KNOWLEDGE CREATION IN AN ERP PROJECT TEAM: THE UNEXPECTED DEBILITATING IMPACT OF SOCIAL CAPITAL

Professor Sue Newell (Royal Holloway, University of

London)

+ Jimmy Huang & Carole Tansley

Enterprise Resource Planning Systems New IT system designed to integrate

corporate activities across globe Common IT infrastructure & common

business processes Diffused rapidly but success? Here – consider micro-processes

surrounding design & implementation

ERP Systems cont. ERP vs. BPR BPR – blank sheet ERP – ‘best practices’ Change organization to ‘fit’

technology not vv. (Soh et al., 2000) Business process change rather than

technical problems key (Holland & Light, 1999)

Research Focus In-depth case study of project team Design

Configure system Integration of knowledge dispersed within

& across organizations (Lee & Lee, 2000) Implementation

Modification/ introduction of org. processes

Gain commitment from users

Project Team Selected on basis of intellectual

capital AND Social capital (Nahapiet &

Ghoshal, 1998) Broadens reach of project team Social capital mobilized to access

knowledge & gain commitment

Definitions (Nahapiet & Ghoshal, 1998) Intellectual capital – the knowledge and

knowing capability of the collectivity Social capital – the sum of actual and

potential resources within, available through, and derived from the network of relationships possessed by an individual or social unit. Social capital thus comprises both the network and the assets that may be mobilized through the network

Research Methodology Ethnography – study of the culture(s) a

given group more or less share (Van Maanen, 1988); to understand fundamental meanings (Kakabadse, 97)

On-site observation over 18 months Semi-structured interviews with project

team members and process owners Interviews with project leader monthly

Case – Quality Engineering Ltd (QEL) HR pillar of large organization-wide

ERP project (SAP/R3) Replaced 1600 legacy systems 2 ‘waves’ of implementation HR forgotten! But recognized as

central

Project Team

HR ERP project initiated by HR Director But no interest in IT! Passed over initiative to Nick & team

Project Team Nick (project team leader)

Project Team Caroline IT skills, PT, strategic career reasons

Project Team Bob HR exp., no IT skill, cut-off from

Bristol

Project Team Robin payroll, IT skills dev., maintained links

Project Team Susan line role - unhappy, permanent search

Project Team Rebecca placement student, excited –

frustrated

Project Team + 2 IT outsourced company personnel no ERP experience, no business

involvement, never seen job through to completion!

HR ERP Project Team Diverse knowledge needed for project Personal goals & desires Nick – emphasized risks Tendency to face outwards rather than

inwards Used personal networks for personal

objectives Little team cohesion (quotes p. 12/13)

Team Activitives ‘Work package owners’ Senior managers – ‘process owners’

Based on functional role Little involvement or interest HR Director similarly uninterested (e.g.

conference) Justification problematic –

demoralizing Eventually project put ‘on hold’

Discussion & Analysis Nahapiet and Ghoshal – social capital

seen as generally beneficial for org. Here used for personal goals Social capital as a private vs. a public

good (Leana & Van Buren, 1999) Project team – need balance between

interests of individual & collective Requires conscious effort to create

balance

Strategic Exchange Watson (1994) Strategic exchange perspective

Personal goals and project goals Project goals over-ridden by personal

goals in context of insecurity Social capital distracted from focus on

project goals Knowledge sharing community not

developed

Conclusions Social capital – appropriable

organization Here appropriated for personal

gain Effects of social capital ambivalent Strategic exchange – heuristic

device

Model of the impact of low commitment and project priority on the appropriation of social capital and project team community development.

Context

Low seniormanagementcommitment

Low projectpriority

Project TeamInteraction

Outward-facingproject teammembers

Social CapitalAppropriation

Appropriated for personalgoalfulfillment

Project TeamCommunity

Little knowledgesharing &integration within team

Strategic Exchange

PersonalGoals/Desires

Project Goals/Requirements

Strategic Exchange in QEL Case

Personal goals/ desires

Project goals/requirements

Project team insecurity

Project Team

IDEAL SITUATION CASE REALITY

Social Capital

Ideal type - use Project reality – use SC forSC for benefit of project personal benefit

Innovation Processes and Social Capital

Innovation Episodes (Robertson et al.,) Agenda formation Design Implementation Appropriation

Innovation Processes and Social Capital Social Capital (Adler and Kwon)

Bridging vs Bonding emphasis Source

Structure – closed (Coleman), open (Burt) Content – relational (trust and norms)

and cognitive (shared understanding) embeddedness

Effects

Innovation and Social CapitalAgenda formation

Design Implemen-tation

Appropria-tion

Bonding Bridging Bonding Bridging

Closed Open Closed Open

Consumm-atory

Instrumen-tal

Consumm-atory

Instrumen-tal

Kn.sharing

Kn. access

Kn.sharing

Kn.access

Team building

Network building

Comm. building

Kn. Hub building

Inn.Episode

Focus

Structure

Content

Effects

Types ofSC

Agenda formation

TeamBuilding(bonding)

Design

NetworkBuilding(bridging)

Implementation

CommunityBuilding(bonding)

Appropriation

KnowledgeHub Building(bridging)

Figure 1. The relationship between the innovation episode and the focus of social capital