Gift Economy
- Dr. Edna Pasher
- Sep 1, 2001
- 5 min read
Based on our experience in knowledge management within organizations, we have found that a culture of knowledge sharing is a necessary condition for the effective management of this strategic asset. Without it, even the most sophisticated procedures and excellent information systems will not suffice. In a place where employees believe that sharing their knowledge with others will lead to a loss of power, and requesting knowledge from others will expose their weaknesses, no effort to advance knowledge management will succeed.
Last April, additional research focusing on this issue was presented at an academic conference at the University of Leicester in Britain: How do we motivate employees to share their knowledge with others, and how do we prevent the phenomenon of keeping personal knowledge as a power source and its loss to the organization when the employee leaves?
The research is based on economic exchange theory, which posits that in every transaction, we choose between alternatives according to the criterion of maximizing benefit at minimum cost, and focuses on social exchange theory.
The assumption is that in social life, as in business, people satisfy their needs and desires through relationships with others. Already in the 1950s, studies dealt with the "gift economy," in which exchanging gifts is a moral obligation, and according to which there are no gifts. You give and expect to receive something back in the future. We can learn about the issue of knowledge sharing according to this theory.
The assumption is that the individual owns knowledge, and only they will decide whether to share it with others or not. To entice people to share their knowledge with others, they must be convinced that it is worthwhile for them to engage in such a transaction. It should be emphasized that the knowledge giver feels that they are not only giving a product of hours of work, but also giving something of themselves, their time, and their life. They expect compensation for this gift. If compensation is denied, this will harm their motivation. The research distinguishes between "hard" or explicit compensation and "soft" compensation.
Examples of "hard" compensation include:
Bonuses - IBM offers a bonus that is divided between the knowledge creator and the knowledge user.
Availability of knowledge and information from others - at Toyota, production knowledge is shared with all component suppliers in the network in exchange for the information and knowledge they also contribute.
Promotion - In large consulting companies, a consultant becomes a partner based on colleagues' recommendations about their level of cooperation with others.
Examples of "soft" compensation:
Partnership in a knowledge community - membership in a thriving learning community where everyone shares knowledge with everyone.
Building personal reputation - peer appreciation is the most significant "soft" form of compensation. It was found that the more emphasis researchers placed on scientific publications in developing new drugs, the higher the rate of new drug introduction to the market.
Personal satisfaction from helping friends - in a Silicon Valley company, it was found that the willingness to help friends (in the spirit of gift culture) in competing companies to solve technical problems is higher than the commitment to employers.
Organizational Environment Supporting Knowledge Sharing
The research found organizational factors that encourage knowledge sharing:
Knowledge sharing is a clear responsibility of employees - it is clear to every employee that this is expected of them, like meeting other tasks. It is clear to them that they are responsible for developing expertise and disseminating it. Examples found in organizations are project debriefs, mentoring, measuring knowledge sharing, and institutionalizing regular times for learning and mutual assistance among employees. At GENERAL ELECTRIC, they encourage "stealing" and "copying" others' ideas. At CITYBANK, they required employees to enter content into a database, and only then did it begin to grow.
Encouraging trial and error - taking risks is crucial for organizations that aim to create new knowledge, as it is often generated through trial and error. Often, there is a strong preference in the organization for systematic analysis over intuition, to the point where no one dares to suggest an idea without supporting data. Therefore, permission to try, at least in the employee's immediate work environment, is crucial. Experiments can be encouraged in various ways: encouraging local initiatives, even if they are not entirely within the organization's strategy framework; allowing failure if it is the result of an experiment; giving autonomy so that employees can deviate from their job definition in search of new knowledge; creating real opportunities for free conversation; in a virtual environment - allowing anonymity to encourage people to contribute controversial ideas; publishing success stories related to the business results of knowledge sharing; encouraging new business models like franchising, which allows employees to try new work methods with some support; creating work environments where trust is high.
Valuing all knowledge contributions regardless of the status of the knowledge creator - early research by Lévi-Strauss (1969) on social exchange theory identified that exchanges occur when players have equal status. Organizations need to diminish the importance of the knowledge holder's status. If this message is embedded in the organization, even those who are shy about contributing or exposing their lack of knowledge will contribute their questions and answers. The conditions must be such that potential knowledge sharers know that in a knowledge community, everyone knows something of value.
Cultivating knowledge communities - Peter Drucker argues that "in a knowledge economy, all employees are volunteers, but managers have been trained to manage conscripts." There is great importance in cultivating knowledge communities as an organizational pattern, driven by the desire and enthusiasm of knowledge workers to share their expertise. Employees who feel that the organization supports them tend to reciprocate with better performance and "good citizenship," which leads to business achievements. The research describes a law firm where the emphasis placed on norms of openness, teamwork, organizational loyalty, and cooperation among employees was a key factor in its business success.
Information systems supporting knowledge sharing (ICT - Information and Communication TECHNOLOGY) - people tend to use them when they are easy and useful. Knowledge sharing through information systems will increase when the technology is user-friendly and intuitive. Organizations have discovered that new systems must be introduced gradually. At Chevron, they created a partial intranet solution for sharing information about successes. After failing to find a complete solution, they settled for creating pointers to people who had succeeded and allowed users to contact them, rather than expecting the successful ones to enter the entire story into the system themselves.
These factors do not involve the direct reciprocity that exists in exchange transactions between individuals trading in private assets, but rather create conditions in which knowledge can be treated as a public good. In such situations, knowledge exchange transactions are driven by moral obligation and community interest, rather than personal interest.
We have learned, therefore, that a culture of knowledge sharing cannot rely on altruism. It requires creating a "knowledge market" in the organization, where people share knowledge with each other and thus contribute their assets to the organization in a method similar to the "gift economy." There are no free knowledge gifts. You give, but you also expect to receive.
The article was published in The Marker newspaper and written by Dr. Edna Pasher, CEO of Dr. Edna Pasher & Associates Management Consultants Ltd., a company specializing in strategic processes and knowledge management, and founding partner of "Status - Monthly for Management Thinking." Dr. Pasher also lectures at Tel Aviv University.
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