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Absorptive Capacity and Knowledge Transfer: Individual Level

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ABSORPTIVE CAPACITY AND KNOWLEDGE TRANSFER: INDIVIDUAL LEVEL

Dana B. Minbaeva

Center for Strategic Management and Globalization

Copenhagen Business School

Porcelaenshaven 24, DK2000 Copenhagen Frederiksberg, Denmark

dm.smg@cbs.dk

Kristiina Mäkelä

Department of Management and Organization

Swedish School of Economics and Business Administration

P.B. 479 FIN-00101 Helsinki, Finland

kristiina.makela@hanken.fi

Larissa Rabbiosi

Department of Management, Economics, and Industrial Engineering

Politecnico di Milano

Via G. Colombo 40, 20133 Milan, Italy

larissa.rabbiosi@polimi.it

1
 INDIVIDUAL ABSORPTIVE CAPACITY AND KNOWLEDGE TRANSFER

Introduction

In previous research, the concept of absorptive capacity has proven highly useful for a better

understanding of knowledge transfer within organizations (Cohen and Levinthal, 1990; Dyer

and Singh, 1998; Lane and Lubatkin, 1998; Van den Bosch et al, 1999; Zahra and George,

2002), and consequently for the competitive advantage of firms (Lane et al, 2006). Indeed, as

Lane et al. (2006: 833) state, “[d]eveloping and maintaining absorptive capacity is critical to a

firm’s long-term survival and success because absorptive capacity can reinforce, complement,

or refocus the firm’s knowledge base”.

As a result, research drawing on the concept, which refers to the ability of an organization to

identify, assimilate and exploit external knowledge (Cohen and Levinthal, 1989), has

proliferated (Lane et al, 2006). Most of the current research has focused on either a firm’s

absorptive capacity (Cohen and Levinthal 1990), or alternatively, absorptive capacity in

dyadic inter-firm relationships (Dyer and Singh, 1998; Lane and Lubatkin, 1998). It has also

been recognized that absorptive capacity is a multi-level construct, which has been studied at

the country, inter-organizational and organizational levels of analysis (for reviews see Zahra

and George, 2002; Lane et al, 2006).

However, the individual level, i.e. “the role of individuals in developing, deploying, and

maintaining absorptive capacity” (Lane et al, 2006: 853), has been largely overlooked in

previous research. This is a serious limitation, since Cohen and Levinthal (1990) in their

original conceptualization argue that an organization’s absorptive capacity depends on the

absorptive capacities of its individual members. To the best of our knowledge there has not

been any empirical research on individual level absorptive capacity, utilizing individual level

2
data.1 Extant studies operationalize absorptive capacity either as R&D intensity or rely on

organizational level data collected from one respondent per company.

Yet, individual level observations have been argued to be the most appropriate type of data in

improving our understanding of the micro-foundations needed to explain the emergence,

existence, persistence and change of various organizational-level variables (Felin and Foss,

2006), such as absorptive capacity. In fact, current research has been criticized for largely

focusing on collectives as the locus of knowledge (Felin and Hesterly, 2007) and ignoring the

role of individual micro-foundations (Foss, 2007). Extant literature concerning intra-

organizational knowledge flows typically assumes that individuals a priori are homogenous,

infinitely malleable, or randomly distributed into organizations (Felin and Hesterly, 2007),

and underestimates the role of individuals in knowledge processes (Argote and Ingram, 2000).

This paper seeks to address these theoretical and empirical limitations in current research by

exploring and explaining absorptive capacity at the individual level. Our starting point is that

individuals are heterogeneous: they differ in the degree of their ability, motivation and the

way they use those opportunities for knowledge sharing that are offered by the organization -

and that these differences reflect their respective absorptive capacities. In this paper, we first

review previous research on absorptive capacity in relation to knowledge transfer within

organizations, and the role of individuals in it. Second, we explain our methodology, an

individual-level analysis of 658 employees in 3 large corporations, and present our results.

Finally, we discuss our findings and their implications in terms of both theory and practice.

1
We replicated the methodology used by Lane et al (2006) and examined the empirical studies included in Table
1 of their article. The reviewed studies neither concentrated on the absorptive capacities of individuals nor used
individual level data.

3
Absorptive capacity for knowledge transfer: the role of individuals

Why absorptive capacity?

There is an implicit consensus in the current literature about the importance of knowledge

receiver behavior with respect to knowledge transfer. The inability of knowledge receivers to

absorb new knowledge (low absorptive capacity) is one of the most often cited impediments

to internal knowledge transfer (Cohen and Levinthal, 1990; Lyles and Salk, 1996; Szulanski,

1996; Lane and Lubatkin, 1998; Gupta and Govindarajan, 2000; Lane et al, 2001). Significant

discussion surrounding the concept exists in the fields of strategic management (e.g., Lane

and Lubatkin, 1998), R&D and innovation (e.g., Mowery and Oxley, 1995), the resource-

based view of the firm (e.g., Lane et al, 2001), and organizational learning (e.g., Kim, 2001)

among others. Extant research has used the idea to explain various organizational phenomena

such as the rate of innovation, knowledge acquisition, knowledge transfer and inter-

organizational learning; analyzed it at different levels of analysis such as country, industry,

inter-organizational, and organizational; and measured the concept in a number of different

ways such as R&D expenditure, investment in R&D activities, presence of knowledge,

experience and previous training (e.g., Cohen and Levinthal, 1990; Dyer and Singh, 1998;

Lane and Lubatkin, 1998; Lane et al, 2001; Mowery and Oxley, 1995; Szulanski, 1996;

Volberda and De Boer, 1999; Zahra and George, 2002). Taken together, this research

suggests several generalizations about what is known regarding the effect of absorptive

capacity on knowledge transfer. First, there is clear agreement on that absorptive capacity is a

major determinant of the knowledge transfer process (Lane et al, 2006). The greater the

absorptive capacity, the greater the degree of knowledge transfer is expected (Szulanski,

1996; Lyles and Salk, 1996; Gupta and Govindarajan, 2000), allowing firms to learn and take

4
advantage of emerging opportunities external to it (Cohen and Levinthal, 1990). Second, a

firm’s level of absorptive capacity depends on the level of prior related knowledge existing

within the organization, and the capability of the firm to share and integrate that knowledge

internally (Cohen and Levinthal, 1990; Lane et al, 2006; Zahra and George, 2002). Cohen and

Levinthal (1990: 128) defined absorptive capacity as the “ability to recognize the value of

new external information, assimilate it, and apply it to commercial ends”. They assumed that

absorptive capacity tends to develop cumulatively, is path dependent and builds on existing

knowledge (Cohen and Levinthal, 1990). Third, and consequently, absorptive capacity is, as

Lane et al (2006: 838) “a byproduct of prior innovation and problem solving” within the

organization, and therefore “dependent on the individual absorptive capacities of the

organization’s members”. This leads us to a discussion around the role of individuals, as

follows.

Why individuals?

We argue that bypassing individuals from absorptive capacity models is ontologically

incorrect and may create shortcomings in our understanding of the concept, for several

reasons. First, individuals are primary actors in knowledge creation, and key repositories of

knowledge in organizations, as agreed by several KBV (knowledge-based view of the firm)

scholars (Grant, 1996; Felin and Hesterly, 2007; Foss, 2007), and also recognized in the

original conceptualization of the term (Cohen and Levinthal, 1990). Second, the individual

level is important, as a deeper understanding of intra-organizational knowledge processes

“cannot be reached in lieu of a starting point in individuals” (Foss 2007: 43). Indeed, as Lane

et al (2006: 853-854) argue, “uniqueness arises from the personal knowledge and mental

modes of the individuals within the firm, who scan the knowledge environment, bring the

knowledge into the firm, and exploit the knowledge in products, processes, and services”.

Hence, following Foss (2007), we argue that if the link between the organizational absorptive

5
capacity and intra-organizational knowledge transfer is to be explained, the explanations are

to be found at the micro-level, i.e. individual level.

Figure 1 depicts the Coleman’s (1990) diagram and illustrates the links between absorptive

capacity and knowledge transfer at two levels: macro (organizational) and micro (individual)2.

As an organizational level phenomenon, knowledge transfer has been defined as being based

on “the level of knowledge utilization by the recipients assuming both acquisition and use of

new knowledge” (Minbaeva et al 2003: 592) (see arrow 3 in Figure 1). We consider

knowledge utilization by individuals as a behavioral concept, i.e. “an overt act of the person

that can be observed and measured” (Tosi and Mero, 2003: 4) or “individual action” in

Coleman (1990). As any behavior, knowledge utilization by an individual depends on the

processes internal to that individual (“conditions of individual actions” in Coleman, 1990).

We refer to those internal processes as individuals’ abilities, motivation and the use of

opportunities provided by the organization. That is, individuals differ in the degree of

knowledge acquisition and utilization due to their individual differences manifested in the

individuals’ abilities, motivation and the use of opportunities provided by the organization

(arrow 2 in Figure 1). Figure 1 also portrays organizational absorptive capacity as being

comprised of individual abilities, motivation and the use of opportunities3 (arrow 1). Thus, in

order to explain how absorptive capacity affects intra-organizational knowledge transfer

(arrow 4) we need to focus on the individual ability, motivation and the use of opportunity

and examine how these lead to the knowledge utilization by individuals (arrow 2).

- INSERT FIGURE 1 AROUND HERE -

2
The group level could also be added to the diagram depicted in Figure 1. Further the diagram could built
upwards featuring other levels at which absorptive capacity has been studied before, namely the inter-
organizational level (e.g. multinational corporation), and country level.
3
Note, as Cohen and Levinthal (1990) argue, the organizational absorptive capacity is more than just a sum of
the latter ones. Similarly, knowledge transfer at the organizational level is more than a sum of knowledge
utilization by individuals. That is why the model depicted in the Figure 1 is presented in the form of trapezium
(also in the original, Coleman (1990).

6
Our operationalization of absorptive capacity at the individual level is rooted in studies on

information processing of external information. In particular, we were inspired by the

Motivation-Opportunity-Ability (MOA) framework extensively developed by MacInnis,

Jaworski and Moorman (MacInnis and Jaworski, 1989; MacInnis et al., 1991). In the original

conceptualization, the MOA framework was used to explain how consumers process external

information, linking individual behavior with the processing of that information. This process

driven approach with linkages to behavior seems particularly appropriate for examining

individual level absorptive capacity, and in line with Lane et al’s (2006) suggestion that in

order to extend the explanatory power of the concept beyond the R&D context, it is critical to

move away from the structure/content assumption of previous research, and adopt a more

process-driven view. Furthermore, the notions of ability, motivation and opportunity have

also been used in the human resource management (HRM) studies as mediating variables in

explaining the link between HRM and performance (e.g. Huselid 1995; Delaney and Huselid

1996; Appelbaum et al, 2000). In KBV inspired research, Argote et al (2003) were among the

first who discussed individual motivation, ability and opportunity as important variables

explaining organizational-level knowledge processes. Minbaeva et al. (2003), in turn,

discussed employee ability and motivation as components of firm absorptive capacity.

Building on these studies, we will now consider how ability, motivation and opportunity

impact knowledge utilization by individuals.

Ability

The dictionary definition of ability refers to human attributes, such as prior achievement,

initial skills, aptitudes, experience etc., which are relevant for a skillful accomplishment of

tasks. As Vroom (1995: 232) argues, “[a] person’s ability to perform a task refers to the

degree to which he possesses all of the psychological attributes necessary for a high level of

performance excluding those of a motivational nature”. Literature in the field of psychology

7
has hosted a significant debate between the behaviorist and cognitive approaches to learning,

differentiating between ‘can do’ and ‘will do’ factors (Dunette, 1976). This distinction has

been a subject of research and discussion for industrial and educational psychologists for over

a half century. The ability/’can do’ approach usually denotes “a potential for performing some

task which may or may not be utilized” (Vroom 1995: 198), while the motivation/will do

factor reflects a drive or willingness to perform a task.

In their original conceptualization, Cohen and Levinthal (1990) point to ability as a key part

absorptive capacity, drawing on research on individual level cognition and behavior. Argote

et al. (2003) agree with their view and stress that individual ability, including both innate

skills and experience, plays an important part in knowledge processes. Indeed, MacInnis and

Jaworski (1989) argue that deficiencies in ability limit an individual’s capacity for

information processing. Factors such as limited intelligence or education, and absence of

experience, have been observed to reduce the ability to process information (Anderson and

Jolson, 1980) and hence, the ability to absorb knowledge. As Cohen and Levinthal (1990:

130) point out, experience in one learning task may influence and improve performance in

subsequent one, and that “the prior possession of relevant knowledge and skill” is a key for

knowledge absorption by increasing creativity and associations between previously

unconnected information. Indeed, as Minbaeva et al. (2003) argue, individuals’ ability may

represent the ‘prior related knowledge’ (Cohen and Levinthal, 1990; Kim, 2001) that is

required for knowledge absorption. Hence, we propose that

Hypothesis 1. Individual ability is positively associated with the degree of knowledge

utilization by that individual.

8
Motivation

While ability is a key component of absorptive capacity, it is not in itself sufficient. The

argument both ability and motivation are important influencers of individual behavior is well

rooted in the behavioral science literature (e.g., Baldwin, 1959; Porter and Lawler, 1968).

Furthermore, considerable research exists in cognitive process theories, such as the

expectancy-valence theory of work motivation (Vroom, 1964), concerning the intensity of

effort amongst employees. Longstanding empirical work suggests that both ability and

motivation need to be present to increase performance (e.g., French, 1957; Fleishman, 1958;

Heider, 1958; O’Reilly and Chatman, 1994). Furthermore, a key argument of these literatures

is that individuals with a high ability to learn will fail to absorb knowledge if their motivation

for doing so is low or absent (Baldwin et al, 1991).

The critical role of motivation has also been observed in the literature concerning knowledge

processes, in which individual motivation is posited to influence knowledge-related outcomes

positively (Argote and Ingram, 2000; Argote et al., 2003; Quigley et al 2007; Szulanski,

1996, 2000). Two types of motivation are typically considered in this regard, namely extrinsic

and intrinsic (Osterloh et al, 2002: 67). Individuals are said to be extrinsically motivated when

they satisfy their needs indirectly, primarily through financial compensation. Extrinsic

motivation has been associated with knowledge management initiatives, such as the well-

known example of Siemens ShareNet for which a reward system was designed to create a

critical mass of content by making users aware of the system and encouraging contributions

(Nielsen and Ciabuschi, 2003). In fact, Bock et al. (2005: 91) assert that “every organization

we interviewed had implemented monetary incentives, points towards promotion, or both as

extrinsic motivators for knowledge sharing”. Along with Cabrera et al (2006: 251), who argue

that “when individuals perceive a link between knowledge sharing behaviors … and

9
organizational rewards … they will be more inclined to participate in knowledge sharing

activities”, we propose:

Hypothesis 2a. Individual extrinsic motivation is positively associated with the degree

of knowledge utilization by that individual.

On the other hand, individuals are said to be intrinsically motivated when they undertake an

activity because it satisfies their internal needs. As Deci (1975: 23) argues, intrinsic

motivation is fostered by commitment to the work itself, and “there is no apparent reward

except the activity itself”. Hence, intrinsic motivation is directed to a self-defined goal or to

the obligation of personal and social norms for their own sake (Osterloh et al, 2002). In the

field of organizational behavior, intrinsic motivation has been noted to be able to lower

transaction costs, and enhance trust and social capital in general. Intrinsically motivated

individuals are not constrained by rules but rather by a sense of self-determination.

Furthermore, intrinsic motivation may also be able to make up for a deficiency in skills and

expertise needed for exploration: “a highly intrinsically motivated person is likely to draw

skills from other domains, or apply great effort to acquiring necessary skills in the target

domain” (Amabile, 1997: 44). Therefore, intrinsic motivation amongst employees is critical,

particularly in organizations which depend on their employees’ capabilities to create new

knowledge and share tacit knowledge with others (Osterloh and Frey, 2000; Cabrera et al,

2006). Hence, we put forward the following hypothesis:

Hypothesis 2b. Individual intrinsic motivation is positively associated with the degree of

knowledge utilization by that individual.

Opportunity

While ability and motivation are fundamental components of absorptive capacity, their effect

may be influenced by the existence of opportunity: “ability and extra effort are even more

10
valuable when coupled with opportunity … to create, retain and transfer knowledge” (Argote

et al, 2003: 575). Indeed, knowledge transfer takes place only when a relationship and at least

some form of interaction exist between a sender and a receiver (Mäkelä et al, 2007). Hence,

organizations try to “reduce the amount of distance” (Argote et al, 2003: 575) by building

communication bridges, offering possibilities for dialogue across organizational hierarchy,

improving conditions for team learning, and creating the systems to capture and share

knowledge within the organization (Levitt and March, 1988; Senge, 1990; Argyris and Schon,

1996).

Yet, it is not just the pure existence of various opportunities to interact, but rather the use of

those that is important for absorptive capacity (Cabrera et al, 2006). The level of social

interaction between the members of two groups or units has been observed to have a

significant positive effect on the level of knowledge exchange within the dyad (Hansen, 1999;

Reagans and McEvily, 2003; Tsai and Ghoshal, 1998; Tsai, 2002). At the interpersonal level,

Uzzi (1997) and Uzzi and Lancaster (2003) observed that embedded ties characterized by

close interaction are associated with a higher level of knowledge sharing than more arms-

length ones. Indeed, a low use of various interaction opportunities may result in

organizational knowledge remaining undiscovered, under-leveraged, or trapped in individual

minds or knowledge management systems, although too much of it may hurt the receiving

units’ performance (Hass and Hansen, 2005).

What kind of opportunities are there? According to Hansen et al (1999) there are broadly two

knowledge management strategies used within organizations, namely personalization and

codification. A personalization strategy uses socialization mechanisms to ensure frequent

person-to-person contact. A codification strategy, on the other hand, relies on electronic

networks. Empirical evidence suggests that both are necessary. In previous research, virtual

communication has been shown to be an effective facilitator of the sharing of more explicit

11
forms of knowledge such as facts or data, whereas more tacit forms of knowledge such as

know-how require more face-to-face interaction, as it enables a more holistic two-way

communication (McKenney et al., 1992; Nohria and Eccles, 1992). Bresman et al. (1999)

showed that interpersonal communication, such as visits and meetings, were significant

facilitators of international knowledge transfer, and Hansen (1999) concluded that the absence

of direct relations and extensive communication among people from different departments

inhibits knowledge transfer, while strong inter-unit relations facilitate it. Accordingly, we

expect that:

Hypothesis 3a. The use of socialization mechanisms by an individual is positively

associated with t the degree of knowledge utilization by that individual.

Hypothesis 3b. The use of electronic networks by an individual is positively associated

with the degree of knowledge utilization by that individual.

Furthermore and in line with studies on information processing of external information, we

argue that ability, motivation and opportunity take effect at different points in the knowledge

absorption sequence (MacInnis and Jaworski, 1989). More specifically, the use of

opportunities moderates the link between ability and motivation, and knowledge utilization by

individuals: it will be higher if in addition to being capable and highly motivated to absorb

knowledge, an individual uses various opportunities (including both socialization mechanisms

and electronic networks) to acquire and utilize new knowledge.

Hypothesis 4a. The use of socialization mechanisms and electronic networks by an

individual positively moderates the impact of individual ability on the degree of

knowledge utilization by that individual.

12
 Hypothesis 4b. The use of socialization mechanisms and electronic networks by an

individual positively moderates the impact of individual extrinsic motivation on the

degree of knowledge utilization by that individual.

Hypothesis 4c. The use of socialization mechanisms and electronic networks by an

individual positively moderates the impact of individual intrinsic motivation on the

degree of knowledge utilization by that individual.

The hypotheses presented above are summarized in the conceptual model presented in Figure

2 below. We will now turn to discuss the data and methods through which the hypotheses are

being tested.

- INSERT FIGURE 2 AROUND HERE -

Methods

Survey

We tested our hypotheses in the context of the multinational corporation (MNC), which

allows us to study a wide array of individual employees located in various geographical,

cultural and institutional contexts. Furthermore, intra-organizational knowledge transfer is

particularly important for MNCs since the competitive advantage they enjoy over national

firms is contingent upon their ability to exploit knowledge internally across geographically

dispersed organizational units (Kogut and Zander, 1993). Until recently, the intra-MNC

knowledge transfer has been studied predominantly on the organizational level focusing on

vertical (headquarters - subsidiaries) and horizontal (subsidiary-subsidiary) knowledge flows.

Therefore, in addition to our contribution to the absorptive capacity discussion, we seek to

provide further contribution to the study of MNC knowledge flows (Foss and Pedersen, 2004;

Gupta and Govindarajan, 1991, 2000; Kogut and Zander, 1993) by unlocking the proverbial

13
“black-box” of the firm and bringing in the individual level explanans (Felin and Foss, 2006)

of collective level phenomenon such as knowledge transfer.

The data used in this paper is a part of a larger research initiative focusing on individual level

knowledge sharing within organizations (MANDI, ‘Managing the Dynamic Interfaces

between Culture and Knowledge’). We used a structured questionnaire, developed through a

focused literature review and an in-depth multiple case study in eight firms. The questionnaire

was available in a number of different languages, in both an electronic (internet-based) and

paper-based version. The questions were translated and back-translated, thereby reducing the

risk of comprehension problems. Prior to launching the survey, the questionnaire was pre-

tested with each company-participant to increase the clarity of the questions, to avoid

interpretation errors and to adjust some questions (such as department/function names) to the

specific context of each of the companies. The questionnaire focused on questions pertaining

to the nature of knowledge management and individual perceptions on the enablers and

barriers to knowledge sharing. Despite their obvious limitations, the use of perceptual and

self-reported measures is the most suitable methodology for the study of individual human

behavior and, when employed through a rigorous research design, may even be superior to

other approaches (Howard, 1994; Schmitt, 1994; Spector 1994). With respect to possible

common method bias, the performance variables were placed after the independent variables

in the survey in order to diminish, if not avoid, the effects of consistency artifacts (Podsakoff

and Organ, 1986; Salancik and Pfeffer, 1977).

The questionnaire was administered globally in three Danish-based MNCs (NNE, Danisco

and Chr. Hansen), which distributed a link to the internet-based survey via their internal e-

mail systems. The collection of the questionnaires was mediated by firm representatives who

acted as contact persons. To reduce possible social desirability bias we followed Tsai and

14
Ghoshal (1998) and in the opening paragraph explained that the used software4 prevents any

identification of individuals, and that the data will be collected using a company-external

server, and that our analysis would be restricted to an aggregated level. The data collection

took place during 2004-05. In the following, we will first describe the three companies, in

which the questionnaire was administered, briefly, and then move on to presenting our

measures, data analysis and empirical findings.

Companies

NNE (Novo Nordisk Engineering). NNE is a leading supplier of systems, consultancy and

engineering services to the international pharmaceutical and biotechnological industry. Its

competencies include engineering, construction, validation, start-up and optimization, and

reconstruction of facilities for product development and production plants, pilot plants and

laboratories within the pharmaceutical and biotechnological field. In 2004, NNE’s net

turnover amounted for DKK 1,015 million, and it had 1,200 employees internationally. The

company has constructed biotechnological and pharmaceutical production facilities in

Scandinavia, USA, China, Japan, Brazil and France. An increasing part of NNE’s turnover is

being generated outside Denmark. The data collection at NNE was facilitated by their

Knowledge Manager. 897 employees were invited to participate in the survey of which 341

responded, giving us a 38% response rate. Majority of responses (91%) came from Denmark.

Danisco. Danisco develops and produces food ingredients, sweeteners and sugar for the food

and beverage industry, and animal feed ingredients for the agriculture industry. In the

financial year 2003/04, Danisco achieved net sales of DKK 16.4 billion through a number of

international subsidiaries and acquisitions. Knowledge is considered a central success factor,

with a corporate slogan ‘First we add knowledge’ signaling both internally and externally the

importance put on knowledge processes. The administration of knowledge management in

4
The software and hosting were provided by WebSurveyor (www.websurveyor.com).

15
Danisco is located in ‘Global Innovation’, Danisco’s research and development organization,

and the firm’s critical relates to specific products and processes. In order to gain access to the

survey participants in Danisco, local HR managers at fourteen different food ingredients sites,

located in eleven countries, were contacted by e-mail from corporate HR with the request to

nominate approximately 20 employees in each for participation in the survey (Danisco Sugar

was excluded from the study as it has a separate self-governing status in the company). Three

sites in the US, two sites in Denmark and one site in the UK, Belgium, Finland, Germany,

Mexico, China, Malaysia and Australia/New Zealand were contacted. 281 invitations were

sent out, of which 221 questionnaires were filled in and 219 questionnaires were usable for

the analysis. This equals a total response rate of 78%.

Chr.Hansen. Chr.Hansen’s core competencies are in the fields of microbiology and

biotechnology, with focus on food starter cultures, enzymes and health promoting

characteristics of probiotics and functional foods, as well as natural colors and dairy flavors.

In the financial year 2003/04, Chr.Hansen’s revenue was 3.420 million DKK. Chr. Hansen is

globally present with production facilities on three continents, employing 2,500 employees

in 30 countries. About six percent of their revenue is spend on R&D and the application of

knowledge, with development centers situated in Denmark, the US, France and Germany, and

application centers in 21 countries. Chr. Hansen’s ongoing efforts in innovation and

development resulted in adopting the corporate slogan “130-years of innovation”, with their

corporate research center focusing their core competence finding and developing

microorganisms for the global food and health industries. The data collection at Chr. Hansen

was facilitated by a manager of their knowledge management project group. The invitations

were distributed internally within functional areas such as R&D, Production, Marketing, and

Sales, for 350 employees in Denmark, France, and the US, where the company has R&D

16
activities. 251 responses were returned, making a response rate of 72%. 153 responses came

from Denmark, 59 from the US, and 26 from France.

In total, 811 questionnaires were returned. However, because of missing data relevant for our

econometric exercise, the number of observations was further reduced to 658. Table 1

provides a detailed description of the respondents. After consultation with each company’s

representative, the distribution of the survey responses was regarded as representative.

- INSERT TABLE 1 AROUND HERE -

Measures

Dependent Variable

When knowledge transfer is discussed at the individual level it is custom to talk about

knowledge utilization (Minbaeva et al, 2003) - the extent to which an individual acquires and

uses the new knowledge (Bresman et al, 1999). Following Minbaeva et al. (2003: 587), we

also specify that the key element in knowledge transfer is not the underlying (original)

knowledge, but rather “the extent to which the receiver acquires potentially useful knowledge

and utilizes this knowledge in its own operations”. The measure adopted from Minbaeva et al.

(2003) was modified for the individual level. More specifically, using a five-point Likert-type

scale (ranging from 1=‘Little or no extent’ to 5=‘Very large extent’), respondents were asked

to indicate to what extent: (1) have you gained knowledge from colleagues in your own

department? (2) have you used knowledge from colleagues in your own department? (3) have

you gained knowledge from colleagues in other departments? (4) have you used knowledge

from colleagues in other departments? We ran a principal factor analysis on the four items

(see Table 2 below), which produced one factor with an eigenvalue greater than one

explaining approximately 80% of the variance. The final measure of knowledge utilization is

17
a weighted average of responses of the aforementioned items, using the factor loadings as

weights (alpha =0.84).

- INSERT TABLE 2 AROUND HERE -

Independent Variables

In order to test our hypotheses, the following independent variables were used. In line with

prior literature, we measure the employee’s ability in terms of prior achievement and skills

(Kim, 1998; Minbaeva et al, 2003). One more measure was added - a measure of self-

efficacy, since the power of efficacy judgments in human learning performance has been

demonstrated numerous times (e.g., Bandura, 1997). We asked the respondents to evaluate on

a five-point Likert-type scale (ranging from 1=‘Strongly disagree’ to 5=‘Strongly agree’) their

individual performance compared to their colleagues on the following six dimensions: (1)

‘Individual productivity’; (2) ‘Level of salary’; (3) ‘Career enhancement’; (4) ‘Ability to

share knowledge’; (5) ‘Job satisfaction’; and (6) ‘Expert status’. The variable individual

ability is the average of the scores to the six items (alpha=0.675).

As it was recommended by Vroom (1995), we use term motivation to refer to “a process

governing choices made by a person” (p.7). Extrinsic motivation is constituted by the

individual responsiveness to incentives for behaving in a certain way, based on the use of a

price system which typically links employees’ monetary motives to the goal of the

organization. In order to capture this concept, respondents were asked to assess to what extent

in the future they would prefer to be rewarded for transferring knowledge in their company

(1) by increments/bonuses, and (2) by promotion, and to what extent in the future they would

prefer to be rewarded for reusing knowledge in their company (1) by increments/bonuses, and

5
Nunnaly (1967) recommended a Cronbach alpha equal to or greater than 0.60 as the minimum value sufficient
for research purposes. That was done in other studies on intra-organizational knowledge trasnfer.For example,
Szulanski’s (1996) study on knowledge stickiness, published in Strategic Management Journal Winter Special
Issue, also reported two scales with Cronbach Alpha below 0.70: “unproven knowledge” - 0.67 and “source is
not perceived as reliable” - 0.64. However, it is clearly on of the weaknesses of the paper, which is discussed in
the final section of the paper.

18
(2) by promotion (five-point Likert-type scales ranging from 1=‘Little or no extent’ to

5=‘Very large extent’). We operationalized the variable individual extrinsic motivation as the

average of responses to these four items (alpha=0.87).

Intrinsic motivation, in turn, is fostered by commitment to the work itself with the reward

being in the activity itself or the duty of personal goals or social norms (Deci, 1975) and there

is no apparent reward except the activity itself (Osterloh et al., 2002). Accordingly, we define

the variable individual intrinsic motivation by averaging the scores on a five-point Likert-type

scales (ranging from 1=‘Strongly disagree’ to 5=‘Strongly agree’) of the three following

items: (1) ‘Increased value for me is enough to motivate knowledge sharing’; (2) ‘Increased

value for my department is enough to motivate knowledge sharing’; (3) ‘Increased value for

my company is enough to motivate knowledge sharing’ (alpha=0.85).

Previous research has indicated that socialization mechanisms that develop trust and

cooperation among individuals and facilitate formal and informal face-to-face relationships

affect knowledge sharing positively (Björkman et al., 2004; Gupta and Govindarajan, 2000;

Schulz, 2001). Thus, we define the variable socialization mechanisms based on the scores

(ranging from 1=‘Never’ to 5=‘Very often’) attributed by the respondents to the following

four items: (1) ‘to what extent do you use meetings when you transfer knowledge to other

people in your company?’; (2) ‘to what extent do you use informal communication (coffee

breaks, social events, etc.) when you transfer knowledge to other people in your company?’;

(3) ‘to what extent do you use meetings when you search for knowledge ?’; (4) ‘to what

extent do you use informal communication (coffee breaks, social events, etc.) when you

search for knowledge?’ (alpha=0.74).

In addition to socialization mechanisms, knowledge – explicit knowledge in particular – can

also be transferred through electronic media (McKenney et al., 1992; Nohria and Eccles,

1992; Pedersen et al., 2003). Indeed, the role of information and communication technologies

19
and their effects in knowledge transfer have been celebrated in the literature (Almeida et al.,

2002; Andersen and Foss, 2005). We define the variable electronic networks by averaging

responses to the following six items: (1) ‘to what extent do you use e-mail when you transfer

knowledge to other people in your company?’; (2) ‘to what extent do you use electronic

discussion forums on the intranet when you transfer knowledge to other people in your

company?’; (3) ‘to what extent do you use videoconferences when you transfer knowledge to

other people in your company?’; (4) ‘to what extent do you use e-mail when you search for

knowledge?’; (5) ‘to what extent do you use electronic discussion forums on the intranet

when you search for knowledge?’; (6) ‘to what extent do you use videoconferences when you

search for knowledge?’ (alpha=0.70).

Control variables

Finally, we include a number of control variables to capture potentially spurious exogenous

effects stemming from heterogeneity in the sample. First, the function to which the employee

belongs to may influence to what extent he/she acquires and uses knowledge from other

colleagues. Since the departments vary across three firms included in our sample, we

clustered them according to their position in the value-chain. We add the two dummy

variables product related and customer related. The former equals one if the individual

operates in a product related department (e.g. production, R&D), the latter takes value of one

if the individual operates in a customer related department (e.g. marketing, sales, logistics).

Second, previous studies have found that females may be more intrinsically motivated than

men (Valerand and Bissonnette, 1992), and more sensitive towards factors such as social

interaction culture (Connelly and Kelloway, 2003). To capture the potential gender

differences, we add the dummy variable female. Third, another source of heterogeneity

pertains to correlations existing between the individual and his/her role in the firm.

Accordingly, we add the dummy variables top management and middle management. The

20
former equals to one if the employee’s current position has been classified by the companies’

representatives as a top management position, and the latter if the employee’s current position

were classified as a middle management position. In an effort to control for the importance of

individual heterogeneity (Felin and Hesterly, 2007), we also add the variable experience in

position indicating how many years the employee has held his/her current position. Fourth, as

the individual propensity of transferring and searching for knowledge can be positively

affected by a favorable environment or, conversely, negatively impacted by an adverse

setting, we control for the importance of knowledge sharing within the company. Based on a

five-point Likert-type scales (ranging from 1=‘Strongly disagree’ to 5=‘Strongly agree’),

respondents were asked to indicate to what extent they agree with the following two

statements: (1) knowledge sharing is valued in my company’, and (2) ‘knowledge sharing is

valued in my department’. The variable importance of knowledge sharing in the firm is the

average of responses to the two items (alpha=0.69). As the respondents belong to three

different MNCs, i.e. Danisco, Chr.Hansen, and NNE, we also control for firm specific effects,

adding the dummy variables Danisco and Chr.Hansen, NNE being the benchmark.

Results

Descriptive statistics of the variables are reported in Table 3. We standardized the

independent variables, by subtracting the mean and dividing by the standard deviation, to

avoid high correlation betweens these variables and the interaction terms (Neter et al, 1990).

- INSERT TABLE 3 AROUND HERE -

Results from the OLS estimations are reported in Table 4. We obtained a robust variance

estimate that adjusts for within-cluster correlation (Froot, 1989; Williams, 2000). Specifically,

we control for the fact that the observations (i.e., individuals) within the same establishment

21
(unit) may not be independent, but the establishments themselves are independent (for details,

see Rogers, 1993).

In Table 4, Model 1 includes the control variables and the independent variables. Model 2

adds the interaction terms of ability with the opportunity variables and Model 3 includes the

interaction terms of extrinsic motivation with the opportunity variables. Finally, Model 4

presents the full results for all the hypotheses. All models are significant at p<0.001 and with

adjusted R-square increasing from 0.272 in Model to 0.295 in Model 4. To test the possibility

of multicollinearity among the individual ability, extrinsic and intrinsic motivation,

socialization mechanisms, and electronic network of practice, we calculated variance inflation

factors (VIFs) for Model 4. High VIFs (above 10) in the variables of concern would indicate

evidence of multicollinearity (Neter et al, 1990). The VIFs for these models were less than 2,

indicating that multicollinearity was not a problem.

Of the control variables, the coefficient of product related is positive and statistically

significant at p<0.01, suggesting that knowledge acquisition is greater for individuals

operating in departments such as R&D and production. The variable female is positive and

statistically significant at p<0.01. In line with the previous research (e.g., Connelly and

Kelloway, 2003; Valerand and Bissonnette, 1992), we find gender to have a strong impact on

knowledge utilization in such a way that female respondents were more likely to gain and

utilize knowledge than male ones. The employee’s experience in his/her position shows a

negative and significant effect (p<0.1) that fluctuates somewhat over subsequent models. Not

surprisingly, the relevance of knowledge sharing for the firm has a strong positive effect

(p<0.01) on the amount of knowledge utilization by the firm employees.

The findings reported in Table 4 support Hypothesis 1. The coefficient of the variable

individual ability is positive and statistically significant (p<0.01). This finding indicates that

the individual ability is an important determinant of knowledge utilization. We do not confirm

22
Hypothesis 2a as the coefficient of the variable individual extrinsic motivation is not

statistically significant at any conventional level. Hypothesis 2b is supported, with the

variable individual intrinsic motivation having a positive and significant (p<0.01) impact on

the dependent variable, suggesting that intrinsic motivation is another key determinant of

individual knowledge utilization.

The variable socialization mechanisms shows a positive and significant (p<0.01) coefficient,

supporting Hypothesis 3a. This finding suggests that as the level of interaction as measured

by the use of socialization mechanisms increases, individuals are more likely to acquire and

use knowledge from other colleagues within the firm. However, the use of electronic media

per se reveals a very weak effect on knowledge utilization. The coefficient of the variable

electronic networks is significant at p<0.1 only in Model 4. Hypothesis 3b is not supported.

- INSERT TABLE 4 AROUND HERE -

Turning to the results concerning the moderating effects, Model 4 reveals that the coefficient

of the interaction term between individual ability and the amount of socialization mechanisms

used by the respondent is not significant at any conventional level. However, the result is

different when opportunities are measured in term of the use of electronic media. As the level

of the employee’s ability increases, an increase in the use of electronic networks by the

employee increases his/her chance of acquiring and using knowledge from other colleagues.

Therefore, Hypothesis 4a is partially corroborated.

The use of socialization mechanisms does not moderate the impact of the extrinsic motivation

on knowledge utilization, while the coefficients of the interaction term individual extrinsic

motivation × electronic networks is negative and statistically significant at p<0.05. These

findings do not support Hypothesis 4b. The interaction term of intrinsic motivation with

socialization mechanisms results in a positive coefficient which is significant at p<0.01, while

we do not find a significant effect at any conventional level for the interaction term individual

23
intrinsic motivation × electronic networks. Accordingly, the hypothesis 4c is only partially

confirmed.

Discussion and Conclusion

In this paper we considered absorptive capacity as a multi-level construct. The primary aim

was to explain the effect of the absorptive capacity on intra-organizational knowledge transfer

at the individual level. Although previous research has been considering absorptive capacity

as a main determinant of intra-organizational knowledge transfer, individual heterogeneities

have been largely ignored. In fact, “research into absorptive capacity has only begun to

explore components and dimensions.” (Jansen et al, 2005: 1008).

We developed a theoretical model designed to fit within the research framework of Lane et al

(2006). We departed from their idea that absorptive capacity within an organization is

“dependent on the individual absorptive capacities of the organization’s members” (Lane et

al, 2006: 838). Individual absorptive capacity was defined as a byproduct of three internal to

the individual processes – ability, motivation and the use of opportunity provided by the

organization. Such operationalization is rooted in the Motivation-Opportunity-Ability (MOA)

framework (MacInnis and Jaworski, 1989; MacInnis et al., 1991), used in studies on HRM

(e.g. Appelbaum et al, 2000) and the KBV research (e.g. Argote et al, 2003).

Our results indicate that as expected ability and intrinsic motivation need to be present in

order to optimally facilitate knowledge acquisition and use by the individuals. While much

prior research on absorptive capacity has emphasized ability aspect of absorptive capacity

(Cohen and Levinthal, 1990; Lyles and Salk, 1996, Lane et al, 2001), our results indicate that

at the individual level motivation should be also considered as it is an important behavioral

component. These results fall in line with the contribution by Zahra and George (2002) who

distinguish between potential absorptive capacity (with an expected high content of

24
employees’ ability) and realized absorptive capacity (with an expected high content of

employees’ motivation).

Further, we attempted to offer a more nuanced perspective on motivation by distinguishing

between two types: extrinsic and intrinsic. Our findings show that knowledge utilization

increases about 16% in case of intrinsically motivated employees, while we do not find any

impact on knowledge utilization for extrinsically motivated employees. This is in line with

The Intrinsic Motivation Principle of Creativity, which argues that intrinsic motivation is

more conducive to creative tasks than extrinsic motivation (Amabile, 1997). Furthermore

intrinsic motivation can even make up for a deficiency in skills and expertise needed for

exploration: “a highly intrinsically motivated person is likely to draw skills from other

domains, or apply great effort to acquiring necessary skills in the target domain” (Amabile,

1997: 44). Deci and Flaste (1995) also argued that employees intrinsically motivated have

higher learning level than extrinsically motivated employees that experience the pressure of

sanctions and a more superficial work performance.

We were inspired by the framework offered by Argote et al (2003) and introduced the third

component – individuals’ use of opportunity provided by the organization. Further, following

the personalization-codification debate (Hansen et al, 1999), we distinguish between the use

of opportunities embedded in person-to-person interactions (socialization mechanisms) and

opportunities offered via IT interfaces (electronic networks). Our results indicate that only the

use of socialization mechanisms affects knowledge utilization while the use of electronic

networks has no direct effect on the dependent variable. These results are in line with Wasko

and Faraj (2005), who report that individuals do not make use of electronic networks of

practice due to the lack of shared history and low interdependence. Moran (2005: 1148) also

concludes that “maintaining some degree of closeness or intimacy is valuable”, and especially

important when engaging in knowledge processes. That is not to disregard the importance of

25
having electronic network of practice in place, but rather to say that the use of those might be

dependent on other contextual factors such as shared norms, familiarity and generalized trust.

We also suggested that the three components of individual absorptive capacity – ability,

motivation and (the use of) opportunity - affect the knowledge utilization at different points.

Indeed, while ability and motivation are a priori, opportunity is a moderator of their relations

to knowledge utilization. We observed that the use of electronic networks by highly capable

individuals (employees scoring high on ability) increases knowledge utilization by those

individuals. That is the individual ability is even more valuable for knowledge utilization

when coupled with the use of IT-embedded opportunities.

We found differences in how different types of opportunities moderate the relations between

extrinsic and intrinsic motivation and knowledge utilization. In particular, with an increase in

the employees’ extrinsic motivation, an increase in the use of electronic networks reduces the

degree of knowledge utilization. These results are somehow unexpected. Yet, potential

explanations could be found in the theories of motivation (Deci, 1972; 1975). Extrinsically

motivated individuals are more likely to engage into knowledge utilization, if they believe

that the returns are positive, proximate and predictable. Once employees receive extrinsic

incentives, they will most probably repeat their activities at minimum costs, which may lead

to higher degree of knowledge exploitation, rather than searching for the new knowledge for

which the use of various opportunities offered by the organization is a must.

Interestingly, we find that the use of socialization mechanisms primarily enhance knowledge

utilization by intrinsically motivated individuals, while extrinsically motivated employees are

less inclined to further exploit these mechanisms. The greater is the intrinsic personal and

social satisfaction achieved while acquiring and using knowledge, the larger will be the use of

complex and ‘rich’ communication media (Daft and Lengel, 1986). Moreover, the

individuals’ reputation is harmed by uncooperative behavior. Therefore, intrinsically

26
motivated employees are willing to spend extra time promoting face-to-face relationships for

transferring knowledge.

Implications

Our study contributes to research on absorptive capacity and knowledge transfer in several

ways. Most importantly, our study integrates the theory of absorptive capacity (Lane et al,

2006) and the recent calls for focusing on the role that individuals play in leveraging

knowledge (Felin and Hesterly, 2007; Foss, 2007). On this basis, our model predicts

differences in the nature and drivers of the impact of the absorptive capacity on knowledge

transfer, depending on the characteristics of the individuals. We suggest that absorptive

capacity at the individual level is manifested in individuals’ ability, motivation, and the use of

opportunities provided by the organizations.

We also believe that our contribution could stipulate discussion of MNC knowledge transfer

at different levels. Till recently intra-MNC knowledge transfer has been mainly analyzed at

the level of the subsidiary. MNCs are a complex phenomenon where transfer occurs in

multiple directions and across multiple dimensions. All three levels – country, inter-

organizational and organizational – may be useful to studies of MNC knowledge transfer,

either one at a time or used in a complementary way. Similarly, the absorptive capacities of a

MNC’s subsidiaries located in different countries may be analyzed in terms of the country

systemic and institutional elements that facilitate absorption (the country level). In

“differentiated” MNCs, absorptive capacity may be treated as a dyad-level construct,

emphasizing the relative similarities between MNCs units (the inter-organizational level).

Absorptive capacity of the subsidiary can also be analyzed at the subsidiary (organizational)

level, focusing on the accumulative behavior of individuals and their role in knowledge

transfer (the organizational level). Yet, to fully comprehend how absorptive capacity

contributes to the intra-MNC knowledge transfer, attention needs to be paid to explanans at

27
the individual level (e.g. individual ability, motivation, and opportunity leading to knowledge

utilization by subsidiary employees), which mediate the link from the former to the latter.

Slicing up the concept of individual absorptive capacity makes it easier to identify managerial

practices the employment of which should facilitate ability, motivation and (the use of)

opportunity by individuals. Such logic is advocated by the emerging knowledge governance

approach (Grandori, 2001; Foss, 2007). It has as its focus the interplay between knowledge-

based contingency factors and governance mechanisms6 such as reward systems, coordination

mechanisms and standard operating procedures. Such logic is also advocated in studied on

HRM and performance, which recommends grouping of the HRM practices to be derived

from the theoretical rationales (MacDuffie, 1995; Youndt et al., 1996). Conceptually it should

be possible to identify HRM practices, which application enhances mediating variables that in

turn affect performance (Guest, 1997). We subscribe to the above arguments and based on

our findings could propose at least three groups of governance mechanisms conducive to

knowledge utilization by individuals: the HRM practices aiming at increasing the (1)

individual ability (e.g. staffing, training, competence-based performance appraisal), (2)

individual motivation (e.g. compensation, acknowledgement schemes, promotion), and (3) the

use of opportunities offered by the organization (e.g. internal communication, team building

exercises, orientation programs, knowledge-friendly corporate culture supporting initiatives).

Further, managers are usually aware of the ways in which both intrinsic and extrinsic

motivation affect performance and work satisfaction. However, as we illustrated, there are

many factors that might moderate how these different types of motivations affect the

behaviors. Advancing the understanding of the moderation effect of opportunities on

motivation, our model suggests that managers should differentiate their investments in

6
Here we use the concept of “knowledge governance mechanisms” as an umbrella concept which covers other
mechanisms such as “human resource management practices”, “organizational antecedents”, “management
practices”, etc.

28
governance mechanisms (in the case of this paper, electronic networks and socialization

mechanisms) depending on how they manage motivation. In situations with a strong emphasis

on employees’ intrinsic motivation, formal and informal personnel interactions should be

implemented and increased. When extrinsic rewards are given for enhancing knowledge

sharing activities, less attention may be paid to the imposing of electronic networks for

knowledge transfer. However, as both extrinsic rewards and intrinsic motivation are very

often found together (Deci, 1975), the choice on opportunities is not simple and should been a

subject of extensive evaluation in the firm.

We acknowledge that our findings also have certain limitations. We based our empirical

analyses on cross-sectional data. Further longitudinal research should empirically establish

the causal claim of our model. Second, our empirical focus was limited in that we only

examined three MNCs, all originated from Denmark. We recognize that individual processes

which we considered in the paper are sensitive to a number of firm-specific characteristics.

We control for the company, the establishment, and the functional area the employees work

belong to. However, empirical studies based on individual data gathered from a wider variety

of firms are necessary to further generalize the findings. Third, future studies should

additionally take into account the impact of the external environment (formal and informal

institutions) in relation to the formation of individual processes which we considered. Among

the external environment variables which must be considered in the future research is national

culture. On the other hand, empirical results on how national culture influences intra-MNC

knowledge sharing and transfer are inconclusive. Cho and Lee (2004) found that the cultural

similarity between a South Korean subsidiary and other members of the MNC network was

positively related to MNC’s intra-network knowledge sharing. In contrast, Bjorkman et al

(2004) reported that subsidiary nationality did not seem to influence the patterns of

knowledge flows. In our companies, there were several areas where a more than marginal

29
difference in national perception was experienced (e.g. questions related to rewards, trust,

hierarchy). For example, national culture seems to have an influence on how employees

would like to be rewarded for sharing knowledge. We re-tested the hypotheses adding a

dummy variable for individual working in Denmark (home-country effect), but the results did

not change. Likewise, we defined the three dummy variables - Europe, USA, and developing

countries - to verify if our results could depend on the different geographical area where the

individuals were employed. Also in this case, we did not observe significant changes.

However, there may be a substantively significant relationship that is not strong enough to be

identified in this study given the sample size per country.

We also acknowledge the shortcomings of using perceptual instruments to measure the

occurrence of knowledge transfer and the absorptive capacity concept, rather than more

objective indicators. However, the empirical research at the individual level on the

relationship between absorptive capacity and knowledge transfer is to some degree still at an

exploratory stage. In future studies, it would be useful to further enhance these measurements,

combining them with some objective indicators to develop more elaborate measures.

30
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 Figure 1. Absorptive Capacity and Knowledge Transfer: Organizational vs. Individual
Levels

Organizational Intra-organizational
absorptive capacity knowledge transfer

Ability Knowledge utilization

Motivation (acquisition and use) by
(The use of) Opportunity individuals

In Italics – the original model

In Bold – the interpretation for the purpose of this paper

Figure 2. Conceptual Model

Individual absorptive capacity

Ability

Knowledge utilization

Motivation
Opportunity
Control variables

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Table 1. Description of the Respondents
Danisco NNE Chr.Hansen
Gender: Male 125 230 139
Female 91 107 112
Non-response 3 4 0
Position: Low 118 191 80
Middle 69 100 84
Top 30 35 81
Non-response 2 15 6
Experience: Average 9.48 6.73 8.34
Age: Average 39.52 40.2 40.91
Education: High school or below 43 48 27
Bachelor's degree 99 167 99
Master's degree 70 115 88
Ph.D. 5 8 37
Non-response 2 3 0
Country: Australia 6
Belgium 17
China 13 3
Denmark 48 310 153
Finland 15
France 13 26
Malaysia 19
Mexico 20
New Zealand 9
Sweden 5
the UK 20
USA 48 10 59
Other 4 13
Total 219 341 251

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Table 2. Definition of Knowledge Transfer: A Principal Factors Analysis

Factor Loadings
You gained knowledge from colleagues in your own department 0.76
You used knowledge from colleagues in your own department 0.76
You gained knowledge from colleagues in other departments 0.82
You used knowledge from colleagues in other departments 0.80
Eigenvalue 2.46
Cumulative variance 0.79
Cronbach alpha 0.84

Table 3. Descriptive Statistics

Mean S.d. Min Max (1) (2) (3) (4) (5) (6) (7) (8) (9) (10) (11) (12) (13) (14)
(1) Knowledge transfer 0.00 1.00 -3.21 1.87
(2) Product related 0.61 0.49 0.00 1.00 0.12
(3) Customer related 0.16 0.36 0.00 1.00 -0.02 -0.53
(4) Female 0.37 0.48 0.00 1.00 0.08 -0.04 0.04
(5) Top management 0.19 0.39 0.00 1.00 0.12 -0.12 0.03 -0.09
(6) Middle management 0.28 0.45 0.00 1.00 0.00 0.08 -0.03 -0.07 -0.30
(7) Experience in position 4.13 4.07 0.00 29 -0.10 0.03 -0.09 -0.05 -0.11 0.10
(8) Firm’s knowledge sharing importance 3.87 0.72 1.50 5.00 0.33 0.09 -0.02 -0.01 0.02 -0.01 0.01
(9) Danisco 0.28 0.45 0.00 1.00 -0.05 -0.21 0.11 0.05 -0.06 0.05 0.17 0.09
(10) Chr.Hansen 0.31 0.46 0.00 1.00 0.08 0.03 -0.10 0.06 0.25 0.08 0.00 -0.04 -0.42
a
(11) Individual ability 3.48 0.45 1.00 5.00 0.29 0.06 -0.11 -0.04 0.14 0.08 0.03 0.26 -0.09 0.10
(12) Individual extrinsic motivation a 2.73 1.00 1.00 5.00 0.00 -0.01 -0.01 -0.06 0.03 0.00 -0.07 -0.06 0.08 0.00 0.07
(13) Individual intrinsic motivation a 3.69 0.66 1.00 5.00 0.32 -0.01 0.00 0.06 0.11 -0.01 -0.09 0.30 0.03 0.07 0.24 -0.02
(14) Socialization mechanisms a 3.38 0.74 1.25 5.00 0.35 0.09 -0.04 -0.03 0.08 0.07 -0.05 0.23 -0.18 0.04 0.29 0.02 0.17
(15) Electronic networks a 2.43 0.58 1.00 5.00 0.15 -0.19 0.05 0.04 0.23 0.12 -0.08 0.08 0.15 0.24 0.10 0.17 0.11 0.23
a
The variable is standardized. The table lists the means, standard deviations, minima, and maxima of these variables prior to this standardization.

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View publication stats

Table 4 - Results of the Regression Analysis of Knowledge transfer

Model 1 Model 2 Model 3 Model 4

Intercept -1.19(0.22)*** -1.21(0.22)*** -1.22(0.23)*** -1.22(0.22)***
Product related 0.26(0.09)*** 0.26(0.09)*** 0.27(0.09)*** 0.27(0.09)***
Customer related 0.18(0.13) 0.20(0.13) 0.19(0.13) 0.20(0.13)
Female 0.16(0.04)*** 0.17(0.04)*** 0.17(0.04)*** 0.17(0.04)***
Top management 0.13(0.09) 0.13(0.09) 0.13(0.09) 0.11(0.09)
Middle management -0.02(0.06) -0.01(0.06) -0.01(0.06) -0.01(0.06)
Experience in position -0.01(0.01)* -0.01(0.01)* -0.01(0.01)* -0.01(0.01)
Firm’s knowledge sharing importance 0.25(0.06)*** 0.25(0.06)*** 0.25(0.06)*** 0.25(0.06)***
Danisco 0.05(0.10) 0.05(0.10) 0.04(0.10) 0.02(0.10)
Chr.Hansen 0.08(0.07) 0.08(0.07) 0.06(0.07) 0.07(0.08)
Individual ability 0.12(0.03)*** 0.13(0.03)*** 0.13(0.03)*** 0.13(0.03)***
Individual extrinsic motivation -0.01(0.04) -0.01(0.04) -0.01(0.03) -0.01(0.03)
Individual intrinsic motivation 0.16(0.04)*** 0.16(0.04)*** 0.16(0.04)*** 0.16(0.03)***
Socialization mechanisms 0.21(0.04)*** 0.21(0.04)*** 0.21(0.04)*** 0.20(0.04)***
Electronic networks 0.04(0.03) 0.04(0.03) 0.05(0.03) 0.06(0.03)**
Individual ability × Socialization mechanisms 0.02(0.03) 0.01(0.03) -0.01(0.03)
Individual ability × Electronic networks 0.07(0.03)** 0.07(0.03)** 0.07(0.03)***
Individual extrinsic motivation × Socialization mechanisms -0.03(0.03) -0.02(0.03)
Individual extrinsic motivation × Electronic networks -0.07(0.03)** -0.07(0.03)**
Individual intrinsic motivation × Socialization mechanisms 0.10(0.03)***
Individual intrinsic motivation × Electronic networks -0.03(0.03)
Observations 658 658 658 658
Adjusted R2 0.272 0.278 0.287 0.295
F-test 18.99*** 27.10*** 39.05*** 39.78***
In brackets robust standard errors corrected for heteroschedasticity and cluster-correlated data.
* p< .10; ** p< .05; *** p< .01 (two-tailed tests applied)

39