Managerial tacit knowledge transfer and the mediating role of leader-member-exchange and cognitive style

The ability of an organisation to transfer knowledge is one of the key sources of competitive advantage for many of today’s organisations (Argote, 2000). New knowledge is created through interactions between explicit and tacit knowledge (Nonaka and Takeuchi, 1995). From the distinction between explicit and tacit knowledge made by Polanyi’s (1966), it is clear that the former can be transferred with relative ease, particularly using recent advances in information technology. Transfer of tacit knowledge on the other hand, requires social interactions with peers, colleagues, mentors and supervisor (Lahti et al, 2002; Cavusgil et al, 2003). Difficulties associated with this have been referred to as ‘internal stickiness’ (Szulanski, 1996) and is believed to be due to several factors. This study examines difficulties associated with the transfer of managerial tacit knowledge in the relationships involving supervisor and subordinates who work as managers in the Malaysian public sector. After examining previous literature in the field it is hypothesised that the stickiness of knowledge transfer may be associated with the quality of leader member exchange relationships, especially between leaders and their ‘in-group’ versus ‘out-group’ members. For example, in-group relationships are associated with higher levels of trust, respect and obligation compared with out-group relations. Another construct known to be associated with the quality of dyadic relationships is cognitive style (Armstrong, 1999). Cognitive style refers to individual differences in ways of perceiving, organising and processing information and differences in ways in which individuals solve problems, take decisions and relate to others. The research employed a quantitative approach using survey methods. Instruments used in the study included a measure of knowledge transfer stickiness (Szulanski, 1996), Leader Member Exchange (LMX7) (Graen and Uhl-Bien, 1995), Tacit Knowledge Inventory for Managers (TKIM) (Wagner and Sternberg, 1989) and the Cognitive Style Index (CSI) (Allinson and Hayes, 1996). The survey was administered to 1200 managers in the Malaysian Public Sector and 344 completed surveys were returned representing a response rate of 28.7%. Results from a final sample size of 300 managers comprising supervisors and their immediate subordinates are reported. The study successfully determined the relationship between knowledge transfer stickiness, LMX, cognitive style and managerial tacit knowledge. As expected, high-quality LMX leads to higher quality exchanges and concomitant improvements in the transfer of managerial tacit knowledge. Moreover, as hypothesised, individual differences and similarities in cognitive style also influence the transfer of tacit knowledge between supervisor and subordinate. Practical implications are given and recommendation made for future research.