, knowledge assets
increase in value when used. According to Argote and Ingram (2000), explanations of competitive
advantages that rely on the positioning of organizations within an industry or the deployment of
organizational assets through competitive interaction with rival firms have been relatively
deemphasized.
This stresses the tremendous importance of knowledge and the corresponding effective
management of knowledge, since resources can only be productive, if the company has sufficient
capabilities to exploit them (Chini, 2004). The result of this knowledge-based view of the firm can
be seen in the recent trend of creating new positions within large companies on the management
level, namely the position of Chief Knowledge Officer (CKO), who is in charge of the entire
knowledge management.
Before getting to the issue addressed in this study - the knowledge transfer from western companies
to companies in the developing world - it is vital to define the terms knowledge, knowledge
management and knowledge transfer, which will be taken care of in the following chapters.
At the beginning of this journey, the basic term of knowledge will be elaborated on. In the course of
this process, not only the issue of defining knowledge as well as its classification from similar terms
will be given, but also a comprehensive overview of the several forms of knowledge, which also
contains material about the different bearer of knowledge.
2.1 Knowledge
There is no common definition of the term knowledge. In the following it is the aim to distinguish
knowledge from data and information and to provide an overview of different definitions and forms
of knowledge.
2.1.1 Data, information and knowledge
Researchers dealing with knowledge and related terms are facing various literature and definitions
about the terms data, information and knowledge and their strong tie. It is important to mention
that these are not interchangeable objects (Davenport and Prusak, 1998). The connection and
classifications between the three terms is reflected in Figure No. 2.1.
15
Data can be described as a bundle of objective facts or as a sequence of symbols and they do not
contain any information of how to make use of them in a given context. Within an organizational
context, data can be described as structured records of transition (Davenport and Prusak, 1998).
The transition from data to information takes place by enriching the data at hand with a specific
context and a meaning, thus making the symbols and facts significant. Davenport and Prusak (1998)
refer to that as “adding value in various ways” (p.4).
Knowledge results from combining various pieces of information, interpreting them and giving
them a meaning as a whole. This suggests that individuals generate knowledge on the basis of
information, which in turn derives from data that is perceived in their surroundings. Since
perception differs from individuals to individuals due to their frame of reference – the complex
stream of experience and information constituting the way we understand and perceive our
surroundings (Weick, 1995) - the process of sensemaking and giving meaning to data or information
also varies from person to person. This makes knowledge individually unique.
INFORMATION
KNOWLEDGE
+ Combination
SYMBOLS
+ Syntax
DATA
+ Context
Figure No. 2.1 Data, Information and Knowledge (Chini, 2004), (Werner, 2004)
16
Probst and Romhardt (1998) on the other hand do not strictly distinguish between information and
knowledge, but speak about a “continuum” between the poles Data and Knowledge (see Figure No.
2.2)
Contrarily, Nonaka and Takeuchi (1995) again stress the differences between information and
knowledge by mentioning three differentiating characteristics: “First, knowledge, unlike information,
is about beliefs and commitment. Knowledge is a function of a particular stance, perspective, or
intention. Second, knowledge, unlike information, is about action. And third, knowledge, like
information, is about meaning. It is context-specific and relational” (p. 58). The latter suggests that
the existing similarities between knowledge and information lie in their characteristics of being
context-specific and relational in that they depend on the situation and are created dynamically in
social interaction among people (Nonaka and Takeuchi, 1995).
In conclusion, as Albert Einstein simply put it: “Information is not knowledge”.
2.1.2 Definition of knowledge
The next paragraphs contain some of the most often quoted definitions when it comes to
knowledge. This should point to the complexity of this term.
Data……………………Information………………Knowledge
Unstructured……………………………………………………………….Structured
Isolated…………………………………………………………………....Embedded
Context-independent……………………………………………..Context-dependent
Low behavior control…………………………………….…….High behavior control
Signs……………………………………………………Cognitive behavioral patterns
Distinction…………………...……………………………………Mastery/Capability
Figure No. 2.2 Continuum of data-information-knowledge (Probst and Romhardt, 1999) (Chini, 2004)
17
• The Oxford English Dictionary defines knowledge as
1.) expertise, and skills acquired by a person through experience or education; the
theoretical or practical understanding of a subject,
2.) what is known in a particular field or in total; facts and information or
3.) awareness or familiarity gained by experience of a fact or situation.
• Davenport and Prusak (1998) understand knowledge as a
“[…]fluid mix of framed experience, values, contextual information, and expert insight that
provides a framework for evaluating and incorporating new experiences and information. It
originates and is applied in the minds of knowers. In organizations, it often becomes
embedded not only in documents or repositories, but also in organizational routines,
processes, practices and norms” (p. 5).
• Sveiby (2001) states that
“Knowledge defined as a ‘capacity to act’ is dynamic, personal and distinctly different from
data (discrete, unstructured symbols) and information (a medium for explicit
communication). Since the dynamic properties of knowledge are in focus, the notion
Individual Competence can be used as a fair synonym” (p.345).
• Nonaka and Takeuchi (1995) see knowledge as a
“dynamic human process of justifying personal belief toward the truth” (p.58).
2.1.3 Forms of knowledge
In the literature one can find a multitude of different classifications with regard to knowledge. This
chapter unites the most common approaches under one roof to relieve the overview.
Knowledge is saved in two different categories of the long-term memory, which are, in terms of
neurophysiology, locatable and distinguishable with regard to their functions: the procedural and
declarative memory. Further on, knowledge is generally subcategorized into explicit or articulated,
and implicit or tacit knowledge. These two dimensions go back to the philosopher Michael Polanyi
(1993), who observed that performers were capable of showing skills without being able to
completely account for their cognitive basis. According to Polanyi (1993), all actions include tacit
and explicit elements of knowledge, with the tacit part being extremely difficult to articulate and thus
18
to transfer. Nowadays, a lot of researchers base their theories on the distinction of tacit and explicit
knowledge (Chini, 2004).
Furthermore and with regard to its availability and the bearer of knowledge, knowledge can be
ontological differentiated by individual, collective and organizational knowledge.
It is important to enlighten the different forms of knowledge, since the likelihood of successful
knowledge acquisition and knowledge transfer depends on the form of knowledge being transferred
(Davenport, 1998). For instance, the transfer of tacit/implicit knowledge is by far more complicated
than explicit knowledge (Argote and Ingram, 2000).
The connection between the forms of knowledge is highlighted in Figure No. 2.3.
FORMS OF KNOWLEDGE
Procedural Knowledge
Procedural Memory
Tacit Knowledge
Knowing-how
Declarative Knowledge
Declarative Memory
Explicit Knowledge
Knowing-about
Individual Knowledge
Collective Knowledge
Organizational Knowledge
Episodic Semantic
Figure No. 2.3 The different forms of knowledge (Chini, 2004) (Nickols, 2000)
19
Tacit and procedural knowledge
According to Polanyi (1983), we know more than we can tell. This form of knowledge is referred to
as tacit or implicit knowledge. “Tacit knowledge is that which is understood within a knower’s
mind” (Jennex, 2006, p.3). Hedlund (as quoted in Chini, 2004, p. 10) defines tacit knowledge as the
non-verbalized, intuitive and unarticulated part of knowledge. The term tacitness of knowledge
refers to its characteristic of being very difficult to transfer, since it includes beliefs and emotions
and depends on one’s individual experience, subjective insights, intuitions and hunches (Nonaka and
Takeuchi, 1995, Nonaka, Toyama and Konno in Nonaka and Teece, 2001). It is deeply rooted in
actions, routines, procedures, commitment, values and ideals. Therefore, it cannot easily be shared
or communicated (Nonaka and Takeuchi, 1995). Grant (1996) associates tacit knowledge with the
expertise in knowing how to do something. Tacit knowledge thus spans a resource of a firm, which
is, among others, based on skills, capacities, competences or technology. An often consulted
example for the explication of tacit knowledge is the capability of riding a bike. There are not really
any instructions or manuals of how to learn to ride the bike, yet nearly every person is capable of
doing it and never unlearns doing so.
Within the area of procedural knowledge, a lot of differences in opinion exist. One view of
procedural knowledge is that it is knowledge that manifests itself in the doing of something, thereby
making it a reflection of motor or manual skills and of cognitive or mental skills. Another common
view is that procedural knowledge is knowledge about how to do something, which is in conformity
to Grant (1996), as mentioned above. This suggests that procedural knowledge is strongly connected
to tacit knowledge. (Nickols, 2000)
In the literature there also seem to exist disagreements concerning the difference between tacit
knowledge and implicit knowledge. While, for instance, Chini (2004) notes that tacit knowledge does
not gain its value from being impossible to articulate, but from not having been articulated yet,
Nickols (2000) draws a straight line between tacit and implicit knowledge by claiming that tacit
knowledge cannot be articulated at all and implicit knowledge did not happen to get articulated yet.
In many other literatures, the terms implicit and tacit knowledge are used synonymously and
interchangeably.
In the following chapters, tacit knowledge is understood as knowledge, which has not been
articulated yet – but it is possible to do so - and which is saved within the procedural memory,
perceiving procedural knowledge as the skill to know-how and as the knowledge that is reflected in
the doing of the knowledge bearer.
20
Explicit and declarative knowledge
Explicit knowledge, in contrast to tacit knowledge, is codified through words, numbers and codes
and can be precisely and formally articulated (Hedlund, as quoted in Chini, 2004, p.9). Nonaka,
Toyama and Konno (in Nonaka and Teece, 2001,p.15) state that “explicit knowledge can be
expressed in formal and systematic language” and shared in the forms of data, scientific formulas,
specifications, manuals and such (Nonaka, Toyama and Konno in Nonaka and Teece, 2001, p. 15).
Another definition of explicit knowledge is given by Nonaka and Takeuchi (1995, p. 8): “Explicit
knowledge can be expressed in words and numbers, and easily communicated and shared”.
Due to these characteristics it can be captured in form of text, diagrams, tables, product
specifications, hard data, scientific formulas, manuals, codified procedures or universal principles
(Nickols, 2000) (Nonaka and Takeuchi, 1995) (Nonaka, Toyama and Konno in Nonaka and Teece,
2001), and consequently passed on more easily than tacit knowledge. This suggests that by modern
means of information and communication technology explicit knowledge can be saved, transferred
and made use of. According to Grant (1996), explicit knowledge can be put on the same level with
the capability of knowing about facts and theories.
Declarative knowledge has much in common with explicit knowledge, since the declarative
knowledge consists of descriptions of facts and things or of methods and procedures (Nickols,
2000). The declarative or descriptive knowledge is the type of knowledge that is expressed in
declarative sentences or indicative propositions, putting it in strong contrast to the procedural
knowledge. This suggests that all declarative knowledge is explicit knowledge, since it is knowledge
that has been articulated.
Furthermore, declarative knowledge itself is divided into episodic and semantic knowledge (Payne,
Nadel, Britton and Jacobs in Reisberg, 2003, pp. 76 – 129):
• Episodic: represents the memory for “episodes” (for instance, the context of an
experienced event in terms of where, when, with who, etc…)
• Semantic: represents the memory for knowledge one acquires during events in terms of
facts about the world or meaning of words, etc…(for instance, knowing that
April is the first month alphabetically, but January the first one
chronologically)
Figure No. 2.4 summarizes the main differences between declarative and procedural knowledge in
order to aid in sorting out matters.
21
Individual, collective and organizational knowledge
“Individual Knowledge reflects individual experience and constitutes the basis for the development
of organizational knowledge” (Chini, 2004, p. 10). According to Probst and Romhardt (1999) and
Werner (2004), collective knowledge in turn represents more than the sum of the individual
knowledge of the members of that collective, since synergy effects may result from combining
several extracts of individual knowledge to one entity. This, however, requires that the members of
the group are potentially capable of linking their individual knowledge (Werner, 2004). This suggests
that collective knowledge is not carried by one single person in charge, but only from the group as a
whole.
The organizational knowledge comprises both individual and collective knowledge and is
continuously generated from these two forms, with tacit and explicit knowledge being elements of
every ontological level of this hierarchy (Smith, 2006). While most explicit knowledge and all tacit
knowledge is stored within the individuals, large of part of this knowledge is created within the firm
and is therefore firm specific (Grant, 1996).
Facts and Things
Tasks and Methods
Motor Skills
Mental Skills
“Describing“ “Doing“ Declarative Procedural
Figure No. 2.4 Declarative and procedural knowledge (Nickols, 2000)
22
Demonstrating the relationship between the different types of knowledge that are present within a
firm’s resource base is a crucial step to be taken, since the transferability of knowledge tremendously
depends on the form of knowledge being transferred. As mentioned above, individual knowledge
represents the basis of organizational knowledge. As Simon (as quoted in Grant, 1996, p. 112) put it,
an organization only learns in two ways:
1. By the learning of its members
2. By ingesting new members, who have knowledge the organization didn’t previously have.
COLLECTIVE KNOWLEDGE
ORGANIZATIONAL KNOWLEDGE
INDIVIDUAL KNOWLEDGE
+ Synergy effects
+ Synergy effects
Figure No. 2.5 Individual, collective and organizational knowledge
23
This stands in conformity to Nonaka and Takeuchi (1995), who claim that organizations cannot
create knowledge on their own without the initiative of the individual and the interaction taking
place within the group. Hence, an organizations’ ability to create new knowledge and to learn is
solely based on the initiative and commitment of its employees.
Through synergy effects, the pool of individual knowledge that is constituted by the knowledge of
every individual member of a group within an organization, for instance the accounting or marketing
department, becomes larger than the sole sum of individual knowledge. The collective knowledge,
now coming from within each department of an organization, is then being combined to
organizational knowledge. Also here, synergy effects guarantee that the organization-specific
knowledge as a whole is larger and more voluminous than the plain sum of every single collective
knowledge. At this point it is important to note that the connection explained here does not
disapprove of organizational learning deriving from individual knowledge directly, but it is the aim
to point to the fact that the learning effect via collective knowledge is more promising.
In the literature, different bearers of knowledge are distinguished. “Organizational knowledge is
embedded knowledge and comprises belief systems, collective memories, references and values.”
(Chini, 2004, p.10). According to Davenport and Prusak (1998), organizational knowledge is often
embedded not only in documents or repositories, but also in organizational routines, processes,
practices and norms. With reference to Argote and Ingram (2000), knowledge is embedded within
the three basic elements of an organization, namely its members, tools and tasks and the various
sub-networks that can be formed by combining or crossing these basic elements. Hedlund (as
quoted in Chini, 2004, p.10) in turn distinguishes of the ontological level of the knowledge bearer
the levels of individual, group (collective), organizational and inter-organizational domains, while
Walsh and Ungson (as quoted in Argote and Ingram, 2000, p.152) speak of five repositories for
knowledge in organizations:
a) Individual members
b) Roles and organizational structures
c) The organization’s standard operating procedures and practices
d) Its culture
e) Physical structure of the work place
Werner (2004) additionally separates natural and unnatural bearers of knowledge (See Figure No.
2.6)
24
2.2 Knowledge management
Referring to the importance of knowledge as a source of a firm’s sustainable competitive advantage,
it is necessary to understand and to implement processes through which firms are able to access and
utilize the knowledge, which is possessed by their members (Grant, 1996). From a strategic point of
view, knowledge furthermore represents an important element for an organization: in order to
maintain the important characteristics of a hard-to-imitate and substitutable, and potentially value-
generating resource, it has to be led by an effective and efficient knowledge management that aims
at accumulating this knowledge and at stimulating its conversion into competitive advantages
(Werner, 2004). This suggests the necessity of installments of knowledge management processes
through which exploitation and utilization of knowledge is ensured.
The aim of this chapter is to introduce the fundamental approaches towards knowledge
management in order to enable the classification and differentiation of knowledge transfer as a
subarea of knowledge management.
Knowledge bearers
Unnatural
Organizational culture
Processes
Organizational structure
Physical structure of the workplace
Information storing data mediums
Natural
Individuals
Figure No. 2.6 The knowledge bearers in an organization (Werner, 2004, p.18)
25
2.2.1 Definition of knowledge management
A multitude of definitions concerning knowledge management can be found in the literature. Chini
(2004) provides an overview of one of the most often cited definitions (see Table No. 2.1).
Source Definitions
Birkinshaw(2001, p. 12)
Knowledge management can be seen as a set of techniques and practices that facilitates the flow of knowledge into and within the firm.
Buckley and Carter (1999, p. 82)
Knowledge management contains “the internal mechanisms for coordination, that is, for pooling the key information garnered by managers whose task it is to monitor external volatility and discover new opportunities”.
Davenport et al. (2001, p. 117)
Knowledge management is “the capability to aggregate, analyze, and use data to make informed decisions that lead to action and generate real business value”.
Demarest (1997, p.379)
“Knowledge management is the systematic underpinning, observation, instrumentalization, and optimization of the firm’s knowledge economies”.
Leonard Barton (1995, p. xiii)
“The primary engine for the creation and growth and of technological capabilities is the development of new products and processes, and it is within this development context that we shall explore knowledge management . . . The management of knowledge, therefore, is a skill, like financial acumen, and managers who understand and develop it will dominate competitively.”
Malhotra (1998, p.59)
“Essentially, it embodies organizational processes that seek synergistic combination of data and information processing capacity of information technologies, and the creative and innovative capacity of human beings.”
Stewart et al. (2000, p. 42)
“The premise is that knowledge assets, like other corporate assets, have to be managed in order to ensure that enterprises derive value from their investment in knowledge assets.”
Tsoukas and Vladimirou (1996, p. 973)
Knowledge management “is the dynamic process of turning an unreflective practice into a reflective one by elucidating the rules guiding the activity of the practice, by helping give a particular shape to collective understandings, and by facilitating the emergence of heuristic knowledge”.
Table No. 2.1 Definitions of knowledge management (Chini, 2004, p. 11)
26
“Two approaches towards knowledge management can be found in the human resources-oriented
and the technology-oriented approach” (Jacob and Ebrahimpur, as quoted in Chini, 2005, p. 10).
However, recent research has applied the integrative-approach, claiming that best results are only
achieved by combining human and technological components (Chini, 2004). In that connection, a
nice illustration is provided by the conceptualization of knowledge management as it is suggested by
Malhotra (see Table No. 2.1), stating that both organizational processes and the creative and
innovative capacity of the employees embody the overall process of knowledge management.
In this study, the integrative approach towards knowledge management will be used, understanding
effective knowledge management as a process of a successful interplay between technological and
human concepts that is taking place organization-wide and between collaborating organizations.
2.2.2 Theoretical approaches towards knowledge management
In the following, a short explanation of a few approaches towards knowledge management is given.
The building blocks model by Probst and Romhardt (1999)
A very often quoted theoretical concept is the one developed by Probst and Romhardt (1999),
which is characterized by its high practical relevance. Introducing eight related and interconnected
building blocks allows for a comprehensive examination of knowledge management. With the help
of these blocks, it is the aim to provide the employees with the opportunity to be better able to
understand and describe emerging problems concerning knowledge within their organization. The
definition of knowledge management, according to the authors, sees knowledge management as
pragmatic development of ideas of organizational learning, whereby the focus is put on improving
organizational capabilities on all levels of the organization by dealing with the resource knowledge
more efficiently.
At this point, the authors of this paper want to stress that the source is originally written in German
and it was only available to them as such. Therefore, the following explanations are based on the
personal and not professional translation of the German source. However, maximum effort and
caution has been used to provide an appropriate and logical translation of the technical terms.
27
Knowledge measurement
Knowledge goals Feed
back
Knowledge storage
Knowledge acquisition
Knowledge creation
Knowledge sharing
Knowledge identification
Knowledge exploitation
As highlighted in Figure No. 2.7., the disposition of the building blocks is split into an outer circle
and an inner circle. The outer circle comprises the building blocks knowledge measurement and
knowledge goals with the managerial tasks to set objectives, to implement them and to measure their
success. The inner circle containing knowledge identification, knowledge acquisition, knowledge
creation, knowledge sharing, knowledge exploitation and knowledge storage represents the
functional part. An important characteristic of this model is the fact that the building blocks are
directly connected to each other. Changing one building block will also cause the others to change,
meaning that building blocks must not be regarded in isolation from the others. In the following,
every single building block will be explained in more detail.
• Knowledge goals
Identifying knowledge goals stands at the beginning of the knowledge management chain
and aims at providing a clear vision of what is desired to achieve, which can serve as a basis
for control and implementation, and which is setting up a clear line that each activity within
the knowledge management has to follow. Thereby, goals can be differentiated in normative,
strategic and operative objectives. Normative goals deal with the creation and development
of a knowledge-stimulating organizational culture, where sharing and enhancement of one’s
own capabilities build the fundament of efficient knowledge management.
Figure No. 2.7 Building blocks of knowledge management (Probst and Romhardt, 1999)
28
Strategic knowledge goals define organizational core knowledge and describe future needs of
the organization for competence and knowledge, while operative knowledge goals are taking
charge of actively implementing the knowledge management activities by concretizing the
normative and strategic goals.
• Knowledge identification
The authors state that a lot of multinational corporations are facing severe problems in
keeping sight of their internal and external data, information and capabilities. Thus, it is the
task of an effective knowledge identification to make the internal and external knowledge
transparent and accessible. In that way, inefficient decisions can be avoided, and employees
are supported in making use of their capabilities by being able to efficiently search for
knowledge.
• Knowledge acquisition
Companies are nowadays not capable of creating the knowledge they require to conduct
various activities all by themselves. Instead, specific knowledge has very often to be acquired
from different sources, which can encompass:
- The knowledge from other companies (e.g. through mergers and acquisitions)
- The knowledge from stakeholders (e.g. acquiring knowledge from customers by
integrating key customers in the development process)
- The knowledge from external knowledge bearer (e.g. recruitment of experts)
- Purchase of knowledge products (patents, blueprints, software, etc…)
• Knowledge creation
Complementary to knowledge acquisition, companies can also enlarge their knowledge base
by creating and developing knowledge by themselves through focusing on manufacturing
new capabilities, products, better ideas and more productive processes, which do not exist
yet. This can not only be achieved by means of Research & Development, but also through
promoting and rewarding creative working as well as the development of innovative ideas,
and through corresponding communication among the employees.
The two building blocks knowledge acquisition and knowledge creation span processes
which Davenport and Prusak (1998) refer to as knowledge generation.
29
• Knowledge sharing
Enabling the employees to utilize isolated or inaccessible knowledge or experience
necessitates the sharing of knowledge within or between entire organizations. Thereby,
Probst and Romhardt (1999) remark that not every employee has to know as much as the
others, but that it is important to ensure that knowledge is shared and distributed to the
employees and departments that are actually in need of certain knowledge. This requires the
management and knowledge bearers respectively to be informed about the particular
knowledge needs of every employee. Establishing an efficient process of sharing and
distributing core parts of the organizational knowledge among every department and
working place can also result in higher customer values through improved time and quality
management: equally shared and distributed knowledge allows the employees to resort to
that knowledge at various different locations and departments in an organization. Instead of
inquiring specialized departments every time, it enables a more efficient and faster reaction
of the employees to certain events or questions.
In this connection, the authors of this paper decided to use the term knowledge sharing
instead of knowledge transfer. The German term the authors are using,
“Wissens(ver)teilung”, is seen as more appropriate translated by sharing or distribution of
knowledge. However, both knowledge sharing and transfer can be used synonymously.
• Knowledge exploitation/utilization/application
According to the authors, organizations are managing their knowledge in order to use it
productively. Unfortunately, after knowledge has been successfully identified and wisely
shared, it is not always the case that the “exposed” knowledge is being made use of in a
proper way within the organization’s everyday activities and processes. Especially the
exploitation and utilization of “foreign” knowledge is constricted due to several barriers,
such like the “not invented here” phenomena, making employees feeling skeptical towards
that knowledge since they were not integrated into the development process and have
therefore only limited overview. Nevertheless, companies have to make sure that strategically
important knowledge that has been created with a lot of effort is being used and exploited in
everyday routines and activities.
• Knowledge storage
Knowledge that has once been acquired is not automatically at disposal in the future.
According to Probst and Romhardt (1999), a lot of companies complain about losing
knowledge due to reengineering processes. To store experience and knowledge permanently
30
in some kind of individual or collective memory calls for a lot of effort on part of the
management and the employees. To keep knowledge from losing, certain steps of knowledge
storage and corresponding processes have to be intentionally configured. The authors
suggest that knowledge can be permanently stored by taking three steps into account:
1.) Selection: select the knowledge, which is also still useable for third persons later, since
only this sort of knowledge is worth to be stored.
2.) Storage: try to transform tacit knowledge into explicit knowledge and create a
common collective memory.
3.) Update: keep the knowledge up-to-date and use it permanently.
• Knowledge measurement
Knowledge measurement aims at verifying, whether the knowledge goals have been
achieved. Furthermore, the feedback resulting from the measurement process is helping to
adapt the knowledge goals to the current conditions.
Probst and Romhardt (1999) claim that the measurement and evaluation of knowledge
constitutes the biggest challenge that knowledge management has to overcome these days,
with no remarkable breakthrough having been occurred yet, since knowledge managers –
unlike finance managers – do not have large equipments containing indicators and
measurement procedures at their disposal. This implies that new and innovative options
have to be taken which have not been established yet.
Alternative approaches towards knowledge management
Chini (2004) introduces the term of the knowledge management value chain, since researchers, such
as Grant (1996), agree on considering knowledge management as a process rather than an object.
Within that context, Chini (2004) summarizes the different stages as they are perceived by other
often cited authors of knowledge management. Hong (as quoted in Chini, 2004, p.12), for example,
divides knowledge management into the four stages of knowledge acquisition, information
distribution, information interpretation, and organizational memory. Hedlund (as quoted in Chini,
2004, p.13) in turn, distinguishes between the storage, transfer and transformation of knowledge.
Figure No. 2.8., which is taken over from Shin, Holden and Schmidt (in Chini, 2004, p. 13), provides
an overview of different approaches with the aim to consolidate different contributions.
31
As the Figure above reveals, a lot of authors differentiate several processes when it comes to their
idea of how knowledge management should be carried out. The four main links in the value chain,
creation, storage, distribution and application can be understood in conformity to the building
blocks described in the previous chapter. Thereby, creation, as it is meant by Chini (2004),
encompasses the building blocks knowledge identification, knowledge acquisition and its
complement knowledge creation. Storage, distribution and application are in accordance with the
building blocks knowledge storage, knowledge sharing and knowledge
exploitation/utilization/application. The part of the building blocks knowledge measurement and
knowledge goals is taken over by the vision and strategy, which is driving the knowledge
management value chain to realize the objectives of an organization, as it is highlighted in Figure
No. 2.8. The figure furthermore reveals that the processes the main links creation, storage and
application consist of differ from author to author. However, where they seem to agree on is that
the distribution stage solely comprises the process of knowledge transfer.
Holzner and Marx (1979)
Pentland (1995)
Nonaka and Takeuchi (1995)
Demarest (1997)
Dall, Hass, and Weggeman (1998)
Davenport,
DeLong and
Beers(1998)
Liebowitz (1999)
Consciousness Extension Transformation Implementation
Distribution Application Construction Organization Storage
Creation
Access Dissemination Application
Construction Embodiment Dissemination Use
Creation
Draw-up Dissemination Apply Evaluate
Creation Transference Asset management
Identify Capture Store Share Apply Sell
Application
Distribution
Storage
Creation
Vision and Strategy
Figure No. 2.8 The knowledge management value chain (Chini, 2004, p. 13)
32
The framework for strategic knowledge management that is provided by Choo and Bontis (2002),
reveals the authors’ understanding of knowledge management as an essential task constituted by
three process: knowledge creation, knowledge transfer and knowledge utilization (see Figure No.
2.9).
According to them, a firm generates value from what it knows through the organizational processes
of knowledge creation, knowledge transfer and knowledge utilization.
• Knowledge creation: the company produces new knowledge through the dynamic
conversion and externalization of its tacit knowledge (see
Chapter 3.2.2)
• Knowledge transfer: knowledge transfer takes place on internal and external level,
i.e. between organizational units and between collaborating
companies
Organizational processes
Knowledge creation Knowledge transfer Knowledge utilization
Locus of
knowing/
Learning
Individual
Group
Organization
Network
Strategic levers
• Exploration
• Tacit knowledge
• Teamwork
• Enabling conditions
• Codification
• Replication
• Modular architectures
• Alliances
• Exploitation
• Product sequencing
• Decision support
• Managing intellectual assets
Intellectual
capital
Human Capital
Structure Capital
Relational capital
Figure No. 2.9 A framework for strategic knowledge management (Choo and Bontis, 2002, p. 16)
33
• Knowledge utilization: firm integrates and coordinates its different forms of
knowledge enabling them to take action and to produce goods
and services
The firm’s intellectual capital is the result from a permanent accumulation of knowledge and
capabilities that are unique to the firm’s learning and experience. The intellectual capital contains the
human capital, structural capital and the relational capital that are embedded within the
organization’s employees, organizational routines, intellectual property, and relationships to
customers, suppliers, distributors and partners. Organizational learning takes place on the levels of
the individual, work group, the organization and the network of organizations the firm is part of.
This organizational learning keeps the intellectual capital continuously updated. The strategic levers,
as they are shown in Table No. 2.2, represent the firm’s actions at their disposal to leverage its
knowledge:
Exploration Stimulate the exploration of knowledge
through converting and sharing tacit
knowledge
Teamwork Forming teams facilitates access to the members’ knowledge
Enabling conditions Creating an knowledge-friendly organizational culture
Codification Codifying knowledge makes diffusion easier
Replication Replicating routines across different locations of the firm enables the exploitation of knowledge assets
Modular architectures Modular architectures of products and processes encourage reuse and recombination of the knowledge
Alliances External knowledge transfer
Exploitation Complementary element to exploration
Product sequencing Sequencing product development in order to take advantage of the path that organizational knowledge, capabilities and product has co-evolved over time
Decision support Strategic learning and adaptation system
34
Managing intellectual assets Purposefully measuring, evaluating and managing the firm’s intellectual assets
Table No. 2.2 Strategic levers (Choo and Bontis, 2002)
The different approaches explained above demonstrate the importance of knowledge transfer within
the process of knowledge management. Only by implementing an effective and efficient knowledge
management system, a firm is capable of generating competitive advantages from this more and
more important resource.
The connection between knowledge management and knowledge transfer has now been established
and the general importance of that stage has been pointed out. In the following chapter, more light
will be shed upon the complexity of knowledge transfer as a key activity during the knowledge
management procedures.
2.3 Summary
Chapter 2 dealt with the technical terms of knowledge and knowledge management, which is
necessary in order to built up a theoretical bridge between knowledge and the process of knowledge
transfer. In the course of this chapter, knowledge has been distinguished from the terms data and
information, and the different forms of knowledge have been explicated. By highlighting the
complexity of knowledge, the necessity of establishing an efficient knowledge management system is
reasoned for. Within this system, several approaches have been described to allow for a deeper
insight into this field. The research thereby revealed that the process of knowledge transfer plays a
decisive role during the knowledge management activities. Thus, Chapter 3 will shed light onto this
particular stage of knowledge management.
35
Figure No. 2.10 Summary of Chapter 2
Knowledge
Data, information and knowledge
• Knowledge is not information
Forms of knowledge
• Tacit and explicit
• Individual, collective and organizational
Knowledge management
Requires effective
Approaches
• Eight building blocks (Probst and Romhardt, 1999)
• Alternative approaches
Knowledge
transfer
Chapter 3
Important process
36
3. THE KNOWLEDGE BEHIND KNOWLEDGE TRANSFER
The following chapter contains comprehensive and insightful information about the complex process of knowledge
transfer. In this connection, common definitions of knowledge transfer as well as deeper insight into this key activity of
knowledge management will be provided. The final part will deal with the influencing factors and barriers that affect
the effectiveness and efficiency. This chapter is crucial for the reader in order to better understand and follow the
empirical parts of this study.
“Successful knowledge transfer involves neither computers nor documents, but rather interactions between people"
(Thomas H. Davenport)
The process of knowledge transfer - or what some authors refer to as knowledge transformation,
knowledge distribution, knowledge dissemination, knowledge sharing (see Figure No. 3.6),
knowledge conversions (Sveiby, 2001 or Nonaka and Takeuchi, 1995) or “best-practice” (Szulanski,
2003) - is a very complex one. To provide a better understanding of the term, definitions of
knowledge transfer as well as its corresponding processes will be enlightened in this chapter. In that
context, two approaches towards knowledge transfer will be explained in more detail, which have
been proven useful for a better insight about this complex procedure, namely the communication
model created by Shannon (1948), which has been firstly used by Szulanski within the context of
knowledge transfer, and the spiral model by Nonaka and Takeuchi. Additionally, Chapter 3.3 will
deal with the different stages knowledge transfer can be subdivided into, before finally the barriers
and influencing factors are introduced that affect the outcome and success of knowledge transfer
and which will constitute focus of the empirical part of this study.
3.1 Definition of knowledge transfer
Like with knowledge and knowledge management, there is no consistent definition of knowledge
transfer throughout the literature. Argote and Ingram (2000) deliver a definition that researchers
frequently come across when studying the issue of knowledge transfer:
“Knowledge transfer in organizations is the process through which one unit (e.g. individual, group,
department, division) is affected by the experience of another.” (Argote and Ingram, 2000, p. 151)
37
Jennex (2006) argues that “knowledge transfer in an organization occurs when members of an
organization pass tacit and explicit knowledge to each other.”(Jennex, 2006, p.3)
In knowledge transfer, knowledge is not only shared within a firm across different functional
groups, product families, geographical locations or time periods, but is also transferred between
firms through inter-organizational alliances and linkages (Choo and Bontis, 2002). The literature
thus distinguishes internal and external knowledge transfer (e.g. Sveiby, 2001): Internal knowledge
transfer deals with the intra-organizational transfer of knowledge, i.e. the transfer of knowledge
between parent company and subsidiaries, or between subsidiaries and subsidiaries – in short:
between organizational units, while external knowledge transfer describes the phenomena of
transferring knowledge to other, company-foreign organizations.
In this paper - as explained in the introduction - knowledge transfer is plainly understood as a
process that takes on external and interorganizational level, within which knowledge is passed on
from companies or organizations in developed countries to collaborating partners located in
developing countries.
3.2 The process of knowledge transfer
Inkpen and Dinur (1998) point to two approaches to knowledge transfer that have been developed
in the literature: the communication model by Shannon (1948) and the knowledge spiral model by
Nonaka and Takeuchi (1995). These two approaches can serve as facilitator to unravel and to
understand the complexity of knowledge transfer processes.
3.2.1 The communication model
Davenport and Prusak (1998) perceive knowledge transfer as a process that involves two actions:
On the one hand the transmission of codified knowledge, i.e. sending or presenting knowledge to a
potential recipient, and on the other hand the absorption and decoding of that knowledge by that
person or group. This procedure of sending and receiving can be based on the communication
model, which has been published by Shannon in his mathematical theory of communication (see
Figure No. 3.1).
38
The communication model consists of five essential parts (Shannon, 1948):
1.) Information source: creates a message or sequence of messages to be communicated to
the receiver
2.) Transmitter: operates on the message to produce a signal that is transmittable
3.) Channel: in charge of transmitting the signal from the transmitter to the
receiver
4.) Receiver: counterpart of the receiver, which reconstructs the message from the
signal
5.) Destination: Person or group that is intended to absorb the message
Due to “noise”, errors can be introduced during the transmission, causing the signal to be received
incorrectly. Thereby, the encoding phase, carried out by the transmitter, and the decoding phase
(receiver) represent the two most critical stages within this model (Chini, 2004).
As mentioned above, Szulanski, in his article “Exploring internal stickiness: Impediments to the
transfer of best practice within the firm”, published 1996 in the Strategic Management Journal, was
among the first to apply this model on the process of knowledge transfer, by seeing the transfer as a
message transmission from a source to a recipient in a given context (Inkpen and Dinur, 1998).
Inkpen and Dinur (1998) analyzed and extended Szulanski’s model, and therein distinguish four
stages of the process:
Noise source
Information
source Transmitter Receiver Destination
Message Signal Message Received
signal
Figure No. 3.1 The communication model by Shannon (Shannon, 1948)
39
1.) Initiation: transferred knowledge is recognized
2.) Adaptation: knowledge is changed at the source location to the perceived needs of
the recipient
3.) Translation: more alterations occur at the recipient unit as part of the general
problem-solving process of adaptation to new context
4.) Implementation: knowledge is institutionalized to become an integral part of the
recipient unit
Thereby, four groups of related factors can be identified (Inkpen and Dinur, 1998):
• Source-related factors
• Recipient-related factors
• Factors relating to the relationship and distance between two units
• Factors related to the nature of the knowledge transferred
At this point it is important to note, that Szulanski as well as Inkpen and Dinur investigated the
phenomena of knowledge transfer within organizations, and not between organizations, as it is the
subject under study of this paper. However, the models explained above are still valid when applying
them to the context of knowledge transfer between collaborating organizations, since the
components and factors, like the relationship and distance between units, also play a major role on
the level of external knowledge transfer.
3.2.2 Spiral model by Nonaka and Takeuchi
Nonaka and Takeuchi (1995) developed a theory of knowledge creation, which is based on a critic
towards the managerial and organizational theories of the western companies that only aim at
acquiring already existing and articulated, hence explicit knowledge.
The cornerstone of their model is the differentiation between tacit and explicit knowledge. On the
basis of an empirical research conducted in collaboration with Japanese companies, Nonaka and
Takeuchi propose a model of how companies can create and use knowledge, which is referred to as
the spiral model of knowledge. In order to create knowledge, the individual knowledge of the
40
employees has to be activated, mobilized and transformed into organizational knowledge for further
use (Nonaka and Takeuchi, 1995).
The basic concept of the model relies on permanent interaction between explicit and tacit
knowledge, with the interaction between the two types of knowledge being labeled knowledge
conversion (Nonaka, Toyama and Konno in Nonaka and Teece, 2001). Therefore, this model
describes the process of knowledge transfer and conversion respectively, since the authors explicitly
highlight that this conversion is a “social” process between individuals and not confined within an
individual. This conversion process results in the expansion of tacit and explicit knowledge in terms
of both quality and quantity.
Since tacit and explicit knowledge exists on the ontological levels of individuals, groups and the
organization, the interaction between these levels results in the creation of knowledge (see Chapter
3.1.3.3). “A spiral emerges when the interaction between tacit and explicit knowledge is elevated
dynamically from a lower ontological level to higher levels” (Nonaka and Takeuchi, 1995, p. 57).
The authors distinguish four modes of knowledge conversion in which the knowledge-creating
process can take place. This process is also known as the SECI process, an acronym build out of the
four modes:
1.) Socialization: from tacit knowledge to tacit knowledge
2.) Externalization: from tacit knowledge to explicit knowledge
3.) Combination: from explicit knowledge to explicit knowledge
4.) Internalization: from explicit knowledge to tacit knowledge
As a little reminder:
• Explicit knowledge: “[…] can be expressed in formal and systematic language and shared
in the forms of data, scientific formulas, specifications, manuals and
such. It can be processed, transmitted and stored relatively easily.”
(Nonaka, Toyama and Konno in Nonaka and Teece, 2001, p. 15)
• Tacit knowledge: “[…] is highly personal and hard to formalize. Subjective insights,
intuitions and hunches fall into this category of knowledge. Tacit
knowledge is deeply rotted in action, procedures, routines,
commitment, ideals, values and emotions.” (Nonaka, Toyama and
Konno in Nonaka and Teece, 2001, p. 15)
41
• Socialization (tacit knowledge to tacit knowledge)
During the process of socialization, new tacit knowledge is created through sharing experience
between the actors involved, implying that due to the difficult transferability of tacit knowledge
the actors have to spend a lot of time together or have to live in the same environment. New
tacit knowledge can be created, for example, through shared mental models and technical
capabilities.
According to Nonaka, Toyama and Konno (in Nonaka and Teece, 2001), socialization typically
occurs, for example, in a traditional apprenticeship, where apprentices learn the tacit knowledge
they need for their craft by rather observing, imitating and listening to their master craftsmen
than by spending time on reading manuals or textbooks.
Another example for the occurrence of socialization can be seen between product developers
and customers. The authors state that the interaction with customers before a new product is
Field
building
Tacit
knowledge
Explicit
knowledge
From
Learning
by doing
Linking
explicit
knowledge
Socialization
“Sympathized knowledge “
Externalization
“Conceptual knowledge “
Internalization
“Operational knowledge “
Combination
“Systemic knowledge “
Tacit knowledge Explicit knowledge
To
Dialogue
Figure No. 3.2 The spiral of knowledge (Nonaka and Takeuchi, 1995, p.62-73)
42
about to be developed together with after market introduction are a continuous process of
sharing tacit knowledge and creating ideas for improvement.
“The key to acquiring tacit knowledge is experience” (Noanaka, and Takeuchi, 1995, p. 63).
• Externalization (tacit knowledge to explicit knowledge)
This process is performed by articulating and symbolizing tacit knowledge and with it, turning it
explicit. During that stage, knowledge is crystallized, and it becomes the basis of new knowledge,
allowing it to be shared with others on a corporate-wide basis. Due to these reasons,
externalization forms the most important process when it comes to creating knowledge.
An example for externalization can be seen in the creation of concepts in new product
development that is triggered by dialogue or collective reflection. For instance, the attempt to
conceptualize an image in language is often followed by inadequate, inconsistent and insufficient
expressions. Hence, for the successful conversion of tacit knowledge into explicit knowledge,
metaphors, analogies and models must be sequentially made use of.
“When we cannot find an adequate expression for an image through analytical methods of
deduction or induction, we have to use a non-analytical method. Externalization is, therefore,
often driven by metaphor and/or analogy” (Nonaka, and Takeuchi, 1995, p. 65).
• Combination (explicit knowledge to explicit knowledge)
Through combination, explicit knowledge is converted into more complicated and systematic
sets of explicit knowledge. Thereby, explicit knowledge is acquired from internal or external
sources and then combined, edited or processed with the aim to create new knowledge, which
then can be disseminated among the employees.
This process is supported through modern information and communication technologies, like
video conferences, internet exchanges or other computerized communication networks. The
combination mode of knowledge conversion can be seen when the management breaks down
and operationalizes corporate visions or product or business concepts.
43
“Reconfiguration of existing information through sorting, adding, combining, and categorizing
of explicit knowledge can lead to new knowledge. Knowledge creation carried out in formal
education and training at schools usually takes this form. An MBA education is one of the best
examples of this kind” (Nonaka and Takeuchi, 1995, p.67).
• Internalization (explicit knowledge to tacit knowledge)
Internalization means that explicit knowledge is circulating within the organization and absorbed
by its members into their individual knowledge base. “It is closely related to learning by doing”
(Nonaka and Takeuchi, 1995, p.69). Explicit knowledge stored in product concepts or
manufacturing procedures has to be actualized in action and practice (Nonaka, Toyama and
Konno in Nonaka and Teece, 2001). Examples for internalization are training programs that can
help trainees to understand an organization. By studying manuals or documents about the
requirements their jobs call for and by reflecting on them, the trainees can internalize this
explicit knowledge and enhance their own tacit knowledge.
“When experience through socialization, externalization, and combination is internalized into
individual’s tacit knowledge bases in the form of shared mental models or technical know-how,
they become valuable assets” (Nonaka and Takeuchi, 1995, p.69).
A new spiral of knowledge is being set off, when the now tacit knowledge is accumulated at the
individual level and then shared with other members of the organization in the process of
socialization.
By taking a closer look at the explanations of each process, it can be seen that every one of these
modes of conversion also involves a sender and recipient of knowledge, as it is demonstrated in the
communication model. According to Chini (2004), this suggests that the sending and receiving units
also have to engage in these conversion procedures in order to process the inflowing or outflowing
knowledge.
In general, a process or procedure can be defined as a series of steps that are taken to accomplish a
specific end. In that regard, the process of knowledge transfer also has to go through a sequence of
different stages. A few approaches toward a possible identification of these stages are provided in
the following chapter.
44
3.3 Stages of knowledge transfer
Inkpen and Dinur (1998), as described in Chapter 3.2.1, distinguish four stages that build the
process of knowledge transfer: initiation, adaption, translation, and implementation. In the
following, the stages of knowledge transfer as they are seen by three other authors of that field will
be demonstrated.
Stages of knowledge transfer according to Szulanski (2003)
Szulanski (2003) investigated within an empirical research the barriers and influencing factors of
knowledge transfer in an intra-organizational context. In order to provide further insight into this
issue, the author splits the process of knowledge transfer into four stages in order to be able to
analyze them in detail. Thereby, a milestone is defined for each stage that has to be achieved. The
model is shown in Figure No. 3.4.
The initiation stage contains all activities that lead to the decision to transfer. As Teece (as quoted in
Szulanski, 2003, p. 34) puts it, a transfer begins “when a need or a potential is recognized”. In other
words, a transfer of knowledge can be initiated as soon as there is a demand for knowledge,
provided that this knowledge does exist within the context of the organization. Furthermore, the
involved persons must be aware that the knowledge being transferred is feasible to address or fulfill
their needs.
Therefore, a transfer seed is formed when a need and the corresponding knowledge to fulfill that
need exists within the organization.
Figure No. 3.3 Stages of the knowledge transfer process (Szulanski, 2003, p. 34)
Formation of the transfer seed
Decision to transfer
Achievement of satisfactory performance
First day of use
Initiation Implementation Ramp-up Integration
MILESTONE
STAGE
45
The knowledge transfer itself is carried out during the implementation stage, which begins after the
decision to transfer has been made. This decision can be taken formally in a centralized,
authoritative manner, or it can also be spontaneous, informal and sometimes even unobservable
(Szulanski, 2003).
As soon as the knowledge transfer is completed, the ramp-up phase is initiated. The first day of use
marks the beginning, where the recipient is actually using the new knowledge for the first time. The
term “ramp-up” implies that at first the recipient will use the knowledge inefficiently, but over time
the efficiency will reach a satisfactory level. The more complex the knowledge, the more time will
pass by for the knowledge to be used efficiently.
The last stage, integration, is triggered when the recipient achieves satisfactory results by using the
knowledge and the application of this knowledge becomes routine. (Szulanski, 2003)
Stages of knowledge transfer According to Krogh and Köhne (1998)
Another model differentiating several stages of the process of knowledge transfer is proposed by the
German researchers Georg von Krogh and Marija Köhne in their book “Der Wissentransfer in
Unternehmen: Phasen des Wissenstransfers und wichtige Einflussfaktoren” (“Knowledge transfer
within organizations: Stages of knowledge transfer and important influencing factors), which was
published 1998 in the Swiss journal of business research and practice called Die Unternehmung (The
Company). Again, the authors of this paper want to stress at this point that the following is based on
their own translation and understanding of the originally German source.
According to Krogh and Köhne (1998), the process of internal knowledge transfer comprises three
stages that are highlighted in Figure No. 3.5. This model contains the elements of tacit, explicit,
individual and organizational knowledge.
46
In conformity to Szulanski’s (2003) procedural distinction, an initiation phase marks the beginning
of the knowledge transfer process.
The initiation phase is characterized by the desire and wish of the employees to transfer knowledge.
As soon as this demand is articulated, the form and scope of the knowledge to be transferred is
determined. Moreover, the involved employees have to identify the possibilities to conduct the
knowledge transfer, and the corresponding recipients have to be selected and integrated into the
prearrangements.
According to Krogh and Köhne (1998), the actual knowledge flow takes place in the following
phase, which also is consistent with Szulanski’s perception of the different stages. The transfer of
tacit and explicit knowledge is reached through interaction and communication of the people
involved in this process. Thereby, knowledge can be transferred by various means. There are
methods that are particularly suitable for transferring tacit and explicit knowledge. Tacit knowledge
can be transferred through actions that emphasize personal contacts, interactions and the sharing of
experience between the people involved. Appropriate methods for transferring explicit knowledge
are less complicated and context-bound and can take place by exchanging, for example, documents,
or manuals.
At the final stage, the integration phase, the receiver of the knowledge has to absorb it into his or
her environment, to classify it based on his or her existing experience, and lastly to integrate it into
his or her knowledge base through active utilization of this knowledge. Incongruent to Szulanski
(2003), the authors Krogh and Köhne (1998) do not explicitly mention an additional phase that
describes the efficiency with which the newly received knowledge is being utilized. Their description
of the last stage suggests that the knowledge is instantly being made use of in a proper way.
Influencing factors
Individuals
Groups
Organizations
Individuals
Groups
Organizations
Transfer of individual and organizational knowledge
Integration
phase
Initiation
phase
Knowledge
Transfer phase
Figure No. 3.4 The stages of knowledge transfer (Krogh and Köhne, 1998)
47
Additionally, Krogh and Köhne (1998) mention the possible occurrence of interferences (see Figure
No. 3.5) during the entire knowledge transfer process that affect its course and outcome. In that
regard, Szulanski (2003) not only points to those inhibiting factors, but also based his empirical
research on the issue, what type of influencing factors actually cause the knowledge to be difficult to
transfer. This research will be elaborated on in Chapter 3.5.1.
The analysis of a few approaches toward the different stages, which knowledge transfer can
comprise, shows that a common agreement of how knowledge transfers are being processed does
not exist. The described models above represent theoretical oversimplifications of a process so
complex, that no model will ever be able to span and consider every single contingency. The aim
was to simply provide a small overview of potential core stages that might be found in near every
knowledge transfer process.
At this point, details about the actual process of knowledge transfer have been delivered and
explained. In order to develop an understanding of the possible knowledge transfers themselves, the
introduction of the ten knowledge strategy issues as they are articulated by Sveiby (2001) will
certainly prove to be useful (see Figure No. 3.2). In this connection, it suggests itself to narrow
down the types of knowledge transfer that are being taken into account in this paper.
3.4 The ten knowledge strategy issues
Sveiby (2001) basically distinguishes nine knowledge transfers or conversions that have the potential
to create value for a company or an organization. They are mapped in Figure No. 3.2.
48
With the external structure, internal structure and the individual competences, Sveiby (2001)
differentiates three families of intangible resources, upon which the knowledge-based strategy
formulation is based.
• External structure: represents a family of intangible relationships, for example with the
suppliers or customers, that form the fundament for the image or
reputation of the company.
• Internal structure: emerges when people direct their actions internally. The family of the
$
2. Knowledge transfers/ conversions from individuals to external structure
3. Knowledge transfers/ conversions from external structure to individuals
4. Knowledge transfers/ conversions from individual competence to internal structure
5. Knowledge transfers/ conversions from internal structure to individual competence
6. Knowledge transfers/ conversions within external structure
7. Knowledge transfers/ conversions from external to internal structure
8. Knowledge transfers/ conversions from internal to external structure
9. Knowledge transfers/ conversions within internal structure
10. Maximize the Value Creation – See the whole
1. Knowledge transfers/ conversions between individuals
Individual competence External structure
Internal structure
Figure No. 3.5 The ten knowledge strategy issues (Sveiby, 2001, p.349)
49
internal structure encompasses, for instance, patents, concepts,
models, templates, or more or less explicit processes. They are created
by the employees and thus “owned” by them.
• Individual competence: consists of the competence of, for example, the staff, experts, R&D
people, and factory workers.
Given this framework, Sveiby (2001) lists and distinguishes nine basic knowledge transfers through
which companies can create value and that aim at improving the capacity-to-act of people inside and
outside of the organization (see Figure No. 3.2.)
1.) Knowledge transfers/conversions between individuals
2.) Knowledge transfers/conversions from individuals to external structure
3.) Knowledge transfers/conversions from external structure to individuals
4.) Knowledge transfers/conversions from individual competence into internal structure
5.) Knowledge transfers/conversions from internal structure to individual competence
6.) Knowledge transfers/conversions within the external structure
7.) Knowledge transfers/conversions from external to internal structure
8.) Knowledge transfers/conversions from internal to external structure
9.) Knowledge transfers/conversions within internal structure
For this study, only two of these knowledge transfer processes are relevant and will be explained in
detail below.
• Knowledge transfer/conversions from individuals to external structure
This process is concerned with the issue of how to transfer the knowledge of the
employees within the organization to the outer world. The corresponding strategic question
to raise is: How can the organization’s employees improve the competence of customers, suppliers and
other stakeholders? (Sveiby, 2001)
• Knowledge transfers/conversions from internal to external structure
50
The strategic question is: How can the organization’s systems, tools & processes and products
improve the competence of the customers, suppliers and other stakeholders?
(Sveiby, 2001)
In this study, emphasis will be put on these two knowledge transfer processes with the attempt to
detect, by which means certain organizations implemented their knowledge-based strategy in order
to make the knowledge transfer successful.
3.5 The barriers and influencing factors of knowledge transfer
The inquisitive researcher can find a multitude of articles and literature about the barriers of
knowledge transfer. Thereby, potential influencing and inhibiting factors may emanate from the
characteristics of the knowledge itself, from barriers on part of the sender and receiver as well as
from the context (Szulanski, 2003).
Argote and Ingram (2000) provide an overview of researches that have been conducted concerning
the influencing factors within the process of knowledge transfer:
• Darr and Kurtzberg: Examined the effect of the similarity between tasks on the transfer of
knowledge between fast-food stores. They came to the conclusion
that strategic similarity - the similarity of the stores’ strategies and
tasks - had a positive impact on the knowledge transfer, whereas the
similarity of customers or the location did not reveal any affect.
• Baldwin and Ford: Their research contained the examination of how the characteristics
of individuals, such as their ability and motivation, affect the transfer
of knowledge from training to transfer contexts.
One important finding that emerges from the work in that field is the
insight that the knowledge transfers are easier and more effective
between organizations that are embedded in a network or
superordinate relationships (e.g. chains, alliances).
51
• McEvily and Zaheer: Their study addressed the issue to what extent the characteristics of
the social networks affect the knowledge transfer. They found out
that “nonredundancy in an organizations’ social networks predicted
their ability to acquire knowledge and new capabilities” (Argote and
Ingram, 2000, p. 162). This means that organizations with social ties
to other organizations that missed redundancy could access more
information and were able to acquire more capabilities than
organizations with overlapping or redundant ties.
In that connection, other researchers showed that the nature of social ties interacts with the
characteristics of knowledge that is being transferred and that this interaction defines the outcome
of the transfer process. For example, Hansen found out that weak ties, characterized by irregular or
distant relationships between units or organizations, “facilitated the search for knowledge in other
units and reduced the time to complete projects when knowledge was not complex and could be
codified” (Argote and Ingram, 2000, p.162). In contrast, complex and not codified knowledge could
only be successfully transferred through strong social ties between the sender and recipient.
• Galbraith: The examination of the characteristics of the technology or tools that
are being transferred was the center of this research. Hereby, Galbraith
compared the productivity of the source and of the receiver during the
transfer of the technology. The findings revealed that the recipient’s
productivity was recovering faster when the technology was less complex,
when sender and receiver were geographically close, when coproduction
continued at the donor site and when a team of engineers at the source
organization was sent to the recipient for a significant period of time. Both,
the permanent coproduction and the team of experts on site remarkably
facilitated the transfer of tacit knowledge.
• Szulanski: As mentioned above, Szulanski analyzed how the characteristics of
knowledge, the recipient, the context and the knowledge itself affect the
transfer of knowledge. He found out that the influence of these factors
depends on the stage the transfer currently goes through.
In the following, more light will be shed upon the findings and insights of Szulanski’s (2003)
research of intra-organizational knowledge transfer.
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3.5.1 The influencing factors and barriers of internal knowledge transfer (Szulanski)
With his research about the possible inhibiting factors, barriers and problems that can occur during
each stage of the knowledge transfer process, Szulanski (2003) concentrated and limited his research
to the internal side of knowledge transfer.
Thereby, his aim was to filter out the factors that cause the knowledge to be “sticky”, meaning
difficult to transfer. As a result of his research he identified nine possible influencing factors in four
categories.
1.) Characteristics of knowledge and stickiness
• Causal ambiguity:
According to Szulanski (2003) , causal ambiguity is one of the main reasons why knowledge
transfer is challenging. Due to the idiosyncratic features and conditions of the new
environment the knowledge is used in after its transfer, he states that it is impossible to
recreate capabilities or results (for example a production function or process) that are
generated by recreating knowledge and putting it to use. There may be an “irreducible
uncertainty that prevents a complete understanding of how features of the new context
affect the outcome of the recreation effort” (Szulanski, 2003, p.26). This uncertainty may
result from causal ambiguity, which in turn emanates from the obscurities concerning the
application of the new knowledge. Rumelt (in Szulanski, 2003) argues that causal ambiguity
is present, if the reasons for success and failure in replication of a capability in a new setting
cannot be determined. Hence, causal ambiguity indicates the lack of knowledge why
something is done, including why a given action results in a given outcome. Causal ambiguity
can therefore be seen as a situation where it is impossible to connect the consequences of an
event to its initial causes or states. Szulanski (2003) concludes that the higher the causal
ambiguity, the more difficult it will be to replicate results from the use of the transferred
knowledge.
• Unproven knowledge:
As the term suggests, knowledge is unproven with regard to its usefulness, if it lacks
empirical substantiation or if it has been used for only a short period of time or on a limited
scope or scale. The recipients may be reluctant to re-create that knowledge and to make use
of it respectively, since they may not consider the knowledge as reliable and therefore
valuable.
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2.) Characteristics of the source and stickiness
• Source lacks motivation:
“The motivation of the source of knowledge to supply conceptions of the practice or to
facilitate access to the recipient may influence the degree of difficulty experienced during a
recreation effort” (Szulanski, 2003, p. 27). A lack of motivation can, for instance, result from
the source’s fear of sharing important information, because this may be accompanied with
the fear of losing one’s ownership (what Szulanski refers to as the “Invented here”
syndrome) or position of superiority, whose loss could cause a feeling of becoming
dispensable. Additionally, especially during the first moments of knowledge transfer, the
source has to commit a lot of time and effort to support the recipient, which can interfere
with the source’s ability to attend to its main tasks. However, if the main task incorporates a
part of the effort, then a decrease in motivation could follow.
• Source lacks credibility:
The behavior and performance of the recipient is strongly influenced by the degree of
credibility the source can convey. In the case that the recipient considers the source’s
conception of the practice, its knowledge, as credible and therefore convincing and
trustworthy, the receiver will be less suspicious of what is offered to him or her and with it
be more open and receptive to its details. This leads to more voluminous and efficient
exchange of information and to lower costs of exchange. By being able to communicate a
larger load of information, the receiver may get a better grasp of the source’s conception
being transferred.
3.) Characteristics of the recipient and stickiness
• Recipient lacks motivation:
“A recipient’s motivation to accept knowledge from an external source, and to engage in the
necessary activities to recreate and apply this knowledge, may prove critical to ensure a non-
eventful replication” (Szulanski, 2003, p.29). Lacking motivation can be demonstrated
through passivity or hidden sabotage and can manifest itself in throughout the transfer
process as well as in the activities that follow. In correspondence to the “invented-here”
syndrome, as mentioned under 2.), lack of motivation on part of the recipient can also result
from psychological barriers like the contrary “Not-invented-here” syndrome.
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• Recipient lacks absorptive capacity:
The success of the knowledge transfer process largely depends on the absorptive capacity of
the recipient, which makes the level of prior related knowledge an important factor, since
this level determines the ability of the source to exploit the outside sources of knowledge
and, according to Cohen and Levinthal (in Szulanski, 2003, p. 29), the absorptive capacity of
a recipient of knowledge. A recipient lacking the capacity to absorb new knowledge will less
likely be capable of recognizing the value of that knowledge, recreating that knowledge and
applying it on everyday activities.
• Recipient lacks retentive capacity:
Knowledge transfer can only be considered successful, if the recipient is permanently
utilizing this knowledge and to integrate it within one’s own knowledge base. “The ability of
a recipient to institutionalize the utilization of new knowledge is a reflection of its retentive
capacity” (Szulanski, 2003, p.30).
4.) Characteristics of the context and stickiness
• Barren organizational context:
The term barren context refers to the first stage of knowledge transfer in the understanding
of Szulanski, namely the initiation stage and the corresponding milestone “Formation of the
transfer seed”, as it is explained in Chapter 3.3. In that connection, a transfer seed embedded
within a barren organizational context is not able to grow and to mature, which is
automatically precluding their transfer. An organizational environment actively promoting
and efficiently stimulating the growth of such seeds can therefore be called “fertile” context.
Next to a barren or fertile context, the possible existence of an organizational context is
imaginable, in which the seeds remain totally unrecognized.
• Arduous relationship between the source and recipient:
The nature of the pre-existing relationship between a source and a receiver is another
important factor. Thereby, a strong and intensive relationship is necessary, since the transfer
of knowledge does not encompass a singular event, but an iterative exchange process. This
process often presupposes a close collaboration before the actual transfer, because potential
recipients require to be informed about the knowledge intended to transfer in order to prove
if it matches its needs. During the transfer itself, a strong tie between the involved parties
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facilitates the selection of appropriate components to transfer since closer look can be taken
at the recipients needs
A summary of the barriers according to Szulanski (2003) is provided in Figure No. 3.6.
3.5.2 Additional overview of potential barriers inhibiting internal knowledge transfer
Another overview of possible factors that are affecting the success of (internal) knowledge transfer
is given by Ang and Massingham (2007), in which some aspects already articulated by Szulanski can
be found. They are building their model of possible influencing factors on five categories: cultural
Stickiness of
knowledge
Characteristics of the recipient
Characteristics of the context
Lack of motivation
Passivity
Not-invented-here syndrome
Absorption capacity
Retentive capacity
Poor organizational framework
Arduous relationship
Characteristics of the source
Lack of motivation
Fear for loss of ownership
Lack of time
Credibility
Characteristics of the knowledge
Validity
Causal ambiguity
Figure No. 3.6 The barriers of knowledge transfer (Szulanski, 2003)
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factors, organizational factors, individual factors, knowledge characteristics factors, and knowledge
management factors (see Table No. 3.2)
Cultural factors
• Relationship between sender and
recipient
Strength of social ties, level of trust, extent to which common processes and values are shared
Organizational factors
• Headquarter control mechanism
Evaluation of the performance of the subsidiary, mechanisms to facilitate development of interpersonal ties
• Leadership
Leaders must be convinced of advantage and usefulness, take more active and supportive role towards knowledge transfer
• Forms of ownership different forms of ownership have different effects on effectiveness of knowledge transfer
• Strategic similarity
similar strategic orientation facilitates knowledge transfer
• Incentive based learning capacity
the higher, the more effective can knowledge transfer be carried out
• Partner protectiveness
partners could prefer to protect their knowledge from the other, resulting in barriers for knowledge transfer
• Human resource management
practices
Interaction between employees’ ability and motivation have effect on the success of knowledge transfer
• Organizational culture Knowledge friendly culture is one of the most important factors for successful knowledge transfer
Individual factors
• Absorptive capacity
see Szulanski (2003)
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Table No. 3.1 Summary of factors affecting knowledge transfer (Ang and Massingham, 2007)
3.5.3 Possible main influencing factors and barriers of external knowledge transfer
Since this study is focusing on external knowledge transfer, i.e. the transfer of knowledge between
organizations, some of the influencing factors listed above do not apply due to their insignificance
• Knowledge transfer capacity combines elements of tacitness and absorptive capacity
• Learning intent Motivation to learn
• Psychosocial filter Determines the likelihood of whether employees would import or share knowledge
Knowledge characteristics factors
• Knowledge embeddedness
means that knowledge is embedded in people, tools and routines, with embedded knowledge being easier to transfer
• Desirability of knowledge Refers to the motivation of the recipient to acquire new knowledge
• Codified vs. tacitness Tacit knowledge is harder to transfer than explicit knowledge, different mechanisms should be used for each type
• Causal ambiguity See Szulanski (2003)
Knowledge management factors
• Infrastructures
an organizational infrastructure for knowledge transfer should identify organizational members with the right skills and assign roles to them
• Information technology Increases the speed of knowledge transfer
• Measurement Important to knowledge transfer, since without proper measurement people involved could lose interest in the transfer
• Appropriate transfer mechanisms Three criteria that have an impact on the transfer method: “Who is the recipient? How frequent and routine is the task? What type of knowledge is being transferred?”
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within this context. Although all of them play a major role when it comes to intra-organizational
knowledge transfer, some of them are negligible in the context of external transfer, including, for
instance, the fear for loss of ownership, psychosocial filters, the partner protectiveness and to some
extent the motivation of the sender and recipient. If a company decides to purposefully pass on
components of their knowledge to a foreign and even offshore organization, it is crucial for the
management to make sure that these factors are precluded from the beginning by assigning the
corresponding tasks to employees that are willing to dedicate their whole commitment and effort
towards the knowledge transfer from the very beginning. Due to these reasons, the factors that do
apply to external knowledge transfer, and on which the emphasis of this study is put, have to
become apparent and modified to some extent in order to be functional for the empirical
investigation. In the following, the corresponding model being used during the empirical research is
demonstrated, followed by a thorough explanation of the enclosed technical terms.
Organizational factors
Knowledge characteristics
Individual factors
Strong ties
Knowledge management factors
• Causal ambiguity
• Explicit vs. tacit knowledge
• Absorptive capacity
• Trust
• Cultural distance
• Communication
Knowledge
Transfer
• Strategic similarity
• Organizational distance
• Organizational culture
• Measurement
• Information technology
Figure No. 3.7 Influencing factors and barriers of external knowledge transfer
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• Strong ties
The relationship between sender and recipient is a decisive factor when it comes to
effectiveness of external knowledge transfer. Aspects to be covered:
- The level of trust
It certainly goes without saying that a strong bond between the two partners is an important
cornerstone when it comes to transferring knowledge. Without any sign of trust, knowledge
transfer might not take place efficiently, since suspicion clearly keeps the recipients from
learning.
- Cultural distance
“Knowledge and cognition, as human behaviour, is guided bythe contextual rules and
resources residing in social structures and conventions; transferred knowledge has thus to fit
these contextual requirements of the recipient unit” (Chini, 2004). Cultural distance
represents a prohibiting factor, since different norms, believes and values of the sending and
receiving employees may cause variances between the underlying assumptions of both sides
that are brought towards the knowledge being transferred and implemented. A
transformation of organizational routines and attitudes should be taken into consideration,
so that they can conform to existing cultural expectations (Chini, 2004).
- Communication
“Communication is the process through which participants create and share information
with one another as they move toward reaching mutual understanding” (Rogers and
Steinfatt, 1999, p.113). A high amount of transmission channels, for example, promote
communication and can therefore facilitate the transfer of knowledge.
Szulanski (2003) points to a few factors that may constitute an arduous relationship and
which can compromise the knowledge transfer: Distance, lack of communication, lack of
open communication, language problems. This factor is especially important when
transferring tacit knowledge.
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• Organizational factors
- Strategic similarity
Firms that feature similar strategic orientations and common objectives are more likely to
successfully transfer knowledge, since this facilitates the establishment of stronger social
ties.
- Organizational distance
Organizational distance refers to differences between organizational units (headquarters-
subsidiary, subsidiary-subsidiary, client-host) in terms of structures, processes and values. If
client and host share similar approaches and attitudes towards decision-making for example,
share similar work culture and so forth, communication and knowledge transfer processes
are tremendously facilitated (Davenport and Prusak, 1998).
- Organizational culture
A knowledge friendly organizational culture remarkably stimulates the transfer of
knowledge. In order to raise such a culture, the employees should be innovative and
positively knowledge-oriented, without having any fear of sharing or receiving knowledge
and with the organizational culture fitting the firms’ objectives for knowledge management
(Davenport and Prusak, 1998). This aspect also contains Szulanski’s (2003) barrier of poor
organizational framework.
• Knowledge characteristics
- Causal ambiguity
Causal ambiguity can be seen as a situation where it is impossible to connect the
consequences of an event to its initial causes or states. Szulanski (2003) concludes that the
higher the causal ambiguity, the more difficult it will be to replicate results from the use of
the transferred knowledge. Behaviors that can cause the knowledge to be causally
ambiguous are, among others: lack of documentation, metrics identification, nobody fully
understands the concept or the communication of a complex process in a simple manner
(Szulanski, 2003).
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- Explicit vs. tacit knowledge
This aspect deals with the fact that tacit knowledge is far more complicated to transfer than
codified or explicit knowledge. It is therefore interesting to investigate, by which different
means these two types of knowledge were coped with.
• Knowledge management factors
- Measurement
Measurement is important to knowledge transfer. Without measurable success, employees
as well as the management could lose interest or motivation in the transfer. This suggests to
investigate the existence of measurement installments that were done in order to not only
monitor the progress, but also to value and measure the overall success (or failure) of the
knowledge transfer with regard to the objectives.
- Information and communication technology (ICT)
Information and Communication Technology is one of the most powerful tools
for successful knowledge transfer. By implementing far-reaching ICT systems throughout
the entire organization of the client and the host, geographical distances as well as barriers
of time can be overcome. ICT and its proper installments are therefore seen as a key factor
for successful knowledge transfer. However, they only represent an effective means to
diffuse explicit knowledge.
• Individual factors
- Absorptive capacity
Cohen and Levinthal (1999) refer to a firm’s absorptive capacity as the ability of a firm to
recognize the value of new, external information, assimilate it, and apply it to commercial
ends. The authors argue that the ability to evaluate and utilize outside knowledge is largely a
function of the level of prior related knowledge, causing differences between organizations’
absorptive capacities. This prior knowledge may include basic skills or even a shared
language, but also knowledge of the most recent scientific or technological developments in
a certain area (Cohen and Levinthal, 1999). Thus, the higher the absorptive capacity of a
firm, the more likely is successful knowledge transfer to happen.
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Szulanski’s (2003) research revealed following elements as being characteristic for the
absorptive capacity of the recipient: the change in mindset; becoming knowledgeable; coping
with the new training methodology; developing equipment and process; hiring the right
people; management training; relative inexperience of recipient; understanding a different
approach to the market; and locating the process owner.
3.6 Summary
Having established the bridge between knowledge, its management and the transfer of knowledge as
an important process within knowledge management, Chapter 3 aimed at providing a deeper look
into the issue of knowledge transfer. By displaying and explaining two common approaches towards
knowledge transfer, the spiral model and the communication model, it was shown that the transfer
of knowledge involves a sender and a recipient of the knowledge. Furthermore, the participants of
this process deal with four different conversion modes that depend on the form of knowledge being
transferred and that determine the extent of the difficulty to transfer the knowledge. Throughout the
entire process, internal and external barriers and influencing factor additionally affect the difficulty
of the transfer process. In order to complete the theoretical ground of this paper, additional
information about the different main stages of knowledge transfer as well as the types of knowledge
transfers, which are investigated in this paper, have been provided.
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Figure No. 3.8 Summary of Chapter 2 +3
Knowledge
Data, information and knowledge
• Knowledge is not information
Forms of knowledge
• Tacit and explicit
• Individual, collective and organizational
Knowledge management
Requires effective
Approaches
• Eight building blocks (Probst and Romhardt, 1999)
• Alternative approaches
Knowledge
transfer
Important process
Stages of knowledge transfer
Ten knowledge strategy issues (Sveiby, 2001)
C H A P T E R 2
Communication model (Shannon, 1948)
Spirale model (Nonaka and Takeuchi, 1995)
Knowledge transfer involves sending and receiving unit
• Szulanski (2003)
• Inkpen and Dinur (1998)
Applied by:
4 modes of conversion
Barriers and influencing
factors of knowledge transfer
Internal External
C H A P T E R 3
C H A P T E R
4 + 5
Empirical
investigation
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4. METHODOLOGY
In this chapter the used methodology of this thesis will be described. It is to show in which way the empirical research
has been approached and to explain the different means that were used in order to carry out the various research
activities.
“Every discourse, even a poetic or oracular sentence, carries with it a system of rules for producing analogous things and
thus an outline of methodology”
(Jacques Derrida)
The methodological approach of this research is divided into four main parts. First of all, the thesis’
research philosophy is going to be described. Herein, the researches want to show the utilized
methodological way of thinking in this research by justifying their choice for the interpretive
approach and by explaining why it is the appropriate one for their research. The second step deals
with the analysis of the research approach, whereby the difference of deductive, inductive and
abductive methods are explained in more detail, together with the researchers’ choice of the
deductive approach. The next part aims at describing the data collection process scheduled for this
thesis by showing the primary and secondary sources, and by justifying why the researchers have
chosen the qualitative approach for gathering data. Afterwards, the applied approach will be
discussed. Under this point, the researchers want to illustrate in which way the question guide for
the qualitative interview was created. This contains information about the way the interview will be
conducted, by which criteria the respondents were selected and in which way the question guide is
disposed. In the final section of this chapter, the trustworthiness and with it the quality of the
research will be discussed.
4.1 Research philosophy – Positivism and Interpretivism
When it comes to the research methodology, several research philosophies can be distinguished. On
the one hand, there is the positivistic approach. Already in the early stages of this research process, it
sets a premium on the definition of research questions, possible hypotheses, and a set of possible
strategies and methods that are going to be applied during the research study (Denzin and Lincoln,
2000). Furthermore, the positivistic approach is according to Remenyi et al. (2002) more focused on
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quantifiable observations, which can be used for statistical analysis. As once Sir Karl Popper was
asked to describe the quintessence of the positivistic theory in one sentence, he replied: “The world
is all surface.” (Medawar, as quoted in Remenyi et al, 2002, p.33). This points out to the fact that the
positivistic approach is not the appropriate research philosophy in social science fields, especially in
business and management studies, because it will not lead to deep insights into complex issues
(Remenyi et al, 2002). Since this paper aims at taking a profound look into the process of knowledge
transfer to developing countries and not to carry out statistical analysis in any way, the authors’
research about the positivistic approach reveals that it should not be considered the appropriate one.
Furthermore, it is to stress that the method of conducting qualitative interviews calls for a certain
degree of flexibility in order to be able to freely adapt and adjust the research question as well as the
approaches to the empirical findings.
The alternative research philosophy becomes manifest in an interpretive research. Hereby, it is not
necessary to have a detailed design of the research beforehand, since it might compose a barrier to
finding new understandings (Denzin and Lincoln, 2000). However, in qualitative research, it is also
necessary to have design procedures a priori, but with the difference that during the creation of the
preliminary framework, it is crucial that the inevitable flexibility, which a qualitative research
demands, is taken into account as well. In this way, it is possible to allow the researchers to learn
new and unexpected empirical facets regarding the subject under study.
The interpretive approach enables the researcher to gain deep insights by discovering meanings
through improving the understanding of the whole subject (Neill, 2006). Furthermore, he states that
the positivistic approach is heading to find and analyze data regarding only parts of the subject
under study and that therefore crucial facets might be left out, which will moreover disturb and
restrict the understanding of the phenomena. In addition, he describes that by applying the
interpretive approach, the phenomena under study turns out to encompass various realities and not
just a single one. Therefore, the interpretive approach can be connected more closely to the
qualitative method with regard to data collection, as it will be described later on in this chapter.
Since this thesis is set to enlighten in which way the main influencing factors of knowledge transfer
are being handled within selected inter-organizational contexts, the interpretive research philosophy
is considered most suitable for the intended undertaking. The research model used for the
interviews is based on theoretical facts, whose usage, importance and practical relevance in selected
cases will be scrutinized and interpreted with the help of the information gathered during the expert
interviews. By leaving enough latitude that allows for additional evaluation and enlargement of the
66
model, the required flexibility is given and thereby reinforces the choice of using the interpretive
instead of the positivistic approach.
4.2 Research approach
There are two extreme ways of looking at the relation between theory and empirical world that have
to be distinguished. On the one hand, there is the deductive approach, which starts off in theoretical
ground. After having found or derived hypothesis and assumptions from the theoretical ground, the
researcher will verify or reject this hypothesis through empirical investigations.
On the other hand, there is the inductive approach, which stands in contrast to the deductive one.
That indicates that the researchers hereby proceed from an empirical level to the theory, implying
that they aim at generating a new theoretical model out of the gathered data. Furthermore, it is
possible to combine these two approaches to the so called abductive approach, where, for example,
new theories are derived from empirical findings, which then in turn represent the main subject the
researchers will elaborate on in further studies within the empirical field. (Saunders, Lewis and
Thornhill, 2007)
In this thesis, the deductive research approach will be applied, indicating that the authors start their
investigation on a theoretical level, subsequently progress through empirical patterns in order to
finally shift to the empirical level and its following interpretation. In this connection it is to remark
that researchers are not using the deductive approach to the core, but they are rather using a partially
deductive research approach, since it is not their aim to examine the validity of hypothesis, but to
interpret theoretical concepts derived from the theoretical ground with the help of empirical
findings. The main influencing factors and barriers that may occur during the process of knowledge
transfer are already written down in various theoretical models. For the purpose of this paper, these
theoretical factors had to be edited and modified to make them applicable to the context of external
knowledge transfer (see Figure 3.7). The questions that remain and which will be investigated are, in
which form these five influencing factors and barriers, that affect the efficiency of knowledge
transfer, occurred in real-life cases. In that connection, it is pending to investigate through
qualitative interviews with appropriate companies and through subsequent analysis of the collected
data, by which means these factors were eventually handled and dealt with, and which degree of
importance these factors are assigned by the persons in charge. The usage of qualitative interviews
additionally serves the purpose to hopefully find out further factors that played a major role in the
process, but were not listed in the used literature. The evaluation and interpretation of the
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importance of the factors, together with the possibility of revealing new factors and having to add
them to the theoretical conceptual model, will still take place on the empirical level, thus turning the
theoretical conceptual model into an empirically updated and modified exemplar that is readjusted to
the research context. This implies that the usage of a partial deductive approach is appropriate, with
a final conclusion bringing the theoretical model and the empirical findings together.
4.3 Data collection
This section will contain specific information about the type of sources that were used to acquire
necessary data for the research. Thereby, the terms primary and secondary data will be
demonstrated. Furthermore, the usage of the quantitative and the qualitative approaches for data
collection are going to be specified.
4.3.1 Primary Data
Primary data is information that is gained especially for the purpose of the research. It is necessary
to have primary data as a source of information, because only then the researchers surely know for
what special reason the corresponding data was generated and in which way it was interpreted. This
makes the information reliable and at the same time enforces the credibility of the work. Yet, it has
to be taken into consideration that generating primary data consumes a lot of time and incurs costs.
With regard to the limited amount of time this research project is facing, the chosen practices of
gathering primary data can only take place to a limited extent. For this reason, in this research study
solely qualitative interviews will be conducted.
This should support the researchers in acquiring necessary information in order to be able to
evaluate the factors for successful knowledge transfer. Details about the interview will be described
in Chapter 4.4.1.
4.3.2 Secondary Data
Secondary data is the second source of available data. These incorporate all sources that were
created and generated for other studies and eventually other purposes. These can include raw data,
like numbers and figures emanating from statistical publications, as well as summarized figures,
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which were already put in a certain analysis process. Using secondary data is supporting the
researchers in getting data within a very limited scope of time. A further advantage is that most of
the sources are freely accessible in the library of universities, the internet or in open libraries on the
internet. In that connection, it is important to always be aware that the data could have been
generated based on other purposes and reasons. Thus, when relying on secondary sources, the
researchers have to make sure that the sources are reliable and do not damage the credibility of the
research by eventually distorting the results. Choosing books that can be found in the library or that
are available at internet libraries can therefore be considered as reliable secondary sources.
Moreover, articles dealing with the subject of knowledge transfer, organizational or corporate
relationships, and with economic development can also be found in the stated sources.
What could be seen as a problem during the process of gathering secondary data is the fact that the
access to a variety of online databases comprising useful articles only granted access to paying
members. Since the research budget is very low, access to these databases mostly got denied. Also
the already mentioned limitation of time is a problem for the depth of the study. Therefore, the
usage of secondary data is helpful for speeding up the research.
4.3.3 Quantitative and qualitative research
In the course of the research, the process of acquiring data can take place via the qualitative and the
quantitative approach. What type of approach will be used and therefore what types of data will be
found, depends on the type of data the researchers are looking for and what method will be used for
the study (Walliman, 2001). Thereby it is important to point out, that it is not possible to make a
strict distinction between the qualitative and quantitative method, since quantity is always a
measurement for quality, putting both approaches into a connecting, and not excluding relation to
each other. The quantitative approach is easily to present in a short period of time. Furthermore, it
measures data in a systematic and standardized way (Patton, 1990), while the qualitative approach
can mainly be used to measure beliefs, motivations or attitudes. Due to this reason, qualitative data
is perceived as being more reliable. In that regard, Strauss and Corbin (1990) stress that qualitative
research can also be differentiated from quantitative research to the extent that it has not been
generated statistically or through other approaches of quantification. They continue that this
research style is mostly applied to issues concerning the behavior of humans and functioning, and
that the qualitative method is useful for investigating individuals, groups and organizations.
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Investigating organizations in the context of knowledge transfer relationships with companies
situated in developing countries necessitates accounting for individual, group, and organizational
behavior. It is statistically not measurable in which way knowledge transfer relationships are
working. In fact, the qualitative aspect rather calls for finding out what methods of knowledge
transfer are used, what factors and barriers have to be considered, and additionally demands for
evaluating the discovered behavior and treatments. This underlines the researchers’ choice for the
qualitative approach for the subject under study, since it is more suitable for the intentions and the
purpose of this paper: to explain in detail the connection between the theoretical model and its
importance in practice, to elaborate on the crucial factors for the success of knowledge transfer and
to analyze the corresponding empirical findings the companies and interviewees respectively
provide.
4.4 Applied approach: The qualitative interview
Predominantly, the process of collecting data about knowledge transfer between the developing and
developed world has been carried out through interviews with experts in the corresponding fields.
The Business Dictionary (2008) perceives an expert as a “professional who has acquired knowledge
and skills through study and practice over the years in a particular field or subject to the extent, that
his or her opinion may be helpful in fact finding, problem solving, or understanding of a situation”.
In all cases, only experts from one party, namely the Swedish company or organization, were
interviewed.
In the following part, the applied qualitative approach for data collection in form of a qualitative
interview will be described in more detail. This spans the demonstration of the way interviews will
be conducted, and what the researchers had in mind while creating and arranging the questions for
the interview. The last point under this section shows the factors that were important when it comes
to the choice of the respondents.
4.4.1 The Interview
For the purpose of gathering primary data during a qualitative research, conducting interviews is a
highly appropriate and promising tool. By allowing the researchers to notice and observe eventual
subliminal or hidden messages and opinions due to the interviewee’s actions behavior, like the tone
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of voice or hesitations while asking questions, the usage of interviews in a research study enables the
researchers to gain more information from the respondents than they would receive by plainly
distributing questionnaires to fill out (Bell, 1996). Furthermore, it is possible during a conversation
to clarify unclear aspects, which is impossible when just sending out questionnaires. Holstein and
Gubrium (in Silverman, 2004) see the interview as an appropriate way of acquiring various facts,
reflections, opinions, and further traces of experiences from the so called “vessels of answers” – the
interviewee. It is the researchers’ task to get the desired information out of them, to open them up
and to create a convenient atmosphere that facilitates the flow and exchange of information between
interviewer and respondent (Holstein and Gubrium in Silverman, 2004). Furthermore, they remark
that the qualitative interview embodies an efficient instrument to turn the passive “vessel of answer”
into an active one.
Type of the interview
Bell (1996) stresses that there are two extremes regarding the interview type: on the one hand the
total formalized interview, and on the other hand, the interview, which is more a lose conversation
determined by the individual respondents. Fontana and Frey (in Denzin and Lincoln, 2000) divide
the interviews into structured ones, where all interviewees get the same questions, in the same order
and with limited answer possibilities, giving the interviewees almost no option to vary their answers.
On the other hand, they introduce the unstructured interview, which provides the researchers - also
because of its qualitative character - with a greater wideness of data. According to Patton (1990),
researchers can chose between three ways of conducting interviews: first, the informal
conversational interview, secondly, the general interview guide approach, and thirdly, the
standardized open-ended interview.
The informal conversational interview can be seen as a normal conversation between two persons,
while the interviewee not necessarily has to know that he or she participates in an interviewing
process.
The general interview guide approach provides an interview question checklist, which is based on
issues concerning a certain topic, whereby the wordings of the questions are preliminary loosely
formulated. It should be rather seen as a conversation with a main thread guiding through the
interviewing process.
The last alternative mentioned, namely the standardized open-ended interview, is characterized by a
strict questionnaire with the same wording and order for each respondent.
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For getting deeper insight into the practical experience and to find out in which way knowledge
transfer is carried out between companies in developed countries and companies coming from
developing countries, the general interview guide approach will be used. That means that the
interviews are conducted with orientation on a question guide, but with the possibility to interact
freely with the interviewee and to react to his or her responding, with the aim to gain deeper insights
into a certain aspect. Thereby, the five factors for successful knowledge transfer will serve as the
basis for the questions to be raised.
The interview guide
The researchers’ type of interviewing is the general interview guide approach. The interview guide
being used contains several topics and fields of subject that constitute the framework of the
interview, within which the interviewer is able to engage in the conversation: it is possible to explore,
probe and ask questions, which need to be asked for clarification of the subject (Patton, 1990).
Further on, Patton (1990) claims that the interview guide helps the researchers to ask about all
necessary aspects during a certain period of time, preventing the researchers from not leaving out
crucial questions or from not drifting away from the main topic. Patton (1990) also states that it
depends on the preliminary knowledge of the researchers, how detailed the interview guide will be
prepared. The interviews should be insightful concerning three aspects: first, concerning the
phenomena knowledge transfer; secondly, the way knowledge transfer is managed practically, and
finally, the interviews are expected to deliver illuminating data concerning the five factors that are -
in theory - said to have a tremendous impact on the success of knowledge transfer. These factors
will be investigated and interpreted by conducting the interviews and by analyzing the corresponding
findings.
The guided interview enables the interviewer to talk freely about the topics under study. With only a
few questions on the agenda, it helps the researchers to not lose sight of the main thread of the
interviewing process and to make more out of it than just an interesting conversation (Bell, 1996).
Furthermore, this interviewing type allows the researchers to interrupt and ask individual and
spontaneous questions, which facilitates obtaining more useful information from the conversation.
Patton (1990) refers to these questions as probes or follow-up questions. He states that probes
enable the researcher to deepen the respondent’s answer, to enlarge the richness of the information
getting from the interviewee, as well as to steer the interviewee back into the desired direction of the
interview if necessary. Having a question guide for the interview beforehand makes it easier for the
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researchers to analyze the data afterwards. This comes in handy especially with regard to time-
limited studies (Bell, 1996), therefore making it attractive for usage within this paper.
The authors of this paper acquired the necessary preliminary knowledge about possible influencing
factors of successful knowledge transfer during their study of corresponding literature. Therefore, it
was possible to formulate 12 questions for the interview guide, which are destined to serve as a red
line throughout the interviews. Thereby, it is purposed to get the interviewee into elaborating,
instead of merely getting him to answer the questions shortly. The disposition and explanation of
the question guide is located at the end of this sub-chapter, while a pure overview of the questions is
provided in Appendix 1.
About the questions
There are a number of different types of questions, which can be discussed during an interview. It is
necessary to think about the purpose of the questions and what the researchers would like to find
out. Patton (1990) listed up several categories: experience/behavior, opinion/values, feeling,
knowledge, sensory and background/demographic questions. Since it is the researchers aim to find
out in which way knowledge transfer is taking place and in what way it is managed by companies
coming from developed nations, it is useful to focus on experience and behavioral questions,
because it entails inquiring about what a person has done or experienced, and which actions and
activities the person undertook in order to manage the issues under study (Patton, 1990).
Furthermore, questions investigating opinions, values or norms of the interviewee will be asked with
the attempt to understand the cognitive and interpretive processes and to get to know what the
person is thinking about the issues in question. The third kind of question that will be used and that
are taken from Patton’s list of question types (1990) encompass questions that aim at obtaining the
factual knowledge of the interviewee. They serve as a means to find out about the special knowledge
of the interviewee. Thereby, opinions and feelings are not taken into account, but only the
knowledge about a certain field or case is relevant (Patton, 1990).
The interview guide has been composed in correspondence with the pattern above: questions,
beginning with experience and behavior questions, are followed by questions about opinions, values
and norms of the interviewee, before finally questions about the knowledge of the interviewee will
be asked. The reasons why the questions are put in this order are described in the following passage.
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Sequence of the questions
There are no fixed rules describing the structural sequence of the questions, but according to Patton
(1990), it is advisable to start a qualitative interview with questions about present behaviors, activities
or experiences, which can also be called statements. The second step, according to him, is to
subsequently ask about opinions regarding the experiences described before, which is needed to
establish a context. This context is moreover required to ask knowledge questions and to receive
answers, since the interviewee will reveal more information if the conversation takes place within an
atmosphere of trust and convenience. Thus, this structure is useful to have in mind when creating
the structure of the question guide, as it applied below in the part describing the disposition of the
interview.
Wording of the questions
There are a few aspects that are important to consider when it comes to the wording of questions.
First of all, it is necessary to pose truly open-ended questions in a qualitative interview. Since it is the
researchers aim to get the interviewees elaborating on the questions, it is important to ask them in a
proper way. Thereby, it is important to ask truly open-ending questions, questions which are not
inherently creating restrictions to the answering possibilities of the respondent (Patton, 1990). He
stresses furthermore that it is from utmost importance to avoid dichotomy in the questions, means
that they should not be asked in a way that enables the interviewee to respond with a plain “yes” or
“no”. “The object of an in-depth interview is to get the person being interviewed to talk – to talk
about experiences, feelings, opinion, and knowledge” (Patton, 1990, p. 297).
In the questions of the preliminary question guide, the researchers should try to avoid “Why?”
questions as well. The reason is, that these kinds of questions presume a cause-effect relation
between two happenings, or furthermore perceive the world as being in perfect order and that
someone has perfect and complete knowledge about a topic. They are always assuming that there
are certain reasons for occurring facts and that they can be known about. It is furthermore often the
case that these questions are selected in order to cover various aspects. This happens for the reason
that the researchers do not want or cannot go into detail, which might lead to the outcome that the
answers of different interviewees respond to different things. This can ultimately result in obtaining
data, which cannot be used for the analysis in the worst case, since they all deal with different
aspects. (Patton, 1990)
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During the formulation of the questions for the question guide as well as during the interviews with
the possible spontaneously upcoming of questions, the researchers put high value in considering all
the aspects mentioned above.
Ways of conducting interviews
The interviews are intended to be conducted in direct face-to-face interaction. The positive aspect of
face-to-face interviews is that facial expressions and the behavior of the interviewee can be observed
(Gillham, 2005). Further positive aspects can be seen that semi-structured interviews, as they are
used in this thesis, provide a balance between structure and openness, and thereby, it is possible to
reach a deeper and more qualitative insight into the subject under study, which will be supported by
the possibility to make probes (Gillham, 2005). The negative side of face-to-face interviews can be
seen in the costs and time that need to be afforded in order to reach and meet the interviewee.
Furthermore, since semi-structured interviews are going to be conducted, the time effort for
analyzing the interview is higher than in a highly structured interview.
In this research, the process of knowledge transfer is considered to take place between countries
that are located all over the world. That means that persons, who are very interesting and
appropriate for interviewing are often not situated in close vicinity to the researchers. Therefore, it is
also necessary to conduct distance interviews. An appropriate tool in this case is also represented by
the telephone interview.
In contrast to merely sending out questionnaires with the purpose that the recipients complete them,
the advantages of telephone and face-to-face interviews lie in the opportunities for the interviewers
to directly react to the interviewee’s answers or to clarify uncertain aspects. Therefore, it is to say
that the answer in spoken form will be more detailed, longer and more reliable then the written
form, which enables the researchers to gain deeper insight into the issues at hand (Gillham, 2005).
Furthermore, Gillham (2005) stresses that the accessibility via telephone interviews is very high,
since people can nowadays almost be reached worldwide: it does not matter if they are sitting in
their office, at home, or in their car. It is needed to prepare the respondent for the interview in the
same way as the interviewee will be prepared for a face-to-face interview. In this connection, it
might turn out to be useful to provide the respondents with a copy of the question guide
beforehand, so that he or she can prepare him- or herself, and also to agree on a fix appointment
that is appropriate for both sides (Gillham, 2005). However, the authors of this paper decided to set
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high value on a more spontaneous course of conversation, with using the question guide simply as a
guideline. Therefore, the question guide will only be sent out to the respondent beforehand in case
they explicitly request it.
Even though the telephone interview has some of the same qualities as the face-to-face interview,
Gillham (2005) also points to some negative aspects that have to be considered. He states that the
duration of the telephone interviews is stronger limited, which implicates that the time for receiving
qualitative data needs to be intelligently planned by the interviewer. Furthermore, it needs to be
mentioned that the non-verbal communication elements are missing, which may hide further useful
information for the researchers.
For this thesis, maximum effort has been put on conducting the interviews face-to-face due to the
inherent advantages this type of interviews. However, due to time and money restrictions it was not
possible in every situation, so that some interviews had to be conducted over the telephone.
Disposition of the question guide
In this part, the theory and intentions described above will be applied on the question guide, which
will be used in the interviews.
For a better understanding of the coherences and for facilitation of interpreting the information
gained during the interview, it may be helpful to firstly ask the interviewee to shortly review his or
her career and to state his or her position within the company and the corresponding tasks and
responsibilities the position entails. After that, it may turn out to be useful to ask the interviewee to
tell something about the project within which knowledge has been transferred to developing
countries. This is necessary, as described above according to Patton (1990), because it should be the
first step to let the interviewee talk about behaviors, activities and experiences.
1.) Would you please introduce yourself and tell us about your position and
responsibility in your company?
2.) Could you please shortly describe the specifications of your project in terms of:
- Name of the project
- Organizations involved
- Type of relationship
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- Operations (schedule, milestones)
- Objectives
In order to avoid just “getting” answers, it is certainly important to ask open-questions. This can be
promoted by giving the interviewee a specific and context-related scenario at the beginning, instead
of posing questions immediately. This additionally helps the purpose of seeking information from
the interviewee’s pool of experience and his or her professional opinion, and at the same time to
establish the actual context of the interview. By doing so, the way is cleared for a more open debate
and deeper problematization with the interviewee.
“Our literature research reveals that especially developing countries are in need of
knowledge and that therefore efficient knowledge transfer between collaborating companies
from the western and developing world is crucial for successful and beneficial relationships.
In the case of outsourcing offshore, for example, lacking or inefficient knowledge transfer is
listed as one of the most common reasons responsible for failed outsourcing relationships.
Furthermore, a lot of attempts of transferring knowledge to developing countries fail due to
inefficient knowledge transfer, although those relationships were established with the only
purpose of transferring knowledge.”
3.) What is your opinion about this issue?
At this time, the context of the interview is hopefully set and every participant is fully aware of what
the interview is about. The researchers can now go to the bottom of the issue addressed by asking
more specific questions about the knowledge transfer itself, in terms of procedures, challenges and
so forth.
4.) What kind of knowledge are you and your company primarily transferring?
5.) Could you tell us more about your approach towards transferring this knowledge?
6.) What are/were so far the major problems/challenges you were facing?
7.) Which measures did you take to solve/overcome these?
The context of the interview is herewith given, so that the interviewee may feel comfortable with the
situation and is therefore willing to answer further and more detailed questions about certain
knowledge (Patton, 1990). Now the actual topic of the research can be addressed and explained to
the interview more specifically, so that he or she has a clear vision of what the following is going to
be about.
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“Since knowledge transfer can take place in different ways in terms of density, complexity,
or types of knowledge, it is the aim to shed light onto the question, in which ways companies
are trying to conduct knowledge transfer successfully to developing countries. By doing so, it
is the aim to evaluate specific intra-organizational based key factors that are generated from
our literature research and that are affecting the efficiency of knowledge transfer by putting
them into the context of an external knowledge transfer between two companies of unalike
markets.”
8.) Before showing you the key factors we gathered from several sources, we would like
to ask you, which factors you and your team consider most important when it comes
to knowledge transfer to developing countries.
The answers to questions four to eight are likely to forestall information with regard to the model of
influencing factors that follows. This is done on purpose, since it is desirable to let the interviewee
mention some of the factors already on his or her own. In this way, any kind of influences the
suggested model could have on the interviewee’s answers are more likely to be eliminated.
Furthermore, by posing these questions it is much more likely to acquire information about
unknown influencing factors and barriers that are not accounted for in the conceptual model of the
research.
Another reason for this approach is the intention of the authors to not overwhelm the interviewee
with a myriad of theoretical aspects and technical terms that may cause confusion or even
discouragement during the interview, in case the respondent did not ask for a copy of the question
guide beforehand to get acquainted with it.
At this point, the model generated from the literature research will be presented and possible still
unspoken factors will be addressed and carefully explained to the interviewee (see Figure No. 4.1).
The purpose is to gain information about the importance and treatment of each factor that has not
been mentioned yet by the interviewee, but still has to be discussed for the sake of completeness.
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After having discussed the model and its factors with the interviewee, there are still some small
questions remaining.
Since knowledge transfer can only be considered successful when the recipient is permanently
making use of it, it suggests itself to ask:
9.) Through which “control” mechanisms – if any – does your company guarantee the
continuous utilization of the transferred knowledge on part of the recipient.
As explained in the previous chapter, motivation-related factors do not and should not play a major
role within an external knowledge transfer. However, projects can consume a lot of time and nerves.
This may result in declining motivation in the course of the project. Therefore, it may be interesting
to talk with the interviewee about possible lacks of motivation the team members on both sides
showed or did not show.
Organizational factors
Knowledge characteristics
Individual factors
Strong ties
Knowledge management factors
• Causal ambiguity
• Explicit vs. tacit knowledge
• Absorptive capacity
• Trust
• Cultural distance
• Communication
Knowledge
Transfer
• Strategic similarity
• Organizational distance
• Organizational culture
• Measurement
• Information technology
Figure No. 4.1 The research model derived from the theory
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10.) Has the project been endangered in any way at any time due to lacking or depleting
motivation on both side of the partnership? (Not-invented-here syndrome, Invented-
here syndrome, fear for loss of ownership…)
Since this study is dealing with knowledge transfer to developing countries, it can be insightful to
shed light not only on the company itself, but also on its macro-environment, specifically on the
governmental and economic side as the final part of the interview.
11.) Did the government of the developing country itself, directly (through interferences)
or indirectly (through laws and regulations) in any way support, inhibit or exacerbate
the transfer process?
The final question was constructed with the aim to gather useful insights and ideas for the
concluding part of this study.
12.) In your personal opinion, to what extent may the whole project and consequently the
transferred knowledge help or stimulate the economic development of the receiving
country?
Throughout the entire duration of the interviews, the interviewers avoided the usage of “Why?”
questions, out of the reasons mentioned earlier. Furthermore, in order to be able to acquire
information about sensitive aspects, the appropriate wording of the questions, as described above,
was kept in mind. Additionally, also the method of asking probe questions was used in order to
obtain more information out of the interviewee’s knowledge base.
Choice of respondents
Patton (1990) argues that it is a characteristic of the qualitative approach to spotlight on small
samples. These examples are cases which are perfectly suitable to show, to illustrate and to explain
the subject under study with a huge amount of information. Patton (1990) additionally stresses that
there are no rules about how many samples have to be used in a qualitative research study.
Everything depends on what the researchers aim to find out, on the acquired information in terms
of its usefulness and its ability to generate the necessary credibility, and ultimately on the necessity
that every step that is taken and every activity that is intended to be carried out for the success of the
research is possible to fulfill within the given period of time and resources.
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Therefore, the researchers aim was to find a list of Swedish companies or organizations that can
serve as appropriate cases or examples to investigate knowledge transfer processes from developed
to developing countries. Focus was set on covering different aspects of knowledge transfer
processes and with it to also strengthen the credibility of the empirical findings. This implies that
cases were preferred that contained dealing with companies or organizations in developing countries
from different regions in the world and also to have knowledge transfer processes under varying
situations and circumstances. In the described cases, the companies or organizations, which were
chosen for the empirical investigation of the crucial knowledge transfer factors dealt with developing
countries from Asia, Africa and South America like China, India, Ethiopia, Uganda, Brazil and Chile.
Furthermore, the cases are dealing with projects affecting the development of cities, municipalities
and whole regions, whereby the span of the projects reaches from knowledge transfer in its purest
form up to high investment ventures. The companies and organizations that provided the
researchers with suitable cases and corresponding information were Swedfund, Kalmar Kommun,
Tetra Pak, Borlänge Energi and Nutek. Each company and case it entails will be described in the
Chapter 5.1.
4.4.2 Data analysis
As Patton (1990) suggests, the analysis of the empirical material should start with a case analysis of
each unit under study, meaning that small descriptions of the investigated case should be provided at
the beginning of the analysis. These descriptions provide information about the different contexts,
under which knowledge transfer took place, and details about the interviewed persons. This enables
the researcher to refer anytime to a specific case or example within the analytical part and
concurrently helps the reader to understand and follow this reference, which is crucial for being able
to associate the given information with the accurate context. The descriptions can be found in
Chapter 5.1.
With the collected data, a structured analysis of the content was carried out. Thereby, an analysis
framework has been created by the authors of this paper in order to facilitate the process of sorting
out the material with regard to the influencing factors and barriers the outline of the investigation
was based on. The framework was created with the help of certain aspects derived from the
examined literature and theory as well as from new insights that were obtained during the interviews.
In that connection, it naturally embraces the factors and their elements that were already mentioned
in the research model:
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• Strong ties (trust, cultural distance, communication)
• Organizational factors (strategic similarity, organizational distance and culture)
• Knowledge characteristics (causal ambiguity, explicit vs. tacit knowledge)
• Knowledge management factors ( measurement, Information and Communication Technology)
• Individual factors (absorptive capacity)
The slight difference is that another factor had to be added to the framework as a result of the
insights that were firstly obtained during the interviews and therefore did not constitute a part of the
original research model.
The collected material was thoroughly examined, structured and categorized in accordance with the
analysis framework and its elements, with the aim to allow for a clear distinction between the
different factors by precisely allocating the experts’ statements to the corresponding factors
throughout the entire analytical process.
Figure No. 4.2 The analysis framework
Advanced Economy
Developing country
Knowledge transfer
Strong Ties
Organizational factors
Knowledge management factors
Individual factors
Knowledge characteristics
Further findings
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4.5 Trustworthiness of the research
Validity, reliability and generalisabilty are according to Remenyi et al. (2002) factors to measure the
quality of a research work with a positivistic approach, which are according to Marshall and
Rossman (as quoted in Remenyi et al., 2002) inappropriate for non-positivistic research approaches
and should therefore be transformed before their usage. Therefore, the transferred quality factors
for non-positivistic research studies, like in this thesis an interpretive research, are called: credibility,
transferability, dependability and confirmability. These criteria, as mentioned in Remenyi et al.
(2002), will be described and applied to this research study in or to illustrate the trustworthiness of
the research study.
Credibility
It should show that the research method was created in an appropriate way to find out and
investigate the research phenomena, so that the findings are believable. The factors for successful
knowledge transfer, which were chosen from the theory, are based on various sources that all refer
to the importance of them. Due to this reason, it can be said that from this point of view the
credibility of this thesis is pretty high. What might decrease the credibility is the fact that due to
restrictions in time, only one primary source for the data collection, namely the qualitative
interviews, could be applied. Furthermore, having to conduct a part of the interviews over the
telephone due to time and money restrictions, has some slight disadvantages compared to face-to-
face interviews as delineated above. However, as described in Chapter 4.4.1 under the choice of
respondents, the researcher attempted to investigate cases that all handle different regions and
countries and different contexts. This might increase the credibility of the work. Regarding the
period of time that was given for this research study, the researchers of this paper therefore evaluate
the credibility of this work as quite high.
Transferability
Here it is the question, if the results are rich in information, and insightful enough to allow other
researchers to transfer the findings to other cases. Since this research study investigates knowledge
transfer from developed to developing countries, it is possible to transfer the findings to other
external knowledge transfer processes that deal with developing countries. The main factors will
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much likely be dealt with in numerous cases of external knowledge transfer cases, but the application
of the additional factors will vary, and at the same time depends thereby on the side of the transfer
that is looked upon more closely. Therefore, it can be said that the transferability of the work is
relatively restricted.
Dependability
It is not the aim of a qualitative research to be able to measure the same phenomena a second time.
In the field of qualitative researches, it is expected that the settings are changing constantly and that
findings should be seen as data that is gathered in one time and in one situation. The findings
gathered via the interviews will provide data for the interpretation of the knowledge transfer
phenomenon with developing countries as it was perceived at that moment by companies and
organizations interviewed. This indicates that the findings are dependent on the situation today, but
that the basic settings will change in the future, meaning that the dependability is decreasing.
Confirmability
Finally, it is to demonstrate if and to what extent the research study got biased by personal or
theoretical tendencies. The five factors, which served as a basis for the research, were classified from
several theoretical sources as crucial for successful knowledge transfer. It could also have been that
other factors might exist, which were not taken into consideration in the theory and therefore also
not in this research study. This might decrease the confirmability of the research study. But on the
other hand, the authors of this paper were open to experience new facets and aspects of knowledge
transfer to developing countries. It was not their aim to neglect any factor, but to also take them in
account for the results of the empirical study, which in turn might increase the confirmability of the
study again.
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5. EMPIRICAL FINDINGS AND RESULTS
The aim of this chapter is to submit and to discuss the empirical findings gathered during the interviews. This will be
done by introducing the descriptions of the different cases that were investigated, and by comparing the statements of the
corresponding experts. The entailing analysis of the findings is based on the data analysis approach that is explained
in Chapter 4.4.2 of the methodology. The concluding part will then provide an overview of the achieved results.
“If you have knowledge, let others light their candles in it”
(Margaret Fuller)
In the following paragraphs, the results from the expert interviews will be discussed. In order to be
able to relate to the interpretations and to understand the different contexts and backgrounds, the
different cases will be described at first. This is followed by a comprehensive analysis of the gathered
information and material, which have been received throughout the investigation. Thereby, the
experts’ opinions and statements concerning the distinctive influencing factors and barriers of
external knowledge transfer to developing countries will be compiled, analyzed and evaluated. The
conclusion at the end of this chapter contains a summarized overview of the findings and their
results.
5.1 Case descriptions
Overall, five cases were investigated, each one at a different company or organization. The next
paragraphs incorporate explicit descriptions about the companies and organizations themselves and
the different contexts within which the knowledge transfers under study took place. It also contains
information about the type of knowledge that was transferred.
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5.1.1 Swedfund
Swedfund is a government-owned risk capital company with investments in Africa, Asia, Latin
America and Eastern Europe (not EU-members). Their aim is to contribute to the development of
profitable companies and thereby to stimulate sustainable economic development in the different
countries. They are therefore working under the development aid umbrella, yet they work fully
commercial with direct investments or with investment through funds. The investments can be of
any kind, except for defense, alcohol, tobacco and real estate, and encompass investments in, for
instance, the pharmaceutical industry, hospitals, different types of productions, software, and
retailers.
In order to invest, Swedfund has to work with a strategic partner. These partners are primarily
Swedish companies that wish to establish themselves in a new market or to expand their operations.
Their role in the investment process is to share the financial risk with Swedfund and to take over the
operative responsibility. Swedfund in turn provides risk capital in form of share capital, loans,
guarantees, and part-financing of leasing agreements, and a huge amount of competence and
experience in the new markets.
Next to the foreign direct investments, Swedfund together with their strategic partners transfer
knowledge in form of knowing how to build and run factories or companies and in form of
managerial knowledge, for example, how to be in the board. Another type of knowledge that
companies from developing countries indirectly can benefit from, is the pool of rich experience in
the emerging markets. By providing their strategic partners with a lot of information about the
economic conditions and circumstances in the country they want to invest in, Swedfund ensures that
major mistakes or misjudgments are less likely to occur, ultimately resulting in a higher benefit and
more efficient knowledge transfer to the developing countries.
The interview took place with a senior investment manager at Swedfund International, who is
working with investments in Asia, concentrating on India, Pakistan, Laos, Bhutan, Sri Lanka,
Bangladesh and to some extent China.
Figure No. 5.1 Swedfund logo (Swedfund, 2008)
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5.1.2 Kalmar Kommun
In the context of the so called North-South-Cooperation treaty, Kalmar municipal has been
conducting various projects with the municipalities of Kalmar’s twin cities and receives financial
support from the Swedish International Development Cooperation Agency (SIDA). Since most of
Kalmar’s twin cities are in countries that are nowadays members of the European Union (for
example Panevezys in Lithuania), SIDA stopped providing financial aid for projects in these
countries, leaving only money for carrying out projects in Uganda and Russia, where Kalmar is
fostering a close relationship and twinning with Entebbe and Kaliningrad respectively. Since the
focus of this research is put on developing countries, only the projects conducted in Entebbe,
Uganda were investigated.
The cooperation agreement between Kalmar and Entebbe was signed in the spring of 2003. As a
symbol of the future partnership with Entebbe, Kalmar sent a fire engine to the town, making it the
second city in Uganda with its own fire engine. Before that, Kalmar already had a lot of contacts
with Entebbe since 1999, when the head of the International Department of Kalmar Municipal was
committed by SIDA in the so-called Lake Victoria Initiative. The aim of this initiative was to use the
experience from the cities around the Baltic Sea, the Union of the Baltic Cities (UBC), to assist the
cities around Lake Victoria to establish a corresponding organization, the Lake Victoria Region
Local Authorities Cooperation (LVRLAC). At that time, the mayor of Entebbe was chairman of
LVRLAC, which marks the beginning of the friendship with Kalmar and Entebbe. Before signing
the actual agreement, a co-operation between the upper secondary school “Stagneliusskolan” in
Kalmar and a similar school in Entebbe resulted in providing scholarships to some children in
Entebbe that enabled them to attend an upper secondary school. Collected money also equipped the
cooperating school in Entebbe with computers and an Internet connection.
The overall objectives of the partnership, which are addressed throughout every project, are:
- Mutual benefits
- Sustainability of the achieved results
- Decreasing poverty
Figure No. 5.2 Kalmar Kommun logo (Kalmar Kommun, 2008)
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- Environmental improvement
- Gender equality
So far, Kalmar Municipal has successfully completed three projects in collaboration with the
municipality of Entebbe and with the financial support of SIDA. The following descriptions also
inform about the types of knowledge that have been transferred to Entebbe.
1.) Town Plan for the city of Entebbe
The objective of this project was to establish a physical plan for Entebbe, since the lack of a
modern town plan causes difficulties to receive support from the government as well as
bilateral and international support for investments in infrastructure. The municipal
administration of Entebbe has no specialist with the function to work with physical
planning.
A physical plan is a plan that shows the usage of land and water area for different purposes.
2.) Democracy project
In the year 2005, the multi-party system has been established in Uganda, which led to new
parties being formed and local elections being held in March 2006. Therefore, the mayor of
Entebbe sent a written request to Kalmar Municipal, asking to carry out a democracy
project. The project concerned following areas:
• The development and working conditions of the popular movement and political parties
• The administrative machine on a central, regional and local level
• The role of politicians/civil servants and the role of the mass media
• Youth influence, gender equality and sustainable development
The overall aim of this project was to hasten the long-term process of democratic
development in Uganda and to educate the officials and politicians in Entebbe about the
democratic process in Sweden as an inspiration.
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3.) Gender equality project
This project is justified by the critical concern of high inequalities women in Uganda are
exposed to: women work considerably longer hours than men; women bear the brunt of
domestic tasks; young women’s rights are violated through early forced marriages, early
pregnancies, and defilement. In the political area, women not only face constraints when
engaging in elective processes, like limited resources for campaigning or spousal control, but
their competence is also undermined by low literacy, inadequate skills or restricted access to
vital information.
The main goal of this project was to increase gender equality in municipal operations. This
aimed at empowering women and gender equality as an integral part of the socio-economic
development of Entebbe. In order to achieve this, a gender policy and a plan of action for
Entebbe have been created that should guarantee the successful implementation of the
policy.
In August 2008, a new project is about to start, which aims at developing an environmentally and
economically sustainable waste management plan. This spans creating new collection methods that
will decrease the total amount of collected waste by 20%. Among other processes, for accomplishing
the objectives it is envisioned to train 15 to 20 “resource persons” within a residential area of around
500 households. These resource persons shall then inform on waste and environmental issues with
focus on the sorting of waste. The new knowledge about waste management is expected to achieve
the desired results by the year 2010.
The interview took place with the head of the International Department of Kalmar Municipal, who
has been responsible for every project being carried out.
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5.1.3 Tetra Pak
With over 130 billion sold packages per year, the Swedish company Tetra Pak is world market leader
in the field of liquid food processing and packaging systems, especially of liquid packing board for
milk and juice cartons. In this regard, Tetra Pak is one of the largest buyers of paper, with
processing over one million tons per year, an amount that is growing by 80 000 tons each year. In
order to meet the worldwide growing demand for Tetra Pak’s products and to keep up with the
corresponding increased need for paper, they have to persistently ensure a sufficient supply of paper
that is needed for the manufacturing process. In order to achieve this, Tetra Pak runs more and
more collaborations with paper producers from all over the world.
It speaks for itself that not every local supplier can be an appropriate partner for Tetra Pak, since
they have high requirements when it comes to the quality of the paper they intend to use for
manufacturing. In order to become a global supplier for Tetra Pak, the company has to fulfill certain
requirements, for example in terms of technical expertise and experience or health and legal issues.
Additionally, it is necessary for them to be able to come up with service, competitive prices and a
long-term view of their strategic orientation.
As mentioned above, not every supplier is capable to fulfill these requirements, yet Tetra Pak has a
high and continuous demand of paper. Therefore, they are seeking possible partners all over the
world. Thereby, every potential supplier is being thoroughly screened with regard to their ability to
meet the requirements. In the case that the results of this screening process reveal that the gap
between the necessities and the actual existent production capabilities of that supplier is bridgeable,
Tetra Pak is setting up different plans, activities and programs in order to help and support this
supplier with its economically and technically progress, with the aim to turn this local supplier into a
global supplier for Tetra Pak.
One of the suppliers that took part in this process is the paper producing company Klabin in Brazil,
which is Latin Americas largest paper manufacturer and Brazil’s largest exporter, with being
responsible for 74% of Brazil’s exports. In the course of the collaboration, which already started in
1982, Tetra Pak realized that the desired progress did not occur as planned. As a result, it was
decided in 2001 to send an expert to Brazil to work on-site with the developing supplier and to
Figure No. 5.3 Tetra Pak logo (Tetra Pak, 2008)
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support them in every way to meet Tetra Pak’s requirements and to become a global supplier. In
general, the aim was to show the employees of Klabin how to produce good paper that can be used
by Tetra Pak for various applications, encompassing issues like the properties of the paper and its
manufacturing.
The interview took place with the expert from Tetra Pak who was living for three years in Brazil and
worked closely with Klabin.
5.1.4 Borlänge Energi
Borlänge Energi is a municipally owned company delivering a number of services to the inhabitants
of Borlänge, for example tap water, electricity, district heating and broadband internet access. They
also run the municipal wastewater treatment plant and are additionally in charge of collecting waste
and its disposal. The streets as well as the roads and green areas are also taken care of by Borlänge
Energi.
Within the scope of their international development projects, Borlänge Energi has educated 68
municipalities in waste management in Chile, but has also been carrying out similar projects with the
municipalities in Wuhan (China) and Pietsi (Rumania). In all three cities, Borlänge Energi is trying to
establish an Environment Technology Center in cooperation with IVL Swedish Environment
Research Institute, with the aim to create a meeting place for Swedish environmental technology
companies and foreign companies. Thereby, the center will act as a long term base for close relations
between the different countries.
The focus of the interview was put on the projects that were conducted in collaboration with
Chilean municipalities in the field of solid waste management. In this context, SIDA-financed (see
5.1.2) development projects in the fields of municipal waste treatment, decentralization actions and
environmental work have been carried out. Some important projects were:
Figure No. 5.4 Borlänge Energi logo (Borlänge Energi, 2008)
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• Waste treatment consultancy (1994-1995)
• Pilot project for waste classification, collection of batteries and compost in municipalities of
Santiago (1995)
• Assistance of nine different municipalities in the development of environmental plans (1996)
• A two-year training project to formulate waste management plans in the municipalities of the
Santiago Region, with the objective to train the participants in being able to develop municipal
waste management plans, and to work with citizens in pilot projects, for example educating
schoolchildren (1999)
• Seminars held in Sweden and Chile about systems for integrated waste management in the
Santiago region (2000)
Current projects envision to establish an incineration plan for waste with energy recovery, to educate
about different methods of handling sludge, and – as mentioned above – to establish an
Environmental Centre between Sweden and Chile.
The interview took place with the head of International Projects within the Department of
Development at Borlänge Energi, who has been in charge of the projects for 15 years.
5.1.5 Nutek
Nutek is the Swedish Agency for Economic and Regional Growth. On a national level, Nutek’s aim
is to contribute to the creation of new enterprises, more growing enterprises and stronger regions in
order to ultimately stimulate the economic growth throughout Sweden.
On the international level on the other hand, Nutek’s primary objective is to contribute to
substantial and prosperous economic development and progress in several parts of the world. As
with regard to the overall system at Nutek, similarities with Swedfund exist.
Within their StartSouth and StartEast Program, Nutek offers Swedish small and medium-sized
enterprises (SMEs), which want to establish themselves in a new market, the opportunity to apply
for financial support for the transfer of know-how and for investments to developing countries. In
addition, emphasis is also put on establishing and fostering long-term and sustainable business
cooperation between Swedish SMEs and private companies in the StartSouth and StartEast
Figure No. 5.5 Nutek logo (Nutek, 2008)
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countries. In this regard, the objective is to implement efficient operational activities by transferring
knowledge from the Swedish companies to the partner company with the attempt to develop and
enhance the operational skills of the partner. The StartSouth and StartEast Program is financed and
supported by SIDA and covers various countries in Africa, Latin America, and Asia (StartSouth) as
well as the Western Balkan countries and the Commonwealth of Independent States (StartEast).
The interview took place with one of the program managers of Nutek’s StartSouth and StartEast
Program, under which umbrella 160 projects are actively conducted in the moment.
5.2 The influencing factors and barriers
The following sub-chapters deliver the empirical findings that became apparent after having
analyzed the collected material with the help of the analysis framework. Each influencing factor and
barrier as it is pictured in the research model will be individually illuminated and evaluated with
regard to its importance in each case. Additionally, information will be provided that reveals in
which way the companies tried to deal with the factors and barriers they were facing.
5.2.1 Strong ties
This factor covers the
aspects of communication,
trust and barriers in form
of cultural distances that
might be affecting the
relationship between the collaborators. These three elements are thereby intertwined, since through
communication and trust cultural differences can be understood and overcome, while cultural
distances at the same time stimulate communication and with it a growing degree of trust. Due to
this reason, the elements cannot be treated separately.
According to the expert of Swedfund, knowledge transfer is a continuous process. It is not about
sitting down at a table and giving the companies a lesson. It is an iterative exchange process that
necessitates a strong relationship in order to get a closer look on the recipient’s needs. During the
project, Swedfund discusses with the partners a high number of times, since they have to be able to
Strong ties
• Trust
• Cultural distance
• Communication
Figure No. 5.6 Strong ties
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tell them where they are proceeding in a wrong way and in which areas they can improve efficiency
– this takes place not only with the strategic partner, but also with the partner in the developing
country. For Swedfund, it is very important to have a very close and informal relation. It is
important to become friends with the persons they work with. In the case that things do not work
out as they are supposed to, it is necessary to be able to discuss and to talk about these issues. Being
incorrigible and always trying do have it according to one’s own will is in no way an appropriate
solution. Emphasis must be put on discussing with them, on building up friendly relations in order
to solve problems. Having two different opinions about specific issues, one has to try to come back
on the same track or one separates. If one is not on the same line, it is not advisable to continue the
project. Furthermore, by establishing a strong and friendly relation, one signals willingness to help,
which makes it easier for the recipient not only to absorb the knowledge, but also to feel more
comfortable during the discussions and negotiations.
Communication is thereby an important means by which the process of bonding with the partners is
remarkably stimulated. In Swedfund, communication does not only involve very frequent status
updates via telephone or email, but also acquiring further information by travelling to the companies
to get a more detailed picture of the projects’ process and health. Swedfund’s intention in this regard
is not teach or educate people in a certain way, but to actively communicate with them and to have a
dialogue that contains knowledge that Swedfund has acquired during the years.
Cultural distances can pose strong barriers on the efficiency of knowledge transfer. Hence,
Swedfund’s strategy is to make sure that cultural difficulties and differences are eliminated as far as
possible already before deciding on entering the project. However, commercial differences in terms
of how to run the company or how to split profits are harder to overcome for Swedfund than
cultural differences, since some partners think that they should receive all the credit while the risks
stay entirely with Swedfund. This aspect is especially difficult for the Swedish strategic partners of
Swedfund, since their management is not always aware of the reasons why some things happen. This
is, for instance, a point at which Swedfund has to support them with their long-time experience and
knowledge about certain procedures and ways of thinking in the developing countries in order to
make the Swedish partner understand and aware of the cultural and commercial differences.
This aspect is also of importance for the head of the International Department at Kalmar Kommun.
Before sending the team of expert to Entebbe in Uganda, it is very important for Kalmar Kommun
to tell the team that communication is everything that decides about the success of the project.
Thereby, communication must not be a one-sided activity, but it must be understood that listening
to the concerns, ideas, visions and intentions of the people in Entebbe is as much an equally
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important part as giving knowledge. They have to understand why the people have a different
opinion, because it is not always related to cultural issues, as the Swedfund case also illustrates. The
expert at Kalmar Kommun stressed that listening actively and carefully is one of the most important
aspects to cover in order to succeed with the project. As an example, the project concerning the
gender equality in Entebbe was brought up. While the situation for women in Uganda is in fact very
bad, even in Sweden or whole Europe women complain about lacking equality. This is, however,
nothing compared to the situation in Uganda. For the team of experts, it is therefore important to
understand why it is like that, which can only be reached through intensive communication.
Since the projects carried out by Kalmar Kommun with Entebbe are only financially supported by
SIDA in the context of a long-term twin sister relationship, it is extremely important to get to know
the people you are working with and to have a very close and friendly relation with each other.
Especially the personal connection between the two coordinators of the projects – the head of the
International Department at Kalmar Kommun and the town clerk in Entebbe – played a major role
during all the years. By also meeting privately and spending time together with the families, a trustful
relationship has been built up between the two coordinators, which certainly contributed to the
success of the projects between Kalmar Kommun and Entebbe.
With regard to the cultural distance as an influencing factor, the head of the International
Department at Kalmar Kommun explicitly emphasized language-related problems. Although
English is also not their native language, getting used to and ultimately understand the Ugandan
English dialect turned out to become a major barrier at the beginning. In order to overcome this
barrier, communication and patience is the most effective way. It is important to honestly let them
know in case that one does not understand what they are saying. One has to ask them to speak more
slowly, even if one has to remind them of that ten times a day. This, on the other hand, necessitates
a certain degree of trust and with it the possibility to be able to be honest to each other without
creating bad feelings.
This not only includes honesty with each other, but also honesty with oneself. The expert explained
that very often during the projects, they were not so sure if they themselves did it the right way,
making it very important to inform the people they are working with in Entebbe that they also faced
problems with this and sometimes did not find themselves capable of solving the problems. Trust
and with it honesty in every way is therefore a very important factor when it comes to having a
strong relationship.
Next to the language, another cultural barrier was the different perception of time in Uganda. The
head of the International Department reported about situations, in which the appointment was set
for 9 a.m. and the officials of Entebbe did not show up before 10.30. Another example was set in
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Sweden during a visit of the officials of Entebbe. Between the seminars that were being held, the
visitors wanted to go shopping and were given one hour for that due to the tight schedule. They
returned after three hours. Additionally, the visit of the mayor of Entebbe in Kalmar revealed
cultural differences in terms of religion, where he had to go to the church very often for about one
hour because his religion orders him to do so. But it is equally important for the hosts to
understand, accept and especially respect that behavior. During the projects, the expert very often
jokes and says to the people from Entebbe, in case they are ahead schedule, that they can now take
Ugandan time. When time is running short though, they would have to change to Swedish time
again.
With regard to the ever tight schedule these visits had to endure, the expert sincerely recommended
not to arrange the schedule in a stiff way, and to rather prefer to take one hour off, to sit down
together, to drink coffee and to get to know each other better during the seminars.
Kalmar Kommun also strengthens the relationship between the municipalities by involving the
youth. As explicated in the case description of Kalmar Kommun, the cooperation between two
upper secondary schools in Kalmar and in Entebbe also provided the school of Entebbe with
scholarships and computers with internet access. In some cases, they are even involved in the
project between Kalmar Kommun and Entebbe municipal. During the gender equality project, for
example, participants from the actual project and from the school-cooperation were brought
together for a discussion between adults and young people about gender equality. This approach not
only leads to stronger social ties, but also to considerable different insights and attitudes towards
certain issues, since young people tend to have a more positive attitude than older people.
The influencing factor of a strong tie between recipient and the receiver of knowledge also played a
major part in the case of Tetra Pak.
At the time that Tetra Pak realized that they did not make satisfactory progress with the Brazilian
supplier Klabin, they decided to apply another approach: to send an expert to Klabin with the task
to work on-site with the paper supplier for three years. The overall aim thereby, was to support the
supplier in every way to stimulate the economic progress of this company, so that they could
ultimately become a global supplier for Tetra Pak. This step of trying to work very closely and to get
to know each other personally led to the establishment of mutual trust that was absolutely necessary
for the collaboration to reach satisfactory results for both sides. The expert of Tetra Pak explained
that the process of them getting to know you, and you getting to know them brings the contractors
closer together, which also lies in the philosophy of Tetra Pak: to work with a supplier not as a
supplier, but to work with them as a partner in a partnership, with bilateral support and exchange of
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knowledge. The expert narrated that during all the years that he was working in Brazil, he spent
most of the time at the supplier’s factories, where they manufacture the paper rolls. In the course of
his stay, he met a lot of people and got to know many allies of the organization. This direct and
personal contact was also a very important thing in order to build up mutual trust and confidence.
A high level of trust is furthermore a major driver not only for fostering the relationships, but also
for the transfer of knowledge directly. According to the expert, nearly all production companies over
the world are rather conservative. The manufacturers are primarily focused on optimizing their
business process to increase productivity, to reduce costs, and to streamline the operation. In this
connection, at the beginning it was a challenge for the expert to work in the facilities at Klabin and
to instruct the operators and supervisors to produce paper in another way and to make them clear
that they are in need of special adjustments within the process, and then to get the acceptance for
that. This whole procedure can consume a lot of time, but a high level of trust helps to rapidly
overcome the rigidity of change at the recipient of the knowledge.
Also in the case of Tetra Pak, the language barrier constituted a big problem at the beginning. The
expert remembered that it was very hard for him as a Swede to learn Portuguese. However, it would
be very important to speak the local language, since it allows for talking to anybody, even operators,
and not only to the highly or better educated. Additionally, speaking the same language as the locals
helped him and them to build up trust, since speaking the same language creates a stronger feeling
of coherence and helps in bridging other cultural distances.
In reference to additional cultural differences, the expert mentioned problems with regard to the
Brazilian society that represented a barrier, since contrarily to Sweden the society in Brazil is rather
tough, with traffic being very dangerous and high attention having to be paid due to the high crime
rate. In a foreign culture, one is exposed to certain conditions and circumstances that just have to be
accepted and adapted to, since changing them is not in anyone’s power. However, since the expert
perceived the Brazilians as very friendly and open-minded people, talking and intensively
communicating with the locals would reveal more about the culture and would help to get used to
the changed surrounding more easily.
The case of Borlänge Energi delivers similar insights like the ones stated above.
According to the expert of Borlänge Energi, one of the most important aspects to cover is also
communication, whereby it is equally crucial to listen carefully to the partner, and to try to find out
in which fields technology projects are necessary, and to show them inside Sweden different
municipalities, companies, and technologies, related to where the partner is in the line of
development. In this connection, it is also very important not to play the errorless and much more
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powerful party, but to honestly and competently point to things they have to improve and
concurrently to explain about mistakes one made oneself, so that they do not do them as well.
This honesty and trust builds the fundament of having very good connections with the partner,
which is exceptionally important for Borlänge Energi. The relationship is thereby mainly fostered
through intensive communication particularly between the coordinators of the projects. Thereby,
the focus is put on having daily contact over various channels, like Skype or Chat-programs like the
MSN Messenger. As in the case of Kalmar Kommun, it is very important that especially the two
coordinators of the projects have a trustful, friendly and close relationship.
When it comes to cultural distances, the expert at Borlänge Energi also mentions the perception of
time. In this regard, the appointed time for a meeting is generously neglected. The expert
exemplified that a telephone interview scheduled in the morning could maybe first start in the
afternoon, because one is unable to reach the Chilean person. Another problem, connected with the
inability of Chilean workers to meet deadlines due to differences in the perception of time, occurred
during the project about waste management. The local employees habitually promised to finish
certain activities next week, but kept on saying that for over one and half year without finishing
anything. In Sweden, contrarily, the expert adds that people, who are in delay with their work for
only one week, can be found having a bad conscience about that, causing them to apologize for that
over and over again. However, he additionally pointed out that it is stimulating for one’s own
personal development to feel another culture, another way of thinking and living.
Furthermore, the expert mentioned several other cultural differences that one has to be aware of,
especially in China. As an example, he talked about situations, in which they were eating together
with Chinese municipality staff and had to drink vodka and rice wine. He continued that in contrast
to Sweden, you are only used to do that on a Friday evening with friends, but not with a mayor of a
city on a Tuesday morning. He stressed that if one cannot handle these kinds of situations, one
should cancel the project. Of course it is possible to thankfully refuse the alcohol, but to allow for a
friendly relation with the Chinese partners in the future, it is very important to only send a team that
is aware of and has enough knowledge about the cultural differences between Sweden and China at
the same time.
Another important issue is the choice of topics of conversations. While in Chile, for instance, it is
possible to talk about every subject that comes to your mind, Chinese people could react more
sensitive when it comes to political topics, for example. Once, the expert had asked the Chinese
coordinator of the project a minor political question and it was possible to immediately draw from
the expression in his face that this question should not have been put onto him. However, he also
pointed out that this issue may only be problem, because of him being part of an upper level within
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Organizational factors
• Strategic similarity
• Organizational distance
an organization. Young people, in contrast, would rather be allowed to speak about political
subjects. As an example, he explained that there are two teams, one from Borlänge and one from
Wuhan, that consists of pupils from upper classes, with each team making newspapers about each
other one’s city, whereby main issues can also be about local democracy questions. At the same
time, this is remarkably strengthening the relationship between the two municipalities.
Another interesting approach of connecting with the partner and building up a strong relationship
by involving younger people can be seen in Borlänge’s efforts to permanently send students abroad
to write their master thesis in cooperation with Chilean municipalities in the field of waste
management or waste energy. By doing so, it would show the partner in the developing country that
something is happening and that the relationship means something to them. It goes without saying
that this is a strong impetus to the process of gaining mutual trust.
5.2.2 Organizational factors
This factor covers the
aspect of strategic similarity
as well as the barriers in
form of organizational
distances that might have a negative impact on the success of knowledge transfer. These two
elements did not turn out to severely touch each other’s surface, so that they can be illuminated
separately.
At this point, it is important to note that the aspect of organizational culture as a barrier within the
organizational factors will not be included due to insufficient findings. After the analysis, the
researchers decided to assign the only finding in that regard to the factor of motivation, which
stands in conformity to Szulanski (2003), but not to the description of this element according to
Davenport and Prusak (1998) and Ang and Massingham (2007) as it was described in connection
with the conceptual model of the research.
Strategic similarity
As soon as a company with the intention to enter a new market approaches Swedfund and asks for
support, thorough discussions begin. If it turns out that during this process some aspects do not
Figure No. 5.7 Organizational factors
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work out, Swedfund is interfering by suggesting other approaches and giving hints about how to
proceed in a better way. These propositions are thereby based on their long experience and mistakes
that they made themselves before. These long discussions beforehand reveal very often, whether it is
the right partner to collaborate with. Swedfund does not enter the projects where they believe there
is something wrong with it.
Another important aspect for Swedfund is to educate the strategic partner about the problems that
are much likely to occur. Swedfund points out that a lot of entrepreneurs are just too optimistic and
therefore consider the whole process being easy and flawless. However, during the discussions it is
very often brought to the surface that these entrepreneurs do not know anything about the market
and the problems they may face, which is very likely to result in cancellation of projects as soon as
the problems in question start to emerge. In the case a consensus cannot be reached due to severe
dissensions, not only in terms of strategic orientation, Swedfund disapproves of a future cooperation
and stops the negotiations. For instance, when they are meeting together with the Swedish partner
and the partner in the developing country and things turn out to be just wrong already at the
beginning of the project, where the participants usually should bring along a very positive attitude
towards the forthcoming project, Swedfund will retreat from the project. If a future collaboration is
already littered with collisions of different views and intentions at the beginning of a project,
problems that will occur during the project will less likely be solved. There where also situations, in
which Swedfund decided to continue the project, but did not realize until the actual course of the
project that their ideas and advice were not picked up or taken into account. This very often
indicates that the partner is not the right one to collaborate with, due to unalike intentions and
opinions. Due to these reasons it is important to thoroughly read your partner and to assess your
and their capability of working together also in difficult times, and to ensure that every necessary
step is taken to secure consistent strategic orientations and intentions from the very beginning.
In the case of Kalmar Kommun, it is, according to the expert, also very important to plan everything
from the beginning and not to have too high expectations.
During the gender equality project, for example, Kalmar Kommun asked Entebbe to create a policy
at the middle of the project and an action plan to implement this policy afterwards. The problem
was that Kalmar Kommun did not receive anything until the last seminar of the project, so they had
to remind them of the missing policy and action plan. Entebbe apologized and gave as a reason the
lack of time due to the imminent visit of the Queen of England, which called for extensive
preparations throughout the city. While the expert thought that the true reasons for their delay
rather lied in the fact that they were not acquainted with constructing such documents, he pointed to
the importance of initially setting up detailed plans specifying explicit time frames, deadlines,
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schedules, and responsibilities in order to keep the project from getting in danger due to time and
with it money-related shortages. This way it can be assured that nobody loses sight of the actual
common objectives that form the cornerstone of strategic similarity.
The expert even stressed the high importance of strategic similarity more often by explaining in
which way they create these common objectives. Before every project, and even before an
application for financial support is sent to SIDA, the town clerk of Entebbe and the head of the
International Department communicate intensively with each other, whereby the town clerk and
himself are figuring out project descriptions as a team in order to make apparent the specific needs
of Entebbe and to finally agree on a common strategy to accomplish the objectives. According to
the expert, it would be a waste of time and money to create a project description by himself, to fill
out an application, and to travel to Entebbe just to find out that the aims and goals of the project are
not required or not able to reach.
The Tetra Pak case moreover underlines the importance of a common or at least similar strategic
orientation and a mutual understanding of the objectives.
For the expert of Tetra Pak, the most important aspect to cover in order to make the knowledge
transfer successful, was for both parties to fully understand the requirements, and to be aware of
what is needed to achieve this standard. To ensure that, the gap analysis, that Tetra Pak is employing
as a tool to search for further potential suppliers, constitutes the most important method to clearly
specify what the overall objectives should look like and in which areas improvements as well as
adjustments have to made. If Tetra Pak wants to find new suppliers, they make a technical audit of
the supplier, and already by carrying out this audit they can obtain a pretty insightful picture
concerning the feasibility of turning this supplier to a fully fletched Tetra Pak supplier. This process
is always conducted at a very early stage, and in case the persons in charge believe that it is a realistic
task to elevate the business systems of the supplier to the standard they require, they start further
prearrangements. Subsequently, it is crucial for the future collaboration to make sure that every
person involved in this process of knowledge transfer understands and follows these objectives in
order to fulfill the requirements. Thereby, it is also necessary to convince the people that they are in
need of the corresponding knowledge and to perspicuously show them the desired results.
Another aspect that is important for a successful collaboration is to have a long-term strategy and
sufficient support from the top management in order to be able to utilize as many resources as
needed. Thereby, it is not sufficient to only receive this type of boundless support from one side.
The managements of both involved parties have to make available the necessary resources. In the
Tetra Pak case, the expert was able to fall back on a myriad of resources and managerial support
from both sides of the deal. Moreover, both the top management level of Klabin and Tetra Pak
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have regular contacts and meetings themselves, which surely contributes to a similar, if not even
consistent strategic orientation.
Both the experts of Borlänge Energi and Nutek also reported about the significant need of strategic
similarity during the process of knowledge transfer.
For Borlänge Energi it was very important as a basis for strategic similarity to convince the
authorities and people in the Chilean municipalities that their way of handling certain activities in
terms of different methods or technologies are to be improved, and that the corresponding
knowledge is in fact required. Only by realizing that the intended change is actually needed, a
common strategy can be formulated.
At Nutek, astonishing 25-30% of the projects Nutek is supporting are cancelled due to several
barriers and problems. Similar to what Swedfund experienced, one of that is that the Swedish side
did not collaborate with the right partner in the countries, maybe due to differences in opinion or
strategic objectives. Another issue in this regard is that the Swedish companies themselves can
become too optimistic and high-spirited. Sometimes they entered the market just to find out that
there was not even any or only insufficient demand for their products, or that they did not conduct a
correct and adequate feasibility study. A third issue that was revealed in some cases involved
damaging business deals that Swedish consultancy firms suggested and which finally led to failed
collaborations and retreat from the foreign market. This underlines the key role of sharing similar
strategic objectives: sharing the same or similar intentions, together with the following extensive
communication and negotiations with the partner facilitates the process of figuring out the exact
market characteristics and conditions. By doing so, problems like the ones stated above can more
likely be prevented.
It is important to note that strategic similarity at the beginning of a project is not enough. To
guarantee permanent strategic similarity throughout the entire project or collaboration calls for
extensive monitoring and measurement activities (see Chapter 5.2.3).
Organizational distance
In Swedfund’s view, it is natural having different routines and processes within companies, but if all
the partners do not share the same views and ideas about the value of a project, they do not enter
the project. However, if Swedfund beliefs in a project and the partners, thorough internal screenings
are carried out to check up on all the participating employees and their internal rules and their ways
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of running business, in order to get to know the partners. Since problems will arise during such a
long-term project, it is crucial to read the partners and to verify, whether they are promising and
trustworthy partners to work with. Every necessary step is taken to keep organizational distance
from becoming a problem, which is very often solved by agreeing on common goals and objectives.
If this can be achieved, having different routines or processes does not represent an obstacle to the
knowledge transfer.
During their projects in Chile and China, the expert from Borlänge Energi also reported about issues
connected with organizational distances.
A huge challenge in this area was to bring the Chileans to overcome their hierarchical way of
thinking within the municipalities that took part in the project with Borlänge Energi. According to
the expert at Borlänge, especially in communist-related countries as China and Rumania or countries
with a dictatorial background like Chile, they can still feel the influence of the past military hierarchic
organization. Due to these reasons, it was initially difficult for Borlänge to show the Swedish way of
behavior that people from higher and lower positions, for example general managers and the drivers
of a truck, can actually sit down at the same table and dialogical discuss and exchange information
and suggestions about how to proceed with given affairs.
In comparison with China, the expert experienced that Latin America companies or municipalities
are much easier to work with, since they are more open-minded and in some regards more like the
Europeans. It is easier to see and to discover the structure of organizations and their work culture.
Within Chinese organizations, it was hard to feel - even after several study visits - the relationship
between the people in a company in terms of the belong to each other, in what way the foreign
ministry is related to the mayors or in what way the environment protection bureau is related to the
trade council in Wuhan and so forth. In order to solve this problem of organizational fog and blur
and to bring clarity, Borlänge Energi had to employ a Chinese speaking expert that was only sent for
this purpose to China. Short trips in form of study visits to China did not suffice to gain insights
into the Chinese organizations and relations.
According to the expert of Nutek, the general problems that the Swedish companies face are also
related to the organizational distance in terms of hierarchic thinking. Depending on the type of areas
and type of projects being carried out, the strong hierarchy in certain organizations in developing
countries of the StartSouth and StartEast Program causes high communication barriers. In some
companies, it depends on your ranking and position, whether you are allowed to raise specific
questions. Very often, this inhibits the process of knowledge transfer considerably.
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Knowledge characteristics
• Causal ambiguity
• Explicit vs. tacit knowledge
The cases of Kalmar Kommun and Tetra Pak surprisingly show in turn, that the barrier of
organizational distance did not represent a problem to the knowledge transfer, but rather a reason to
carry it out.
In the collaborations between Kalmar and Entebbe, the term organizational distance might not be
applicable, since only municipalities were involved. However, it is possible in this context to speak
about organizational distance, for instance, in terms of lacking knowledge about democratic electoral
process or non-existent gender equality. Yet, these aspects did not cause any barriers to interfere
with the knowledge transfer, but have contrariwise led to the initiation of projects attempting to
reduce this grievances.
In the case of Tetra Pak, organizational distance was also the reason that caused the process of
knowledge transfer to stagnate. At the time persons in charge at Tetra Pak recognized that the
transfer of knowledge was not really successful, since they did not achieve full partnership and
activities therefore did not progress as planned, they decided to move activities closer to the supplier
and to send an expert. The aim was to improve and to adjust the processes for Tetra Pak’s needs in
order for Klabin to become a global supplier for them.
5.2.3 Knowledge characteristics
The factor of knowledge
characteristics spans the
aspects of causally
ambiguous knowledge and
the aspect of transferring explicit and tacit knowledge. Since these aspects are not correlated to each
other, they can also be explained separately.
Causal ambiguity
For Swedfund, causal ambiguity of the knowledge did not play a major problem. Sometimes, the
expert said, it can happen that the local partner did not understand the type of knowledge or used it
in the wrong way. However, since they are working close with their partners, it is tried to reduce
mistakes in that regard with the help of frequent monitoring and follow-up activities. Based on the
Figure No. 5.8 Knowledge characteristics
104
results of the monitoring procedures, it can confidently be detected if, for instance, knowledge has
been used in the wrong way. This underlines again the importance of efficient monitoring systems.
In the case of Kalmar Kommun, causal ambiguity seemed also not to have constituted a major
problem, since mainly the practical demonstration of processes and ways about how to handle
technical equipment and other things virtually ruled out possible misunderstandings when it came to
the knowledge.
The statements from the Tetra Pak expert did also not reveal that the barrier of causal ambiguity of
knowledge had any positive or negative impact on the knowledge transfer. The expert from Tetra
Pak was observing the process of producing paper, gave advice, and constantly tried to support. If
things did not worked exactly as planned, he could immediately make small corrections and
therewith establish a pretty efficient way of working. Furthermore, he explained that it sometimes
took him a lot of attempts to convince them that certain know-how or improvements were needed
in some fields. This was, however, not because they did not understand the concept, but rather
caused by their refusal to accept it instantly. They wanted to think about it, discuss it internally, and
reach a consensus that everybody understood in the same way. And if disagreements would emerge,
it was the task of the expert to enter the discussion and to formulate new concepts together or to
eliminate the existent stumbling blocks. In this way, it was much likely that the knowledge in form
of certain concepts was not used in the wrong way. According to the expert, it is in this regard
especially important to get the people involved and convinced. Thereby, the best way would be to
make them believe that they came up with all the ideas, since this will considerably increase
motivation.
From the statements made by the expert at Borlänge Energi can also be extracted that causal
ambiguity of knowledge did not represent a problem, since comprehensive monitoring activities
kept the knowledge and technology from being used falsely.
Explicit vs. tacit knowledge
The transfer of explicit knowledge and its handling is not of importance for Swedfund, since they do
not work with documents. It is not their aim to send out lists with knowledge and demanding the
people in the countries to do this according to that. This indicates that emphasis is put on sharing
tacit knowledge in form of experience.
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For Kalmar Kommun, explicit knowledge also plays only a secondary role. The experts stated that it
can be very stimulating for the success of the projects, when the people in Entebbe they work with
already bring along theoretical knowledge they had acquired during their education in school in
certain areas. Herein, the problem is that they never tried to actually apply this knowledge, since they
cannot afford to do so. The expert furthermore explained that they are indeed making use of explicit
knowledge, especially in form of manuals. However, it is more useful to show them in practice. Due
to this reason, it is the primary task of the team from Kalmar to share their entire experience in
using modern equipment, for example. And the process of sharing experience, tacit knowledge, is
very much facilitated through a strong relationship and through spending a lot of time together.
Therefore, the Swedish team of experts works very close and on-site with the people from Entebbe
during the project in order to practically demonstrate in which way they have to work with things.
During the gender equality project, for example, the Swedish team tried to provide them with tools
about how to start with setting up and working on a gender equality policy that is expected to be
fully adapted by the city council of Entebbe. In the following steps, when it comes to actually
implement this policy, the team gave continuous support by practically showing them examples of
how they work in Sweden and therewith in which way the implementation can be accomplished.
Transferring this kind of knowledge by sending manuals or by just theoretically educating the people
in Entebbe about that issue would probably not have led to a successful outcome of the project.
Another project that entailed rather difficult transferrable knowledge was the democracy project,
where Kalmar Kommun tried to bring the process of democracy and its characteristics closer to the
people and politicians in Entebbe, which were not acquainted with this type of electoral system. To
achieve this, municipality staff from Entebbe visited Sweden during the time of elections in order to
realistically experience the way the Swedish parties, the democratic systems and the municipality
were working. Among others, the visit of the people from Entebbe provided them, for instance,
with insights into the Swedish electoral proceedings by visiting party headquarters, following
election campaigns and debates, listening to the informative lectures on party policies, and finally by
being able to observe the manner of friendly communication between the different parties and their
leaders. The expert from Kalmar provided a nice example in this connection: In the context of an
public election campaign, the town clerk from Entebbe asked the expert from Kalmar Kommun,
how it can be possible that the moderates and the social democrats could stand very close to each
other without fighting, while pointing out that in Entebbe he would never allow them to even stand
in the same square in order to prevent a lot of violence.
At the end of the democracy project, the participants were given explicit knowledge in form of
documentations that included information from the Ministry of Foreign Affairs, SIDA and the
Swedish Institute, party programs, municipal policy document regarding gender equality and youth
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influence. Without any doubt this is really useful information for the people of Entebbe, however, it
should be clear that the practical experience during the study visit in Sweden caused a much stronger
learning effect.
The second interesting example concerns the waste management project that is about to start in
August 2008: Since effective waste management systems are not implemented in Entebbe and a
practical demonstration is therefore not accomplishable, it would not make sense to travel there and
to plainly show them how it is working theoretically. This again calls for showing the people from
developing countries like Uganda directly how things are working in a developed country like
Sweden, for instance. In the case of the waste management project, municipality staff from Entebbe
will visit Sweden and get an insight into the waste management of a household by being invited over
to the home of the expert from Kalmar Kommun. The aim hereby is to practically enlighten the
people from Entebbe about the different trash cans you need for different types of waste, how
much space this takes, where to dump the full trash bags and in which manner the entire waste is
handled by the municipality. In this process, they can already see which kinds of problems are likely
to occur in Entebbe and which they can expect. Next to this, it also provides them with an
understanding of the environmental effects of their own handling of household waste.
Due to different circumstances and conditions like this in developing countries, it is much more
useful to not only teach them the theoretical framework, but to show them the reality, since that way
leads to a far steeper learning curve. Hence, the people of Kalmar Kommun that are involved in the
project put emphasize on transferring their knowledge and sharing their experience practically
wherever it is possible.
Another important part of each project is holding not only presentations, but also seminars, where
the participants as well as officials from both sides sit together and discuss about the projects in
terms of content, disposition or target groups. This cares for a deeper twin city co-operation
between Kalmar and Entebbe, since it can be seen as an efficient exchange place of explicit and tacit
knowledge at the same time. Very often, external experts like consultants are invited to participate in
these discussions as well. During the gender equality project, an external expert to the Swedish
government in gender equality questions has been hired to explain and to show the participants in
which way to work with certain tools, and to share her experience in that field. This increased the
efficiency of the project remarkably.
The case of Tetra Pak is a very good example for sharing and transferring tacit knowledge. The
expert from Tetra Pak that was sent for three years to Brazil to work hand in hand with the supplier
Klabin focused on supporting them in becoming a global supplier for Tetra Pak. That the
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relationship did not achieve the desired outcomes clearly indicates that the strategy of providing the
supplier with Tetra Pak’s requirements regarding the characteristics of the paper, and to leave the
production totally up to the supplier, did not pay off. The explicit knowledge in form of these
requirements could not be entirely translated by the supplier, so that they were not fully capable of
manufacturing the different types of paper of varying sizes for Tetra Pak without any support. A
huge part of this support was given by the expert during his time in Brazil. At the beginning, he
noted that he nearly spent half of his time physically in the plant. After he noticed that things were
running according to the plan, he reduced the time, but it was very exhausting in the beginning. He
underlined, that during all the time he spent at the plan, it was primarily about giving permanent and
dedicated support in form of sharing experience, and that it is not a matter of putting instructions
on a piece of paper and expecting optimal results, but a matter of discussing and interacting with
each other and of giving continuous support.
The strategy of Borlänge Energi in this regard has always been not to act as a consultant and to
provide explicit knowledge in form hundreds of reports, but to help the people in developing
countries to help themselves. For them, sending documents is not the right way to do the
knowledge transfer. Most important is the sharing of experience. During the projects, it is therefore
not their aim to write notes down and give advice in paper form, but to actively and practically show
the ways of waste management as they are exercised in Sweden in the context of study visits. During
these visits, the Chileans were demonstrated the Swedish technology and knowledge of how
different municipalities treat and collect waste and how they operate on different materials.
Furthermore, special workshops with lectures from special experts were arranged. Afterwards,
during a period of one and a half year, they have to begin to write first plans for waste management
by themselves, whereby they are supported by Borlänge Energi. According to the expert, it is
therefore more about practically showing, and about sharing experience in such heavy infrastructure
investments like energy, water, sewage and waste. This process of practically demonstrating
technological equipment and process is particularly important for technology that does not exist
inside the developing country.
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Knowledge management factors
• Measurement
• Information technology
5.2.4 Knowledge management factors
This factor embraces the
aspects of measuring and
monitoring the projects’
progresses and outcomes as
well as the general importance of using information and communication technologies. Again, both
elements do not stand in any direct relation to each other, so that they can also be treated separately.
Measurement
As mentioned before, it is especially important for Swedfund to monitor the progress and status of
the projects. In case it reveals that Swedfund’s ideas, advice and suggestions were not picked up, it
might be the wrong partners to collaborate with, which in the worst scenario can lead to the
withdrawal of Swedfund from the contract. Hence, continuously keeping an eye on the activities and
behavior of the partners is a very helpful tool to prevent unintentional outcomes or bad surprises
from happening. When it comes to the monitoring systems itself, Swedfund argues that it is possible
to measure the results by analyzing figures and statistics. Afterwards, it is important to compare the
actual values with the target values. The analysis of eventually appeared discrepancies very often
shows that the reasons for the gap emanate from not following the advice or ideas of Swedfund.
Furthermore, during the process of collaboration, they do follow-up activities on the environmental
standards and the code of best practice to ensure that the companies are behaving the way they want
them to.
Monitoring and measurement activities also play a key role during Kalmar Kommun’s projects with
Entebbe. One requirement in order to maintain the financial support by SIDA, is to regularly hand
in progress reports concerning the projects’ accomplishments of objectives. Furthermore, the
management committee, constituted by the two coordinators of the projects, meets once a year in
order measure and to evaluate the success of finalized projects and to construct a final report about
the current project. During this meeting, they discuss what actually has happened in the course of
the project, and to what extent the objectives have been completed. If there are any objectives that
were not reached, the report also has to contain a list of reasons for that. Having this meeting and to
create this final report is very important to SIDA, since the expenses for travel and accommodation
are even sponsored by them. Since projects cannot be continued or restarted most of the time after
they have been closed, the expert stressed the importance of regularly monitoring the progress of a
Figure No. 5.9 Knowledge management factors
109
project, in order to be able to early intervene, if the project is headed in the wrong direction.
Handing in the final report, though, does not automatically impose a forbiddance to further keep an
eye of the results and its continuing impacts. After a project has been finished and the final report
constructed, it is still essential to follow up the results and impacts at least once a year and to
evaluate them. In case the desired results did still not occur, it is especially helpful to be ready to use
this experience in further projects and to improve certain aspects, since sometimes similar problems
can occur in future projects.
As in the case of Swedfund, the expert of Tetra Pak also lists occasionally too optimistic behavior of
the counter part as a potential challenge. However, he does that in the context of measurement
approval, instead of strategic similarity. For Tetra Pak in general, efficient monitoring and measuring
systems are of utmost importance.
His explications revealed, that in some situations he asked the workers at Klabin to perform a
certain task within a given time frame, and when he came back at the end of the deadline it turned
out that nothing was taken care of in this matter. After investigating the reasons for the neglected
work, he found out that they were just not capable of realizing what was demanded from them. To
complicate matters further, they did not always tell when they encountered severe problems during
the time he was working with them, because they may have been embarrassed about not being able
to comply with the task. It is therefore very important to frequently measure the progress, and not
only to tell them to go from point A to point to B, and then to return after a few months and ask for
the results. In the expert’s experience, it proved very helpful to create a detailed measurement plan
that contains a high number of follow-up points, at which to ask for feedback and to subsequently
push and motivate a little bit to get and keep things running.
During his three years in Brazil, the expert constantly monitored the progress and provided
continuous support. Therefore, he was able to notice at any time, whether the paper production
processes delivered the desired results. If not, corrections could be instantly made, which ultimately
maintained a very efficient way of working. Another form of monitoring was practical testing. The
supplier could make a test production, and the paper would subsequently be sent to Tetra Pak’s
converting plant. They would use it in their established process to produce the package material,
which will be used in the filling machines afterwards to produce the end package. This package
would then endure performance and evaluation tests. In the case a deficit within the quality
parameter shows up in Tetra Pak’s converting plant, and they find out that it does not feature full
compliance with their requirements, corrections had to be made. This approach ensured that no
problem could hide and would be detected sooner or later. According to the expert, measuring the
effect of every single activity and monitoring the progress in form of a very efficient and practical
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loop of working - produce paper, produce packaging material, produce packages, validate the
packages, look at the performance, make necessary adjustments if needed and go back to the paper
machine – was a very important aspect for the knowledge transfer. In short, he had to watch and to
monitor these activities and to analyze the results of what he suggested.
When it comes to measure the success of the whole project, Tetra Pak has different tools at its
disposal to follow up the performance of the supplier. The most general tool they employ is called
the supplier evaluation, and is carried out quarterly. This evaluation aims at assigning scores to the
supplier based on different criteria in terms of, for example, the base material of the supplied paper
or environmental friendliness. The suppliers know about this tool and that it is being used on a
regular basis. The results of the evaluation are published on the internet, so that every Tetra Pak
employee and the supplier themselves can check the results. Tetra Pak also established a claim and
complaints data base, which contains every complaints and claims from a converting plan about the
paper. This helps the employees of both Tetra Pak and the supplier to follow up the current
situation and problems. The specialty of this measurement approach lies in its ability to also serve as
a motivator: Positioning on a high rank in the supplier evaluation is very stimulating for the
supplier’s business, since reputation and of course quality are very important factors. In case they
can show a good score in the supplier evaluation, they can use it as a sales argument when they want
to approach other potential customers. Taking seat on a lower level of the evaluation might lead to
reluctance not only on part of Tetra Pak, and to decreased contract volumes.
As a means to monitor the progress of current projects and to measure the success of finished
projects Borlänge Energi was involved, half-day seminars take place in every municipality, whereby
everybody is invited to come: citizens, schools, local universities, information departments and the
media. During this seminar, the mayor of the corresponding municipality informs the audience
about what has been accomplished so far, what is currently carried out and what new plans the
future envisions. This does not only serve as a measurement tool for Borlänge, but also as a method
to spread word about this new received knowledge to everyone.
Nutek, and so does SIDA, requires every company they support to come in with a final report
towards the end of a project, which contains information about which subjects or topics were
addressed together with the co-operating company, and about the problems and difficulties that
occurred during the knowledge transfer and in which way they managed them. This indicates that
the involved companies frequently monitor the progress and status, and measure the success of the
projects in order to be able to evaluate the outcomes in the final report. After the company handed
in the final report, it is important for Nutek to go out and to visit the country and to see what
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knowledge they have actually acquired from the cooperation. Before writing off the loan that was
granted to the Swedish company, they would have to go to the partner company first.
Information and communication technologies
In all cases, the frequent use of information and communication technologies (ICT), such as the
telephone, mobile phones, and the communication with the help of Personal Computers networked
through the internet, were primarily used to strengthen the relationship between the participants of
the project and to exchange information or knowledge. In this connection, the main applications
used were E-Mail and Chat-programs as well as video conferences via programs like Skype. The use
of modern ICT does not only open up golden opportunities to save time and money, but also has
positive impacts on the environment, since it is not necessary to travel to the corresponding
countries for every little meeting any more. Thus, ICT can be perceived as an important factor when
it comes to successful knowledge transfer.
5.2.5 Individual factors
This factor encompasses
the aspect of the capacity to
absorb knowledge, which is
strongly related to the
degree of prior-related
knowledge, whereby a low capacity can represent a barrier to the knowledge transfer.
In the case of Swedfund, the absorptive capacity of the individuals is of high importance, but hardly
represents a barrier of any form. Severe screening procedures of potential collaborates, as mentioned
before, are purposed to select qualified partners for the collaboration with qualified employees that
bring a certain amount of knowledge in different areas. However, the expert additionally stated in
another context, that the better the knowledge the countries have, the better they can survive and
improve their development. If this applies to a country, it certain applies to the people in this
country and each individual as well.
Similar procedures take place at Tetra Pak. The absorptive capacity as for Tetra Pak is already judged
before the start. The gap analysis, on whose result Tetra Pak’s decision is based whether a paper
Individual factors • Absorptive capacity
Figure No. 5.10 Individual factors
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manufacturer can potentially become a global supplier for them, is also a tool to overcome the
possible barrier of missing absorptive capacity. By thoroughly screening the potential supplier, Tetra
Pak makes sure that the gap between their capabilities and Tetra Pak’s requirements is not too huge,
which ties in with the existence of sufficient prior knowledge.
As mentioned earlier in the context of the projects conducted by Kalmar Kommun, having already
established a broad theoretical framework in a certain area certainly facilitates the process of
transferring related knowledge. The expert, however, pointed to the fact that most educated people
in Entebbe do not have sufficient financial means, appropriate equipment or experience to actually
apply this knowledge in form of some basic skills, for example. Yet, this does not imply that the
total absence of knowledge in a certain area can still lead to projects filling that knowledge gap.
Kalmar Kommun would only carry out a project, if there are people involved that have at least a
small amount of knowledge in the area the project is about to cover. An example: In the project of
creating and implementing a physical plan for Entebbe, Kalmar Kommun informed Entebbe
before the start of the project, that Entebbe would need to employ a physical planner during the
project and inquired, if there was a sufficient amount of money available to afford that. After the
city council of Entebbe discussed the issue and decided to employ the physical planner during the
project, Kalmar Kommun began with the arrangements. At the time that stage one of the project
was about to end and the physical planner was not yet employed by Entebbe, Kalmar Kommun
refused to initiate stage two. As soon as Entebbe hired the physical planner, the project continued.
This example shows that the absorptive capacity in form of at least one person with prior area-
related knowledge is essential for carrying out their projects with Entebbe. According to the expert,
it would take too much time to transfer them the knowledge from scratch.
Nutek reported about the trend that companies very often complained that the basic level education
is very low, forcing them to begin the knowledge transfer from scratch. For the Swedish companies,
this has been a factor that they did not anticipate from the beginning. This resulted in a much longer
time that was needed to be sacrificed in order to conduct the education. In this case, lacking
absorptive capacity did pose a problem to the Swedish companies, which could be traced back to
insufficient or inadequate precautions.
A similar aspect that falls in this category is the high turnover of staff as companies problematically
experienced it and struggled with in Asia. It prevalently occurred that after having received the
knowledge and education, part of the staff left the partner company. The only remaining choice for
the Swedish company is then to do it all over again, which tremendously incurs time and costs.
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All this stresses again the importance of systematically collecting information about the potential
partner before engaging in the collaboration in order to not having to cope with the barrier of
lacking absorptive capacity that can cause inconveniences in terms of higher costs and longer
durations of the project.
5.2.6 Further findings
This section will show what
kind of supplementary
influencing factors and
barriers were found during
the research, and which
were not listed in the used literature. Therefore, these factors represent important aspects that are to
cover and to anticipate particularly in the context of external knowledge transfer to developing
countries.
Government and corruption
The role of the government played in most cases a rather subordinate role, since they were not
directly involved at all. For Swedfund, for instance, the tasks concerning governmental issues had to
be taken care of by the local partners. In the case of Tetra Pak, the only governmental barrier
imposed was the problematic of acquiring a working permit. When one wants to apply for it, one
has to be a professional and to prove that one has skills that are not really available in the country,
since there is a high unemployment rate in Brazil. In this connection the expert of Nutek revealed
additional governmental barriers in terms of red tape the companies had experienced. In a lot of
countries, it is not friendly and easy for companies to start up, since there are so many different
licenses and instances in the public service sector that have to be visited in order to get the
permission to build up a company from scratch.
The company that made positive experience with regard to the government is Borlänge Energi,
which had direct contact with the Chilean government during their projects. First, Borlänge Energi
was involved when the government established their environment protection board, and secondly
the government is related to the project of establishing the Environmental Protection Agency. In
Further findings
• Government & corruption
• Experience & knowledge
• Motivation
Figure No. 5.11 Further findings
114
this connection, the government was permanently trying to give good support. Not in form of
money, but in form of hiring persons that take a look at the projects and try to help where possible.
However, in three of the five investigated cases, the issue of corruption was addressed.
The expert of Swedfund notes that it is very easy to come into the corruption spiral. Once one starts
bribing someone, word will spread and everybody will come to you and try to get a piece of the cake
as well. It is therefore very important to be resistant from the very beginning, and to make clear to
the people around one, that this is not a goldmine, but a professional and legitimate investment.
Sometimes also, the expert continued, it may happen that certain things during the project are
heavily delayed due to the problem of corruption, especially when it comes to very small things.
According to the expert of Kalmar Kommun, the government did not interfere with their projects.
However, he has often read in some SIDA reports that they were putting their finger on some
projects and that corruption is very often involved. But since Kalmar Kommun more or less deals
with pure knowledge transfer, they themselves did not experience any problems in that regard.
Interestingly, the expert pointed out, that it is another issue, though, when it comes to bigger
investments (see Swedfund). Very often he was contacted and the person on the other end of the
line told that certain arrangements could be carried out much cheaper through him. After the expert
answered that they did not have the intention or financial funds to invest, the whole project was of
no interest to the person on the telephone any more.
The expert of Nutek that has managed a lot of projects in the context of the StartSouth and
StartEast Program also reported that a lot of companies are facing corruption. Thereby the
corruption very often manifests itself in the problem of acquiring correct or sufficient information
from public officials and sometimes it even showed itself in people trying other people to stop them
from doing what they are doing.
Experience and knowledge
At first glance, having experience in the field of area within which knowledge is to be extracted and
transferred to another company seems self-evident. Surprisingly, however, lack of experience
sometimes did turn out to be the reason that a project or collaboration had to be canceled. It is to
remark, that this factor only plays a decisive role for sender of the knowledge and not for the
recipient.
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Swedfund often came to know that some entrepreneurs are too optimistic and do not bring along
sufficient experience in the market they want to enter. As it is mentioned in Chapter 5.2.2, this lack
of experience and knowledge often results in failed co-operations. Due to this reason, it is important
to Swedfund to continuously support the strategic partner and to make him aware of possible
mistakes and problems that are much likely to occur. This support is largely based on the long-time
experience that Swedfund gathered themselves during all the years of doing investments in
developing countries. It is essential to provide the strategic partner with this experience and
knowledge about, for instance, cultural or commercial differences that they will face.
Similar to that, Kalmar Kommun sets high value in providing the team, which is sent to Entebbe,
with as many information about the country as possible. Since they already make sure that the team
consists of enough experts with experience and knowledge in the corresponding area, it is still
important to them to prepare the team for the changing surroundings and conditions in a
developing country. The head of the International Department, for instance, receives E-Mail
newsletters from the UN about Africa every week and several informing material from the
Norwegian council. Furthermore, when something important comes up, when something is going to
happen in Uganda, he sends this information to the team already months before they enter the
actual project. Additionally, he delivers a lot of SIDA projects in order to inform the team what
SIDA has to say about the current status of corruption and so forth. In short, caring for a fully
competent and prepared team that brings along enough knowledge and information about what lies
ahead of them is a very important aspect to consider. Without having enough experience or
knowledge oneself, the process of knowledge transfer is very likely to fail.
Also for Borlänge Energi, it is a very important part of the prearrangements to make sure that the
team involved has enough information and knowledge about cultural differences and the history of a
country. As mentioned in Chapter 5.2.1 in the context of this case, it is crucial to know about certain
rituals, taboos or ways of behavior in order to build up a friendly relationship and not to alienate the
partners due to cultural ignorance. Another point the expert mentioned, and which stands in
conformity to the other statements in this section, is that it is essential for the success of knowledge
transfer to have enough experience and knowledge yourself and to be ready to share it.
When it comes to the case of Tetra Pak, the fact that the expert and his team built up massive
knowledge in the field of paper production and processing, contributed largely to the successful
outcome of the project that aimed at turning Klabin into a global supplier of paper. The expert
highlighted that during his 25 years at Tetra Pak, he carried out similar projects in Sweden, Finland,
North America, South Africa and Russia. He worked with many different suppliers, cultures,
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languages, initial standards and more. Having and using this massive knowledge that has been
acquired during years of experience constitutes an important base when it comes to improve and
develop a supplier. By additionally featuring a large network of companies like Tetra Pak had
established during the years, the supplier was also able to get in touch with other companies in order
to open up new business opportunities. This demonstrates the huge effect that a huge pool of
knowledge and experience can have on the knowledge transfer process for the developing countries.
Motivation
Motivation is an important factor in nearly every business activity. Without proper motivation and
commitment, efficiency may decline. Although the aspect of motivation was precluded from the
aspect of external knowledge transfer (see Chapter 3.4), the research findings revealed that it actually
did contribute to the outcome of the knowledge transfer process.
As pointed to in Chapter 3.4, companies that intend to engage in knowledge transfer to developing
countries should purposeful select appropriate candidates for that activity that bring the needed
motivation from the very beginning. However, what may be a motivated employee at the start may
end up a frustrated and unmotivated one in the end.
Swedfund reported, it often occurred that people noticed they were not headed in the right direction
and got frustrated, because they were intensively struggling with certain problems, but could not
succeed in the end. In the case this happens, it is sometimes the best solution to replace this person
with someone new, fresh and hungrier, since the whole success of the collaboration relies on the
people involved.
For the head of the International Department at Kalmar Kommun, motivation also plays an
important role. Although he mentioned that it can be very difficult sometimes, he is giving his best
to motivate the team. Mostly the aspect of the language is what they are afraid of. However, once
the team has been spending some time in Entebbe, it is nearly always the case that they return with
much higher enthusiasm towards the project than before, which is very stimulating for the future
course of the project.
In order to once shed light on the part of the developing country, the expert said that the town clerk
in Entebbe had more difficulties in finding appropriate candidates for the projects. Sometimes it
occurred that people in Entebbe only want to participate in the project to see Europe, since the
involvement in such projects is supporting them financially to travel. These allowances are in some
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cases much more than their salary. Therefore, it is important to recognize that this is not a reason
for taking part in such a project.
In chapter 3.4, the issue of the fear for loss of ownership was addressed and concurrently precluded
from the investigation, since by appointing the right people for a project it should be avoided that
people are reluctant to share their knowledge in order to not lose importance within the company.
In the selected case, only the expert of Tetra Pak experienced conflicts in that regard. In case there
is a person in a company, which is very knowledgeable and normally gives advice and technically
support of how to work with the production of alternative products, it certainly creates a conflict
when an outsider appears and starts to turn everything upside down by suddenly taking over the role
of the supporter. This can lead to a fear for loss of ownership, since the person will get afraid of his
position and role in the organization. In the worst case, it can happen that this persons starts to
work against one instead of working with and supporting one, by instructing the workers against
one’s own advice behind your back with the aim to defend his position. Instead of putting energy
and effort on solving problems together, they waste it to defend their positions and to work against
one. The expert mentioned that this can happen in any organization and that he himself experienced
that. Not only because of this, it is essential to get the people you work with convinced and
involved. As mentioned before, the best way, according to the expert, is to make them believe that
they invented that all by themselves, which will ultimately result in higher motivation.
5.3 Summary
The analysis of the collected material reveals that with the exception of organizational culture, every
influencing factor and barrier derived from the theory was experienced by the companies and
contributed to the influence on the success of knowledge transfer. Thereby it turned out that each
factor to some extent influenced the effect of other factors on the transfer process. In some cases it
is even observable that by entirely covering certain factors can result in overcoming other barriers.
This connection between the influencing factors and barriers can be seen in Figure No. 5.1.
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Figure No. 5.12 The connection between the influencing factors
Experience and motivation
Transfer of explicit and tacit knowledge
improves
Bureaucracy and corruption
Measurement
evaluates
Success
Communication
Trust
Cultural distances
creates
Strong relationship
builds
overcomes
Strong ties
facilitates
inhibits
ICT
Monitoring
Strategic similarity
Causal ambiguity
overcomes
overcomes
Organizational distance
Lacking absorptive capacity
ensures
promotes
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Although every factor should be treated equally important, the aspect of strategic similarity turns out
to represent the most influencing factor. For a company that plans to engage in a knowledge transfer
process to developing countries like China, Uganda, or Chile, it is essential to thoroughly conduct
the prearrangements by planning every single aspect from the beginning in terms of time schedules,
activities, objectives and tasks, so that strategic similarity can be guaranteed. Achieving this also leads
to overcoming the barriers of organizational distance and the possible lack of absorptive capacity.
Through intensive screening processes and discussions with the partners about the projects
requirements beforehand, companies are able to ensure that the partner is the right one to
collaborate with and that a certain level of knowledge and experience is existent. Otherwise the
projects should not be carried out. Furthermore, sharing a similar strategic orientation makes the
barrier of organizational distance kind of irrelevant. Although the hierarchic structure can impose
problems sometimes, agreeing on similar tasks and objectives is enough to connive at such
organizational distances.
The aspect of strategic similarity is moreover important, since having common goals remarkably
initiates intensive communication, which can lead to building up trust and therewith a strong and
friendly relationship during the collaboration. And the findings clearly reveal that a strong bond
between the involved companies or organizations constitutes the cornerstone of every collaboration.
Modern equipment in form of information and communication technologies are appropriate means
to build up a trustful relationship, next to regular contact and especially personal meetings as often
as possible. This not only stimulates the transfer of knowledge, but also helps to overcome cultural
distances. Through intensive communication, the involved people can better understand why
unalike views and ways of behavior exist and respect that. In this connection it is important for
companies to take into account that certain culture-related aspects and differences have to be
understood and accepted, since they cannot change them.
Since objectives and intentions of a company can change during the course of a project, it is
important to permanently monitor the status of the collaboration. Through frequently observing
whether advice and suggestions have been picked up and implemented by the partner, it is ensured
that both collaborators still head into the same direction, which automatically ensures the
maintenance of long-term strategic similarity. In addition, by thoroughly inspecting the progress of
the project and its intermediate results, the aspect of monitoring also makes sure that the partner is
not using the knowledge in the wrong way. The findings revealed furthermore that the companies
put high value in this procedure, since it helps to prevent undesired results from happening.
Thereby, intensive communication and updates between the parties can help to establish an efficient
monitoring system.
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Three additional factors were discovered during the research that largely influence the success of
knowledge transfer: motivation, experience and governmental factors in terms of high bureaucracy
and corruption. It is crucial for companies to select suitable candidates for certain projects that not
only bring along the right motivation, but also enough knowledge in the corresponding area in order
to pass it on. Otherwise, the project is doomed to fail from the beginning. As an inhibitor of
knowledge transfer, the aspects of bureaucracy and corruption are to be mentioned. Companies that
intend to engage in knowledge transfer to developing countries, have to expect barriers in form of
high and time-consuming bureaucracy and – depending on the type of knowledge – corruption
issues.
By covering and taking into account all the aspects mentioned above, the transfer of explicit and
tacit knowledge is much more likely to succeed. In this connection it is very important to remark
that it does not make any sense to send explicit knowledge, since the investigated cases revealed that
most countries would not be capable of applying that type of knowledge. Explicit knowledge has
always to be transferred like tacit knowledge.
Therefore, emphasis has to be put on passing on tacit knowledge by spending a lot of time together,
to work very close to each other, and to try to practically educate about specific thing wherever and
whenever it is possible.
Equally important is not only the actual transfer of knowledge, but also its measurement by
evaluating the outcome. By doing so, the companies are able to pinpoint certain problems that
occurred and to learn from this experience. Implementing efficient measurement systems are not
only an important step for finished projects, but also for the future of the collaboration.
EXHIBIT: Internal vs. external knowledge transfer
By describing which factors are more important for which type of knowledge transfer, this short
exhibition aims at providing a better understanding about the differences between internal and
external knowledge transfer. Since there is rarely literature concerning external knowledge transfer, it
is intended to also underline once more the pertinence of this study by pointing out the major
differences and shifted emphases concerning the importance of each factor.
The following discussion is based on the research findings of this study about external knowledge
transfer and on the empirical and statistical findings by Szulanski (2003), who investigated the
phenomenon of internal knowledge transfer.
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The main difference between internal and external knowledge transfer is that internal transfer does
not necessarily has to involve engagement in projects of any kind. Within companies, knowledge is
continuously transferred along the way, sometimes without context, intention or even purpose.
External knowledge transfer in contrast, should involve a close collaboration and some sort of
projects with a particular purpose. Due to this reason, the main influencing factors and barriers
differ when it comes to internal and external knowledge transfer.
As part of his empirical research, Szulanski (2003) investigated with the help of open questions the
most important barriers to internal knowledge transfer as they were perceived by managers. The
results can be seen in Figure No. 5.2.
0
10
20
30
40
50
60
70
80
90
Recipient Motivation Absorptive capacity Causal ambiguity Arduous relationship
The main influencing factors of internal knowledge transfer
Figure No. 5.13 The main influencing factors of internal knowledge transfer (Szulanski, 2003, p.75)
As the diagram reveals, the factor of motivation of the recipient with 80 entries turns out to be the
most difficult influencing factor for internal knowledge transfer. This factor covers, for instance, the
not-invented-here syndrome, implying that employees are skeptical towards the knowledge they
should receive. The empirical findings of this paper, however, do list the factor of motivation, but in
the context of an external knowledge transfer it is ensured beforehand that only motivated people
are involved that are willing to share and to receive knowledge. The high importance of the degree
of absorptive capacity is not consistent with the empirical findings of this research either. Again,
strategic similarity in form of thorough prearrangements and the accompanying examination of
potential partners makes sure that enough basic knowledge is existent at the partner, ruling out
lacking absorptive capacity from the beginning. Since the factor of causal ambiguity also turned out
to take in a rather subordinate role according to the research findings of this study, the barrier of
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0102030405060708090
Absorptive capacity Causal ambiguity Arduous relationship Recipient motivation
Relative importance of barriers based on the statistical analysis
arduous relationships is interestingly perceived as one of the most unimportant ones by the
managers. This heavily contradicts the findings about external knowledge transfer as portrayed in
this study, which reveal that having a very close and honest relationship is – next to ensuring
strategic similarity – one of the most important aspects to cover in such a process.
As mentioned above, these findings are based on a survey that was conducted with open questions
and analyzed with the managers’ answers. However, Szulanski’s findings that rely on a statistical
analysis deliver a different picture of the main influencing barriers, as shown in Figure No. 5.3.
The factor of the recipient’s motivation became completely secondary, while the barrier of
absorptive capacity represented the most difficult to handle. The aspect of arduous relationships as a
potential barrier to knowledge transfer gained in importance, but only slightly. Although the degree
of importance of motivational factors dramatically decreased, the findings that claim absorptive
capacity and causal ambiguity to be the main reasons for difficult knowledge transfer still stand in
contradiction to the results this study generated. Due to this reason, it does not matter which
findings will be used for comparison with external knowledge transfer, since both the statistical and
empirical findings of Szulanski (2003) revealed results that heavily differ from the empirical findings
of this study.
The empirical findings of this and Szulanski’s (2003) study show that the importance of the main
influencing factors and barriers varies, depending on the context and the purpose of knowledge
Figure No. 5.14 Relative importance of barriers based on the statistical analysis (Szulanski, 2003, p. 76)
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transfer. In the perception of managers, sharing knowledge within companies necessitates a high
motivation to learn and to absorb the knowledge, with causal ambiguity and the kind of relationship
playing a minor role. Differences can be found in Szulanski’s statistical analysis, assigning motivation
the least importance, and the barrier of lacking absorptive capacity the most.
In the context of external knowledge transfer, motivation does play a constant supporting role and
does not experience heavy fluctuations in its importance like it does according to Szulanski’s (2003)
findings. However, the focus of the companies should be rather put on ensuring strategic similarity
and on fostering a strong relationship – aspects that seem to cease to apply when it comes to
internal knowledge transfer.
At this point it is important to point out, however, that these findings are suggestive, and not
definitive. But they should not be ignored.
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CONCLUSION
In this research, the process of knowledge transfer to developing countries has been examined on
the basis of five cases, where this type of knowledge transfer took place. The investigation revealed
that each company or organization had faced the main influencing factors and barriers as they are
described in the literature, except for the aspect of organizational culture. When it comes to the
importance of the factors, it was shown that two aspects took in a dominant role: strategic similarity
as an element of organizational factors, and the factor of having a strong bond with the
collaborating partner. In order to ensure strategic similarity, the partners have to be entirely
integrated in the prearrangement of a project and it is important to commonly agree on the
objectives of the collaboration. Furthermore, the aspect of strategic similarity demands that
everything has to be thoroughly planned with the partner from the very beginning. This does not
only refer to the objectives, but also to certain framework elements liker time schedules, deadlines,
responsibilities, tasks and money-related issues. The better the preliminary work, the more probable
is the project to succeed. Monitoring activities have to make sure that strategic similarity not only
exists at the beginning, but throughout the whole project.
The factor of having strong and friendly relationship is another important issue. Companies that
intend to engage in external knowledge transfer have to try to build up a friendly relationship with
their partners. Together with a similar strategic orientation, the majority of the other factors and
barriers can be overcome. Therefore, these two aspects are the most important ones to take into
account and to cover.
In the course of the research it was also revealed that the roles of the additional factors of
motivation, having enough knowledge and experience and of bureaucracy and corruption issues can
also lead to failed projects. Companies and organizations have to consider these issues within their
preliminary work.
The purpose of this research was to find out, to what extent the theoretical factors occurred in real-
life cases and in which way the involved companies or organizations dealt with them. The research
findings tell, as mentioned before, that every factor did occur in some way, except for organizational
culture. This, however, does not imply that organizational culture does not play a role at all, but just
that the specific findings did not contain any consolidated information concerning this barrier.
Furthermore, the researchers were able to provide a long list of insights about the ways the
companies were trying to carry out the knowledge transfer and by which means the factors were
dealt with. The discovery of three additional factors that were not mentioned in the examined
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literature completes the purpose of this research. With regard to the issue of external versus internal
knowledge transfer (see Exhibit), the research revealed that each factor is assigned a different degree
of importance depending on the type of knowledge transfer. In this connection, the results of this
paper are able to provide enough information for the reader to develop an understanding of which
factors are more necessary to take into account when engaging in external knowledge transfer. The
lack of technical literature about this issue underlines the pertinence of this study and also opens up
further research areas within this topic.
Further research
The knowledge transfer between developed and developing country is a relatively unexplored
phenomena in the literature. This paper only covers a small aspect of that area, which suggests that
further research is recommended. On the one hand, it can be illuminating to not only focus on the
developed world, but also to investigate the transfer process as it is perceived in the developing
country. Moreover, taking a closer look at the impacts of this knowledge transfer not only on the
developing country, but also on the advanced economy is advisable, since knowledge transfer is a
two-sided activity. On the other hand, it can also be very insightful to investigate the issue of money
vs. knowledge. In this connection, research questions that address the efficiency of developing
support in form of money as it is granted by a myriad of organizations and unions in the developed
world. Possible investigations could aim at revealing in which way this money is used in the
developing countries and at evaluating whether the transfer of pure knowledge or the sending of
plain money is more stimulating for the economic progress of a developing country.
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6. FINAL DISCUSSION AND OUTLOOK
The last chapter tries to provide a final discussion and a global outlook about knowledge transfer projects with
advanced economies to developing countries. Hereby, general findings about influences and impacts of knowledge
transfer on the economic development of developing countries will be discussed.
“Knowing is not enough; we must apply. Willing is not enough; we must do”
(Johann Wolfgang v. Goethe)
It is often discussed, if the transfer of knowledge is having an actual impact on the development of
developing countries, or if it is the money that is helping the developing nations to make prosperous
progress in society as well as in the economy. In this connection, it needs to be said that this is a
neither-nor discussion. It is necessary to create treatment plans for investment projects, that means
just transferring money into a project does not work. It has to be clearly organized, in which way the
money will be used and what goals have to be reached with the project, which moreover stresses the
importance of a well established a priori plan. Only then, it can be seen that knowledge transfer is
actually needed, before the investment project is getting into progress at all. When the treatment
plan is put into realization, it is essential to have people involved, who take care of the correct
implementation. These persons need to have the requisite knowledge about this case to support the
successful accomplishment of the project. Even organizations like SIDA, which have collected a
huge amount of experiences with developing projects all over the world, sometimes fail in projects,
where big sums of money are flowing for investments, because the desired amount of knowledge
has not been transferred. There are, of course, further types of projects, where the investment
aspect has an inferior role, namely in projects where the only aim is to transfer knowledge to
support the economic progress of the nations in development. The projects Kalmar Kommun is
carrying out with its twin city Entebbe in Uganda are financed by SIDA, but the major aim of the
projects is not to invest in the city. It is the purpose to provide Entebbe with knowledge about
certain topics like the above mentioned town plan, democracy, and gender equality. However,
financial support is also needed for those projects. Therefore, it can be said that both money and
knowledge is needed, but the purpose of the project determines the required amount of money.
Impacts and influences on the entire social and economical development of developing countries
through single knowledge transfer project are not easy to measure. It is often the case that the
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impact of one single project is not directly measurable, but that these projects often set other
development supporting processes into progress. These processes are taking time. First, it might be
a project that affects the surroundings just on a local basis, but by-and-by it is possible that the
knowledge will spread and therewith be transferred and communicated to other instances, until it
might reach a nation or region wide perception. Thus, it takes time until the outcome of one
successful knowledge transfer project is multiplied and its impacts kick in nationwide. In this
context, the democracy project of Kalmar Kommun with Entebbe serves as a good example for the
reluctant outspread of knowledge transfer projects. As described in chapter 5.1.2, the democracy
project was arranged between the twin cities Kalmar and Entebbe in Uganda on municipal level
only. It has to be seen that in Uganda the democratic process just set in and that the political parties
are newly formed. Due to these reasons, the learning process will take a longer period of time. Local
politicians from the Entebbe region had the chance to learn about the organization of democratic
processes and about basic rules of political conduct, gender equality, and sustainable development.
They will carry them out in their parties and in the connected processes further on, but until it really
proves to have influences on democratic processes in the entire country, it will probably take longer
time. Nevertheless, these small projects are from utmost importance to set processes into movement
and to influence the development constantly.
Another aspect that has to be considered with knowledge transfer projects from developed nations
to developing ones is dealing with ethnocentrism. Ethnocentrism is “defined as the degree to which
other cultures are judged as inferior to one’s own culture” (Rogers and Steinfatt, 1999, p. 38).
Transferring knowledge to developing countries implicates the transfer of procedures, routines,
approaches, and methods, as well as individual skills, which are all based on long-term experiences
of one’s own, of one’s company, of one’s country or of one’s culture. These experiences are
transferred to countries, which find themselves in the process of getting experiences in these areas
for themselves. The advanced countries, however, try to support them and concurrently transfer,
intentionally or not, their own norms and values. This is a sign that their own methods and
approaches are seen as superior and more valuable compared to those in the developing countries.
The approaches and organizational way of thinking of the sender, in this thesis the developed
countries, will always be transferred to a certain extent, but it certainly also depends on the way the
providing companies or organizations are dealing with the transferring process. Borlänge Energi’s
strategy, when it comes to transferring knowledge in fields where the developing partners do not
have previous knowledge, is to help them helping themselves. Thereby, it is important to show the
developing partner, how the own development has been, what crucial steps were taken to succeed in
the projects, and what went wrong during the projects. The partner transferring the knowledge has
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to involve the developing partner, so that they can be convinced from the idea. They also need to
have time to be able to discuss methods internally with the developed partner, and must have the
opportunity to ask questions about the process again and again. This is the way Tetra Pak gave
authorities in the plant in Brazil the chance to get convinced of the methods. Thus, it can be seen as
crucial for the development of the developing nation to show them own approaches and methods of
how to handle and manage certain aspects. But it is also important to make clear that the approaches
themselves just developed over the years and that it is not a flawless receipt for future success.
When it comes to projects between developed and developing partners, it is often assumed that the
impacts, which might emerge, are just affecting the economic development of the developing
country. But there are also different aspects to consider when it comes to certain influences.
Projects, within which knowledge is transferred, also show impacts on, for instance, in the field of
human development, educational and healthcare aspects. The Tetra Pak – Food for Development
Office is committed to provide schools all over developing countries with milk and seminars,
informing the people about the value of milk for the health. Furthermore, they are supporting the
local farmers with agriculture development projects, which aim at establishing a better milk supply in
the developing countries. Nutek supported a Swedish private investor in founding an open-heart
surgery clinic in Addis Abeba, Ethiopia, which is so far the only clinic of this kind in Ethiopia and
its surrounding countries. This has had a big influence on the healthcare development locally and
nationally and even cross-border. Another aspect, which can be considered, is the impact on the
educational development of knowledge transfer. Making a small exception by dedicating the
attention to a transition country, a short example showing the impact of the educational
development has emerged in its origins from the joint venture of the German car producer
Volkswagen and the Czech car manufacturer Škoda. The joint venture helped Škoda to catch up
with European standards in car production, since Volkswagen was supporting them with
investments and development projects (Tutor2u, 2008), until they became Czech Republics’ biggest
exporter and employer (Wildcat, 2008). This relationship also lead to the foundation of Škoda Auto
University, which is until now the only company-owned college in the Czech Republic, where
students have the possibility to attend guaranteed internships and other educational programs in
Škoda or in Volkswagen during their education (Savs, 2008). These examples show that knowledge
transfer to countries, which are in a developing process, has more than just impact on the
economical development. Even if the primary aims of the investing companies might be economical
oriented, other positive sides effects can occur that support the development of the receiving
country in other ways.
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To the question of how the experts of the cases that were investigated in this thesis see the
importance of knowledge transfer projects for the development of the country, it was the overall
answer that any kind of knowledge projects are seen as crucial. The better knowledge the countries
have, the better they can survive and improve their development. Swedfund sees it as their task to
help the countries in their development. With the help of their investments, they were able to create
50.000 new jobs, where everyone of those has created jobs for in average five more people. This
shows that Swedfund has maybe generated around 250.000 working places for people in developing
countries. Tetra Pak’s project elevated Klabin from a local supplier in Brazil to a global supplier, and
is now running operations as provider of paper rolls over all South America. Moreover, Klabin is
now supplying South East Asia, China and other parts of China in addition. Thereby, the business is
still growing constantly from year to year. Since, for example, Borlänge Energi had so many
environmental projects with Chile, they also supported the establishment of an environmental
protection board. Furthermore, the Chilean government has now even created a position of a special
environmental minister. Since the government got more aware of the environmental issue due to
manifold projects Borlänge Energi did with municipalities around Santiago de Chile, they are
supporting nation-wide projects dealing, for instance, with waste management and waste energy.
This whole development is also depending on governmental decisions, because they are allowing the
accomplishment of these projects. In this context, it has to be said that it is important that
developing countries are starting their development not with obsolete and unused technologies from
the nowadays advanced countries. The usage of new technologies, approaches and methods should
be supported, also because of environmental issues. Outdated technologies might have negative
effects on the environment, while newly developed and established technologies are already
developed with ulterior motives of environmental friendly production.
Having such positive effects on one company, it is also showing other companies from developed
nations the possibilities that are offered by the country, which may motivate them consider
investments in companies situated in these regions. This means that more money is flowing in the
developing countries through bandwagon effects. Furthermore, positive relationships offer an
attractive example for other industries and their companies to raise investments.
The companies’ main aim is repeatedly not to transfer knowledge and to bring development and
progress to the developing country; this is mostly a bandwagon effect. Companies go abroad mainly
due to other reasons, which are more cost and efficiency-oriented. In this regard, primarily Tetra Pak
wanted to support Klabin in order to benefit from cost reductions and to improve the outcome of
the company. Besides that, a lot of knowledge was necessary to transfer, which made Klabin from a
local supplier to a global supplier and more importantly, it also provided them with a very good
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reputation for other contract relationships with partners outside Tetra Pak. A problem, which can
therefore appear in the home economies, is the fact that due to lower labor costs, the advanced
economies prefer to produce intensified in the developing countries. This will be amplified, since
they know what kind of knowledge the company in the developing country has. This may have a
negative impact on the economies at home in terms of higher unemployment rates.
Each expert stressed that it cannot be said that knowledge transfer is just taking place in one
direction. Even advanced countries can never learn enough, so that knowledge transfer relationships
have mutual impacts. Nutek said that successfully finished projects had very positive spin-off effects
on the developing countries locally, and in the entire economy, basically because the cooperating
company got access to new knowledge, new technology and also to new markets. On the other
hand, the Swedish partner company also made profit from this relationship in terms of gaining
access to new markets or making their production more effective. Borlänge Energi also stressed that
the learning effects between the partners are 50:50. Thus, it is not about to give knowledge only. It is
also to learn from the other side. As with Swedfund, they are stressing moreover that companies
from today’s advanced countries can simply be overtaken by today’s developing world in the near
future. Through ongoing development projects, developing countries receive knowledge,
experiences, and also money from the advanced side, which allows them to make faster progress in
their development than it is possible for the nowadays developed countries. That is the reason why
rapid growth of those countries is underestimated by the developed world. Hence, it is necessary to
become a part of the global development and to be in close relation and knowledge exchange with
developing countries, in order to allow for a future competition on a well-balanced level on the
global markets of tomorrow. Next to this and in connection with the competing aspect, it can also
be noted that the workforce of the developed world needs to be prepared for the already ongoing
globalization trend. Borlänge Energi mentioned that it is important to give the Swedish people the
opportunity to broaden their horizon by going abroad for several weeks a year. It is the only way to
get to know a culture while living among it and not just reading about it. And it is furthermore to say
that the developing partners have learned to be more open-minded and that they always had the
drive and motivation to go abroad and to actively contribute to the progress in the development of
the country - an attitude that is not necessarily existent in the already established economies. They
are more content with what they have and intend to protect it. That is the reason why partners from
developing countries know exactly if the partner from the developed world has experiences with
foreign cultures or not. It is important for the establishment of trust that the developing partners
feel that their culture is valued by the western partner and that the knowledge transfer can take place
on an open-minded basis. That is the reason why Borlänge Energi is also supporting the exchange
131
of students for writing their dissertations abroad, as well as school projects between Borlänge and
other municipalities all over the world. It is important to involve the workforce of today, but also to
prepare the workforce of the future for this ongoing globalization trend, which will cause an
increasing number of knowledge transfer processes to the developing world. In this connection, it is
important to remark that the benefit developing countries draw from the knowledge transfer does
not depend on the volume of the knowledge being transferred. Even the smallest amount of
knowledge can contribute to the social and economic progress of developing countries – main thing
is that at least something is happening, because as the philosopher Kahlil Gibran once said: “A little
knowledge that acts is worth infinitely more than knowledge that is idle.”
132
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List of interviews
Swedfund, Arne Georgzén, Senior Investment Manager, Telephone Interview 18th April 2008,
Conference Room Baltic Business School, Kalmar.
Kalmar Kommun, Anders Engström, Head of the International Department of Kalmar Municipal,
Interview 24th April 2008, Kalmar Kommun, Kalmar.
Tetra Pak, Gert Ekdahl, Common Agenda Manager, Interview 25th April 2008, Tetra Pak, Lund.
Borlänge Energi, Ronny Arnberg, Head of International Office, Telephone Interview 5th May 2008,
Conference Room Baltic Business School, Kalmar.
Nutek, Nadja Berger, Program Manager for the StartSouth and StartEast program, Telephone
Interview 5th May 2008, Conference Room Baltic Business School, Kalmar.
139
APPENDIX 1: The interview questions
1.) Would you please introduce yourself and tell us about your position and
responsibility in your company?
2.) Could you please shortly describe the specifications of your project in terms of:
- Name of the project
- Organizations involved
- Type of relationship
- Operations (schedule, milestones)
- Objectives
“Our literature research reveals that especially developing countries are in need of knowledge and
that therefore efficient knowledge transfer between collaborating companies from the western and
developing world is crucial for successful and beneficial relationships. In the case of outsourcing
offshore, for example, lacking or inefficient knowledge transfer is listed as one of the most common
reasons responsible for failed outsourcing relationships. Furthermore, a lot of attempts of
transferring knowledge to developing countries fail due to inefficient knowledge transfer, although
those relationships were established with the only purpose of transferring knowledge.”
3.) What is your opinion about this issue?
4.) What kind of knowledge are you and your company primarily transferring?
5.) Could you tell us more about your approach towards transferring this knowledge?
6.) What are/were so far the major problems/challenges you were facing?
7.) Which measures did you take to solve/overcome these?
8.) Before showing you the key factors we gathered from several sources, we would like
to ask you, which factors you and your team consider most important when it comes
to knowledge transfer to developing countries.
9.) Through which “control” mechanisms – if any – does your company guarantee the
continuous utilization of the transferred knowledge on part of the recipient.
10.) Has the project been endangered in any way at any time due to lacking or depleting
motivation on both side of the partnership? (Not-invented-here syndrome, Invented-
here syndrome, fear for loss of ownership…)
140
11.)Did the government of the developing country itself, directly (through interferences)
or indirectly (through laws and regulations) in any way support, inhibit or exacerbate
the transfer process?
12.) In your personal opinion, to what extent may the whole project and consequently the
transferred knowledge help or stimulate the economic development of the receiving
country?
The University of Kalmar has more than 9000 students. We offer education and research in natural sciences, technology, the maritime field, social science, languages and humanities, teacher training, caring sciences and social service.
Our profile areas in research are: biomedicine/biotechnology, environmental sciences, marine ecology, automation, business administration and informatics, but we have research proceeding in most subject areas of the University.
Since 1999, the University of Kalmar has the right to accept students in postgraduate studies and to examine doctors within the subject area natural sciences.
Baltic Business School, at the university of Kalmar
Visiting address: Kalmar Nyckel, Gröndalsvägen 19
SE-391 82 Kalmar, Sweden Tel: +46 (0)480 - 49 71 0
www.bbs.hik.se
The University of Kalmar