Trans-specialization understanding in international technology alliances: The influence of cultural distance

In the information age, the firm's performance hinges on combining partners' specialist knowledge to achieve value co-creation. Combining knowledge from different specialties could be a costly process in the international technology alliances (ITAs) context. We argue that the combination of different specializations requires the development of "trans-specialization understanding" (TSU) instead of the internalization of partners' specialist knowledge. This article examines the extent to which inter-firm governance in ITAs shapes TSU, and whether the development of TSU is endangered by cultural distance. We hypothesize that relational governance, product modularity, and cultural distance influence TSU development, which in turn influences firm performance. We collected data from 110 non-equity ITAs between software and hardware firms participating in the mobile device sector. We analyzed the data using partial least squares path modeling. Our findings suggest that TSU largely depends on product modularity and relational governance in alliances. However, while cultural distance negatively moderates the path from relational governance to TSU, it has no effect on the relationship between product modularity and TSU. Based on this, we conclude that product modularity can substitute for relational governance when strong relational norms are not well-developed in international alliances. Thus cultural distance does not invariably amount to a liability in ITAs

Knowledge Transfer in Software Maintenance Outsourcing: The Key Roles of Software Knowledge and Guided Learning Tasks

Software maintenance eats up the lion’s share of corporate software expenses, and many organizations attempt to reduce these costs through outsourcing and offshoring. A key challenge in these initiatives is to transfer knowledge to the new service delivery unit (a vendor or a captive center). Even though knowledge transfer plays a key role across theoretical perspectives in sourcing research (such as transaction cost economics, knowledge-based perspectives, and social perspectives), we know surprisingly little about what knowledge is most critical and through what mechanisms this knowledge is transferred in software maintenance outsourcing and offshoring. Insights from a multiple-case study of five knowledge transfers at a Swiss bank suggest that the most critical knowledge is software knowledge and that software knowledge is transferred through guided learning tasks. Software knowledge (i.e., knowledge about the application software, including its structure, functionality and behavior) is most critical because it allows engineers to cope with the cognitive burden imposed by enormous amounts of code, data, and documents. While engineers in settings of low knowledge specificity may possess sufficient software knowledge from the beginning, engineers in settings of high knowledge specificity acquire this knowledge through a series of guided learning tasks, i.e., by working on real or realistic maintenance tasks while receiving direction and task-specific information from experts. Our study adds to the emerging literature on transitions and offers important implications for the discourses on transaction cost economics and on knowledge-based perspectives in sourcing research