Technology Usage and Organizational Performance in Multi-Unit Firmstransferring Knowledge by Transferring Individuals: Innovative Technology Usage and Organizational Performance in Multi-Unit Firms

Abstract

Transferring individuals who possess relevant knowledge from one organizational unit to another – a form of resource redeployment – may help to overcome impediments to knowledge transfer. Despite the promise of this mechanism, which often occurs through intra-firm geographic mobility, relatively little research has examined how the knowledge and expertise of individuals interacts with the organizational resources of the units to which individuals move. This study examines whether intra-firm geographic mobility improves organizational performance by providing a conduit for the transfer of knowledge, while accounting for the interaction between individual knowledge and factors at the organization-unit level of analysis. We analyze the performance effects of the transfer of engineers who have expertise in innovative process technologies. The results from a large multinational company show that the innovative process technology-related expertise of an individual engineer who moves to a new organizational unit is positively associated with the performance of that unit, suggesting that intra-firm geographic mobility improves organizational performance by providing a conduit for the transfer of knowledge. The results also show that the technology-related knowledge of engineers is a substitute for organization-level factors when a unit uses only technologies with which it is already familiar, whereas the technology-related knowledge of engineers is a complement to organization-level factors when units introduce new technologies. Thus, individuals who bring novel expertise to their organizational units through intra-firm mobility may be important vehicles for organizational learning and building new competences, helping to diffuse best practice.

Keywords: knowledge transfer, resource redeployment, strategic human capital, microfoundations, organizational learning, process technology, employee mobility, multinational firms

JEL Classification: D22, D23, D83, M1