Knowledge Transfer between Swedish firms andtheir Indian sales units: : Enablers, impediments, and the importance oforganizational culture

University essay from KTH/Industriell ekonomi och organisation (Inst.); KTH/Industriell ekonomi och organisation (Inst.)

Abstract:

The purpose of this study is to explore knowledge transfer between Swedish firms and their

Indian sales units. We maintain that knowledge is a strategic contributor to the firm and that it

is crucial to leverage knowledge to newly established subsidiaries abroad as selling-related

knowledge is the key driver of sales performance. India is interesting to examine because of

its large and fast growing market, which gives reason to establish and sharpen sales activities

in the country.

Knowledge transfer research has identified three main areas related to this concept; the nature

of knowledge, enablers, and impediments. We have explored these three areas using four case

studies. Two of the case companies are large MNC’s that are used to obtain general

information about knowledge transfer between Sweden and India, while the two latter are

smaller MNC’s where information more specific to sales was gathered. At each company, at

least one Swede and one Indian employee have been interviewed in order to capture a senderreceiver

relationship. In total, eleven interviews and two surveys were conducted over a

period of two months in India.

Seven propositions form the basis of our theoretical framework and we can support six of

them. Based on these, we go on to construct a model for knowledge transfer between Sweden

and India. This model is the first of its kind - no earlier research has presented a description of

knowledge transfer between Swedish and Indian sales units. Another key finding is how the

parent company can transfer their organizational culture to the Indian unit. Cultural

differences, especially strong hierarchies and vague communication in India, are identified as

the key impediments to knowledge transfer. These cultural gaps can be mitigated by a

common cultural context which is why the parent company needs to establish the Swedish

organizational culture at the Indian subsidiary, while still respecting the Indian culture in

general. We present what motivates Indians to adopt a new organizational culture, how the

culture should be communicated, and which practices that are efficient. For expatriate CEO’s

- one of the most central practices - we provide a model that can help Swedish managers to

decide if a Swedish CEO or Indian managers should be used, from a perspective of how to

transfer organizational culture.

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