Knowledge and Process Management Volume 10 Number pp 115–126 (2003) Published online in Wiley InterScience (www.interscience.wiley.com) DOI: 10.1002/kpm.170 & Case Study Organization-internal Transfer of Knowledge and the Role of Motivation: A Qualitative Case Study Thomas Kalling* Institute of Economic Research, Lund University, Sweden This paper reports a case study of a knowledge transfer programme in a manufacturing MNC, and suggests that firm-internal knowledge transfer programmes are exercises requiring a great deal of recipient motivation In contrast to existing theory, which has a tendency to address the role of cognitive factors such as tacitness, causal ambiguity and absorptive capacity, this paper suggests that motivation needs to be in place first In the studied case, differences in local perceptions of transfer ventures, aspiration and strategic ambitions, internal competition, the view on the nature of knowledge and local communication seem to explain success and failure in transfer ventures If motivation is not in place ‘naturally’, it can be managed in different ways, including local and corporate management control routines as well as organization structure Consequently, we argue that knowledge transfer theory should not presume that organizational units are interested in the knowledge transferred, or that knowledge is always ‘good’ Knowledge is contextual, meaning it fits certain operations and strategies better, even in instances where intra-organizational units are homogeneous Hence motivation is central to transfer success Copyright # 2003 John Wiley & Sons, Ltd INTRODUCTION Knowledge transfer within an organization may be thought of as the process by which an organization makes available knowledge about routines to its members, and is a common phenomenon that can be an effective way for organizations to extend knowledge bases and leverage unique skills in a relatively cost-effective manner With the increasing resource-based focus in strategy research, knowledge and ways to develop and leverage it have become key strategic issues (Barney, 1991; Peteraf, 1993) Much of the research focuses on cognition, the nature of knowledge and organizational issues, in *Correspondence to: Thomas Kalling, Institute of Economic Research, School of Economics and Management, Lund University, P.O Box 7080, SE-220 07 LUND E-mail: thomas.kalling@ics.lu.se Copyright # 2003 John Wiley & Sons, Ltd describing success and failure of knowledge transfer Although there are debates about the finer details of the roles of these factors, the factors that are highlighted are relatively common from study to study However, there are relatively few indepth studies of the ways in which people involved in knowledge transfer ventures behave, how they perceive these ventures, and whether these factors are connected to the subsequent success or failure of knowledge transfer Thus the purpose of this paper is to provide some insight into how knowledge transfers are perceived and managed by those involved, and how this perception can affect learning strategies and subsequent success The paper is structured in the following way The next section discusses and summarizes theory on knowledge transfer, and the following section holds a discussion of the interpretive methodology applied Then follows an empirical section describing a knowledge transfer initiative, framed by the CASE STUDY structure provided by interpretations of accounts We have interviewed more than 30 managers and employees in SCA Packaging (a European paper packaging supplier), representing both the sources and recipients of transferred knowledge, about the programme The effects of the transfer programme have also been measured, enabling comparison between successful and unsuccessful plants In the subsequent sections we discuss the possible explanations to transfer success and its relation to existing knowledge transfer theory THEORY Knowledge transfer theory has obvious overlaps with general knowledge management, the latter being defined as the individual and organizational activities by which organizations develop or leverage their knowledge base The specific focus of knowledge transfer is the processes by which members within an organization learn from each other, without interacting with the environment Knowledge transfer theory attempts to explain the factors that drive or hamper transfer But in terms of the dependent variable, the majority of the empirical research has used ‘accomplished transfer’ (von Hippel, 1994; Darr et al., 1996; Szulanski, 1996), rather than, say, product quality, or even performance effects (exceptions include Ingram and Baum, 1997; Levin, 2000; Tsai, 2001, McEvily and Chakravarthy, 2002) Accomplished transfer has been measured in different ways Sometimes it is based on individual assessments about whether the transfer has been successful, requested through questionnaire surveys (Szulanski, 1996) In other studies, accomplished transfer has been measured in terms of whether routines have been improved, for instance whether labour cost per unit of output has been improved (Epple et al., 1991) The explanatory factors are subject to greater variation The nature of the transferred knowledge is often addressed as an important factor (von Hippel, 1994) For instance, the more tacit and complex, the more difficult it becomes to accomplish transfer (Simonin, 1999; Argote et al., 2000; McEvily and Chakravarthy, 2002) The more ambiguous the causes and effects of the knowledge, the more difficult it is to transfer (Szulanski, 1996, 2000; Stein ˚ and Ridderstrale, 2001) Besides the knowledge transferred itself, the cognitive abilities of both the source of knowledge (Foss and Pedersen, 2002) and the recipient (Gupta and Govindarajan, 2000; Tsai, 2001) are key factors Absorptive and retentive capacity of the recipient, i.e how well equipped they are to take in, absorb, and apply 116 Knowledge and Process Management the knowledge, is of course central in transfer situations (Szulanski, 1996; Simonin, 1999; cf Cohen and Levinthal, 1990) Furthermore, the value of the stocks of knowledge at the source is a potential factor The more valuable it is, the more likely it is that the recipient will attempt to use it (Gupta and Govindarajan, 2000) The absorptive capacity will determine whether it will work or not Another factor, related to competitive advantage, is the uniqueness and inimitability of the knowledge If knowledge transferred internally can also be transferred externally, to competitors, for instance through personnel migration or intelligence activities, there is a risk that the effects, say on costs, can be duplicated by competitors This can lead to cost reductions across the industry, meaning there is a risk that price and profit levels are reduced overall Here, the commonalty of knowledge across actors will determine the risks of failure (Zander and Kogut, 1996) Another risk refers to drawbacks that result from the articulation of knowledge necessary in order to be able to transfer it Articulation requires simplification, which means that finer aspects of the knowledge might have to be removed or be unintentionally lost (Boisot et al., 1997) Some argue that the risks associated with articulating and transferring tacit knowledge are so high that it is more effective to avoid transferring such knowledge and accept the higher costs associated with coordinating a diverse set of organizational skills (Grant, 1996) However, it has also been argued that organizations must try to diffuse knowledge, otherwise it will be difficult to reap the leveraged benefits of knowledge (Sanchez, 1997) Apart from cognitive factors, organizational context is often addressed Geographical or perceived proximity helps intensify communication between individuals in different units Phone calls, meetings and personal acquaintances across units are normally associated with successful transfer (Epple et al., 1991; Darr et al., 1996; Ingram and Baum, 1997) Intensive integrative practices, such as crossfunctional meetings and broad participation from multiple functions further increase the chances of successful transfer (Hoopes and Postrel, 1999) The richness of communication channels (integrative mechanisms such as liaison positions, task forces and interpersonal familiarity) is another factor (Gupta and Govindarajan, 2000), as is the pre-existence of social subnetworks, referred to as the interrelations between organizational members, tools and tasks (Argote and Ingram, 2000) In terms of interrelations, arduousness (ease of communication) as well strategic similarity (the extent to which units are related strategically) impact transfer success T Kalling Knowledge and Process Management (Szulanski, 1996; Tsai, 2000) Unsurprisingly, the relative network centrality of the recipient, defined as the number of communication linkages the unit has, is positively associated with transfer as well (Tsai, 2001) Furthermore, the perceived trustworthiness of the source of the knowledge is reported to be a factor (Tsai, 2000) A third group of factors falls under motivation However, the role of motivation appears debatable and is less clear, according to research Relatively few empirical studies claim that motivation is ˚ important Stein and Ridderstrale (2001), drawing on Polanyi (1962), suggest that motivational problems, such as unwillingness to absorb or share knowledge, could be dealt with through socialisation, compensation, documentation, toleration, communication and rotation Motivation was also found to drive source units to transfer knowledge (Gupta and Govindarajan, 2000), but not all studies have been able to corroborate this, either because they have not studied it, or because they found it to be unimportant Szulanski (1996) studied a range of factors and found no link between motivation and transfer accomplishments Cognitive and relational factors were more important and therefore, Szulanski suggested, it is better to stimulate learning capacities and relations than incentives In a subsequent study (Szulanski, 2000), the downsides to motivation were elaborated upon Highly motivated adopters might ‘exacerbate problems of implementation by prematurely dismissing outside help, expanding seemingly straightforward modifications into major projects, making unnecessary modifications to preserve pride of ownership and status or to let out hidden resentment , or switching to new practices at a suboptimal moment because of unchecked enthusiasm’ (Szulanski, 2000, p 24) Thus, the theories on knowledge transfer rest solidly on cognition, organizational context, and, to a lesser extent, motivation With this as a platform, a very simple theoretical frame of reference, this paper aims to shed light on perceptions of and actions in relation to knowledge transfer, and whether and how this influences success or the antecedent factors of cognition, organization and motivation METHODOLOGY This is a case study, and the object of study is the transfer of manufacturing knowledge in SCA Packaging (SCAP) Epistemologically, the study bears resemblance to grounded theory approaches (Glaser and Strauss, 1967), but deviates slightly in its focus on interpretation rather than positivistic Transfer of Knowledge and the Role of Motivation CASE STUDY findings We not claim to be able to generalise the empirical findings to a larger population, but simply to highlight things in relation to existing theory about the ways in which knowledge transfer can be perceived and managed and how it might influence the results of transfer processes Furthermore, we deviate from grounded theory in our use of an a priori theory as guidance Grounded theory is normally seen as purely inductive, free from theory or preconceptions Some claim that a clear mindset is important in order to avoid interpreting in accordance with existing theories (Glaser and Strauss, 1967; Glaser, 1978), whereas others (Miles, 1979; Eisenhardt, 1989; Yin, 1994) claim that an a priori theory is important for positioning emergent theory and stimulating analysis This study acknowledges the latter logic and takes its starting point in the theories described above (see interview guide, Appendix A) However, the overarching ambition is to be able to develop or refine knowledge transfer theory, which is done through a ‘pattern-matching’ method (Yin, 1994) THE CASE The reported case concerns a corporate-spanning knowledge transfer programme initiated in SCAP in 1997 The objective of the programme is to spread best production practices throughout the plants in order to improve performance in the less well-performing plants The programme is referred to as an exercise in improving production skills with the result that cost improvements (less labour and raw material per unit of output) and price or sales volume improvements (through standardized qualities, reliable supply) are anticipated SCAP has over 200 plants, but only some 40 (per 2001) are included in the programme discussed in this paper The plants (profit centres) are spread across Western Europe, primarily The knowledge inherent in the programme is absorbed both internally (from knowledgeable plants) and externally (from the field of science, consultants, alliance partners, machine suppliers etc.), and is continuously growing and updated Knowledge may be articulated as production methods and procedures, or as recommendations, suitable under certain conditions and for certain machine types Methods to reduce machine downtime, improve maintenance routines and eliminate waste are examples Methods are documented in memos, reports and in databases, accessible over the corporate intranet and direct distribution Three basic outputs are measured per machine: average machine speed, direct productivity and waste; these results are reported 117 CASE STUDY monthly from plants to head office Each machine team sets targets annually, and follows up performance regularly Benchmarking is made feasible, and plants who want to improve performance on a particular machine can easily track sister plants across Europe who are performing well on that machine, and approach them for their experience and solutions Successful machine teams are awarded annually, on the basis of their improvements, at an award ceremony attended by top management and runner-up machine teams The programme is administered centrally, by a technical department, including technical experts as well as one data administrator At plant level, the production manager is normally responsible for internal communications and the performance RESEARCH DESIGN The main data collection method used was interviewing We basically asked respondents how they perceived the programme and its pros and cons, which the success factors are, if and why they have succeeded, their view on the nature of knowledge, the way they manage the system centrally and locally, organizational interrelations, control routines, local team work, and so forth (see Appendix A for the interview guide) We singled out five to six people at six of the plants (the general manager, the production manager, the sales manager, a supervisor, and one or two operators), located in different countries in Western Europe We also interviewed staff at the central technical department In total 36 interviews were made, all personal Interviews were semi-structured, including some closed questions and some open to ensure exploration Here, the factors given by theory were further investigated, but we also asked open-ended questions regarding respondents’ views One researcher conducted all the interviews, but fellow researchers assisted in the interpretation of accounts, checking too radical interpretations Interviews lasted between 60 and 200 minutes, and the average run length was approximately 120 minutes Interviews were taped and transcribed Where appropriate, for instance regarding accounts of events, we used respondent validation (Van de Ven and Poole, 1990) to ensure reliability Interviewees were selected in order to provide a broad representation of those involved The case company has no direct influence on the interviewees sampled To provide a context for the relative success of each unit we also studied up-front what sort of 118 Knowledge and Process Management improvements that had been made, at each of the 40 plants Had they succeeded in improving average machine speed, direct productivity and waste? This is of course an important issue if one is interested in determining whether the local perception and management of the knowledge transfer programme potentially affects the results As it turned out, four successful plants had improved significantly on waste performance The other two failed to improve at all In terms of average machine speed, even the two less successful plants managed to improve a few percent, but nowhere near the other four, which improved in a range between 15% and 40% In terms of direct productivity (annual output per full-time equivalent machine workers), one of the two less successful did improve on par with the average of the other four, but the other unsuccessful plant actually experienced a reduction of productivity of 20% (The six plants are briefly described in Appendix B.) In accordance with the grounded approach, the structure of the presentation of the empirical findings below is based on observations, not primarily on pre-existing theory, and on six dimensions in relation to which successful and unsuccessful plants differed EMPIRICAL INTERPRETATIONS In the empirical study, we enquired about a range of different potential factors behind transfer success or failure Six such factors appeared to discriminate: the perception of the transfer programme, aspirations and strategic ambitions, the view on (firminternal) competition, the view on the nature of the knowledge transferred, programme management and control, and local communication This section is structured accordingly The (theoretical) areas where successful and unsuccessful plants did not differ are not discussed here, but later in the overall comparison between empirical findings and theory Local perceptions The way that local managers and workers viewed the programme, in terms of their associations and the extent to which they liked it or not, differed between plants The two less successful plants, referred to as plant and plant 2, saw the exercise more as a ‘stick’ and a competition that they could never win, rather than a carrot None of the ten respondents in plants and expressed a positive view The fact that not just methods but also the results of their application (machine speed, direct T Kalling Knowledge and Process Management productivity and waste levels) were measured meant that some plants potentially blurred the focus ‘It is a performance measurement, a control device for managers who not know production well, to set targets for machine men I cannot see it as a carrot, it is a stick’ (supervisor) ‘It is merely a section of the annual productivity budget’ (production manager) Several respondents claimed they saw it as a competition that they could never win, and that they might not even want to win it, or at least not be awarded for it ‘The worker of the year approach doesn’t fit our culture, we are not used to being given vases and dinners for doing our job, and we are a bit too shy to be put on pedestals’ (general manager) Furthermore, the two plants indicated that the results-orientated approach did not take local differences into account ‘I can’t see that it contributes a lot to the situation we are in, we don’t primarily need more production improvements, we need to focus on winning new customers’ (general manager) In comparison, the four successful plants displayed a different view They focused both on the results and the methods, and embraced, to a greater extent, the benchmarking opportunities ‘It is about knowledge and benchmarking’ (operator) ‘It is a knowledge base that has helped us survive over these years’ (general manager) ‘It is a library of methods’ (production manager) They did acknowledge that there had, previously, been fears that the programme was a corporate control exercise designed to push up productivity ‘There was a fear initially that it was just a big stick, but that view is gone now’ (supervisor) Respondents also indicated that the programme has become integral in day-to-day routines ‘It is institutionalized now It is a way of living’ (production manager) ‘It has helped us develop team spirit, it is in the minds of the workforce’ (operator) The majority of respondents expressed positive experiences However, some respondents indicated that their level of activity in terms of searching, absorbing and applying new methods was slightly declining ‘I haven’t been very active lately in checking which new methods there are’ (production manager) Aspiration and strategic ambitions Because each plant investigated was run as a profit centre and was normally measured (by corporate headquarters) on operating margin and/or return on operating capital, there was substantial leeway and autonomy for local units to decide upon local strategies Corporate headquarters normally allowed plants to work out for themselves how to Transfer of Knowledge and the Role of Motivation CASE STUDY generate the margins and returns required, but supported in specific areas, such as customer contacts, technology development and information systems Therefore, local aspirations and strategic intents had strong impact on whether central initiatives (such as the reported knowledge programme) are being picked up locally Consequently, less successful plants did not see production performance as an item on the strategy agenda ‘We have other priorities here at the moment, like developing our customer base The advice is important, but obviously I am not familiar with it I don’t think we need that production knowledge today’ (general manager) Another general manager said ‘We don’t have time We are not active enough, definitely not.’ This was true also where the programme fits the local strategy ‘It fits our volume strategy well, but we simply don’t have the energy’ (general manager) Respondents also claimed that they have identified more general inabilities to take on new methods ‘Whenever we try to change things here, there are obstacles prolonging implementation Things simply die, and so does motivation’ (supervisor) Furthermore, practical arrangements facilitating participation were limited ‘I don’t know of anybody who has been trained on how to use the intranet We have a computer somewhere that accesses the intranet but I don’t know where it is’ (supervisor) In the successful plants the situation was different They prioritized the programme, despite perceived time limitations ‘I am deeply involved in working with taking in new methods’ (general manager) ‘I am not too active but I have appointed someone to be active for me We don’t use the intranet properly, though It is a time issue’ (general manager) ‘We now have screens at each of the machines, where they can access the intranet Each team also has formal gatherings where they exchange knowledge’ (supervisor) ‘I use the intranet several hours a week to seek for new methods But there is a time issue’ (production manager) The view on internal competition The competitive nature of the programme was addressed by many respondents, and it was a particular area where views differed The programme was designed as a competition, with official results and annual award ceremonies The programme management stressed competition in their communications Posters with formula-one depot teams, rowing-boat teams and javelin-throwers stressed the sports-related component of the programme, intent to make employees aware of the value of competition, teamwork and sportsmanship 119 CASE STUDY ‘Merchandise’ such as printed T-shirts, armbands and baseball caps were distributed and further emphasized an athletic profile The weaker plants did not see competition as an incentive, partly because they were too far from being best in the corporation at the outset ‘Playing in Division three you don’t really think about Premier League Many of our guys have given up competing’ (production manager) ‘We only have one machine with a chance to win, they might be competitive, I don’t know really’ (general manager) Another factor was priority: ‘We’re not driven by being best’ (general manager) ‘There is always someone somewhere who has better possibilities and knowledge than we do’ (supervisor) In an interesting twist of the competition concept, an operator stated that ‘competition is good here in the sense that it makes us wanting not to be the worst’ Successful plants embraced internal competition ‘The people’s perception of competition is important’ (general manager) ‘The transfer programme means we can now compete on a constructive basis across the company’ (supervisor) ‘The definitions we use are now agreed upon by everybody in the company That was not always the case in the old days’ (production manager) ‘I don’t think the guys think about it constantly, but they are very proud when they get awarded’ (general manager) Plantinternal competition is still important for the successful plants: ‘We compete with ourselves in relation to last year and we compete between shifts’ (supervisor) In certain plants, competition is deeply rooted An operator at a plant in the former Eastern Europe said: ‘We are used to socialistic competition, to be benchmarked and compared, and to setting targets and making plans, and being rewarded or punished depending on our results.’ The view on the nature of knowledge Another factor that plants appeared to view differently is the nature of the knowledge transferred The programme clearly was an attempt to explicate what previously (and to some still is) viewed as tacit knowledge While all respondents admitted that the knowledge required to run any particular machine efficiently was not completely explicit, there were some differences in whether there is a point in trying to articulate and make transferable such knowledge It appeared that less successful plants perceived production knowledge to be more tacit and difficult to articulate, than did successful plants—they did not trust the articulated knowledge as forming the only basis on which to develop work routines 120 Knowledge and Process Management As a consequence, they saw little reason in even trying to make use of it ‘We have a complex process that we cannot write down There are many parameters to think of We once tried to list all the parameters to consider but it is impossible’ (general manager) ‘There is a large proportion of tacit knowledge that cannot be taught or transferred’ (supervisor) ‘There are many variables, each machine has its own quirky bits’ (operator) ‘A lot of it is very tacit, we see that when certain, more experienced people are replaced’ (production manager) Respondents in successful plants displayed a different view ‘There is a certain tacit component but I want to break it down’ (production manager) ‘We wrongly believe it to be a form of art rather than bringing it closer to science Some of it is art but we overplay that’ (production manager) ‘Quite a lot can be written down We can improve by writing things down’ (supervisor) Successful plants also addressed motivational factors ‘Motivation drives learning here’ (operator) ‘There is a tacit component, but then you need motivation to be able to take it in, it is a learning curve to pass’ (production manager) ‘The fact that others [less successful plants] say knowledge is tacit only means they are not skilled or motivated enough to grasp it, doesn’t it?’ (supervisor) Programme management and control The way the knowledge transfer programme was managed also differed between plants The idea of the central programme management was that, at the least, plants should make yearly plans for each machine, outlining performance targets, and monitor and feedback progress both to the central programme administration and to local staff Their ambition was that production managers should be involved in the local assessments, if not the general manager The less successful plants indicate less activity in this respect than the others ‘I am involved in the planning exercise only, once a year I never discuss these figures explicitly with my boss but we discuss productivity on a quarterly basis Our actual results are reported to me by someone at head office One of our guys enters the data on the intranet’ (general manager) ‘We don’t display performance figures on the notice board nowadays’ (production manager) ‘I have meetings with key operators an hour every three weeks where we might cover it’ (production manager) ‘I look at the figures quarterly and focus on highlights I go through it with the production manager then too’ (general manager) ‘We don’t really discuss the T Kalling Knowledge and Process Management figures explicitly, we used to The programme is on the backburner’ (supervisor) Successful plants did it differently The local management was more involved ‘I discuss these things regularly with production management, at least once a week I go in ad hoc when needed’ (general manager) ‘I get regular updates to be able to inform my sales guys about current production performance’ (sales manager) ‘I follow it up daily and have meetings with key staff three times a week when we discuss it Monthly I go through it with all staff’ (production manager) ‘I communicate daily with operators and they really react upon it I have daily meetings about downtime, overproduction and so on The planning exercise is dealt with rigorously with shift leaders and the teams We have broken down annual targets into quarterly to get better control’ (production manager) ‘Within the shifts we talk about it when new data is displayed All workers know about the performance’ (operator) Local communication A final factor relates to plant-internal communication of efforts and results It appeared that the less successful plants sensed an urge to improve communication of what is being done and achieved within production to other stakeholders Improvements of activities other than production appear to be perceived as potentially conflicting with productivity improvements Functions such as Sales or Logistics appeared not to embody or understand the principles of the knowledge transfer programme, and as a consequence, support and attention were limited ‘Sometimes, the production figures are interpreted by people who not have the whole picture’ (production manager) ‘There is too much focus on productivity, you cannot forget the market side, and we need to invite the sales people’ (general manager) ‘We must communicate better with Sales We need to communicate it better with customers’ (sales manager) ‘We need to communicate better across plants’ (supervisor) Production too was seen as lacking in understanding of the programme implications ‘We must communicate better with the production people, they don’t understand it very well here They must understand that this is something that makes things easier for them’ (supervisor) Communication was not seen as an issue in the more successful units No respondent indicated that communication is a problem ‘I am involved on a monthly basis or if there is an ad hoc debate about something between Sales and Production’ (sales manager) ‘We are informed about our Transfer of Knowledge and the Role of Motivation CASE STUDY production performance and if it suits our purposes we will communicate it one way or another to our customers’ (sales manager) DISCUSSION The empirical interpretations of accounts of perceptions and actions in relation to knowledge transfer give some indications in relation to existing theory, discussed below The empirical interpretations that there are six types of differences between plants that succeed with internal transfer of knowledge indicate that such corporate initiatives need to consider not just cognitive factors, but also factors connected to motivation and local and corporate management control principles or routines Indirectly, the organizational context can be seen as a factor as well In knowledge transfer theory, cognitive factors such as the nature of knowledge and the absorptive capacity of recipients are key ‘knowledge barriers’ (von Hippel, 1994; Szulanski, 1996; Simonin, 1999) This study implies that cognitive factors, such as causal ambiguity and tacitness, and absorptive and retentive capacity, are affected by motivation The stronger the motivation to learn, the more likely it is that individuals will work harder on trying to learn and pick up new knowledge Trying to make explicit what might be seen as tacit, at least partly, may improve learning Here, motivation is absolutely central; what else will trigger learning, if we assume that local knowledge and abilities are naturally inflexible? Thus we propose that motivation may be a factor behind cognition in the first place Furthermore, the differences in motivation, in the reported cases, are also evident in local perceptions of transfer programmes, by the local aspirations and strategic ambitions, by the view on internal competition and partly in the internal communication Those who perceive the programme as an opportunity to learn, rather than as a ‘stick’, succeed Those who see a direct fit with the existing local strategy and those who aspire to improve their performance, are likely to be more keen on using the transferred knowledge Furthermore, the will to compete, with other shifts and other plants, also appears to be a motivator In a sense, the lack of communication in the unsuccessful plants also highlights a lack of motivation among local managers If those involved in or affected by knowledge transfer not understand the purpose and the contents of it, if they cannot see the reasons for it, they are likely to be less motivated to support and contribute 121 CASE STUDY For all these factors, motivation is central Motivation drives cognition, and if cognition is not there motivation might help Motivation in turn can be driven by many things: a weak position performance-wise, or by a generic will to learn and improve If this ‘natural’ motivation is not in place, local management control efforts may create the incentive General managers and production managers can set targets, monitor and feed back to those involved to stimulate activity In the reported case, we saw that successful plants had very active local management in all these aspects Furthermore, should local management not be active enough in inspiring their work staff, corporate (or middle if that is the case) management control could help instead In the above case, the corporate involvement in terms of stimulating local management was primarily through the award routine The regular financial reporting between general managers and their superiors did not focus very much on the knowledge transfer programme, unless the general manager included it himself The management control factor can thus be seen as a way to create an incentive to learn, when there is no natural desire to so—hence it is again a factor connected to motivation The role of incentive shines through in the empirical material It also relates to corporate management control principles and indirectly to organizational context The reported company is decentralized in the sense that local units are controlled financially, only, and local management has great leeway and is expected to formulate strategies themselves Horizontal communication between plants is desirable but difficult with a profit centre structure which forces each unit to carry all their costs In the vertical dimension, a fairly remote relation between plants and their superiors at corporate level further isolates the local unit Under such circumstances, local motivation is a make-or-break factor In relation to theory, this paper is strongly focused on the role of motivation and incentives Motivation is seldom referred to as an explanatory factor in knowledge transfer theory Szulanski (1996, 2000) found no or limited support for motivation being a factor, and reasoned that it may be because motivation is also associated with uncritical commitment A few, like Gupta and Govindarajan ˚ (2000) and Stein and Ridderstrale (2001) claim it is important Gupta and Govindarajan (2000), for instance, discuss the role of incentives and corporate coercion in stimulating motivation Huber (1991) does not discuss motivation but claims that internal distribution of information is triggered by the view on the relevance of the information, the 122 Knowledge and Process Management power of the recipient, the level of workload and resources available In comparison, this study has provided some insight on how motivation or lack of motivation can occur and be managed in transfer situations We also suggested that if motivation is not in place naturally, management control routines and organizational context may substitute These factors are slightly more popular in theory (Epple et al., 1996; Simonin, 1999; Argote and Ingram, 2000), while others claim they are unimportant (Szulanski, 1996) In order to get a more detailed discussion of the role of motivation, we need to consult more general knowledge management and organizational learning theory However, even within the so-called organizational learning track (cf Fiol and Lyles, 1985; March, 1991; Levinthal and March, 1993) the focus on learning is fairly cognitively biased Consequently, Fiol and Lyles refrain from discussing motivation but suggest that learning is driven by strategy, structure, culture and the environment As an interpretation, at least the first three of these can be said to be connected with the concept of motivation They set the boundaries of learning by defining business, norms and beliefs, and organizational infrastructure Similarly, Nonaka (1994) discusses organizational learning and suggests that there are three factors that induce commitment in an organizational setting: intention (sense-making, intentionality), autonomy (autonomous organizational members that interact can help stimulate ‘unexpected opportunities’ for learning) and fluctuation (a discontinuous environment can generate new patterns of interaction and hence stimulate commitment to learn) Other than these factors, the so-called not-invented-here concept refers to situations where potential recipients of knowledge lack the incentive to learn, primarily because they not sense that sources of knowledge have the proper level of authority, and that their own knowledge base has a stronger authority (Katz and Allen, 1982, Hayes and Clark, 1985) Katz and Allen, in particular, stressed the role of the perception of oneself as an authority as a key obstacle to learning But despite the slightly stronger focus on motivation within general organizational learning theory, there is little discussion about motivation in knowledge transfer theory In a sense, existing theory on knowledge transfer appears to assume that all units within an organization are interested in a particular piece of knowledge, and that if they are not, they will be forced directly by corporate command to recognize its importance It also appears as if existing theory assumes that new knowledge is always ‘good’ In the case above, units are highly similar in T Kalling Knowledge and Process Management terms of machinery and so on, but they have different strategies, even in such simple dimensions as the choice of generic strategy (Porter, 1980) Some go for a low-cost strategy, others are working on acquiring customers through differentiation The knowledge in question appears not to be an appropriate fit for both equally well In organizations with greater heterogeneity, this will be emphasised even further The proposition that theory subconsciously makes these assumptions is also reflected by the fact that most of them see the objective of knowledge transfer to be accomplished knowledge transfer rather than improved performance A number of the mentioned texts, like Epple et al (1991), Darr et al (1996), Szulanski (1996), Tsai ˚ (2000) and Stein and Ridderstrale (2001) use accomplished transfer as dependent variable Exceptions include Zander and Kogut (1995), Ingram and Baum (1997) and Tsai (2001), who all study the effects of transfer on competitive advantage, survival and profitability It should also be noted that the knowledge transfer theory we have taken into account is explanatory in nature There are, as yet, few theories aimed at outlining the finer causal structures that exists between knowledge and successful knowledge transfer CONCLUSION The purpose of this paper is to increase the understanding of how knowledge transfers can be perceived and managed, and how choices can affect success We have studied a particular knowledge transfer programme in a manufacturing MNC, and tried to investigate what differences there were between units that succeeded and those who did not While theory on knowledge transfer suggests a number of different factors of which almost all touch upon cognitive matters, the six overarching factors found to be relevant in this case all had a connection to motivation Consequently, we argue that theory should take into account these factors among others, not least because it might be that motivation is a factor in overcoming obstacles provided by causal ambiguity, absorptive capacity and the tacitness of the knowledge to be transferred Motivation is of course not a new concept in the world of management research, but it is in relation to theory specific to organization-internal knowledge transfer The not-invented-here concept (Katz and Allen, 1982; Hayes and Clark, 1985) and other concepts connected to motivation have occasionally been referred to, but with limited explanatory power (Szulanski, 1996) In this case, this did not surface Transfer of Knowledge and the Role of Motivation CASE STUDY as a particular factor Motivation aspects were different in character This suggestion also provides some input to managers It is very important to pay attention and provide flexibility to make sure there is motivation among both sources and recipients in transfer situations This could be done through enforced control mechanisms and a less decentralized structure, but it appears more efficient to stimulate it by making sure recipients understand the value of the knowledge in question, and by fitting the contents and presentation of knowledge in a way that suits recipients Benchmarking exercises, with internally public methods and output results, awards and recognition, team-building efforts, is one way of stimulating motivation A case study of this kind obviously has some limitations in terms of generalization to population Instead, we discuss findings in relation to existing theories and propose extensions or refinements in relation to it (Yin, 1994) A one-case approach also means the character of the particular case has a strong influence The particular pieces of knowledge (hands-on production-related knowledge), organization (deep decentralization, financial control), strategies (local), the heterogeneous, local, character of markets, and so forth, have an impact on the interpretations This might explain why this study focuses motivation so much In a setting where knowledge is transferred between, say, two departments in a functional organization, things might be different even if this case alone gives a strong argument why motivation should be part of a knowledge transfer theory The case is representative of a typical, fairly mature, manufacturing industry spread out across European cultures, and interview respondents appear to display views that may well be relevant in other industries as well In that sense, it is not unlikely that the suggestions here are applicable elsewhere What we have suggested is that motivation is important and should be understood and managed Furthermore, we have suggested ways in which these problems can surface and how they can be managed We would argue that on this level of discussion, the findings are probably relevant in other transfer settings, especially if they are industrial and if the organizational context (decentralization, financial control, size) is similar Considering the nature of the knowledge transferred, it is clear that some of it is specialized whereas some is fairly simple in nature But in spite of that, the findings and suggestions made here are probably independent of the type of knowledge in question It could be that more tacit knowledge will encounter other factors and lead to different 123 CASE STUDY situations Generally speaking, the case operations are not so specialized that we cannot discuss knowledge transfer and the role of motivation in the way that we have The role of motivation is probably as important in a chain of hotels or supermarkets, a software vendor or a consulting company, regardless of the nature of knowledge The method of analysis is generalization to theory, and given the level of abstraction in theory, we should be able to discuss knowledge, knowledge transfer, motivation and other concepts in the way we have here, albeit taking into consideration what settings the findings were taken from In terms of future research, there ought to be plenty of opportunities, considering the increasing popularity of knowledge transfer and similar methods of learning Cases such as SCA Packaging highlight the need to understand better the role of motivation, and what corporate managers can to stimulate it Both case studies, cross-case studies and quantitative studies will be relevant, regardless of which factors and independent and dependent variables one is interested in Knowledge and Process Management APPENDIX A INTERVIEW GUIDE The view on the Knowledge Transfer Programme (KTP)? E.g a knowledge base, a benchmarking data base, a competition, a mindset, a social ritual, gatherings etc What is the plant attitude now and how has it evolved over the years? The value of KTP? a Is KTP valuable to the plant? Examples? b How has it changed since 1997? c In what way is it valuable? Standardized behaviour, improved work, control, improved performance, competitive advantage? What aspect makes KTP valuable? (Grade each, 1–5) a The knowledge it contains b The competition c The social incentives/arrangements d The benchmarking/Getting a picture of where we stand e Being best in the group f Integrating autonomous plants, a more unified organization g A control device for central and local management KTP and the Business model: a Effects on activities and organization? Any function that suffers while others prosper? b Effects on the offering: Quality (e.g product mix, standardisation, poor product quality, 124 10 delivery performance etc) or Costs (less labour per output, less raw material consumption etc) c Customer attitude: they know about KTP? d Suppliers? Are they involved in any way? e Competition? Strategic context: a Describe the plant strategy b Does KTP support or constrain the plant strategy? c Is or could KTP be giving you competitive advantage? d Could you have good performance without the KTP? How would you describe the production knowledge made available in KTP? a Does KTP performance reflect desired performance? b Is KTP knowledge relevant to the plant? c Is KTP knowledge well documented and presented? d Is the KTP knowledge documentation explicit or does it require further input from local staff to be comprehensive? e If it requires local input, is this input easily documented? f Does KTP knowledge help you improve operations? g Does KTP knowledge help you challenge your strategies? h Do you actively search for knowledge? i Do you always understand how to use the new knowledge? j Is it reliable? k Does it have to be proved elsewhere before you take it in? l Easy or difficult to understand? m Easy or difficult to apply? n Does it come from reliable sources? How you act when you apply ‘new’ knowledge? a Provide some examples of the plant having identified a weakness and actively having solved the issue by using KTP knowledge? b Are all machine groups equally good on taking on and applying new knowledge? c What, in your view, distinguishes between groups’ abilities to assimilate and use KTP knowledge? Which are the success factors? Submitting knowledge: a What contributions has the plant made to the KTP knowledge base? b Is the plant active? Examples? Local KTP work What is done to improve KTP performance: a Roles and duties? Authorities? T Kalling Knowledge and Process Management b What procedures are held locally? Plans, feed back sessions, etc? c How informed or educated are senior plant management about KTP? d What sort of training and education is done internally? e Which functions are involved in KTP-related work? f Is there always good motivation to work with KTP? g What is the role of plant management? Facilitator, controller etc? 11 The KTP structure, Support a Centrally? What they to help you? Regular, ad hoc? Examples? b Other stakeholders? 12 Structural context: a Is KTP always a ‘vertical’ organizational project, or is knowledge exchanged also directly between plants, ‘horizontally’? b Is KTP discussed on Regional general management meetings? c Who, among plant personnel, discusses KTP with members of other plants? d Does KTP affect the general manager and plant assessments? e What would happen if KTP performance was added to plant and general manager assessments? 13 How would you improve KTP? a Considering your strategy, how would you change the KTP project to fit better your strategy? b If KTP supports your strategy, how would you modify it? APPENDIX B BRIEF INTRODUCTION OF THE SIX CASE PLANTS The six plants studied share many features, like technology, machinery, skills levels (many operators and workers go to the same type of schools and colleges and they are trained regularly by the same machine suppliers), raw material sources, basic manufacturing procedures, structures, customer segments and physical resources What separates them are, among other things, culture, size, history, financial performance, and current strategies, but it is important to realize that these differences appear not to be related to the differences between the plants in terms of transfer success or failure Plants and failed to take on the knowledge transfer, whereas the other four succeeded Transfer of Knowledge and the Role of Motivation CASE STUDY Plant is a small plant, based in northern Europe, with a history of satisfactory profits However, during the last five years their profits had steadily declined Its strategy is primarily aimed at differentiating the offering and to acquiring new customers The workforce has been fairly intact during the last five years, in terms of both numbers and people Plant is a large plant, one of the larger ones in terms of output, based in northern Europe, with some problematic years behind them They have been running with a loss for some years, and are currently undergoing structural and management changes and redundancy programmes Their strategy is a growth-based low-cost strategy Personnel turnover is not very high, comparatively Plant is a small plant, also based in northern Europe, relatively distant from urban areas It has a more dated capital base (machines) but a very fine yet slightly declining profit margin The plant has not done too many changes over the years— corporate ideas and ventures are taken in slowly The workforce as well as the management team has been very stable over the years Their current strategy is to attract new customers Plant is mid-sized and based in Central 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