Knowledge Transfer and Creation Systems: Perspectives on Corporate Socialization Mechanisms and Human Resource Management

Abstract

This study explores the role played by corporate socialization mechanisms (CSMs) and human resource management (HRM) practices in inter- and intra-unit knowledge flows and creation systems in multinational corporations (MNCs), especially focusing on professional service firms (PSFs). Drawing on a longitudinal case study of Cambridge Technology Partners (CTP), which was established during a paradigm shift in the consulting industry arising from the advancement of information technology (IT), the findings of this study suggest that CSMs are incorporated into HRM practices. When CTP was a global consulting company, CSMs worked as an infrastructure for transferring knowledge from the headquarters (HQs) to a focal subsidiary. HRM practices were designed to enhance and practice the HQs’ goals of achieving global competitiveness. Specifically, training and development practices played a role in transferring knowledge from the HQs to a focal subsidiary at the corporate level, while tacit and explicit knowledge were transferred from senior to junior consultants at the individual level. At present, sharing the corporate philosophy within CTP has generated a high project success rate in Japan and laid the foundation for further knowledge creation for CTP. HRM practices are designed to enhance CTP’s business model, methodology, and corporate culture and to create new knowledge. Training and development practices enhance the creation of new knowledge within the company. Additionally, performance appraisals and incentive practices are designed to encourage consultants to create new knowledge.