If I Knew What You Know: 5 Q & A on Knowledge Transfer

I pride myself as a quick learner, yet to me, the dilemma of learning and knowledge transfer is a fascinating and highly significant topic in business and everyday life.   

As a teenager, I remember how I used to observe my brother when he raced his sports car, changed the oil and kept his machine impeccably fine-tuned. Each time I wondered: How can I learn more? What possibly might have been a passing interest, was really deeply embedded. I must have learned something or felt inspired deep within, as I ended up being in the business of lubricants and loving it!  I was watching a chemist creating the most robust formulations and I was wondering how we all can learn in the company. The dilemma is how do people learn from others in a fast, efficient and effective way. Above all how do we transfer knowledge? 

Working in the manufacturing industry, all of us know how challenging it is to transfer knowledge from person to person, department to department, between subsidiaries… An explicit knowledge – yes, rather easy to integrate- but tacit knowledge, or specific knowledge, which is embedded in human beings? Not so easy.

As I continue to work on my dissertation, “Knowledge Transfer During Post-Merger (Post-Acquisition) Integrations (PMI)” – I have discovered that many outstanding people are resilient to knowledge sharing and the reasons, for the most part, are socio-psychological barriers to knowledge transfer. I want to cover this interesting topic by answering 5 of the most relevant questions specifically related to the subject.

I also want to draw your attention to my previous article on this topic.

First Question: What is Knowledge?

Greek philosophers such as Plato and Socrates suggested the following definition of knowledge: knowledge is nothing but perception, knowledge is a true judgment. In the modern world:

Knowledge is Information in Action

Second Question: Why should a company commit to Knowledge Transfer (or knowledge management) initiatives – be it during PMI or internal amongst its own employees and subsidiaries?

Every day that a better idea goes unused, is a lost opportunity. We have to share more and we have to share faster. Sharing and using proven and successful best practices is the most important thing we should do for the organizational success. (Kenneth Derr, a former Chevron Chairman & CEO)

Knowledge Transfer has been identified as critical for the integration of an acquired firm and the ability of the merging firms to transfer knowledge, will contribute a significant portion to the organizational success. New knowledge from an acquired firm can be a key factor for organizational improvement. However, the current understanding of how to overcome the challenges of knowledge transfer between the merging entities, or international subsidiaries, is limited (O'Dell & Grayson, 1998).

In the modern day and age, if a company wants to be successful, its leadership needs to admit, that the grass is often greener in their own back yard.  Look no further, for the most part, all the newly acquired employees, or internal ones from subsidiaries, have a tremendous amount of stored knowledge, the real problem is to help them share it and then capitalize on it - with a simple goal: To positively impact the bottom line.

$$$$: at Dow, for example, early efforts to manage knowledge brought an immediate $40 million savings. Or Chevron’s implementation of networks of knowledge back in 90s - resulted in $150 million savings (O'Dell & Grayson, 1998)

Based on what I have read, ExxonMobil, Phillips66, Shell, Dow, DuPont, BP and Chevron are the biggest ones in the chemical industry that help their employees with knowledge transferring initiatives. The reason they do this is that they are truly tapping into the hidden asset, capturing it, organizing it, transferring it, and using it to create customer value, operational excellence and product innovation - all while increasing profits and effectiveness (Grant, 2013).

Third Question: What are the barriers to Knowledge Transfer?

  “We have two plants across the street from one another and it’s the damnedest thing to get them to transfer knowledge and best practices” (O'Dell & Grayson, 1998)

Knowledge Transfer - perceived as simple in concept, but when it comes to reality, is difficult to execute. Most companies end up discouraging rather than encouraging knowledge transfer. Why? Many large global companies have a huge psychological barrier, which can have cultural or other roots and is called a ‘Not Invented Here Syndrome’ (NIH) (read more here) and in addition their executives believe that knowledge transfer responsibilities can be added on top of everyone’s regular work and they expect to have positive results –Good Luck with that :)! 

Nevertheless, according to O'Dell & Grayson (1998), with lots of fanfare and high hopes, all companies start the knowledge management sites, intranet pages, off-site meetings and the alike. And while indeed some of these systems are needed for structural reasons, they overlook the human psychology component. Companies need to build systems, but cannot ignore the fact that organizational personalities come in all sorts of cultures, shapes, sizes – without this realization all of the efforts will not be successful. The three barriers below need to be combined:

• Dr. Szulanski (1996; 2004) a Strategy Professor at INSEAD,  performed an experiment and discovered that the number one biggest barrier to knowledge transfer is Ignorance: Ignorance on both ends of the transfer. As in most companies in his study, particular the larger ones, neither the “source” nor the “recipient” knew someone else had the knowledge they required or would be interested in the knowledge they had available.
• The second biggest barrier is the Absorptive Capacity of the recipient. Even if a person or company knew about the better practice, neither the resources (time, money) nor enough practical details may exist to implement it.
• Knowledge Ambiguity, is also on this list - which is an inherent and irreducible uncertainty as to what the knowledge components are and how they interact.

The Barriers to Knowledge Transfer: Ignorance, Absorptive Capacity, Knowledge Ambiguity

Additionally, other researchers discovered that socio-psychological barriers interfere with people’s ability to share their knowledge such as:

1. Source’s ability to transfer knowledge (not everyone can teach others)
2. Communicational, cognitive and motivational limitations
3. Sociocultural interfirm linkages (perceived freedom, trust factors, collective teaching, and cultural integration)

Thus, it would be na?ve to believe there is one answer to this organizational malaise. Prescribing a single remedy to a host of organizational knowledge transferring problems is clearly not going to work. Also, no two companies are alike, but reviewing best practices can help and while there is no single answer, there appears to be a growing consensus that the fastest, most effective and powerful way for companies to manage knowledge transfer is by having IT and HR systems in place that facilitate a systematic transfer of best practices, while factoring in and being sensitive to socio-psychological components (Dixon, 2000).

 Fourth Question: What influences knowledge transfer?

Your organization’s current situation, designing a detailed project, and a good implementation plan. 

Keep in mind that sociocultural interfirm linkages (complementary employee skills, trust, collective teaching, and cultural integration) between the merging firms (or between subsidiaries) significantly influence the level of knowledge transfer in M&As.

A database is merely enabling mechanism, a key to success is a willingness to share and learn. People want to share with and learn from others they trust and respect (O'Dell & Grayson, 1998).

Knowledge transfer depends on the opportunity, motivation and ability to do so, plus, it has been proven that social capital creates channels of communications that promote exchange creation and recombination of knowledge among individuals.

It is most important to be aware that intrinsic motivation drives a participation in knowledge transfer, which is based on competences such as self-evaluation and social acceptance. Furthermore, the probability of knowledge transfer increases when individuals perceive that their contribution makes the difference. Individuals, who have a great sense of group-identification, are also more likely to contribute to the group (Minbaeva, et al, 2003).

 Fifth Question: How to stipulate Knowledge Transfer?

To start with, any company would need a high-level executive commitment and methodological approach. Successful initiatives require a clear focus, well defined desired results, an enabling environment, a compelling need to change and assessing sessions.

When creating your own knowledge transfer system, keep in mind that effective knowledge transfer requires creating a supportive and collaborative culture and eliminating traditional rivalries.

In order to remove the socio-psychological barriers of knowledge transfer, it is important to create a collaborative culture. It can start with the improvement of communal spaces: coffee room, cantines, and overall office spaces that stipulates team building(O'Dell & Grayson, 1998).

Face to face meetings are absolutely the most important KEY to knowledge sharing. Global team meetings are not an expense- but an investment!

Nevertheless, you have to provide both purpose and motivation; you have to provide the tools (IT, etc), and finally you have to complement both with intrinsic rewards and intangible incentive structures.

“We are here to make money” is not good enough. The common goal must be both more specific and more inspiring, including some social relevancy.

The bottom line is that knowledge transfer and sharing require behavior changes at every level. Operating supervisors have to make the time to meet and talk about a change and share ideas; for example: technical managers must be able to cede control of R&D by discussing product innovation with marketing and front-line sales.

 Conclusion

Build the trust, motivate and inspire. Provide with tools and resources and recognize that in the end of the day, your people are your best source of competitive advantage.

Let me quickly bring it back home: Organizational competitiveness rests in the tacit not explicit knowledge. The elitist firms in today’s business world have one thing in common - they recognize that their employees are their key stakeholders and they inspire a culture that recognizes the importance of people and their knowledge. By doing so, they lay the groundwork for the critical task of leveraging their employees experience, practices and knowledge.  Ultimately, to be successful: Overcome the psycho-social barriers that impede knowledge transfer, provide systems to facilitate the transfer of knowledge and create sustainable tangible values for your bottom line and customers.

 Reference 

Dixon, N. M. (2000). Common knowledge: How companies thrive by sharing what they know. Harvard Business School Press.

Grant, R. M. (2013). The development of knowledge management in the oil and gas Industry/El desarrollo de la dirección del conocimiento en la industria del petroleo y gas. Universia Business Review, (40), 92.

Minbaeva, D., Pedersen, T., Bj?rkman, I., Fey, C. F., & Park, H. J. (2003). MNC knowledge transfer, subsidiary absorptive capacity, and HRM. Journal of international business studies, 34(6), 586-599.

O'Dell, C., & Grayson, C. J. (1998). If only we knew what we know: Identification and transfer of internal best practices. California management review, 40(3), 154-174.

Szulanski, G. (1996). Exploring internal stickiness: Impediments to the transfer of best practice within the firm. Strategic management journal, 17 (S2), 27-43.

Szulanski, G., Cappetta, R., & Jensen, R. J. (2004). When and how trustworthiness matters: Knowledge transfer and the moderating effect of causal ambiguity. Organization science, 15(5), 600-613.

DISCLAIMER

Opinions expressed are solely my own and do not express the views or opinions of my employer. Information presented is publicly available.

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Thank you for reading my post! Here, at LinkedIn, I regularly write about sales excellence, performance psychology and lubricants. If you would like to read my regular posts -please click 'Follow' and/or send me a LinkedIn invite.

Some other posts that I have written:

PERFORMANCE PSYCHOLOGY

What Makes A True Leader: One Deep Perspective

Dream Big: It Is Not Over Until You Win

Driving Successful Post-Merger Integration (PMI)

LUBRICANTS

Selling Grease: Top 4 Applications for Polyurea Greases

The Best Kept Secret For Sales Success When Selling Lubricants Globally

Grease Color Challenge Solved: 2 Factors You Need to Know

Fluids - The Lifeblood That Keeps Transmissions De-Stressed

SALES EXCELLENCE

Let’s Bring Agility to the Chemical Industry Ordering Process

Big Hero Sales Blitz (Three Key Principles of Instant Sales Increase)

Art of Global Sales: The Cultural Practices

Long Cycle Sales Explained

Sincere Regards,

Yulia, M.B.A

Doctoral Student