Opposites attract

How to transfer knowledge across different industry domains

Hilda Bø Lyng

• Publisher: De Gruyter
• Year: 2020
• ISBN:
  9783110686753
• Edition: 1
• Topic: Negocios y empresa
• Subtopic: Capital del conocimiento

Cross-industry innovation introduces a dilemma for the innovation process. On one hand, there is a broad consensus in research that diversity in knowledge leads to increased levels of novelty in innovation. On the other hand, the crossing of industries boundaries is known to cause knowledge boundaries between actors. This book contributes to this end, by the development of new understanding of important aspects in cross-industry innovation.

The empirical bases for this research are case data from the Pumps & Pipes association in US and Norway (conferences and 7 Norwegian cross-industry collaborations), and cross-industry cases from the Norway Health Tech cluster.

1 Introduction

It was six men of Indostan

To learning much inclined,

Who went to see the Elephant

(Though all of them were blind),

That each by observation

Might satisfy his mind.

.....

And so these men of Indostan

Disputed loud and long,

Each in his own opinion

Exceeding stiff and strong,

Though each was partly in right,

And all were in the wrong!

The Blind Men and the Elephant

by John Godfrey Saxe (1871)

The famous poem The Blind Men and the Elephant by John Godfrey Saxe is based on an ancient Hindu fable of six blind men who seek to explore the true nature of an elephant. They all chose to explore different parts of the elephant, and all therefore ended up with different perceptions of it. These different perceptions, as shown in the second verse (which is the second to last verse in the original), led to disputes on the nature of the elephant. They were, however, all right, and at the same time all wrong, as they all failed to discover the whole of the elephant. The poem is therefore an excellent illustration of how different actors can possess different perspectives of a single phenomenon, based on their previously contextualized presumptions, and how this can lead to barriers between those involved. This poem can therefore be used to shed light on the challenges faced in collaborations that involve actors who originate from very different contextual backgrounds.

The phenomenon studied in this research is knowledge transfer in cross-industry innovations, between actors from foreign industries who are working together towards a shared innovative outcome.¹ The term foreign industries refers, in cross-industry settings, to industries “which are not operating in the industry sector of the respective focal organization and does not have anything to do with boarders between countries” (Dingler & Enkel, 2016, p. 50). Education in, and work experience from, highly different industries, mean that actors possess different contextualized presumptions. This leads them to interpret and understand new knowledge and problems in different ways, contextualized differences affecting the interests and focus of the actors, and therefore determining where they focus their attention. The result of this may therefore be that cross-industrial actors choose to explore and focus their attention on different parts of the “elephant”, so infusing barriers that hinder shared understanding and collaboration.

A broad consensus has been established in research that diversity of knowledge and experience, despite this hampering collaborations, leads to higher levels of novelty and creativity in innovation. Cross-industry innovation, in which knowledge and competences are transferred and combined across industry sectors, therefore holds a vast potential for radical innovation. There are therefore strong incentives for being able to manage and successfully carry out cross-industry collaboration. To do so the involved actors need to discover new and relevant knowledge in a highly unfamiliar knowledge domain, integrate and combine this new knowledge into their own contextualized knowledge, and then find ways to overcome the knowledge barriers present between cross-industry actors. Firms that succeed in overcoming all these challenges, may be able to unlock the potential of cross-industry innovation and reap the rewards.

The contextual backdrop of this research is the petroleum recession which began in 2014. Norway is highly dependent on the petroleum industry and was strongly affected by this. This recession therefore required the Norwegian government to initiate an industrial transformation process to promote growth in new industry sectors. Norway has world leading knowledge and competence in the oil and gas sector. However, new areas needed to be found into which these resources could be transferred and reused. Several initiatives were started to facilitate new growth in new industry sectors, a number of industry sectors being emphasized – ICT, food/nutrition, energy, healthcare and health technology. The research reported in this book focuses on the development of health technology through cross-industrial knowledge transfer.

A Norwegian branch of the US Pumps & Pipes association was established in 2015, as an instrument of the industrial transformation process. The formation of the Pumps & Pipes association is an intriguing story that is worth telling. A cardiovascular surgeon and a drilling engineer were sitting next to each other on a flight back to Houston. They were both working on their laptops, when they discovered some important analogies between their fields. They concluded from this conversation that they both worked with pumps and pipes, whether for drilling for oil, or in heart surgery. This conversation was the initiation of the Pumps & Pipes association, whose stated mission is to (Pumps & Pipes, 2020):

• provide a platform to bring together professional groups who may not otherwise have the opportunity to interact, for knowledge and technology transfer.
• be the leader in promoting cross-industry collaboration to solve challenging Pumps & Pipes problems.
• help strengthen the education on offer in Science, Technology, Engineering and Mathematics (STEM).

Pumps & Pipes included the aerospace industry into the association in 2012, NASA being at the forefront of this, and as their mission shows, the Pumps & Pipes association is also heavily involved in academia. The home of the US Pumps & Pipes association is Houston, where the medical, petroleum and aerospace sectors are the three most influential industries. The directors of Pumps & Pipes are therefore from medicine, energy, aerospace and academia. Pumps & Pipes has held an annual conference since 2007 to bring together professionals from these very different areas to share knowledge, technology and experiences across industry domains. The founding organizations behind this conference have been Exxon Mobil, Houston Methodist DeBakey Heart & Vascular Center, NASA and the University of Houston. A quote by one of the founders of Pumps & Pipes, describes well the purpose of the annual conference in 2014:

This is really a platform about meeting people. It’s not about sitting here, listening to breakout sessions. We want you to walk around and talk to people. The theme here is ideas to insight. Take those ideas and talk to someone outside your comfort zone, and figure out how you can take their concepts and use it in your industry. We called this looking into the other guy’s toolkit.

(Pumps & Pipes, 2020)

“Looking into the other guy’s toolkit” has become the slogan of the Pumps & Pipes association and reflects the association’s objective, which is to open up our minds to the potential inherent in the crossing of industry boundaries.

The Norwegian branch of the Pumps & Pipes association was the first satellite of the US association. It was seen to be a facilitator for reusing the world leading knowledge and technology developed in the petroleum industry, to develop innovations in new industry sectors. Pumps & Pipes Norway received funding from the Norwegian government to initiate projects that specifically made use of petroleum knowledge and technology to solve medical problems. A call for applications was issued, and eight projects received financial support from Norway Pumps & Pipes. Seven of these projects are used as empirical cases in this research. The Pumps & Pipes cases will be explained in more detail in the case description section.

Norway Health Tech is a Norwegian cluster of health technology companies with more than 200 members and represents firms from the entire value chain within the health technology sector. The cluster plays an important role through supporting and accelerating the development of new health tech products, services and innovative solutions in the Norwegian, and the global market. It also provides a network for knowledge transfer. Norway Health Tech has been granted the Cluster Organization Management Excellence Label GOLD, which is the highest quality level for clusters in the EU (Norway Health Tech, 2018).

The Norway Health Tech cluster facilitates contact between cross-industry partners and emphasizes the use of cross-industrial knowledge and technology in the development of new health technology innovations to their member firms. The cluster therefore has established a focus on cross-industry knowledge transfer.

The Norway Health Tech cluster has, in recent years, been engaged in the project “Cross4Health” with 6 European technology clusters (Innovation Skåne, Zenit, Aerospace Valley, EuroBcreative, Biotecyl, Optimizing Value Chain for Health and Innovations). Cross4Health is funded by the European Commission Framework by the Horizon 2020 program for 2.5 years. Cross4Health seeks to develop product opportunities within aerospace, biotechnology, energy, ICT, and medical devices based on knowledge and technology transfers across the industries involved. Cross4Health provides funding and innovation services to projects that involve at least one organization from the energy or the aerospace industry, and that engages in collaborations for the development of health technology innovations (Cross4Health, 2018).

The contextual backdrop presented above illustrates the motivation and social relevance of this research. The intention of this study is not, however, to provide a contextual understanding of what took place during the petroleum recession, but to provide a better understanding of the means of accomplishing innovation across industry boundaries at the micro-level. There is a wealth of research that addresses knowledge transfer across knowledge boundaries for innovation purposes. This stream of research is, however, mainly discussed within the confines of individual firms or industries (Bechky, 2003; Carlile, 2002; Carlile, 2004; Dougherty, 1992; Dougherty & Dunne, 2012). It is therefore ambiguous whether existing research on knowledge boundaries is valid for settings where the distance between actors increases to involve foreign industries. Actors within a firm will, even where they are part of different occupational communities, still share the same organizational culture and goals (Berends, Garud, Debackere, & Weggeman, 2011). There is, however, likely to be a large gap between the organizational culture, objectives and thought worlds of actors originating in foreign industries. When heterogeneity increases among collaborative actors, the level of resources required for knowledge transfer also increases (Hacklin & Wallin, 2013).

The cross-industry innovation literature (Brunswicker & Hutschek, 2010; Enkel & Bader, 2016; Enkel & Gassmann, 2010; Gassmann & Zeschky, 2008) emphasizes the inclusion of foreign industries in developing innovations. The focus of this stream of literature is on the potential of cross-industry innovation in knowledge discovery (input), and on the antecedents of cross-industry innovation, and innovation outcomes (output). There is, however, a gap in this literature around the understanding of how actors develop understanding despite different professional languages, how the integration of highly unfamiliar knowledge takes place between cross-industry actors, and how knowledge barriers are affected by increased levels of relational distances between actors at the micro-level. There is therefore a need for new theory to address the micro-level mechanisms that take place at the continuum between input and output phases in cross-industry settings.

New research has also been requested into the understanding of innovation practices and mechanisms in boundary spanning. The request is more specifically for descriptions of the differences between the actors involved in boundary spanning (Rau, Neyer, & Möslein, 2012). Literature on relational distances (Boschma, 2005; Fitjar, Huber, & Rodriguez-Pose, 2017; Knoben & Oerlemans, 2006; Parjanen, Melkas, & Outila, 2011) was found valuable and has been integrated into the studies carried out to meet this request. The literature on relational distances provides a framework for classification of different relational distances between actors. This stream of literature is however primarily used in regional geography studies and is therefore empirically based at the macro-level. There is therefore a need to explore how relational distances are associated with micro-level mechanisms in cross-industry settings.

This research therefore opts to close some of the key theoretical gaps in successful cross-industry innovation. The overarching question of this research is; How can knowledge be transferred across highly different industries for the purpose of innovation?

Knowledge transfer is, however, a multidimensional topic. The development of new understanding of knowledge transfer in cross-industry innovation will therefore include many different perspectives. Different streams of literature are therefore integrated to provide clarity to the phenomenon studied. This research, through this, opts to provide an integrated and holistic understanding of important mechanisms of micro-level processes of knowledge transfer in cross-industry innovation, and therefore extend the individual perceptions of “the elephant”.

Interest in cross-industry innovation has increased in recent years, as a response to the need for solving complex technological and social problems, where no single discipline or industry can provide all the knowledge required. The need for combining highly different knowledge domains is, however, not a new phenomenon, as shown b...