‘Control – What Control?’ Culture and Ambiguity Within a Knowledge Intensive Firm*

ABSTRACT This paper explores the distinctive culture that existed within a knowledge‐intensive firm (KIF) and also attempts to explain the emergence and effects of this culture. The findings are based on a detailed case study that was conducted over two years within a consultancy firm that created and applied scientific knowledge and expertise to the invention of solutions for clients. The firm employed highly educated scientists, considered ‘leading’ in their respective disciplines and project work was inherently fluid, complex, and uncertain. These kinds of ‘knowledge workers’, and this kind of work, are expected to demand high levels of autonomy. This creates complex managerial dilemmas around how to balance autonomy with control and uncertainty and flexibility with efficiency. The analysis shows how a strong culture based on an acceptance of ambiguity (e.g. in roles, power relations, organizational routines and practices) promoted the development of a loyal, committed, effective workforce and sustained a fluid and flexible form of project working over time. Critically, ambiguity allowed individuals to sustain multiple identities as both ‘expert’ and ‘consultant’. This, coupled with a corporate identity premised on ‘élitism’, helped to maximize commitment to the work and minimize tensions between control and autonomy. Thus the culture that embraced ambiguity (a consensus that there would be no consensus) engendered a form of normative control whereby consultants operated freely and at the same time willingly participated in the regulation of their own autonomy.     

Beyond the Global City Concept and the Myth of ‘Command and Control’

The article argues that the lack of convincing empirical evidence for the global economy as being subject to ‘command and control’ results from that contention being a neo‐Marxist myth. First, imagining the global economy as being subject to ‘highly concentrated command’ through the function of some major cities as ‘strategic sites’ for the production of ‘command and control’ is traced back through several neo‐Marxist authors to narrate its genesis, and to argue that the lack of evidence for that proposition is a consequence of those antecedents envisioning capitalism as a totalizing structure, thus making the assumption that it is subject to control and coordination from a distance. Second, Taylor's interlocking world city network model is forensically examined to explain that it is fallacious because it is a structuralism that, bedevilled by a sorites paradox, contains the further problem of containing no credible evidence for the existence of ‘command centres’. Finally, the article moves beyond neo‐Marxism's key concepts by juxtaposing their assumptions with ethnographic results from social studies of finance, a manoeuvre which forges an understanding of cities as socio‐technical assemblages and eventful multiplicities, beyond, inter alia, the baseless assumption that the global economy is subject to ‘command and control’.     

Vertical De‐Integration in the Mutual Fund Industry: Using Knowledge as a Factor of Production

This paper extends the knowledge‐based view of the firm by using relative measures of two fundamental classifications of knowledge as factors of production. It relates differences in relative quantities of these classifications of knowledge to the probability that a given stage of production is outsourced or de‐integrated. The probability of de‐integration of adjacent stages of production is found to increase on increasing reliance on tacit knowledge and decreasing reliance on encapsulated knowledge. The research was motivated by the belief that the cost and value of knowledge, as a factor of production, influence economic efficiency. Copyright © 2014 John Wiley & Sons, Ltd.     

The Inside Track: On the Important (But Neglected) Role of Customers in the Resource‐Based View of Strategy and Firm Growth*

abstract This paper argues for the important role of customers as a source of competitive advantage and firm growth, an issue which has been largely neglected in the resource‐based view of the firm. It conceptualizes Penrose's (1959 ) notion of an ‘inside track’ and illustrates how in‐depth knowledge about established customers combines with joint problem‐solving activities and the rapid assimilation of new and previously unexploited skills and resources. It is suggested that the inside track represents a distinct and perhaps underestimated way of generating rents and securing long‐term growth. This also implies that the sources of sustainable competitive advantage in important respects can be sought in idiosyncratic interfirm relationships rather than within the firm itself.     

Union responses to ‘multi‐enterprise’ factories in the Italian motor industry

During the 1990s, outsourcing work was commonly associated with the weakening of union organisation and the deterioration of pay, working conditions and job security. A variant of outsourcing, termed here as ‘insourcing’, involves a firm purchasing ‘non‐core’ functions and services from enterprises located under the same roof. This case study of Fiat outlines the impact of insourcing on traditional arrangements and practices, and analyses the response of Italian local unions. The findings indicate that in the context of ‘bargained compromise’ between trade unions and management in the Italian motor industry insourcing did not have the negative implications for union organisation and employee terms and conditions associated with traditional outsourcing.     

Knowledge Networks and Careers: Academic Scientists in Industry–University Links*

abstract Careers are central to our understanding of the knowledge creation dynamics of network organizations. Based on the example of R&D project collaboration between firms and universities, this paper examines the emerging forms of career models that support knowledge flows between organizations. It explores how some large firms in the high‐technology sectors have sought to break away from the limitations of internal R&D and firm‐based careers for scientists by engaging in external collaborative projects to gain access to the open knowledge networks of university researchers. It examines how the firms seek to forge close institutional ties with their university partners and develop network career structures in order to engage academic scientists in joint knowledge production. It argues that firms have sought to extend their human resource and knowledge boundaries into the established internal labour markets of the universities with which they collaborate, leading to the formation of a pool of joint human resources with work experiences and career patterns straddling the two sectors. The paper develops the concept of an ‘overlapping internal labour market’ to provide a conceptual bridge between internal labour markets and network organizations.     

Corporate Governance in China: A Meta‐Analysis

How has the impact of ‘good corporate governance’ principles on firm performance changed over time in China? Amassing a database of 84 studies, 684 effect sizes, and 547,622 firm observations, we explore this important question by conducting a meta‐analysis on the corporate governance literature on China. The weight of evidence demonstrates that two major ‘good corporate governance’ principles advocating board independence and managerial incentives are indeed associated with better firm performance. However, we cannot find strong support for the criticisms against CEO duality. In addition, we go beyond a static perspective (such as certain governance mechanisms are effective or ineffective) by investigating the temporal hypotheses. We reveal that over time, with the improvement in the quality of market institutions and development of financial markets, the monitoring mechanisms of the board and state ownership become more strongly related to firm performance, whereas the incentive mechanisms lose their significance. Overall, our findings advance a dynamic institution‐based view by substantiating the case that institutional transitions matter for the relationship between governance mechanisms and firm performance in the second largest economy in the world.     

Foreign remedies for local difficulties: the case of three Scottish manufacturing firms

Literature on Japanese transplant manufacturing firms in the automotive sector often emphasise the importance placed on attitude as opposed to skills in the hiring decisions for line workers. In this paper, a case study of one second-tier components supplier for a major Japanese automotive assembler in the Midwestern United States provides the opinions of senior managers and human resource associates regarding recruitment and selection practices. In-depth interviews, carried out over a two-week period in August 2000, are used to develop an understanding of the recruitment and selection process for line workers as well as to investigate the desired skills and value of previous Japanese experience. Results of the case study analysis are compared with two models from the literature: (1) a model of recruitment and selection at Japanese automotive-related firms in Japan and (2) a model of recruitment and selection at Japanese transplant automotive-related firms abroad. Deviations from the two models point not to a new paradigm of ‘second-generation’ Japanese transplants – those that have moved into regions quite familiar with Japanese firms and related management and production methods – but rather to overall weaknesses in the stereotypical models. Managerial opinions within the case study firm place limited value on familiarity with a Japanese environment, considering such experience secondary to attitudes and work ethics that are in line with the philosophy of the case study firm.     

Work‐life balance and the software worker

This article examines the impact of employer flexibility to work‐life issues and negative spillover from work to non‐work life on the attitudes of software developers. Software workers present an interesting case for work‐life balance issues – Ackroyd et al (2000) designate them the key occupation to examine in future studies of ‘knowledge workers’, and Barrett (2001) states that they are the ‘vanguard’ of new working practices, with the separation of work and life being substantially more ‘blurred’ than for more traditional occupations. Despite this general perception of the work‐life boundary, our results show that intrusion of work into private life for this group of workers still has a substantial impact on work‐related attitudes. Work‐life boundary variables affect trust in the organisation which plays a mediational role in these variables' relationship to job satisfaction and organisational commitment. Our results suggest that even within this industry, where employees are relatively individualistic in orientation, highly marketable and unlikely to show attachment to a single organisation, mutual gains for employee and employer can be attained by an accommodating approach to non‐work commitments which may lead to greater organisational attachment.     

‘A Land of Milk and Honey’? Reengineering the ‘Past’ and ‘Present’ in a Call Centre*

ABSTRACT This article explores how managers, in the Call Centre of a Bank, (re)defined, and drew boundaries around ‘past’ cultural conditions, in relation to the introduction of a Business Process Reengineering (BPR) regime. Managers represented the ‘past’ negatively, in terms of conflict and coercion, whilst the ‘present’ was largely described as a Shangri‐La of teams and consensus. This eschewing of the ‘past’ and sublimation of the ‘present’ stood in opposition to the representations of the staff. Both the ‘staff’ and ‘managers’ seemed to reject or embrace discourses that challenged or coincided with their understanding of how things are or should be. In view of this, their understanding of the past/present is inseparable from a consideration of power and identity. The article examines the interplay between discourses and individuals, arguing that it is bound up with fear and anxiety, hope and aspiration, memory and nostalgia, among other, everyday life experiences.     

The impact of Investors in People: a case study of a hospital trust

This article reports on case study research conducted in a hospital trust and explores the impact that the Investors in People award had on employees. Investors in People is widely seen as the principal mechanism for increasing workforce skills within a voluntarist system as well as supporting ‘good’ employment policies. Yet in this case study, as elsewhere, most of the ‘soft’ HR initiatives had existed prior to accreditation and the internal marketing of corporate value statements was met with both amnesia and cynicism. More worrying, training activity was focused on ‘business need’, which was defined in the narrowest sense, with the result that some employees had fewer opportunities for individual development. Motivation and commitment levels were high, staff were enthusiastic about their work and many actively engaged in training and development. But this owed little to Investors in People, and its impact here raises questions about its influence on skill levels more broadly.     

Networks to Nerdistan: The Role of Labor Market Intermediaries in the Entry‐level IT Labor Market

Although networks have long governed economic relations, they assume even more importance in a knowledge‐based economy. Yet, some argue that because of the lack of social networks and human capital, some groups are permanently ‘switched off’ the networks of the global economy. Evidence presented in this article suggests that instead there is latent potential for access to the network, due to the rise of networked community‐based organizations and the increasing accessibility of technology. Based on surveys and in‐depth interviews with almost 700 workers and training providers, I show how the switched off are entering jobs in information technology through network ties and the acquisition of soft skills, or communication and interaction skills. Although community‐based training providers are best positioned to help disadvantaged jobseekers enter the network society, changes in the US workforce development system are reinforcing network exclusivity, rather than facilitating this upward mobility.     

A Capabilities Perspective on the Evolution of Firm Boundaries: A Comparative Case Example from the Portuguese Moulds Industry*

ABSTRACT The issue of vertical firm boundaries continues to attract interest both for economics and management research. The transaction cost economics approach, emphasizing transaction‐specific assets and opportunism in order to explain discrete ‘make‐or‐buy’ decisions, dominates the literature. Nevertheless, alternative perspectives, developed under the guise of the capabilities, competence or knowledge‐based theories of the firm, have gained attention recently. They focus on the evolutionary dynamics of boundaries in the context of the division of labour among firms in an industry and on what is to be divided and co‐ordinated – i.e. productive knowledge. The conceptual links between this line of research, which some refer to as neo‐Marshallian, and the Industrial Networks approach are explored in this paper. The paper emphasizes both a vision of firms as sets of direct and indirect capabilities, developed and combined in different ways over time, and the connectedness between inter‐firm relationships. The discussion is illustrated with the cases of two firms, which are contrasted in terms of the dynamic evolution of their boundaries. The analysis made supports the argument that firms’ vertical boundaries reflect their relationships with specific counterparts and the way they address through time the division and integration of knowledge through the configuration of direct and indirect, counterpart specific, capabilities.     

Human resources in the German maritime industries: ‘back-sourcing’ and ship management

In today's global shipping industry have management functions often been outsourced to separate companies and to overseas locations. With the appearance of socalled ‘flags of convenience’ the world shipping industry has increasingly registered commercial vessels overseas. Following this trend, human resource management functions have also been relocated, with the opening of recruitment offices and the use of HR agencies outside OECD countries. Recently, new German regulation has sought to attract previously outsourced HRM functions back to Germany. A case study of such a newly established firm, called ‘Reimarus’, will exemplify the impact of the new regulation on HR firms in shipping. The following paper analyses this process based on an empirical study of Germany's commercial shipping industry.     

Labour-management partnership in the non-union retail sector

Analysts and policy advocates have argued that a meaningful labour-management partnership can be established in the absence of trade unions. In this paper we have examined employee outcomes of partnership in a medium-sized non-union retail firm, regarded as one of the ‘best practice’ cases of non-union partnership by the Involvement and Participation Association (IPA) of the UK. We have also compared the employee outcomes from our case study firm with those from a representative sample of retail sector workers from unionized and non-union retail firms in the UK. Findings indicate that compared to employees in other retail-sector firms, workers in the ‘best practice’ partnership firm were significantly disadvantaged with respect to their influence over workplace and policy decisions with little evidence of ‘mutual gains’ as claimed by partnership advocates.     

‘McJobs’, ‘good jobs’ and skills: job‐seekers' attitudes to low‐skilled service work

This article focuses on unemployed job‐seekers' attitudes towards entry‐level jobs in three areas of the service sector – retail, hospitality and call‐centre work. The article examines whether job‐seekers are reluctant to pursue these opportunities, and provides an analysis of the motives of those ruling out service work. A range of potential barriers is discussed, including the extent to which job‐seekers perceive the service economy as offering only so‐called ‘McJobs’– low‐skilled, low‐paid jobs with few opportunities for development. However, the article also focuses on perceived skills mismatches, with some job‐seekers arguably over‐qualified for entry‐level service jobs, while others consider themselves to lack the necessary ‘soft’ skills. The analysis is based on interviews with 220 unemployed people in Glasgow. The article concludes that policy action may be required to encourage job seekers to consider a broader range of vacancies and to provide tailored training in partnership with service employers. On the demand side, service employers must address the need for entry‐level positions that offer realistic salaries, decent work conditions and opportunities for progression and development.     

Making the cut: occupation-specific factors influencing employers in their recruitment and selection of immigrant professionals in the information technology and accounting occupations in regional Australia

The ongoing underutilisation of immigrant skills has become a topical issue for researchers and policy-makers alike. Within Australia, the majority of studies conducted in this space have adopted either the immigrant or policy-maker perspective, and have utilised human capital theory or labour market segmentation theory to explain the phenomenon. This paper contributes to the existing literature by proposing a novel occupation-specific approach focusing on the employer as a central player in determining labour market outcomes. In this exploratory study, interviews were conducted with 21 employers of accounting and IT employers in the regional city of Wollongong, Australia. The findings suggest that employers of accountants held a greater preference for Australian work experience and qualifications; communication skills beyond English language skills; and emphasised person–organisation fit over person–job fit. Conversely, employers of immigrant IT professionals were more tolerant of overseas-based qualifications and experience; were willing to accept candidates with ‘sub-standard’ communication skills; and were open to personal attribute variations. Immigrant accounting professionals were therefore more likely than their IT counterparts to experience disadvantage when seeking employment opportunities in Australia; a finding that represents important implications for immigrant professionals, policy-makers and employers.     

Employment relations,cost minimisation and inter‐organisational contracting

This article explores and theorises the employment relations consequences of cost minimisation in the management of inter‐organisational contracts for less‐skilled work. Case‐study data reveal that cost minimisation creates and exacerbates employment relations problems, with the ‘success’ of particular tactics dependent on the relative tractability of broader economic conditions and social relationships.     

Work and employment in distribution and exchange: moments in the circuit of capital

This article examines the ‘politics of production’ within grocery warehousing and distribution. In doing so, it highlights the complex linkages between logistics companies and their dominant supermarket customers. Building on the work of Glucksmann and the notion of the ‘total social organisation of labour’, the article reveals how an understanding of employment change within grocery distribution necessarily involves mapping these linkages, thereby examining how they impact on the labour process. Drawing on case‐study evidence from two third‐party grocery distribution companies, it examines empirically the nature of the linkages between these organisations and their effects on the labour process. It also explores the extent to which organised labour within these interconnected distribution companies is able to mediate and re‐shape the requirements placed upon them by their customers. It concludes by highlighting how the power of the retailers and the corresponding ‘logistics revolution’ has reshaped the politics of production. In addition, it calls for an understanding of work and employment in warehousing and distribution, which engages with the complex articulation between production, distribution and exchange.     

Employee development,commitment and intention to turnover: a test of ‘employability’ policies in action

Participation in three types of development activities is examined among salaried employees of a firm that significantly increased access to development after a series of layoffs in the late 1990s. Analyses of survey and archival data representing 667 employees show that on‐the‐job training was positively related to organisational commitment and negatively related to intention to turnover. Participation in tuition‐reimbursement, which provides more general or marketable skills, was positively related to intention to turnover. However, intention to turnover was reduced after earning a degree through tuition‐reimbursement if employees were subsequently promoted. Implications for an employment relationship based on ‘employability’ are discussed.