A process model of tacit knowledge transfer between sales and marketing

Highlights

• Trust is built through outcomes of socialization efforts.

• Interfunctional communication quality is a crucial factor for tacit knowledge transfer.

• Mutual understanding is important for tacit knowledge transfer.

• Top management support also encourages tacit knowledge transfer.

• Healthy relationships between sales and marketing organizations are important for improved tacit knowledge transfer.

Abstract

Although an ability to generate and transfer tacit knowledge provides the basis for competitive differentiation, organizations face two primary issues when attempting to achieve this task. First, tacit knowledge, which differs from explicit knowledge in that it can only be gained through experiences, deep interactions, and learning by doing, is highly complex and therefore difficult to transfer. Second, as challenging as tacit knowledge transfer may be under the most ideal circumstances, the issue is exacerbated by the fact that sales and marketing professionals oftentimes have a dysfunctional relationship. Addressing these issues, we present and examine a theoretical model which captures the process through which tacit knowledge transfer occurs across the two functions. Study results, derived from a sample of 215 salespeople, highlight the important role interfunctional communication quality and the development of a mutual understanding play in this process. We discuss the theoretical and managerial implications arising from the study, and present opportunities for further research in the area.

Introduction

In an increasingly chaotic marketplace characterized by constant change and heightened customer demands, knowledge has come to the fore as a preeminent resource capable of providing organizations enduring positions of marketplace superiority (Hunt & Morgan, 1995). Organizations that are effective in acquiring and disseminating knowledge related to their customers and competitors outperform their rivals (Jaworski & Kohli, 1993; Slater & Narver, 1995), primarily because knowledge is a complex, higher-order resource that cannot be easily imitated (Hunt & Morgan, 1995). Recognizing this, organizations have invested significant resources to facilitate the dissemination of knowledge to ensure that all in the organization have access to it when making decisions. As an example, the global customer relationship management (CRM) software and support market is expected to grow to over $40 billion dollars by 2023 (Liu, 2019). However, any technology is only as good as the knowledge contained within it, and not all knowledge is created equal. Many technologies are particularly effective at collecting and transferring explicit knowledge which, although valuable, does not provide a deeper level of understanding that is captured through more engaging activities. In contrast, tacit knowledge - knowledge that is “rooted in action, procedure, routines, commitment, ideals, values, and emotions” (Nonaka & von Krogh, 2009, p. 636) - is difficult to disseminate and more pivotal in the delivery of customer value. In addition, as Polanyi (1966) suggests, tacit knowledge, important in its own regard, is also key to our understanding and application of explicit knowledge. Moreover, tacit knowledge improves a variety of business and marketing outcomes (Arnett & Wittmann, 2014; Cavusgil, Calantone, & Zhao, 2003; Ganguly, Talukdar, & Chatterjee, 2019; López-Cabarcos, Srinivasan, Göttling-Oliveira-Monteiro, & Vázquez-Rodríguez, 2019; Wu & Lin, 2013). Yet, developing and sharing it is challenging even in the best of situations because it can only be gained through experiences, deep interactions, and learning by doing (Hirunyawipada, Beyerlein, & Blankson, 2010; Nonaka & von Krogh, 2009). It often relies significantly on social interaction. However, when those involved in knowledge sharing lack a cooperative relationship (e.g., marketing and sales), the results are less certain.

Though the topic of tacit knowledge has captured the attention of researchers in many disciplines, a thorough understanding of how it is transferred within organizations and in turn how to develop concrete strategies to enhance its acquisition and use is still elusive. Studies span a number of topics important to the firm, including tacit knowledge transfer within multinational corporations (Guo, Jasovska, Rammal, & Rose, 2020; Sheng, Hartmann, Chen, & Chen, 2015), joint ventures (e.g., Park, Vertinsky, & Lee, 2012), strategic alliances (Becerra, Lunnan, & Huemer, 2008; Qiu & Haugland, 2019), and teams (Andrews & Smits, 2018: Kögl & Silvius, 2019). Much of the research examining tacit knowledge transfer focuses on factors that directly affect knowledge sharing (e.g., trust, conflict, and communication quality) (see e.g., Arnett & Wittmann, 2014; Becerra et al., 2008). In this study, we suggest that such factors have an indirect effect on tacit knowledge transfer, rather than a direct one. We propose that mutual understanding, an under researched concept in this area, mediates the relationship between such factors and tacit knowledge transfer. As Guzman and Wilson (2005) maintain, mutual understanding provides a relational foundation, which facilitates the sharing of tacit knowledge.

As challenging as tacit knowledge transfer may be under the most ideal circumstances, sales and marketing professionals oftentimes compound the process with their dysfunctional relationship. “Marketing blames the sales force for its poor execution of an otherwise brilliant rollout plan” while “sales departments tend to believe that marketers are out of touch with what's really going on with customers” (Kotler, Rackham, & Krishnaswamy, 2006, p. 68). Conflict, disharmony, and distrust (Hughes, Le Bon, & Malshe, 2012; Kotler et al., 2006) create environments where individuals from both functions end up ignoring and antagonizing one another. Even though salespeople are ideally positioned to gather and share market-based information (Arnett & Badrinarayanan, 2005; Pass, Evans, & Schlacter, 2004), firms struggle with when the marketing and sales functions are not well aligned. As a result, tacit knowledge transfer between sales and marketing provides a crucial testing ground for examining the factors that affect tacit knowledge transfer.

By focusing on tacit knowledge exchange between the sales and marketing functions, we seek to improve our understanding tacit knowledge sharing within organizations by examining factors commonly associated with the marketing-sales relationship and quantifying their roles in either supporting or inhibiting tacit knowledge transfer. We present and test a theoretical model which captures a process through which tacit knowledge transfer occurs across the two functions. The remainder of this paper is organized as follows. In the section that follows, we provide an overview of our theoretical foundations and the rationale for our hypotheses. We then discuss our methods and corresponding results. We conclude with a general discussion that focuses on key theoretical and managerial implications.