When knowledge acquired in one organization affects another (either positively or negatively), transfer of knowledge occurs (Argote & Ingram, 2000). A long tradition of research in psychology examines whether individuals are able to transfer knowl- edge from one situation or task to another (e.g., see Thompson, 1998). This work examines whether experience with one task affects individual performance on a subsequent task. For example, Dokko, Wilk, and Rothbard (2009) found that the relationship between individual experience and performance on subsequent tasks was mediated by task-relevant knowledge and skills and further that organizational experience weakened the positive relationship between individual experience and knowledge and skills. Researchers have also examined transfer at the group and organizational levels of analysis. Theorists have argued that not only do organiza- tions learn from their own direct experience, they also learn from the experiences of other organizations (e.g., see Huber, 1991; Levitt & March, 1988). Empirical research is accumulating on whether one organization learns from the experience of other organizations.
How might one organization learn from another organization? Many mechanisms exist for transferring knowledge from one organization to another. The mechanisms include training members of the recipient organization, allowing them to observe the performance of experts at the donor organization, and providing opportunities for communication between members of both organizations. Providing documents, blueprints, and descriptions of the organization to the recipient organization as well as transferring experienced personnel there are additional mechanisms. Because some of the donor’s knowledge can be embedded in its hardware, software, and products, providing those to the recipient organization also facilitates knowledge transfer. Thus, in very general terms, knowledge can be transferred by moving peo- ple, technology, or routines to the recipient organization or by modifying the people (e.g., through training), technology, and routines of the recipient organization.
Organizations also acquire knowledge from external sources in the environment, such as suppliers and consultants. For example, Chrysler Corporation reported that its suppliers developed ideas that saved Chrysler $1 billion and increased its profits by $280 million in 1996 (Christian, 1997). Examples of cost-saving ideas submitted by suppliers include suggestions for decreasing the weight of a car and for reducing the size of its cooling system. US Airways arms its employees with cameras, stop- watches, and pads of paper and sends them on other airlines to identify their com- petitor’s best practices (Carey, 1998). Bloom and Van Reenen (2010) described how consultant firms transfer good management practices to organizations.
Products also contain knowledge. By “reverse engineering,” or tearing down a competitor’s product, a firm can obtain useful information that enables it to improve its product or reduce its costs. Mansfield (1985) argued that knowledge embedded in products transferred more readily than knowledge embedded in processes or organizational practices and routines.
Customers are also an important source of knowledge that can improve a firm’s performance (von Hippel, 1988). For example, engineers from Caterpillar visit con- struction sites around the world to study customers using their earth-moving equip- ment in order to identify ways to improve it (“Survey of manufacturing,” 1998).
In addition, other organizations are important sources of knowledge. The popu- larity of “benchmarking” and programs to transfer “best practices” or “lessons learned” from one organization to another reflects the usefulness of acquiring knowledge from other firms. Similarly, knowledge available through patent applica- tions (Appleyard, 1996), personnel movement across firms (Almeida & Kogut, 1999), scientific and trade publications, consultants, and conferences can be useful to a firm. At a more macro level, interorganizational arrangements, such as coopera- tive relationships (Shan, Walker, & Kogut, 1994), strategic alliances (Hamel, 1991; Larsson, Bengtsson, Henriksson, & Sparks, 1998; Mowery, Oxley, & Silverman, 1996), joint ventures (Barkema, Bell, & Pennings, 1996; Kogut, 1988, 1991; Makhija & Ganesh, 1997), transplants (Lewis, 1993), interlocking boards of direc- torates (Davis, 1991; Haunschild, 1993), consortia (Browning, Beyer, & Shetler, 1995), business groups such as Japanese Keiretsu (Cho, Kim, & Rhee, 1998), and multinationals (Bloom & Van Reenen, 2010), are also potential mechanisms for knowledge transfer across firms. Rosenkopf and Almeida (2003) compared the effects of two knowledge transfer mechanisms, personal mobility and alliances, on interfirm knowledge flows. The researchers found that personnel mobility facili- tated interfirm knowledge flows, regardless of the geographic proximity of the firms, while both personnel mobility and alliances facilitated knowledge flows across technologically distant firms.
Appleyard (1996) aimed to determine the effectiveness of various knowledge transfer mechanisms by asking respondents in the USA and Japanese semiconductor firms to rate the importance of nine sources of technical information, including col- leagues in their company, colleagues at other companies, vendors, suppliers, cus- tomers, benchmarking studies, presentations at conferences, scientific publications, and patents. Respondents from both the USA and Japan rated colleagues in their own company as the most important source of technical information. Scientific pub- lications and presentations at conferences were rated second and third in importance by respondents from both countries. Responses of representatives of the US and Japanese firms diverged on the source rated as fourth in importance: Japanese respondents rated patents fourth, whereas US respondents rated colleagues in other companies as the fourth most important source of technical information.
Appleyard (1996) also asked respondents to rate their preferred mode of knowl- edge sharing with both “horizontal” (another semiconductor company) and “vertical” (vendors) sources. Japanese respondents preferred public mechanisms for knowl- edge sharing with other semiconductor companies such as conferences, the press, trade journals, and patents. In contrast, US respondents preferred a mix of public (trade journals and conferences) and private (telephone and face-to-face meetings) mechanisms. A similar pattern of results emerged for the preferred mode of knowl- edge sharing with vendors: Japanese respondents preferred public sources, whereas US respondents preferred a mix of public and private sources.
Further work is needed to determine the conditions under which various modes of knowledge sharing are most effective. In addition to describing patterns of knowl- edge sharing, it will also be important to determine how patterns of knowledge sharing affect organizational outcomes.
How can one determine if knowledge transfer has occurred? The learning curve model described in Chap. 1 can be expanded to investigate whether knowledge transfers across organizational units. We turn now to our study of fast-food fran- chises to illustrate an approach to assessing the extent of knowledge transfer.
Source: Argote Linda (2013), Organizational Learning: Creating, Retaining and Transferring Knowledge, Springer; 2nd ed. 2013 edition.