Knowledge sharing between partners has more upsides than downsides, provided that the right kind of knowledge goes back and forth.
There are two categories of supply chain partners: those that buy and those that sell. Depending on which group they identify with, managers have different perspectives on the value of sharing critical knowledge resources with their supply chain partners. Both groups agree that sharing knowledge makes for more efficient supply chains (with lower costs and quicker speeds) and more effective organizations (with higher quality outputs and enhanced customer service). But the benefits of knowledge sharing don’t always accrue equally or simultaneously to all participants.
In addition, some managers think that knowledge sharing between buyers and suppliers has an underappreciated “dark side” that can outweigh the benefits.1 A common worry is that divulged information regarding technologies, pricing schedules, client bases and processes can be copied or shared with competitors. Another worry is that relying on knowledge flows from other organizations can undermine a company’s flexibility and leave it vulnerable to changes in its partners’ priorities. Despite these concerns, knowledge sharing between supply chain partners offers more positives than negatives, provided that the right kind of knowledge goes back and forth.
What type of information or knowledge should suppliers and buyers share with each other? How does knowledge sharing provide value to buyers and suppliers, and under what circumstances can it help both? How do cross-cultural differences between global buyers and suppliers influence the value of sharing information? To answer these questions, we studied more than 100 cross-national supply chain partnerships in the industrial chemicals, consumer durables, industrial packaging, toy and apparel industries in 19 country locations.(See “About the Research.”) We examined how different types of knowledge sharing can benefit buyers or sellers individually. But more importantly, we studied how knowledge sharing can enhance the performance of partnerships and build stronger supply chains in the global marketplace. We sought to understand not only which companies benefit from cross-border knowledge sharing but also the conditions that lead to knowledge sharing in global supply chains. Many people see knowledge sharing as the result of customer or supplier needs when in fact it is more likely to be influenced by market structures or organizational similarities and dissimilarities between buyers and suppliers.