– Thoughts on Strategy and Management

The preference for know how from outside

In Germany we have a saying: “A prophet has no honour in his own country”. (According to a source in the Internet this saying is quite well known; the fundament is: John 4:44). This can be applied to the corporate world: The ideas of others (e.g. external consultants, other companies) will be more considered than internal ideas.
The preference for external knowledge and ideas can cause huge problems, since companies start to reinvent the wheel. That means also wasting resources. According to a research by Tanya Menton and Jeffrey Pfeffer “Valuing Internal vs. External Knowledge: Explaining the Preference for Outsiders” the reason for the preference has got a psychological background: Many employees treat good ideas from their colleagues as a thread. This thread by an internal rival for the self-perception has an impact on the willingness to accept his (internal) ideas and knowledge.

Hence the study can explain why companies have problems to set up a learning organisation. In order to address this issue managers are recommended to identify how and to which extend “ego threads” work in their organisation.

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