1
Knowledge transfer mechanisms in service business
acquisition
Miia Kosonen 1
Riitta Forsten-Astikainen 1
Kirsimarja Blom...
2
Jasimuddin (2007), there is a plethora of research regarding the various aspects of knowledge
transfer but only a few st...
3
Knowledge transfer is defined in the literature as a process through which one unit is affected
by the experience of ano...
4
treated as an independent experiment standing on its own as an analytical unit (Yin, 2003). By
comparing findings from t...
5
transfer knowledge within each case. In the second part of the analysis, recurrent themes were
compared and contrasted w...
6
“Of course our aim is to make it more interactive, but people tend to act rather distant then, it
is quire natural that ...
7
3. Formal training
The role of training was also emphasized in each case. Acquisitions represent a major change
for orga...
8
“Training is very superficial. Here in our unit we do things so that if someone knows one
issue better than others, he o...
9
“In weekly meetings it is not possible to study things, it is more about informing… In small
groups, the IT system issue...
10
6. Codified database
In our cases, applying codified database represented a key mechanism to transfer knowledge.
Across...
11
Table 1 summarizes the identified knowledge transfer mechanisms, examples of types of
knowledge being transferred, and ...
12
research, our study thus underlines the importance of combining “hard”knowledge transfer
mediated by technology and “so...
13
Day, G.S. 1994. Managerial representations of competitive advantage. Journal of Marketing, Vol. 58,
pp 31-44.
Eisenhard...
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Knowledge transfer mechanisms in service business acquisitions

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Knowledge transfer mechanisms in service business acquisitions

  1. 1. 1 Knowledge transfer mechanisms in service business acquisition Miia Kosonen 1 Riitta Forsten-Astikainen 1 Kirsimarja Blomqvist 1 Tatiana Andreeva 2 1 Lappeenranta University of Technology, School of Business, Finland 2 Graduate School of Management, St.Petersburg State University, Russia miia.kosonen@lut.fi riitta.forsten-astikainen@lut.fi kirsimarja.blomqvist@lut.fi andreeva@som.pu.ru Abstract The fact that service provision involves a lot of human-related and tacit knowledge makes services sector promising for studying knowledge transfer mechanisms. We applied service business acquisitions as an illustrative context to study the issue, drawing on a qualitative empirical study of one B2B service firm, in order to identify knowledge transfer mechanisms and classify them. As a result, six mechanisms were identified: acquisition management team, unit managers, formal training, rooming-in, e-communication, and codified database. These can be further classified into management-, learning- and technology-related mechanisms. The contribution of the study is twofold. Firstly, it adds to the literature of knowledge management by providing a classification of knowledge transfer mechanisms. Secondly, it presents empirical evidence about the role and use of such mechanisms in service business acquisition, hereby contributing to managerial understanding about how to facilitate knowledge transfer between the acquirer and the acquired target in the field of knowledge- intensive service firms. Keywords knowledge, knowledge transfer, knowledge transfer mechanisms, service business Introduction Within knowledge management, knowledge transfer constitutes a strategic research area (Jasimuddin, 2007) and a source for firm competitiveness. Indeed, transfer of existing knowledge within an organization helps the company use available resources in the most efficient way by transferring the best practices — those that have proven to bring the best results, lower costs, or very satisfied customers — from one department to another, from one project or client to another and so on. Existing empirical research on knowledge transfer has been criticized for focusing predominantly on the technological knowledge transfer and/or on the domain of R&D function (Bresman et al., 1999, Simonin, 1999). Secondly, as noted by
  2. 2. 2 Jasimuddin (2007), there is a plethora of research regarding the various aspects of knowledge transfer but only a few studies on focusing the related transfer mechanisms and their appropriateness in different circumstances. Our study aims to contribute to these two research gaps. Service business acquisition provides a rich context for our research due to its intangible value-creating processes, where the role of individuals is critical. The literature suggests that the distinctive characteristics of services, intangibility, heterogeneity, inseparability and perishability (typically referred as IHIP), make services highly dependent on human factor –employees who actually provide the service. This fact implies the importance of employees’skills and knowledge (including the tacit one) for all types of services, and, consequently, the importance of knowledge transfer within the service company, both between individual employees and between units (Gittel & Seidner, 2009). The fact that service provision involves a lot of human-related and tacit knowledge makes services sector even more promising for research on knowledge transfer mechanisms in the light of the criticisms of the existing research. In the case of a service firm acquisition, knowledge transfer is a particularly important issue as the access to new knowledge about clients, products, markets or technology is considered one of the key motivations for the acquisitions (e.g. Haleblian et al., 2009; Kongpichayanond, 2009; Tsang, 2008; Bresman et al., 1999). Hence, we apply service business acquisitions as an illustrative context to study knowledge transfer mechanisms, drawing on a qualitative empirical study of one B2B service firm. Our research question can thus be stated as the following: What types of mechanisms for knowledge transfer in service business acquisitions can be identified, and how can these mechanisms be classified? The rest of the paper is structured as follows: firstly, we present the theoretical background of our study. Thereafter, we describe our research design, methods and data, after which the empirical findings are presented. Our paper contributes by providing a classification of the knowledge transfer mechanisms involved in service business acquisition. We conclude by discussing the theoretical and practical implications of our study. Theoretical background In this section we briefly review the existing literature on knowledge transfer mechanisms and explain the specifics of the services and acquisitions context for the knowledge transfer. According to the knowledge-based view of the firm (Grant, 1996), all products and services are fundamentally tangible or intangible embodiments of human knowledge. Therefore, knowledge is viewed as one of the key sources for the creation and maintenance of a sustainable competitive advantage, especially in the context of a post-industrial economy (Kogut & Zander, 1992; Grant, 1996; Teece, 2004). Consequently, the tasks of managing various knowledge-related processes in an organization are brought to the forefront. Knowledge transfer is one of such processes that enable organizations to save costs, increase efficiency and creativity by transferring the best practices, efficient allocation of existing knowledge resources and sharing new ideas across the company.
  3. 3. 3 Knowledge transfer is defined in the literature as a process through which one unit is affected by the experience of another (Argote & Ingram, 2000, see also Szulanski, 2000); in this process, the organization provides its members knowledge to extend its knowledge base and leverage unique skills (Kalling, 2003). However, organizations do not always know what knowledge they possess, and transferring knowledge may be challenging due to its stickiness (Szulanski, 1996). As Argote & Ingram (2000) note, the most difficult types of knowledge to transfer are interactions among people, tasks and tools. Yet in the context of service co- creation, finding solutions to customer’s problems requires such complex interactions (Ritala et al. 2010). Knowledge transfer mechanisms have not been studied as a single homogenous mechanism system. The concept of mechanism is not explicitly defined in current literature, either. Based on current research, knowledge transfer mechanisms can be understood as policies, models, tools and practices through which knowledge can be transferred between and across different levels, i.e. at individual, organizational and industry level. The nature of the mechanisms is context-dependent and multidimensional. Hereby, due to our focus in service business and the focal role of human-bound tacit knowledge (e.g. Gittel & Seidner, 2010) we are interested in studying the micro-level mechanisms that directly involve people. Acquisitions also represent the context that is rich in knowledge transfer. On the one hand, one of the frequent reasons for acquisitions is desire of the acquiring company to access some valuable knowledge of the acquired target. On the other hand, the process of integration involves transfer of the knowledge from the parent firm to the acquired target, aimed to coordinate consolidated operations. The intensity of such knowledge transfer depends on the level of integration. Typically, three levels of integration are identified in the literature –(1) procedures (that does not go beyond unification of financial and other reports), (2) assets and products (that may involve integration of the product range, production systems and technologies, and (3) organization (that involves integration of organizational structures, management teams and organizational culture) (Nahavandi & Malekzadeh, 1988; Cartwright & Cooper, 1996). From knowledge perspective, these integration levels can be differentiated from more focused on explicit knowledge transfer (procedural level) to more focused on tacit knowledge transfer (organizational level). They also differ in the complexity of knowledge, as organizational level of integration typically involves transfer of the complex body of organizational knowledge, embedded in people, documents, routines and culture. Thus the levels of integration represent different modes and also challenges in terms of knowledge transfer. These challenges also depend on the relationship between parties of the knowledge transfer. Evidence from practice and research suggest that relationships between acquirer and acquired frequently are uneasy (Cartwright & Cooper, 1996), and in such a case the tensions between parties make knowledge transfer a challenging task. Methods and data collection The choice of research design was based on the objectives of the study. We considered a comparative case-study approach (Eisenhardt & Graebner, 2007) as suitable for increasing understanding about the knowledge transfer mechanisms. Within this setting, each case is
  4. 4. 4 treated as an independent experiment standing on its own as an analytical unit (Yin, 2003). By comparing findings from the individual cases, researchers are able to justify whether an emergent finding is idiosyncratic to a single case, or consistent within a number of them (Eisenhardt & Graebner, 2007). Firstly, we selected one company, under which we further identified four different cases that allowed us to investigate the processes and practices related to knowledge transfer in service business acquisitions. Our research design allowed us to contrast the cases and single out the differences better, as the parent strategy and culture remained constant. The acquiring firm Alpha is a well managed and strongly growth-oriented B2B service provider that had almost tripled its size through several acquisitions during the last ten years. It has invested both in IT to enhance efficiency, in customer relationship management as well as a team-like organization to enhance both efficiency and effectiveness. It has a unique culture aiming for high efficiency, continuous development and family-like organizational climate. The acquiring firm Alpha produces routine expert services and increasingly also consulting type of services for its B2B customers (on the typology of various types of services and related customer-supplier knowledge interaction, please see Ritala et al. 2010). Types of knowledge that is transferred to acquired new companies are related to B2B professional service software (in cases when different between the acquirer and the acquired target), ERP system, ways of organizing e.g. team structure, coordination processes e.g. financial reports and HR processes, services portfolio sold to B2B customers, and customer processes and organizational culture aiming for efficiency and effectiveness. All the merged companies were small privately owned firms operating within the same B2B service industry. In addition, all the acquisitions had taken place quite recently, less than three years ago. We used theme interviews and focus group interviews (e.g. Morgan, 1996) as data collection methods. Focus groups can be used for theory development purposes, i.e. building propositions from participant subjective experiences (Auerbach & Silverstein, 2003). They can be useful when studying topics that do not have dense sets of observations readily available (see e.g. Berg, 2004). At best they can elicit participant tacit knowledge, subjective understandings and interpretations for shared understanding of complex phenomenon such as knowledge transfer in acquisitions. The theme interviews focused on the role and types of knowledge, and the means to transfer it to the merged companies. The interviews were purposefully open and narrative in type, following the lead of the interviewees and allowing them to reflect their experiences and present examples. The focus group interviews, in turn, focused on the types of knowledge, means of knowledge transfer, critical or important factors related to transfer processes, and ideas for improving them from the perspective of the merged companies’representatives. Altogether, we interviewed 25 people from the company. Of these, six interviewees participated in individual interviews and 19 interviewees in focus-group interviews. We held four focus groups sessions, in which there were 3-6 participants in each. All the interviews lasted between 70 and 110 minutes. Overall, theme interviews and focus group interviews resulted in 152 pages of transcribed data. The analysis started by looking at individual cases. To provide a data-grounded understanding of the phenomenon, the first analysis round focused on capturing the variety of means to
  5. 5. 5 transfer knowledge within each case. In the second part of the analysis, recurrent themes were compared and contrasted with each other between cases. The themes were then categorized under descriptive labels, resulting in a classification scheme of knowledge transfer mechanisms. Two members of the research group contributed to the category labeling independently, and the results were double-checked and agreed upon jointly. We will now turn into the findings of the empirical study. Results The study yielded a classification of six knowledge transfer mechanisms in the context of service business acquisition: acquisition management team, unit managers, formal training, rooming-in, e-communication, and codified database. We will now describe each of the mechanisms in turn. 1. Acquisition management team as an initiator The so-called acquisition management team represented an important mechanism in the early stages of the process. It consists of the managing director, HR manager, group controller and experts in IT processes and training. The types of knowledge that were transferred were mostly explicit in nature, such operating manuals and routines, and the use of IT systems. However, also new practices and modes of thinking related e.g. to the customer management model were transferred. While in pre-acquisition situation it is typically only the entrepreneur with whom the acquirer engages in discussion with, in post-acquisition (post-contract) phase a larger team took responsibility about transferring knowledge between the two parties. Its role is to facilitate change in terms of providing legitimacy and supporting the acquired unit’s employees by giving both formal (information, processes and structures) and informal (social) support. For instance, the benefits obtained from the acquisition for both parties are introduced. One of the interviewees from the acquiring firm described the role of the initial contact with the acquired unit: “It is important how you make the first contact… We visit there, sit around the same table and start building the cooperative practices. I tell people we are operating in the same field, doing the same things, but of course there are also changes taking place.” These opening sessions were also appreciated by the units, particularly in terms of reducing uncertainty and ‘giving faces’to change. They also build social identification by reducing the distance between the personnel in acquired and acquiring firm, manifesting change from a small unit into a part of a large international player. Hereby, managing director emphasized similarities and shared professional identity, yet also the opportunities and challenges related to being part of a larger, and development-oriented firm. One challenge in terms of knowledge transfer is how to make the communicative processes two-way right from the beginning:
  6. 6. 6 “Of course our aim is to make it more interactive, but people tend to act rather distant then, it is quire natural that they are afraid of asking questions and discussing with the visitors. It takes time.” Two-way communication can be seen critical for the evolution of trust. Especially the managing director and HR manager emphasized the role of trust in acquisitions. The managing director’s role can be seen as “ice-breaker”and giving face to the acquiring firm, whereas the HR manager stepped in later, when personnel in the acquired firm was more ready for a dialogue. 2. Unit manager as a translator The role of the unit manager was highlighted across a variety of the cases, and across all levels of the organization: parent company, unit managers themselves, and the employees in subsidiary units. Regarding knowledge transfer, unit manager seemed to serve as a link between the parent company and the unit’s employees. He or she was the first to receive knowledge from the parent company and based on their long experience, the employees were able to trust their unit manager’s expertise and ability. As a result, the employees felt they had the knowledge they needed. The unit manager helped to ‘localize’knowledge, i.e. the focus was in internalizing and thus in tacit-types of knowledge. “As we are now part of a large company… The operation models and practices must have put through to the personnel and it is unit manager’s task.” An illustrative example of management’s focal role in the acquisition was one of the cases, where the unit operated for a short while without unit manager. Even if every employee was skilled enough related to their professional work, they faced severe problems in learning “the ways of the house”and felt like they were left alone. “We were uncertain and lonely, and we had to solve a lot of things alone. We would have needed someone who guided us in how to do things.” Unit manager’s managerial competence was established through a training program. Its purpose was to educate the unit managers in order to transfer e.g. the customer-oriented approach to their employees: “In management’s training program, the model of customer care is one of the key areas, and I find it very important, because it allows us to distinguish – it is not just reporting and billing, but continuous dialogue with the customer.” All in all, the role of unit managers was to bridge knowledge across various stakeholders, both in the acquisition phase and in the everyday operations. They also supported each other in this task. One of the unit managers described a situation of having another manager with whom to share feelings; she could ask for advice, solve similar problems together and thus develop in her work. Other unit managers were having regular ‘peer group’meetings where they could share experiences and engage in discussions about a variety of topics.
  7. 7. 7 3. Formal training The role of training was also emphasized in each case. Acquisitions represent a major change for organizations, and the employees considered well-planned training as an efficient means to transfer knowledge in such a situation. The unit’s employees need to be trained to the practices and tools of the parent company, using the sources of data, and serving customers appropriately, i.e. the main focus was on transferring explicit knowledge. In addition, industry-specific areas of training were also considered important, regarding e.g. the changing legislation. However, considering the acquisition situation, in some cases the employees felt the training organized by the parent company was not sufficient in its amount and quality. Firstly, some of our interviewees described how there should have been guidance on how to use the new tools, for instance, instead of a two-hour presentation given by the expert from the parent company. In other words, the focus was in “what” instead of “how”. Secondly, the transferred knowledge should have been split into smaller coherent pieces instead of a continuous “push” effect. Thirdly, experts having enough competence related to the substance areas should have been deployed. Pedagogically poorly planned training resulted in much confusion among employees: “In the beginning, there were just huge amount of new knowledge and no clear idea of where we should end up and why… It caused much uncertainty about goals, objectives and timing.” In contrast, in some units there was in-room guidance available for employees and this significantly lowered the barrier to adapt to the new systems: “The most basic thing is what we needed to do and have done since the beginning…each employee was demonstrated hand-to-hand how the system is used.” Another illustrating example of the importance of training was the parent company’s model of customer care and training units to treat their customers with a more professional ‘consultative touch’. Before the acquisitions, the unit employees contacted their customers by office visits or by email, including general discussion about customer-related issues. After the acquisition, it was more like adapting to the mode of solving problems together with customers and engaging in continuous dialogue with them. Such a notable change cannot be executed on the side, but it presupposed purposeful and concrete actions from the parent company in the form of training. The employees also faced responsibility to start the so-called additional services sales and thinking of how to ease customer’s own work. However, an interesting contradiction could be perceived from here. While the parent company seemed to rely on the units’employees ability to perform their tasks and acquire the knowledge needed, the employees assumed that the parent company would support them in this task and organize more training and practical guidance: “They [the parent company] trusted that we can do everything here…and yes, we can do everything.”
  8. 8. 8 “Training is very superficial. Here in our unit we do things so that if someone knows one issue better than others, he or she will advise them.” In other words, the parent company and the subsidiaries at times seemed to shirk responsibility by demonstrating a kind of “someone else should take care of this”attitude. Another type of barrier was the resistance of change in some of units being acquired. The unit managers were in the box seat to sense the atmosphere: “Earlier we had been able to do just like we want…and naturally, the resistance of change against certain authorities was significant.” “Of course we are dealing with such a major change that it takes time to internalize everything, it is not an easy task for each of us.” In some cases the resistance of change did not hamper the knowledge transfer processes in a similar vein. For instance, one group of interviewees discussed how personal advance in using computerized systems was clearly required after the acquisition phase. While this naturally caused additional workload to the employees, it was often considered as a positive ‘side effect’, forcing the employees out of their own comfort zone to learn new. They also felt proud of being part of a larger company carrying a more professional image and reputation than the small unit, which may have acted as a catalyst for their motivation to engage in the processes of learning and adapting to the new modes of operation. 4. Rooming-in As noted in previous section, many of our interviewees considered training inadequate in terms of how to use the new IT systems, for instance. Hereby, we can identify another distinctive mechanism for knowledge transfer that is of particular importance in organizational-level integration: having an in-room support person whose role is to ensure that all employees will adapt to the systems and the related practices. In other words, it is about proactive support, personal care-taking and introducing new employees “the way of the house”. This could be seen as a kind of precondition for effective individual performance after the acquisition: the employees only start learning after they feel secure enough to operate with the new systems and experiment with them. Respectively, we see rooming-in as a second embodiment of learning-related transfer mechanisms. It is of particular importance regarding the absorption of tacit knowledge. The objective is both to make the employees feel more secure, and to support them in establishing the basic routines in daily work after the changes raised by the acquisition. “If we only had someone who would have sat here for two week and demonstrated how to operate in different situations.” In the absence of rooming-in, the unit manager acted in that role, for instance, when clarifying issues and discussing with employees in weekly meetings. His or her role was to inform employees about current topics, seek the information needed and thus enhance problem solving. Thereafter, concrete processes of learning on how to use the systems were established and conducted in smaller groups.
  9. 9. 9 “In weekly meetings it is not possible to study things, it is more about informing… In small groups, the IT system issues can be dealt with in a greater depth and reach more practical levels.” In addition to acting as a support person, unit managers had an important role regarding knowledge transfer between the parent company and subsidiaries in general, as illustrated earlier. Having presented the mechanisms related to the ‘human’dimension in the form of management and learning, we will now turn into the mechanisms reflecting the ‘technology’ dimension. 5. E-communication E-communication represents a mechanism that involves human-to-human interaction, relying on electronic means to transfer knowledge between two or more communicating parties. In our cases, the most applied channel was e-mail, which was described as an important instrument both to contact people and to document knowledge, allowing employees to trace back what has been done and when. Typically to the organizational use of e-mail, it was mainly applied to inform employees about current topics i.e. to transfer explicit knowledge. The unit managers practically received all information from the parent company via e-mail and decided whether it should be delivered further. The downside of relying heavily on e-mail was the amount of incoming information, particularly in the early stages right after the acquisition. Both the amount and mass delivery of e-mails raised frustration among the employees. “I just read only the first sentence and then notice it doesn’t concern me at all.” However, looking this mechanism from the acquisition perspective, it is essential to note how a majority of the parent company’s practices became transferred into the subsidiaries through increased use of e-communication. As it became an everyday routine in the form of concrete interaction and communication patterns, the subsidiaries slightly started to adapt to the parent company’s communication culture. This was also one of the major challenges, as all the merged companies represented relatively small units in comparison to the large parent company. It raised asymmetry: “I understand that it was a normal practice in the parent company [to communicate mainly via e-mail], and this approach has been transferred to our unit as well, but the parent company is so large…we are used to discuss with each other face-to-face.” Finally, having illustrated the human-to-human (i.e., communication) side of technology- mediated knowledge transfer, we now turn into the human-to-medium types of transfer in the form of codified database.
  10. 10. 10 6. Codified database In our cases, applying codified database represented a key mechanism to transfer knowledge. Across all organizational levels, our informants described the focal role of corporate intranet, where all the necessary knowledge had been stored. The types of knowledge were explicit in nature: manuals, guides and instructions needed to provide the professional service. Another representation of codified database was the ERP system. Both systems were generally considered as a good means to store and transfer knowledge. However, the widespread use of the intranet also had its reverse side: much of the knowledge was obsolete and its overwhelming amount prevented many employees to find the right knowledge quickly and easily. “Even if you write a clear entry, you do not find it from the intranet.” Respectively, a common theme regarding the improvement of the knowledge transfer processes was the better organizing of the content of the intranet, and making it more user- friendly. Time was seen as a critical factor here, as the right knowledge should be found and acquired from the intranet as rapidly as possible. The management ideal were having intranet as all-inclusive knowledge storage, while the employees performing routine tasks might have found the solution inappropriate and insufficient. Across different organizational levels, the intranet was basically considered as a well-operating system for managing the documents and guidelines needed, but the problems were related to trying to manage too much information. Having described the knowledge transfer mechanisms, we now turn into discussing our findings in the light of prior research. Discussion The aim of this study was to identify knowledge transfer mechanisms that are of importance in service business acquisitions. The identified mechanisms can be roughly classified into three categories: management-related (acquisition management team, unit managers), learning-related (formal training, rooming-in) and technology-related (e-communication, codified database). As noted by Goh (2002), the role of management is to create favorable conditions and positive atmosphere for knowledge transfer. Respectively, our study highlights the role of the management team and unit managers as separate knowledge transfer mechanisms in acquisitions. Whereas the former creates the conditions for change, initiates the process and introduces the models and practices (explicit knowledge), unit managers localize knowledge and support its interpretation in the form of organizational processes (tacit knowledge). The same dual logic applies with learning-related mechanisms. Whereas formal training is applied to transfer explicit knowledge –in other words, to introduce the models, processes and IT systems to the acquired unit –rooming-in is needed to internalize that knowledge and thus support employees in establishing the basic operational routines.
  11. 11. 11 Table 1 summarizes the identified knowledge transfer mechanisms, examples of types of knowledge being transferred, and the dominating nature of knowledge. Table 1. Summary on knowledge transfer mechanisms in acquisitions Mechanism Knowledge being transferred Dominating nature of knowledge Acquisition management team as an initiator Modes of organizing, esp. team Organizational culture HRM & HRD practices Incentive systems B2B service software ERP system, Intranet Explicit Unit manager as a translator Organizational culture Processes - coordination - customer-related - IT processes Tacit Formal training CRM model Customer-related processes B2B service software ERP system, intranet Explicit Rooming-in B2B service software ERP system, intranet Tacit E-communication Documents Coordination processes, know- whom Explicit Codified database Documents and reports, know- what Explicit According to Day (1994), the transfer of tacit knowledge remains more critical than the transfer of explicit knowledge. Our study reinforces this notion. Transferring tacit knowledge, in turn, requires active direct communication and participation (e.g. Lam, 1997; Connell et al., 2003). While both the parent company representatives and the merged units’employees were relatively satisfied with the available IT solutions (ERP, corporate intranet and in some cases also the B2B professional software) the latter group demonstrated significant concern on how they were trained to use them after the acquisition. Due to parent company’s strong focus on codified knowledge, they mostly relied on explicit-types of knowledge transfer mechanisms. Hereby, the merged small units with a different knowledge strategy were subject to a major change regarding both the knowledge as such and the processes to transfer knowledge. Jasimuddin (2007) notes that people-focused mechanisms of knowledge transfer are inappropriate when the parties of the transfer process are geographically dispersed. Our study provides a different perspective: even if the acquired units were geographically separated from the parent company, transferring knowledge would have required not relying only on technology-mediated mechanisms. Instead, an effective combination of the two types of mechanisms could better facilitate the transfer process. Also Minbaeva et al. (2010) found out that the increased use of electronic networks did not moderate the acquisition of knowledge, as personal relationships and socialization were considered more satisfactory by intrinsically motivated people. Finally, the management team should pay special attention to the role of personal caretaking and providing in-room guidance (e.g. how to use the new IT systems) instead of an excessive weight on transferring explicit and “what” types of knowledge. As distinct from prior
  12. 12. 12 research, our study thus underlines the importance of combining “hard”knowledge transfer mediated by technology and “soft” knowledge transfer mediated by human interaction patterns such as learning and management practices. Conclusions The objective of this study was to find out what types of mechanisms for knowledge transfer in service business acquisitions can be identified, and to classify them. We applied service business acquisitions as an illustrative research context, drawing on a qualitative empirical study of one B2B service firm. As a result, our study provided a typology of six knowledge transfer mechanisms: acquisition management team as an initiator, unit management as a translator, formal training, rooming-in, e-communication, and codified database. These can be further classified into management-, learning-, and technology-related mechanisms. The contribution of the study is twofold. Firstly, it adds to the literature of knowledge management by providing a classification of knowledge transfer mechanisms. Secondly, it presents empirical evidence about the role and use of such mechanisms in service business acquisition, hereby contributing to managerial understanding about how to facilitate knowledge transfer between the acquirer and the acquired target in the field of knowledge- intensive service firms. From managerial point of view, our study highlights how the transfer mechanisms should be tailored to match to the type of knowledge being transferred (see also Gupta & Govindarajan, 2000). This requires increased awareness of different knowledge strategies and the related managerial actions needed, in particular when there is asymmetry between the acquirer and the acquired target. The main limitation of our study is that we only investigated one company and hereby four different acquisition cases. As the results of the empirical study represent one industry, the identified knowledge transfer mechanisms should be further tested and validated in other types of service industries and other cultural contexts. References Argote, L. and Ingram, P. 2000. Knowledge transfer: A basis for competitive advantage in firms. Organizational Behavior and Human Decision Processes Vol. 82 No 1, pp 150-169. Auerbach C.F. and Silverstein L.B (2003). Qualitative Data. An Introduction to Coding and Analysis, New York University Press, New York. Berg, B.L. 2004. Focus Group Interviewing, in Qualitative Research Methods for Social Sciences, Fifth Edition, Pearson Education Inc, USA, pp 123-145. Bresman, H., Birkinshaw, J. and Nobel, R. 1999. Knowlegde transfer in international acquisitions. Journal of International Business Studies Vol. 30 No 3, pp 439-462. Cartwright, S. and Cooper, C.L. 1996. Managing Mergers, Acquisitions and Strategic Alliances: Integrating People and Cultures, Butterworth-Heinemann, Oxford. Connell, N.A.D., Klein, J.H. and Powell, P.L. 2003. It’s tacit knowledge but not as we know: Redirecting the search for knowledge. Journal of Operational Research Society, Vol. 54, pp 140-152.
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