Knowledge that Transforms

This paper examines the introduction of new technologies in the manufacturing environment, and addresses two central questions. First, how can factories introducing new process technology deal with change rapidly and effectively? Further, what fundamental organizational changes are necessary to enable plants to respond successfully to the challenge of technological change? The research examined 48 projects where new manufacturing technologies were introduced. Projects were undertaken in plants in Italy, West Germany, and the United States which belong to a single company. In comparing success across regions, performance measured by startup time and operating improvement was significantly lower in the U.S. plants than in European operations. A significant portion of this performance gap can be explained by differences in the way project teams in each region used available mechanisms for identifying and solving the problems associated with new technologies. U.S. project teams were, on average, less likely than those in Europe to engage in preparatory problem-solving activities, or to solve problems by working with external technical experts, or by merging different functional perspectives within the project group. To understand the source of these differences, the paper examines historical and organizational differences among the operations in different geographic regions. Over time, local managerial choices had resulted in distinct sets of organizational capabilities, resources, and assumptions that affected the way plants in different regions approached technological problem solving. The paper argues, therefore, that such managerial choices constitute important strategic decisions which have long-lived implications for technological innovation in the manufacturing environment.

Employees frequently give technical information or advice to colleagues in other firms, including direct competitors. This paper addresses whether such information-transfer is in the economic interests of the firms involved. It is hypothesized that employees trade information in accordance with the economic interests of their firms. Conditions are discussed in which information trading creates an economic advantage for the participating firms. Data on specific information transfer decisions were obtained from a survey of 294 technically oriented middle-level managers from the U.S. specialty steel and mini-mill industry. The observed pattern of information transfer strongly supports the hypotheses (1) that employees trade information and (2) that such trading is desirable from a firm's point of view. Furthermore, the data suggest a positive link between the participation of a firm's employees in informal informationtransfer networks and the economic performance of the firm. Indeed, it can be in a firm's interest to make its boundaries penetrable for informal information trading rather than to discourage such transfers.