With a focus on International equines and organizational behavior) from the University of Saskatchewan, Canada. She is currently a Ph. D. Student in Management Information Systems and Organizational Behavior at Queen's School of Business, Queen's University, Canada. Her research interests are in knowledge management, cross-cultural Issues, organizational culture and leadership, trust, and adoption of technology. Holland E. Chain is an Associate Professor of Management Information Systems at Queen's School of Business, Queen's University, Canada.
She holds a Ph. D. From the university of Western Ontario In Canada, an M. Phil. In Management Studies from Oxford university In England, and S. M. And S. B. Degrees In Electrical Engineering and Computer Science from the Massachusetts Institute of Technology in the US. Prior to joining Queen's, Dry. Chain worked with Andersen Consulting (now Accentuate) in Toronto, Canada as an Information systems consultant. Dry. Chain conducts research on knowledge management and on Information technology strategy, alignment and performance.
She has published her findings in journals such as Information Systems Research, MIS Quarterly Executive, Journal of Strategic Information Systems, Information ; Management, and The Academy of Management Executive. The authors wish to acknowledge the contributions made to this manuscript by editorial assistant, Anna Decker, the support of Dry. Lou Hammond Jettison and Dry. Graham Links, and the generous funding received from the Queen's Centre for Knowledge-Based Enterprises and the Social Sciences and Humanities Research Council of Canada.
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Queen's KEEP Centre for Knowledge-Based Enterprises 3 Abstract The following is an exploratory case study, which examines relationships between cross-cultural differences and knowledge transfer within an international subsidiary. Organizational culture has been shown to be a key factor in the success of knowledge management practices. Hypotheses (1980) theory specifies that organizational culture is not independent of national culture. The current study was conducted to explore the extent to which knowledge transfer is dependent on national culture.
Results indicated that language differences can create knowledge blocks, and cross-cultural differences can explain the direction of knowledge flows within an international subsidiary. Keywords: Knowledge Sharing, Knowledge Management, Cross-cultural, Case Study, Knowledge Blocks Introduction In 21st century organizations, senior managers show avid interest in the topic of knowledge management. Trucker claims that it is the only way to achieve sustainable competitive advantage in today's markets (e. G. Trucker, 1969, 2001). We do not yet fully understand, however, how businesses can successfully implement knowledge management. Recent research has focused on factors that lead to effective knowledge management (e. G. , Gold, Malory & Gears, 2001). These efforts suggest that organizational culture can significantly promote or hinder knowledge management initiatives. One question that has received fairly limited research attention has been how cross- cultural issues relate to knowledge management.
As noted by Hefted (1980), businesses cannot assume that organizational cultures exist independently of national cultures. Furthermore, different national cultures emphasize distinct values and are associated with diverse languages. These additional factors can influence a company's ability to implement organization-wide knowledge management initiatives successfully. In an increasingly globalize business context, companies need to understand if and how cross-cultural differences influence knowledge management.
The purpose of this study was to investigate whether or not cross-cultural differences thin an international subsidiary influence knowledge flows within the company, and if so, how. The current study investigates these issues with a two-dimensional focus: knowledge management and cross-cultural issues of international subsidiaries. We also investigate organizational culture. Although research has been conducted within each of these areas individually, very little research has focused on where and how they intersect.
Since there is no literature that specifically addresses the intersection area, this research project is necessarily exploratory in nature. Our article contains the following: an introduction of key knowledge management and cross-cultural concepts, a description of the research methodology, a summary of the Queen's KEEP Centre for Knowledge-Based Enterprises 4 results, and a discussion of the findings, including implications for practitioners and future research. Literature Review Our review of the literature highlights important knowledge management and cross- cultural issues.
This discussion gives rise to a number of research questions for Knowledge Management As mentioned previously, it has been argued that knowledge is the only resource that ivies a company sustainable competitive advantage (e. G. , Trucker, 1969, 2001). Knowledge is a resource contained within the minds of employees, and is the only resource that does not diminish in value with use, and can enhance the value of other capital (Harris, 2001). On the contrary, knowledge increases in value with use, while disuse may lead to loss or forgetfulness (Davenport & Prussia, 1998; Olivia & Lieder, 2001).
All other company resources depreciate over time. A person or an organization can possess different types of knowledge: tacit and explicit. Explicit knowledge is easily articulated, coded and transferred (Monika, 994). Tacit knowledge, on the other hand, is far more difficult to articulate and is derived by individual experiences (Mutatis & Hill, 1998). Both types of knowledge are valuable to the organization; however, tacit knowledge is more difficult for the organization to capture as it resides within the individual.
Monika (1994) describes a second taxonomy of knowledge: individual and organizational knowledge. Organizational knowledge is developed and created within groups of individuals (Olivia & Lieder, 2001), which leads to a gap between the knowledge that exists in the organization and the knowledge in individuals. This is described ironically in the statement "if organizations only knew what they knew' (Prefer ; Sutton, 2000). For an organization to gain the advantage of strategic knowledge management, they need to capitalize on individual knowledge and turn it into organizational knowledge.
Four processes characterize knowledge management: knowledge generation, knowledge codification, knowledge transfer (also known as knowledge sharing), and knowledge application (Olivia ; Lieder, 2001). Specifically of interest to this study is the process of knowledge transfer, which is the dissemination of knowledge from one individual or group to another within the organization. Knowledge transfer assists in organizational learning; in its absence, the gap between individual and organizational knowledge will increase.
Knowledge transfer is one of the most challenging processes for a knowledge-based enterprise due to employees' possible reluctance to share what they know. Furthermore, it is possible that knowledge transfer is the most susceptible to Queen's KEEP Centre for Knowledge-Based Enterprises 5 effects of cross-cultural differences within a company. Therefore, this study focuses solely on this knowledge process to understand more clearly the relationship twine cross-cultural differences and knowledge transfer.
Cross-cultural Issues The challenge facing companies wishing to gain a competitive advantage through knowledge management is to create a culture and environment in which knowledge sharing will thrive. Without an appropriate culture, knowledge transfer is at best very difficult, and most likely will not occur (Davenport ; Prussia, 1998; Gold, Malory ; Gears, 2001). Prior to 1980, organizational culture was considered by many to be independent of national culture. Hefted (1980), however, argued that an organization's culture is nested within a national culture.
Therefore, national culture This raises the following questions: How can companies whose employees manifest significant cross-cultural differences encourage knowledge sharing in their work environments? Also, does the mix of national cultures create unique avenues for knowledge transfer? Many American companies and Japanese companies are discovering and instituting innovative and successful methods of knowledge creation and management. However, American and Japanese cultures are very different in terms of underlying beliefs and foci (Hefted, 1980).
In order for knowledge transfer o occur, several factors are critical: trust, common language, culture and beliefs. Therefore, it is important to understand how knowledge exists and is managed within organizations that combine these cultures. Furthermore, studies investigating the effectiveness of knowledge transfer between international alliance partners have found that cultural differences impact information flows, knowledge management processes, and knowledge transfer (Lees & Salk, 1996; Timeliness et al. , 1997; Mowers et al. , 1996, all CB.
Simon, 1999). Simon (1999) concludes that the cultural distance between firms increases the faculty of performing these processes successfully. Previous research suggests that national culture and cross-cultural distance may influence knowledge processes. Therefore this should be further examined. Definition of Culture Culture is a very broad term that can refer to professional culture, an organization's culture, and a national culture. Thus far, the focus of the literature for knowledge management has been on organizational culture.
However, national culture is the primary focus of this research; organizational culture will be discussed as a component of the organizational environment (in essence, a contingency variable). National culture is defined as "the collective programming of the mind which distinguishes the members of one human group from another" (Hefted, 1980, p. 25). The collective programming is based on values - "a broad tendency to prefer certain states of affairs over others" (Hefted, 1980, p. 19).
In other words, members of a Queen's KEEP Centre for Knowledge-Based Enterprises 6 culture will have similar sets of preferences built in to how they view the world. This was a widely accepted definition of culture prior to Hypotheses work, but his taxonomy has influenced our thinking. Hypotheses taxonomy was based on his sass survey with MM. The four factors he derived from this survey became the dimensions of the taxonomy. These four factors were: Individualism/Collectivism, Uncertainty Avoidance, Power Distance, and Masculinity/Femininity.
Hefted and Bond (1988) later developed a fifth dimension, which they called Long Term Orientation. This dimension was originally based on Confucianism; however, it was not named as such because "we [Hefted and Bond] got perfectly meaningful scores on it from countries that had never heard of Confucius" (Hefted in an interview; Hodges, 1993, p. 4). See Table 1 for the definitions of the dimensions. Table 1. Hypotheses Cultural Dimensions Cultural Dimension Definition Power Distance (PDP) How inequalities are viewed and handled in the culture (I. E. , Collectivism How individuals view themselves (e. G. Are they an individual striving for individual goals or a part of a collective group, where group harmony is important? ) Uncertainty Avoidance (AJAX) How accepting of uncertainty is the culture Masculinity/ Femininity How the culture values competitiveness/assertiveness (I. E. , masculine traits) and cooperation/nurturing (I. E. Feminine traits). Long Term Orientation This dimension accounts for people's reference time frame (I. E. , do the people focus on long term goals or the more immediate, short term goals? ) After identifying these dimensions, Hefted rated each country within his sample accordingly.
For instance, Japan's culture (in the sass) was high in Power Distance (score of 54), low in Individualism (score of 46), and very high in Uncertainty Avoidance (score of 92). The United States, on the other hand, was low in Power Distance (40), high in Individualism (91), and low in Uncertainty Avoidance (46). Canadian scores were comparable to American results, with 39, 80, and 48 for Power Distance, Individualism, and Uncertainty Avoidance, respectively. According to Hypotheses dimensions, Japan and the United States are culturally very different, and Canada and the United States are very similar.
Implications of National Culture for Knowledge Management The differences in these dimensions may impact the knowledge processes within an organization. For instance, cultures that measure high on Individualism value the accomplishments of the individual, whereas Collectivist cultures place more value on collective accomplishments. One possible implication is that Individualistic cultures may have more difficulty in knowledge sharing, since knowledge is often seen as a source of power and a tool for success. Similarly, cultures that are high in Masculinity (I. E. Queen's KEEP Centre for Knowledge-Based Enterprises 7 competitiveness) may also have more difficulty in knowledge transfer if the competitiveness is between individuals and not only between organizations. Power Distance and Long Term Orientation may also alter knowledge processes (or the adoption of knowledge processes) within a business. Countries that have a high Power Distance may have more hierarchical structures, therefore knowledge may be more likely to flow from the top down, or may be more limited than knowledge flows within a culture that has less Power Distance.
If a culture has a Long Term Orientation, then the members of that culture are more willing to work for the long- term goals and benefits that accompany knowledge management. Since benefits of knowledge management may not be realized in the very short term, a Long Term Orientation may better promote and value knowledge management processes. While researchers have not tested the hypothesis that national culture impacts organizational knowledge management processes, You, Ginsberg and Ann. (1999) have a research proposal that examines this issue.
Within this proposal, You et al. (1999) discuss conducting case studies at multiple sites within a consulting firm, pning both American and Korean sites. Their research questions investigate the effectiveness of the dimensions of knowledge management practices across cultures; which of these dimensions are culture specific; and if there is an underlying theory that can explain any differences. However, as of this date, the results of this proposed study have yet to be published.
They should be able to further illustrate the issue dimensions, Japan and the U. S. Differ widely in history, language, and religion. As well, Japan has a very homogeneous culture, whereas U. S. Culture is more heterogeneous. One of the implications is that where there is a shared or common language (both semantically and conceptually) there will be greater likelihood of effective knowledge transfer. In other words, different cultures, vocabularies, and frames of reference create friction in the knowledge transfer process (Davenport ; Prussia, 1998).
Similarly, knowledge transfer is likely to occur more readily within a monogamous culture than in a heterogeneous culture due to the shared frames of reference, cultures and vocabularies. In summary, we argue that national cultures and knowledge transfer intersect in the following ways: a) Cultures that are high on Individualism may have more difficulty in knowledge transfer than cultures that are high on Collectivism. B) Cultures that are high on Power Distance may have a more top-down flow of knowledge than cultures that are low on Power Distance. ) Cultures that are high in Masculinity may have less knowledge transfer between organizational members if the competitiveness is individually based. There may be no difference if competitiveness is organizationally based. D) Knowledge transfer between heterogeneous cultural groups may be more difficult (I. E. , require more time and effort) than knowledge transfer within a homogeneous cultural group. Queen's KEEP Centre for Knowledge-Based Enterprises 8 We derive the following two research questions: Research Question 1: How does national culture relate to knowledge transfer and flow within an international subsidiary?
Research Question 2: How does knowledge transfer across cultural groups differ from knowledge transfer within cultural groups (if it does differ) within the subsidiary? Organizational Culture Organizational culture can act as a mediator for national culture and knowledge management processes. It is defined here as the organization's expectations and the reward structures, which communicate to its members what the organization values. The values are communicated either explicitly or implicitly through practices, policies, and symbolic interactions.
Various researchers have found that the type of organizational culture is important for the success of knowledge management practices. For instance, in a survey of knowledge-based enterprises within Canada, 89 per cent of the respondents "agreed hat their organization has a culture that encourages and provides opportunities for communicating ideas, knowledge and experience internally' (CNN, March 14, 2001). This is admittedly a generic and broad description of what type of organizational culture is key to knowledge management.
Others, however, have discussed more specific aspects of the organizational culture (Davenport & Prussia, 1998). For instance, for the process of knowledge transfer, the following aspects are key to the organizational culture: trust, common cultures, vocabularies, frames of reference, eating times and places, broad ideas of productive work, status and rewards that do not go to knowledge owners, absorptive capacity in recipients, the belief that knowledge is not the prerogative of particular groups, absence of the "not-invented- 1998).
Other aspects of organizational culture that stimulate knowledge generation include the promotion of serendipitous knowledge creation (often done at water coolers or in talk rooms), and knowledge fairs and open forums for knowledge creation and transfer. These practices can symbolically create an organizational culture that supports knowledge management. Therefore, the purpose of this study is to address the above research questions regarding national culture's impact on knowledge sharing within an organization.
Organizational culture is a context variable that will be considered, as it may mediate national culture's impact on knowledge management. The following section describes the research methodology for this study. Queen's KEEP Centre for Knowledge-Based Enterprises 9 Methodology We chose to use a case study methodology, which lends itself well to an exploratory effort. Research questions were derived from the literature in an effort to develop theory to help fill the current void.
However, it is not solely due to the exploratory nature of the investigation that the case study method is appropriate; rather, this topic is a contemporary issue, the relevant behaviors cannot be manipulated, and the research questions are more of a "how' and "why' nature, not of a "what" nature. These characteristics also suggest that the case study is an appropriate methodology (Yin, 1994). Furthermore, the nuances between organizational culture, national culture and knowledge processes are best measured in a natural setting.
It is difficult to create all three factors in an artificial setting. Manipulation is not required (nor possible with respect to national culture). Thus, again we see the appropriateness of the case study method (e. G. , Beneath, Goldstein & Mead, 1987). Yin (1994) also states that case studies are appropriate for theoretical generalizations. Although a case study holds little external validity, since it is a sample size of one, Yin (1994) contends that this limitation only pertains to statistical generalizations.
While this research project seeks to develop a theory regarding the influence of cross-cultural issues for knowledge management practices within an international subsidiary, it is also implicitly testing the theories from which the research questions are derived. We do not aim to specify what occurs within all international subsidiaries with respect to knowledge management; rather the objective is to develop a possible theory for further investigation.
Participants / Case Site The appropriate case site for examining these research questions is an international subsidiary of a company whose headquarters' national culture is very different from the subsidiary company's national culture. An instance of this would be a Japanese company set in Canada or the U. S. Furthermore, the appropriate site would have multiple cultures within the organization. For instance, the top management would most likely be of the same national culture as the parent company, and the middle management or employees would have the national culture of the country in which the site is located.
Another consideration for choosing a site is the type of knowledge- based enterprise. We take the stance that all businesses are knowledge-based degree. The degree to which they reap the benefits of their knowledge base is the degree to which they are a knowledge-based enterprise (Mencken & Smith, 1998). Choosing a site that has highly formalized knowledge management practices may be appropriate, but a less formalized site may also have advantages since more formalized the knowledge management practices will necessarily be less "messy' and offer less to discover.
Furthermore, agricultural issues may not be as relevant. In other words, the more formalized the practices become, the more ingrained they are in the organizational culture and practices. Simon Queen's KEEP Centre for Knowledge-Based Enterprises 10 (1999) found a similar effect with alliances and cross-cultural effects; more experience and institutionalizing led to decreased effects of cross-cultural differences. Therefore, the more experienced and formalized a company is with respect to its knowledge management practices, the more these may mitigate the influences of national culture.
Hence, the influence of national culture and cross- cultural distance will be more obvious if knowledge management practices are less formalized. Taking the above into consideration, the site chosen for this case study is an international subsidiary company located in a country with a very different national culture from that of the parent company. It does not have highly formalized knowledge management practices, but does implement knowledge management to some degree. The site chosen is a Japanese manufacturing subsidiary in the Western U. S. The president of the subsidiary is Japanese; the top management (e. G. UP) of the subsidiary are American and Canadian; the middle management are a mix of Americans, Japanese, Canadians, and other cultural groups (e. G. , Chinese, Indian); and the employees are Americans who consist of other minority groups (cultures) living in the U. S. Study participants consisted of firm management (top and middle) and employees. Participation in this study was voluntary for all participants, and all participants were guaranteed confidentiality of their comments/data. Data Collection Data collection was done by multiple methods, both quantitative and qualitative, in hopes of triangulating the results.
The multiple methods consisted of questionnaires, interviews, site observation, and documentation. All methods were qualitative, with the exception of the VS.-94 Survey (Hefted, 1994) which was used to categorize the dimensions of culture, and a questionnaire regarding knowledge sharing tendencies and management support (Connelly ; Galloway, 2001). Prior to the site visit, 60 questionnaires were distributed throughout the organization to an equal number of management and non-management employees. The response rate was 85 per cent (51/60), and all but three questionnaires were useable for analysis.
The questionnaire was the VS.-94 Survey (Hefted, 1994), which consists of 20 questions that assess the five dimensions (Individualism, Power Distance, Masculinity, Uncertainty Avoidance, and Long Term Orientation), and six demographic questions (I. E. , sex, age category, nationality at birth and current nationality, and occupational status [I. . , managerial versus non-managerial]). A few minor amendments were made to the questionnaire to improve its face validity and reliability. For the Liker scales within reduce any possible confounding of "neutral" and "no opinion. Finally, the question regarding occupational status was altered to reflect the company's structure more appropriately. (See Appendix A for descriptive statistics of the respondents. ) Originally, a site visit was planned for 12 days, but due to high participation rate, the assistance of the primary contact's administrative assistant, and the convergence of he data, all data collection was completed by the eighth day. During the eight-day site Queen's KEEP Centre for Knowledge-Based Enterprises 1 1 visit, the principal researcher observed several departmental and company meetings and toured the production area and office areas.
Casual observations were also recorded during regular office hours as a result of conversations with various employees. Documentation was received during the site visit consisting of the two previous years' consultant reports regarding the business and its strategy, the company's mission statement, and a book on the foundation and mission of the company. Finally, interviews were conducted with 21 employees. Interviewees represented various levels within the organization from upper management, middle management, and front line employees. As well, the interviewees represented the company's wide range of cultures.
The interviewees were primarily from the administrative and business side of the company, as the manufacturing and warehouse employees were very busy due to high product demand. All but two of the interviewees had also completed the VS.-94 questionnaire. The interviews took 30 to 60 minutes. All interviewees were given a list of interview questions ahead of time. The interviews were audio taped and notes were taken to ensure accurate recording of the responses. During the interview process, it became clear that two aspects were not being fully captured by the interviews.
To correct this, a second Information Sharing questionnaire was sent out to the original 60 individuals. This posed knowledge sharing and management support questions (Connelly & Galloway, 2001). Finally, additional insights and data were gathered during social events with various individuals (e. G. , lunches, dinners, tours, and sight-seeing events). This included a dinner with the President. Qualitative Data Analysis Methodology Data analysis required several steps. First, with the help of a secretarial assistant, the principal researcher transcribed all interviews and organized all written documents (I. E. Sorted documents as to whether they pertained to governance, knowledge management practices or processes, or culture). Interview transcripts were compared to the audio-recordings to correct any transcription errors. A second reading/ listening was done to listen for emphases of words by the interviewees, and themes were also highlighted. All themes and codes emerged from the data. Subsequent adding were done to identify and quantify all themes, and to highlight relevant quotations. Themes are, in essence, commonalities of thoughts and ideas. They were pulled from the interviews to examine the research questions.
Therefore, while the themes were derived from the interview data and the written documentation, they fell into the two main categories of knowledge management processes and cross- cultural issues. Other categories also arose with respect to organizational culture and Queen's KEEP Centre for Knowledge-Based Enterprises 12 Results We present the results of both qualitative and quantitative analyses below. Cross- Cultural Analyses Qualitative Data Analysis and Results One of the first indicators of different cultures is the presence of different languages (e. G. , Triads, 1996, Hefted, 2001).
Within Monaco (the name we give the manufacturing subsidiary to preserve its anonymity), three languages are spoken regularly, plus several others occasionally. English, Japanese and Spanish are most prevalent. The majority of the employees speak only one language, although some are bilingual, and a few are multilingual. During the interviews and casual discussions, some individuals also commented on ultra differences other than language. Some of these comments fell outside of the realm of the Value Survey Module (VS.) questionnaire (see the discussion below).
For instance, employees commented on the stronger sense of community among Hipic workers as opposed to non-Hipic workers. For example, they expect to share in celebrations with one another (I. E. , days off for a colleague's wedding, etc. ). Others frequently commented on perceived work ethic differences between Japanese and Americans, as exemplified by the following quote: "There is an obvious difference between Japanese and Americans. The Japanese very such come from the Japanese corporate culture, and this has been explicitly mentioned by the President that he wants it to be stamped out.... It's sort of click, but if you were to put a Japanese and American worker next to each other, the American worker will look lazy, and the Japanese worker will look stupid. A Japanese will spend ten hours of cleaning a machine with a toothbrush, the American will grab a hose, rinse it down and walk away. " While neither way of cleaning a machine is wrong, and in essence both groups have a strong work ethic, the perceptions of what is valued and how work should be done I. E. , a precise versus efficient process), can create differences and misunderstandings.
A Japanese worker offered an additional example of cultural differences between Japanese and Americans: "[It is difficult to understand] because sometimes of the Japanese [language], and the different way of expressing the feelings and asking people for favors or Queen's KEEP Centre for Knowledge-Based Enterprises 13 giving them an order or instruction [in English]. Maybe this is because of the culture of the company. In the Parent Company, if a manager gives instructions to their same bevel or the level below them, they will do it, no matter how rudely expressed.
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