انتقال دانش و یادگیری سازمانی در یافتن مناطق آفشور

Offshore sourcing is the trend where companies look for cheaper offshore resource options to reduce their baseline costs. This involves the retrenchment of more expensive onshore resources to be replaced with cheaper offshore resources. A key activity is the transfer of knowledge from the onshore resources to the offshore resources. This paper is written from an organizational learning perspective, looking at how a global IS department in a multinational bank went about transferring its business application support and development experiences to another insourced location. Specifically, we examine how knowledge is transferred for the five IS body of knowledge (BOK) areas, namely, technology, application domain, IS application, organizational and IS development process knowledge. We find that whilst some areas of the IS BOK are easily grafted, some require intense vicarious and experiential learning using rich media, whilst others are more difficult to transfer. The findings extend the literature on knowledge transfer and organizational learning in the context of the IS BOK.

A study by A.T. Kearney Inc, a management-consulting firm, cites that “U.S. financial companies plan to move more than 500,000 jobs to other countries, cutting operating costs by more than $30 million”. A company looking towards cheaper offshore locations for their sourcing requirements is a new phenomenon motivated by a company's need to cut costs. In a survey done by Deloitte Consulting Pte. Ltd. [1], they revealed that the world's top 100 financial service providers have plans to relocate operations offshore, translating into a bottom line annual cost savings of US$138 billion or US$1.4 billion each by 2008. British Airways found that it saves nearly US$23 million a year for every 1000 jobs it relocates to India [2]. Due to pressures on the organization's cost base and shortage of onshore skilled resources [3], [4] and [5], two options are available—outsourcing offshore and/or insourcing offshore. Outsourcing is the process of turning over part or all of an organization's functions to external service providers so as to achieve economic, technological and strategic advantages [6]. Insourcing, on the other hand, includes in-house capabilities as well as contracts that call for the market to provide resources, but with the premise that it is under the buyer's management and control [7]. Outsourcing and insourcing are not new phenomena [8] and [9], but looking offshore for a cheaper source has been gaining momentum in the 2000s as organizations look towards resource costs arbitrage. In the 1990s, this could have been another instance of globalization, where companies decide where to grow and place their new jobs. But in the 2000s after the dotcom-bubble burst, companies were replacing more expensive onshore resources with cheaper offshore resources. This replacement maybe as high as 65% of a whole department, as in the case that we have studied. Depending on the knowledge content of the job being replaced, successful knowledge transfer from the onshore to the offshore resource is vital. Particularly in the area of IS technology support and development, there is a need for the offshore staff to acquire and master existing knowledge on the application quickly, to get quick access to domain knowledge for which the software is being developed and to know “who knows what” so as to tap onto this knowledge. Knowledge transfer has been described as a process where information and skills between entities are systematically exchanged [10]. There are individual and collective knowledge [11] that must be transferred from the onshore staff to the offshore staff. Tacit knowledge [12], with its personal quality and stickiness [13], is harder to formalize and communicate as it is deeply rooted in action, commitment and involvement in a specific context. It is also locally specific and harder to gain access to from a distance [14]. The offshore organization has to rapidly learn and apply all the knowledge that the onshore resource has accumulated over the years, in a rather short project time frame of three to 6 months. As we see more companies moving towards offshore locations, the knowledge that cannot be transferred will be lost. This case study looks at how the IS department of a multinational bank—who insourced more than 65% of its work to two offshore locations—went about transferring its business application knowledge. Using an organizational learning lens, this paper aims to study how an IS (business application) technology department in a multinational bank went about transferring knowledge from the onshore location to the offshore location. The two research questions are: given the short time frame of three to 6 months, how did the organization manage the learning experience of transferring the majority of its application support and development knowledge across countries and what were the learning processes involved that enabled successful massive knowledge transfer from onshore to offshore teams. This case contributes to the understanding of how IS technology knowledge is transferred and learnt in an offshore insourcing scenario. It also extends the understanding of the IS body of knowledge (BOK) [15] from an organizational learning and knowledge transfer perspective. In the next section, a literature review on knowledge transfer and organizational learning will be presented. This is followed by the case description and its findings. We then conclude and suggest implications of our study.

As organizations continue to take advantage of cost arbitrage between onshore and offshore locations, the importance of knowledge transfer from the onshore to the offshore staff is vital, as knowledge that is not transferred will be lost. Research on knowledge transfer between organizations in the past was mainly in the area of international joint ventures and less complex inter- and intra-organizational knowledge transfers, where there was little threat of knowledge loss. This case study is different in that it provides empirical insights on a massive large-scale knowledge transfer programme from one geographic location to another in an extremely limited time frame with the threat of knowledge loss. The organization had to very quickly transfer its past experiences or risk losing them. From an organizational learning perspective, we find that many of the learning subprocesses which typically refer to learning from an external organization, such as grafting and vicarious learning, are applicable in this situation. Grafting in this context was for the purpose of quickly building up knowledge base so as to enable better absorption, versus the original definition of gaining new knowledge. Vicarious learning in this instance was done from within the organization, instead of learning from outside the organization. Another key finding was that self-appraisals, such as tests, interviews and team appraisals were key experiential learning subprocesses that were adopted to ensure that what was transferred was indeed learnt by the offshore staff. In information interpretation, the richest media of face to face was predominantly used and information overload was expected. Finally, to ensure that organizational memory was preserved as much as possible, we found that most of the lower-level onshore staff with easier-to-graft technical and application domain knowledge were retrenched, with the organization keeping the more senior level onshore staff, which had difficult-to-transfer tacit IS application knowledge. The practical implications of this case study show how an organization was able to cut costs through successfully sending work to cheaper offshore locations. Firstly, it provides useful insights that not all teams should be sent offshore, where risk criticality of the business application and cost efficiency are major considerations. Secondly, the overall transition programme benefited from having a Transition Guide, which ensured that best practices were used consistently across the different teams doing the transition. Some of the knowledge transfer best practices include presentations, written tests or quizzes, on-the-job training, support simulation, playback, oral tests and team appraisals. The teams felt that three to six months to do the transition was rather short, but the programme director was satisfied with the outcome. Finally, to stabilize this major organizational change, companies might find it useful to reorganize their reporting structure to ensure that the offshore teams work in unison with the remaining onshore members as a team. With the ever-increasing pressure to bring down costs, organizations will continue to look for cheaper locations to do their business, it is thus important to learn how organizations can go about moving their knowledge capital from one geographic location to another effectively.