Linn Langangen: 0835194 Maja Øidne Korsen: 0776757

‘BI Norwegian Business School – Thesis’

- Competence Development in Professional Service Firms A Cross-Cultural Study of Professionals in France and Norway

Date of Submission:

01.09.2011
Supervisor:

Bente Løwendahl
Study Program:

Master of Science in International Marketing and Management

This thesis is a part of the MSc program at BI Norwegian Business School. The school takes no responsibility for the methods used, results found and conclusions drawn.

GRA 19402 – Master Thesis

Competence Development in Professional Service Firms

Content
CONTENT ......................................................................................................................................... I   ABSTRACT .................................................................................................................................... III   ACKNOWLEDGEMENTS .......................................................................................................... IV   1.0 INTRODUCTION ..................................................................................................................... 1   1.1 INTRODUCTION OF THE RESEARCH TOPIC AND RESEARCH QUESTIONS ................................... 1   1.2 MOTIVATION FOR- AND VALUE OF THE RESEARCH ................................................................. 2   1.3 KEY TERMS .............................................................................................................................. 4   1.4 STRUCTURE OF THE THESIS ...................................................................................................... 6   2.0 THEORETICAL BACKGROUND ......................................................................................... 7   2.1 NATIONAL CULTURE ................................................................................................................ 7   2.2 PROFESSIONAL SERVICE FIRMS ............................................................................................. 11   2.2.1 Characteristics .............................................................................................................. 11   2.2.2 Value Creation in PSFs ................................................................................................. 14   2.2.3 Management Consulting ............................................................................................... 15   2.3 RESOURCES WITHIN PSFS ...................................................................................................... 19   2.3.1 Resource-Based View of the Firm ................................................................................. 19   2.3.2 Tangible and Intangible Resources within PSFs .......................................................... 20   2.3.3 Competence ................................................................................................................... 21   2.3.4 Knowledge Management and Methods of Knowledge Transfer ................................... 27   2.4 DEVELOPING AND USING COMPETENCE WITHIN PSFS ........................................................... 30   2.4.1 Contributors and Constraints to CD ............................................................................. 30   2.4.2 Evaluating CD ............................................................................................................... 31   2.4.3 Process for Utilization of Competence ......................................................................... 34   2.5 SUMMARY .............................................................................................................................. 35   3.0 RESERCH METHODOLOGY .............................................................................................. 37   3.1 CHOICE OF DESIGN AND RESEARCH METHOD ....................................................................... 37   3.1.1 Case Studies .................................................................................................................. 38   3.2. DATA COLLECTION AND CONTEXTS ..................................................................................... 40   3.2.1. Industry Details ............................................................................................................ 40   3.2.2. Respondents .................................................................................................................. 40   3.2.3 Interviews and Written Material ................................................................................... 44   3.2.4 The Interview Process and Transcription ..................................................................... 44   3.2.5 Interview Concerns ....................................................................................................... 46   3.3 DATA ANALYSIS .................................................................................................................... 48   3.4 RESEARCH QUALITY .............................................................................................................. 49  

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3.5 PRESENTATION OF THE FINDINGS .......................................................................................... 53   3.6 SUMMARY .............................................................................................................................. 54   4.0 FINDINGS, ANALYSIS AND DISCUSSION....................................................................... 54   4.1 CULTURE................................................................................................................................ 55   4.1.1 National Culture ............................................................................................................ 55   4.2 CD THROUGH INVESTMENTS ................................................................................................. 60   4.2.1 Mentor Programs and Support Systems ........................................................................ 60   4.2.2 Courses and Training .................................................................................................... 65   4.2.3 Evaluations and Measurement ...................................................................................... 72   4.2.4 Technical Tools ............................................................................................................. 76   4.3. CD THROUGH DAILY OPERATIONS ....................................................................................... 85   4.3.1 Learning by Doing ........................................................................................................ 85   4.3.2 Learning from Others .................................................................................................... 92   4.4 SUMMARY .............................................................................................................................. 98   5.0 CONCLUDING REMARKS AND MANAGERIAL IMPLICATIONS ............................ 98   5.1 CONCLUDING REMARKS ...................................................................................................... 100   5.2 MANAGERIAL IMPLICATIONS ............................................................................................... 101   5.2.1 Communication – the Crucial Glue ............................................................................ 101   5.2.2 Aligning Firm Goals with CD of Professionals .......................................................... 103   5.2.3 Supporting the Contributors and Reducing the Constraints of CD ............................ 104   5.3 LIMITATIONS ........................................................................................................................ 105   5.3.1 Choice of Literature and the Issue under Investigation .............................................. 105   5.3.3 Methodology .....................................................................Error! Bookmark not defined.   5.3.1 Choice of Literature and the Issue under Investigation ...Error! Bookmark not defined.   5.3.3 Methodology ................................................................................................................ 106   5.4 SUGGESTIONS FOR FURTHER RESEARCH .............................................................................. 111   REFERENCES............................................................................................................................. 113   APPENDICES .............................................................................................................................. 130   APPENDIX 1: INFORMATION LETTER SENT TO COMPANIES IN FRANCE ....................................... 130   APPENDIX 2: INFORMATION LETTER SENT TO COMPANIES IN NORWAY ..................................... 131   APPENDIX 3: ENGLISH GENERAL INTERVIEW GUIDE ................................................................. 132   APPENDIX 4: NORWEGIAN GENERAL INTERVIEW GUIDE ........................................................... 134   APPENDIX 5: PRELIMINARY THESIS REPORT ............................................................................. 136  

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Abstract
Competence has received increased interest over the past decades as it is identified as an important contributor to value creation in firms. Professional service firms (PSFs) are in relations to this, deemed interesting to study, as they serve as role models in the development of resources for value creation, and are competing on competence as they are identified as highly knowledge-intensive. This study set out to investigate how competence is developed in PSFs and the main contributors and constraints to competence development (CD). Also our cultural knowledge and experience with France created perceptions that differences could occur in relation to how CD is influenced across borders. Therefore we aimed to include a cross-cultural aspect in this study. Based on a qualitative case study of professionals in France and Norway, altogether 37 cases, the results are the following: We found that firms down-prioritized CD of their professionals. The focus

and understanding of its importance seemed to be present, however clients and business development were often given higher priorities. • Culture influences CD in the way that it affects especially the culture for sharing and asking questions within- and across borders. Communication has been identified through our findings as crucial “glue” for CD. • CD through investments made by the firms and daily operations are two important routes to development whereof the latter, namely CD through daily operations, served as the most crucial route for all professionals in both countries. • Differences across levels of newly employed, seniors and partners and how they develop competences do exits, however far more similarities than differences can be found, also across borders. After studying CD and viewing it as an intangible resource within PSFs, we question if PSFs can still be viewed as role models in terms of CD. Also, whether CD is vital for the PSFs competitiveness can be questioned as these firms are down-prioritizing this. Key words: culture, professional service firms, professionals, competence development. Page iii

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Acknowledgements
We offer our sincerest gratitude to our supervisor, Professor Bente Løwendahl, who has supported us throughout our thesis with her patience, suggestions, comments and knowledge, whilst allowing us the room to work in our own way. Thank you for supporting us throughout this challenging process, and for sharing your valuable information and knowledge, and providing us with fruitful insights, discussions and constructive guidance. You are our Mentor! We would also like to thank all of our respondents in the different PSFs both in Paris and Oslo. Thank you all for taking the time in your busy schedules to contribute to our sample, making this master thesis possible. We highly appreciate the trust and openness that you have all shown us, resulting in many interesting and fulfilling interviews, serving as fundamental information for our study. Furthermore, we would like to thank Professor Siw Fosstenløkken. Through her doctoral dissertation we found the motivation to continue her work on competence and competence development, across borders. Lastly, our sincerest gratitude also goes to the people close to us who have been there all the way supporting us.

Oslo, September 1st, 2011 Linn Langangen Maja Øidne Korsen

Enquiries about this master thesis can be sent to linn.langangen@student.bi.no or e102153@escpeurope.eu

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1.0 Introduction
1.1 Introduction of the Research Topic and Research Questions

The purpose of this study is to analyze how professionals develop competence emphasizing on identifying the main contributors and constraints to competence development (CD). The aim was to perform a cross-cultural analysis between France and Norway to explore if there are any differences on how competence is developed among the French and Norwegian professionals. We are in our study solely focusing on the industry of management consulting. The overall research question can thereby be presented as the following: How does competence development take place in PSFs in Norway and France? Culture will in this thesis have a predominant role for the analysis and interpretation of the findings at later stages. Thereby we have introduced Hofstede’s cultural dimensions (2001). The main differences between the two countries that might be relevant are ‘individualism’, ‘power distance’, ‘uncertainty avoidance’, and ‘masculinity’. When referring to the professionals’ nationality we hereby discuss the French and Norwegian culture despite the multinational working environment within PSFs. We will elaborate more on this matter within the second chapter of this study. The thesis is focused on a collection of international management consulting firms situated in the two countries. The logic behind the locational choices is that both of us have studied in France, hence we found it interesting to make the most out of this experience by introducing an international perspective in our study. We have paid attention to how CD takes place. Tsoukas (1996) stressed that it is important to study how employees say that they develop competence, going beyond what companies and partners state that they do in this matter. Itami (1987) emphasizes the need to regard particular learning investments made by the firm as well as CD in daily work. As stated by Nordhaug (1993), detecting what contributes and constrains CD in PSFs will help these companies in understanding what initiatives to further improve and develop, maintain, and nurture. We have Page 1

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chosen to investigate CD on three levels within our target companies; newly employed, seniors, and partners. We found this interesting due to the fact that we expected differences to occur between the different layers of professionals. Based on previous studies on competence (e.g. Nordhaug, 1993; Løwendahl & Nordhaug, 1994; Fosstenløkken, 2007) we were also aware of people developing different types of competences at work, hence we found it appropriate to include a classification of types of competences. Based on the abovementioned dimensions we found it beneficial to amplify the overall research question through the following sub questions: (i) How does national culture of the professionals and the companies’ influence their development of competence? (ii) What are the main contributors and constraints of the professionals’ competence development through investments made by the firms in competence development processes? (iii) What are the main contributors and constraints of the professionals’ competence development through daily operations?

1.2 Motivation for- and Value of the Research

It is now widely recognized that ‘services account for a very large part of economic activity and that the service sector constantly increases its share of GDP, employment, and international trade’ (Løwendahl, 2009:17). Services account for 79% (2010) of the GDP in France, and 57.8% in Norway (Nationmaster, 2010). More specifically, professional service firms (PSFs), which this study will focus on, constitute a significant sector of the economy, despite being measured by their size, numbers, or influence (Greenwood et al., 2005). PSFs can be found within the broader category of knowledge-intensive firms (KIFs) (Løwendahl, 2009), as KIFs overlap with, and include, the notion of professional service organizations (Alvesson, 2001). These professional service organizations offer services to clients within areas such as e.g. accounting, advertising, architecture, communication consulting, engineering design, legal Page 2

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advice, and management consulting (e.g. Maister, 1993; Empson, 2000; Løwendahl, 2009). It is claimed that KIFs will figure prominently in future economies, and hereby it makes sense to study PSFs in order to learn more about the nature of these firms and to understand how they handle themselves successfully (Greenwood & Suddaby, 2006). PSFs are becoming ever more prominent in economies the world over (Delong & Nanda, 2003 cited in Greenwood et al., 2005), and are among the world’s biggest and geographically complex business enterprises (Greenwood et al., 2005). PSFs typically lack the hard-nosed bottom line focus and hierarchical management structure, and have been likened to ‘herding wild cats’ (Løwendahl, 2009:69). The organizational structure, as described above, creates the challenges considering management. Furthermore, it is crucial for management to know what drives each of the professionals, what makes their work satisfying and how they most effectively develop competence. With this thesis we seek to contribute with insight on these matters. It might be difficult for managers to gain full and unbiased information regarding their professionals. Therefore we hope that through our conduction of interviews, and with us being more neutral to the companies, it can increase the chances of the respondents to answer honestly. Our findings might shed light on issues that can increase insight and understanding useful in relation to e.g. recruitment, training, investments in CD and future retention. Lorsch and Tierney (2002:24) state that ‘[T]he central difference - and distinguishing characteristic - of the PSF business model is its reliance, its absolute dependence, on skilled and motivated professionals’. These companies assert knowledge as their foundation for value creation and competitive power (e.g. Løwendahl, 2009; Stabell & Fjeldstad, 1998; Empson, 2000), and a growing interest in knowledge as a competitive asset suggests the benefit of studying PSFs. The critical task of their competitiveness and success is their ability to process information and manage knowledge, making these organizations successful examples. Moreover, we clearly view PSFs as valuable to study because they contribute to a significant sector of the economy. Also, we regard it as essential to

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devote more research to the professionals within these firms, as believe that their CD is a crucial building block for firms in general. Previous literature have also emphasized the need for research regarding competence and its development because of the highly competitive and increasingly knowledge-based economy, which can be characterized by rapid changes and frequent development of technological advances (Drucker, 1993). Furthermore, to stay competitive for a long-term survival, CD is argued to be of great value for PSFs (Løwendahl & Revang, 1998). A problem concerning competence was revealed in Fosstenløkken’s (2007) PhD dissertation. Her results suggested that the PSFs she investigated were far from particularly sophisticated in prioritizing, organizing and developing measures for systematic development of expertise (Innovations Report, 2007). CD was found to have a low priority in the firms studied. The responsibility for their professional development was left to the employees themselves. We found these findings surprising, as a large number of researchers (e.g. Sveiby, 1997; Empson, 2000) have identified competence within PSFs as vital to competitive ability and value creation. We were motivated by these results to further investigate whether the same tendencies could be found within management consulting firms. We also found it interesting to extend her research by incorporating an international dimension and thereby also investigating potential differences across borders. To our knowledge no research has discussed and undertaken the same topic as a cross-cultural study between France and Norway. By examining the professionals and their perceived CD, we have strived to detect and address the possible differences and/or similarities across levels, within the two geographical contexts.

1.3 Key Terms

In this section we want to introduce the key terms ‘national culture’, ‘professional service firms’ (PSFs), ‘professionals’ and ‘competence’ in a general matter, as these terms will be central throughout our thesis. The definitions and explanations

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of these key terms are chosen based on their appropriateness for the later discussions in relation to our sub research questions. National culture is by Kubr (1996:105) defined as ‘the values, beliefs, behavioural norms, habits and traditions that characterize human society in a particular country’. Despite the fact that one may find several distinct cultures within one country, we have chosen to regard only one national culture in each country. Culture has in this study been based on Hofstede’s (2001) cultural dimensions, and will be more closely introduces in chapter two. Based on the definition by Løwendahl et al. (2001), PSFs are knowledge-intensive firms employing professionals with a high degree of knowledge who work closely with clients to deliver a service with a high degree of customization. This is however only an extract and interpretation of the whole definition which can be found in the literature review in this study. The professionals within the service firms are here viewed as highly educated people, and members of a highly professionalized occupational group. These individuals enable PSFs ability to deliver unique and customized solutions (Løwendahl, 2009), as referred to above. Since highly skilled workers belongs to a category that may include the categories of knowledge workers and professionals, and the three terms often is used interchangeably, we will refer to the people working in a PSF as professionals. Further, we find this term appropriate as the employees within PSFs refer to themselves as professionals, have a professional orientation and emphasize the importance of professional behavior. Furthermore when we discuss CD of the professionals, we choose to base this on the definition of work-related competence made by Nordhaug (1993:50): ‘the composite of human knowledge, skills, and aptitudes that may serve productive purposes in organizations’. The suitability and relevance of this definition, and the discussions of these elements, will be thoroughly introduced in chapter 2.

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1.4 Structure of the Thesis

The thesis consists of five main chapters. Chapter 1, as seen, describes the research topic, our main- and sub research questions, motivation for- and value of the research, and key terms. Chapter 2 continues by presenting the theoretical foundation for our study. This includes literature on national culture, PSFs, resources within PSFs, and the aspect of developing and using competence. Thereafter, chapter 3 addresses methodological considerations, with particular emphasis on research design, data collection- and context, analysis, and research quality. Chapter 4 contains a conflation of the findings, linked with analysis and discussions. This chapter is based on cross-case comparisons of the three different levels of professionals, in addition to the cross-border differences between France and Norway. National culture, CD through investments and CD through daily, operations will here be highlighted. The thesis is completed by chapter 5, which presents concluding remarks containing managerial implications, limitations and suggestions for further research.

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2.0 Theoretical background
This part of the report will focus on literature that we identify as relevant to the research question presented. This chapter is comprised of four main parts, which are organized under the headings ‘National Culture’, ‘Professional Service Firms’, ‘Resources within PSFs’, and ‘Developing and Using Competence within PSFs’. The first section will present literature regarding issues of culture, and its potential impacts on CD will be presented with focus on Hofstede (2001). Further, PSF characteristics are presented, and we continue with what we consider as some of the main resources of such a firm. Here, intangible resources will be central, and competence will be predominant in the overview as it is determined as a critical resource in PSFs. Further we will present a more in-depth overview of previous literature on the topic of developing and utilizing competence.

2.1 National Culture

This section of the literature review will consider culture and its potential effects on professionals CD. Since this is a cross-cultural study we see it necessary to include cultural aspects, as we assumed that the nationalities of the headquarters (HQ) of the firms and the professionals would most likely affect our findings. National culture is by Kubr (1996:105) defined as ‘the values, beliefs, behavioural norms, habits and traditions that characterize human society in a particular country’. We have considered the French and Norwegian culture, as this is where the respondents were situated, and thereby these are the main cultures of comparison. Additionally, since most of the companies’ HQs are based in the United States, the U.S. culture will also be taken into consideration. When discussing culture we are here referring to the collective level. To include culture we have chosen to use Hofstede’s (2001) studies on national culture, based on his studies within IBM, as he has developed by far the most influential national cultural work that is known to be the most widely cited in existence (Steenkamp, 2001; Jones, 2007; Western Page 7

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Libraries, 2011). With such a groundbreaking body of work one cannot escape criticism (Jones, 2007), and some of the most common criticisms are linked to the one-company approach, national divisions and cultural homogeneity (Graves, 1986; Olie 1995; Søndergaard 1994; Nasif et al. 1991; Redpath 1997; DiMaggio 1997; McSweeney 2000 in Jones, 2007). Recent research has found that culture is in fact fragmented across group and national lines. Despite the criticism, the theory of Hofstede still remains significant.

Here all four of Hofstede´s primary dimensions (2001) would be of interest, namely ‘individualism’ (IDV), ‘power distance’ (PDI), ‘uncertainty avoidance’ (UAI) and ‘masculinity’ (MAS). At a later point, he added a fifth dimension after conducting an additional international study. This dimension was named ‘longterm orientation’ (LTO) and was applied to 23 countries whereof one of them was the U.S. Due to the fact that this dimension has not been applied to either France or Norway, it will not be considered as we thereby lack a basis for comparison.

Figure 1 and 2: Norway and France- Cultural Dimensions (Sources: Hofstede, 2009)

Figure 3: United States - Cultural Dimensions (Source: Hofstede, 2009)

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Individualism, and in individualistic cultures, people are expected to take care and look after oneself and their immediate family (Hofstede, 2009). In other words, the ties between people in the society can be viewed as rather “loose”. Individualism refers to the opposite of collectivism, which is to what degree individuals are integrated into groups. In collectivistic societies people have built strong ties within their group, e.g. their family and/or extended family. When considering the cultures of interest in this study, they can all be regarded as being more individualistic. Both France and Norway have an approximate score of about 65 out of 100, and so the expected differences among the nationalities in terms of individualism are likely to be few. The U.S on the other hand, scores 91 out of 100, making it a potentially more “extreme” case. Since most companies in our study are U.S. based, the differences may not be that few after all. There are a limited number of countries in the world having individualism as their highest score - the U.S. is, however, one of them. Within firms where individualistic cultures may have left its traces, one may question the degree of collaboration or willingness to collaborate in terms of e.g. sharing information upon request and internal competition amongst professionals. Power distance can be interpreted as human inequality such as prestige, wealth and power (Hofstede, 2001). France and Norway weights status and consistency among these areas rather differently. France scores almost three times as high as Norway on power distance, with an approximate score of 63. This may have important implications for later findings. Within organizations, power distance is often related to hierarchical structures, however as PSFs have been identified as having rather flat structures, this may not be as predominant compared to other types of firms e.g. manufacturing firms (Løwendahl, 2009). Thereby it is of interest to see whether there are differences between the structures of the firms in the two countries, as this might have implications for the degree of openness and culture for asking questions across levels within the firm. This is especially because the U.S. and France are known for having greater hierarchical influences in work situations (Hofstede, 2001). In other words, the “distances” between the different levels are more distinct than it would be in Norway, where an egalitarian situation would occur as according to Hofstede’s dimensions. Egalitarianism

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refers to situations containing more equality regarding power and its distribution defined from below (Hofstede, 2001). The third cultural dimension we view as important is uncertainty avoidance, which can be explained as to what degree members of a certain culture feel threatened by uncertain- or unknown situations (Hofstede, 2009). France scores approximately twice as high as Norway and the U.S., at around 80 out of 100. In work situations this may result in appreciation of rules, norms and directions, as to avoid unstructured situations. For PSFs we feel that this might be rather challenging as novel situations might arise in relation to novel client problems within the rapid changing economy we have today. Furthermore, Fosstenløkken’s (2007) findings suggested that professionals were often left to themselves, which in turn may create ambiguous situations. Moreover, without strict rules and guidelines, there might also be different views regarding as to whether this may constraint or contribute CD among individuals. We also assume that the wish of avoiding unsure situations in the French culture might influence the professionals’ need for feedback and evaluations. This because they may have a higher need for reassurance and appreciation that they are on “the right track”. The last dimension of interest is masculinity, which versus its opposite (femininity) is described as follows: ‘dualities of the sexes is a fundamental fact with which different societies cope in different ways; the issue is what implications the biological differences between the sexes should have for the emotional and social roles of genders’ (Hofstede 2001:279). Related to work goals, feminine cultures are more focused on social goals such as relationships, helping others, quality of life and tenderness. On the contrary, masculine cultures are recognized as being more egocentric and careers oriented, also rather focused on the efficiency of the delivery as well as material success. Norway is known as scoring extremely low on masculinity, with about eight out of 100. France, even though not identified as a very masculine oriented culture, scores five times higher than Norway, and the U.S. more than seven times as high. Within PSFs the effects of masculinity or femininity may in turn influence the responses from the professionals regarding CD. To the extreme, one might assume that CD is viewed quite differently within the two cultures. In feminine cultures the ability to Page 10

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develop competence might be viewed positively in terms of career development, hence by having a social goal and maybe improving their social situations in terms of job satisfaction. On the other hand, we might presume that feminine cultures may not give as high priority to CD, as they value more social goals and thereby possibly family instead of careers. Also one may question the focus on CD if feminine cultures prioritize team collaboration and team values, more than each professional’s development. In less feminine cultures however, CD might be viewed positively in terms of helping the professionals achieving their career goals, becoming more competitive in the job market, and hence assist them in generating larger revenues. At later stages in this study we will link Hofstede’s cultural dimensions to our findings as it can contribute to explanations to the potential differences between the two countries.

2.2 Professional Service Firms

This section firstly defines PSFs according to the pragmatic definition proposed by Løwendahl (2009) before turning to the characteristics of PSFs. Thereafter a brief presentation of value creation in PSFs will be viewed before turning to a presentation of the management consulting industry.

2.2.1 Characteristics The professional services industry is one of the largest and most diverse in modern economies. The industry includes more than one million firms on a global basis, and is highly fragmented (International Data Corporation, 2010). The industry consists of a broad aggregation of firms all serving the same private and public sector client base, and also each other (Kubr, 1996). ‘The actual content of the services delivered by the hired professionals may range from help in defining the problem to be solved, to a complete process of problem definition, solution development and implementation, result control and follow-up’ (Løwendahl, 2009:18).

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The significance of the professional service industry that sets it apart from other industries will be introduced in the following section of the thesis. Organizations can be categorized as knowledge-intensive where the majority of employees are experts or professionals, and the most important input or stock is knowledge (Starbuck, 1992). PSFs are highly depending on the knowledge of the professionals, which in turn is embedded in intangible products or services and necessary in order to be competitive (Løwendahl, 2009; Starbuck, 1992). PSFs distinguish themselves from traditional firms in the way that their business model is based on customizing intellectual property in collaborative relationships. Advisory professionals do not perform services for clients, but they collaborate with them, empowering and enabling them to solving their own problems: ‘Professional services rely to a large extent on the interaction between knowledgeable buyers and highly educated service providers who engage in some form of joint problem solving activity’ (Løwendahl, 2009:18). According to Lorsch and Tierney (2002:24), ‘firms that attract and retain the best people and motivate them to build enduring client relationships, put the firm first, and follow through on strategic imperatives are the firms that ultimately win’. Consulting firms’ business management energy is centered on elevating the utilization of their consultants’ time, aiming to develop service offerings or skill sets that clients will find compelling. Eventually, their basic goal is appropriately charging and receiving payment from clients. In most professional services segments, the client relationships and satisfaction determine repeat business and referrals. Due to relatively low barriers to entry, the competition is intense in most segments and consequently the service level expected from clients is high. Hence, the PSFs aim to ensure customer satisfaction through deliverables of the highest possible quality and meeting client expectations throughout the whole engagement process (International Data Corporation, 2010). PSFs are significant subjects for research because they represent a growing sector within modern western economies of both employment and value creation (e.g. Aharoni, 1993; Løwendahl et al., 2001). With their flat structures, service-oriented workforce, and participative decision processes, PSFs can provide a model toward which larger, more hierarchical organizations can turn for direction as they Page 12

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become leaner, quicker, and more flexible (Liedtka et al., 1997). As PSFs rely almost purely on skilled human capital, they are often perceived ‘as harbingers of organization forms in an increasingly human capital-intensive or knowledgeintensive economy’ (von Nordenflycht, 2006:1). They shape managerial thoughts and actions through their advice to clients. As PSFs were among the first to develop and use systems for knowledge management, they are by some companies viewed as role models (Løwendahl et al., 2001). We will elaborate on knowledge management under the section ‘Resources within PSFs’. The performance of the firm ultimately depends upon the performance of its professionals. Hence, a PSF not only competes for customers, it also compete for talented professionals. They ‘…are forced to attract and retain qualified people who can adapt their repertoires to meet the demands of the task’ (Kärreman, Sveningsson & Alvesson, 2002:73). Even when services are replicated from one project to another, the marketing of services requires the development of close relationships with each client (Morris & Empson, 1998). This illustrates the critical role of the professional workforce as they represent, operate, and translate the knowledge essential for the firm’s output. Also they play a key role in the firm’s relationships with clients. In this study, client matters are not included among our research questions; issues related to clients will be briefly mentioned where we find it natural as to potentially extend the readers’ overview and insight. Furthermore, this issue will appear in our ‘Suggestions for Further Research’. After viewing the importance and uniqueness of PSFs, we have chosen to summarize the characteristics of PSFs in accordance to the pragmatic definition proposed by Løwendahl (2009:22), which classifies the firms based on the services they deliver. She states that professional services: 1. Are highly knowledge intensive, delivered by people with higher

education, and frequently closely linked to scientific knowledge development within the relevant area of expertise. 2. 3. Involve a high degree of customization. Involve a high degree of discretionary effort and personal judgment by

the expert(s) delivering the service. Page 13

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4. 5.

Typically require substantial interaction with the client firm Are delivered within the constraints of professional norms of conduct,

representatives involved. including setting client needs higher than the profits and respecting the limits of professional expertise.

2.2.2 Value Creation in PSFs The most critical and valuable resources of PSFs are identified to be competence and client relationships (Winch & Schneider, 1993; Sveiby, 1997; Empson, 2000). These matters are interlinked, as good client relationships nurture a positive reputation (Stabell & Fjeldstad, 1998). Favorable relationships can in turn generate access to attractive clients and professional workforce. However, having an attractive client portfolio is in itself seems not to be sufficient for long-term sustainability and profitability. Within a bigger picture, the PSFs needs to pay attention to value creating processes proposed by Løwendahl (2009): (i) selling ‘a credible promise’; (ii) delivering what has been promised; and (iii) learning from the selling and delivery processes, in order to improve both efficiency and effectiveness in future projects. The first process is what differentiates PSFs form traditional manufacturing firms. Selling a credible promise concerns persuasion of clients about their capability of value creation. Regarding the professionals that are engaged in this process, CD can directly add value in terms of individual, collective and/or organizational learning. The next process includes both professionals and client representatives to perform the activities needed in order to deliver what has been promised. In terms of quality, it is concerned with both the actual quality of the deliverance, and perceived quality. The last process is about the post learning processes for the professionals, as to enhance and secure future quality in service delivery. This third process is by the PSFs the most neglected one, which we identify as a rather unfortunate fact, as PSFs and CD are dependent on learning. We will elaborate on the matter of competence under the section ‘Resources within PSFs’.

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Due to our capacity constraints, client relationships and value creation will not be of focus in chapter 4 where we analyze and discuss our findings. After presenting the theoretical foundation of PSFs, we are now turning to our primary focus, namely the management consulting industry.

2.2.3 Management Consulting The consulting firms included in this study are treated anonymously hence we are withholding specific company descriptions, however we have chosen to provide the reader with a broader overview of the industry at focus. We will here look more into the management consulting industry as we consider it beneficial to present the context and our perception of the industry as this may affect the presentation and discussion of findings at later stages. The industry includes a wide-ranging set of highly diverse services; hence we have selected a generic industry definition suggested by Kubr (2002:10): ‘Management consulting is an independent professional advisory service assisting managers and organizations to achieve organizational purposes and objectives by solving management and business problems, identifying and seizing new opportunities, enhancing learning and implementing changes’. Unlike professional business services, such as physicians or accounting, the management consulting industry has no professional accreditation or certification systems, and is not a protected occupation (Armbrüster, 2006). Although industry associations do exist they are not formally approved professional associations regulating the practice. Maister (1993) defines the industry as having a quasiprofessional status due to the knowledge-intensity of its services. Nonetheless, the field of management consulting is still evolving, providing space for competing ideas of appropriate consulting practice to coexist (Reihlen et al., 2010). Management consulting outlook The prominent consulting firms have been advising and reshaping the largest organizations in the world since the 1920s (McKenna, 2006). Over the past halfcentury, the diversity and volume of the market for management consulting Page 15

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services has grown significantly, both in terms of revenues and number of people recruited (Løwendahl, 1992). Today, the industry shows signs of increasing maturity (Reihlen et al., 2010). It is still a fairly young industry, however due to its progress towards a fuller institutionalization (DiMaggio & Powell, 1983) and large growth rates during the last decades, McKenna (2006) states that consultancy services are being added to a mature frame. Another indicator of maturity is the stratification of elites and non-elites, which vary in terms of reputation and size (Greenwood & Suddaby, 2006). In the early years, management consulting delivered unique expertise that the clients did not have. Clients today are becoming increasingly sophisticated and have developed more demanding attitudes and expectations (Lowe, 2004). Modern buyers questioning and challenging the views of professionals has become more predominant – they will ask for justifications, second opinions and even claim service in the form of excellent ‘beside manner’ in addition to technical advice (Wiley Knowledge for Generations, 2010). As previously mentioned, the client-consultant relationship is essential to PSFs (Schön, 1983), since the professional services are produced in interaction with the client. The professional services industry, hence also management consulting, is also faced with market dynamics affecting and implicating the way the businesses are run (Wiley Knowledge for Generations, 2010). This was recently experienced due to e.g. the financial crisis. General decrease in demand created by cost cutting among clients, created fluctuations that disturbed the demand for consulting services. In such cases, the dilemma for the consultancy firms lies in tight cost control versus holding on to their people so that they are in the best place when upturns comes in the long run. Effective recruiting is critical if a firm is to uphold or increase its capacity to perform. At the utmost importance is also retaining knowledge accumulated by key professionals, and utilizing it through training of young professionals. An additional element is that the value of information diminished as availability increases, hence effective application of knowledge is becoming a differentiator between firms (Wiley Knowledge for Generations, 2010).

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The Anatomy of a Consulting firm The structure of management of consulting firms are centered on the degree of customization in their activities, and the extent of client interaction (Maister, 1993). The value of the firm is often embedded in the specific talents of their highly skilled individuals. Leverage, knowledge and experience are the basic elements of their business models, where the leverage structure is the relative mix of newly employed, seniors and partners. When the professionals progress and spiral upwards in the firm, the roles and thereby level of responsibility, and their work tasks, will evolve. The roles of the professionals may have an explanatory effect on our findings at later stages in terms of the potential differences in CD on the three levels mentioned. A right balance in the matching of skills required by the work to the skills available in the firm is crucial. However, due to resource constraints it will be impossible to assign the most appropriate people to the specific projects at all times. The companies’ staff may lack necessary competence, or professionals with the desired competence may happen to be occupied on a different project. Consequently, this may also lead to the professionals being put on repetitively similar projects that we believe could serve as a constraint to CD. In coping with this issue, the companies engage in resource preplanning, where they identify future projects and the human resources needed to determine the availability of personnel and the most cost-effective ways of replacing skills and knowledge shortages. To facilitate this, the firms engage in actively allocation of assignments, routing staffing requests, ‘…to trade off among the conflicting pressures of professional development; client demands for quality, cost effectiveness, and speed; and the preferences of the firm’s members’ (Maister, 1993:157). To what extent this actually functions successfully remains for our findings to indicate. As a general remark, the service-delivery cost will decrease the larger the proportion of newly employed to seniors and managers. As a strategy to win projects, consulting firms market themselves based on their reputation and their high-profile key professionals, e.g. through their experts, senior consultants and/or partners. Success in winning projects ‘depends on the qualities of the professionals as perceived by potential clients’ (Løwendahl, 1992:506). After being awarded projects, they will reallocate the scarce experts across other projects and clients. Due to shortage of experts, less experienced consultants will be brought in. Increasing the proportion of newly employed to be Page 17

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used in projects, reduces the costs of the projects. By developing and investing in the skills of its junior members, the firm adds to the only resource it has to sell: professional judgment and talent (Maister, 1993). Whether the resource allocation of staff actually contributes to professionals’ CD, will be illuminated in chapter 4. People The young professionals entering this industry are highly ambitious and career oriented (Maister, 1993). Both the individuals and the organization share excessive expectations for progress and career development. In the early stages of their careers, professionals need to develop the necessary technical skills to perform at work. From a firm perspective, they are intended to deliver e.g. exceptional work for clients, learn how to cooperate with peers, how to manage teams and how to work with partners who have different skills and preferences. The individuals entering these firms are openly entering a system inspired by an “up-or-out” policy, where they either should pursue a career that will lead to longterm success in the firm, or a timely decision to leave. As professionals progress in their careers they must learn to deal with the diverging pressures that come from managing important client relationships, whilst taking on increasing internal responsibilities regarding the management of the firm. The system within PSFs might be viewed as Darwinian, since the candidates with the most potential will spiral upwards, and vise versa. The up-or-out promotional system is highly present, and the expectations for ‘what constitutes a reasonable period of time of each stage of the career path’ clearly stated (Maister, 1993:7). When individuals are not showing progress as expected, they will, either by their own choice or at the suggestion of the firm, abandon the company. All newly employees face a risk of not making it, and this creates a pressure to work hard and succeed. We believe that our interviews might provide insights into how professionals are being evaluated within the firms under investigation. Further we hope to reveal the consultants’ perceptions in terms of how the evaluation systems affect their CD. For many firms the goal is to develop as many young professionals as possible. Many managers within professional service firms are able to identify a few professionals who they view as crucial to the company and its survival (Maister, 1993). This is major issue for PSFs, as they need many professionals of this caliber. These are often the skilled individuals with experience and ability to solve Page 18

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complex problems, often referred to as the experts. Further they are characterized by bringing in the biggest fees and often have large networks outside of the company. These experts, and also professionals who have the potential to become experts, choose the companies to work for with great care (Maister, 1993).

2.3 Resources within PSFs This section is dedicated to resources within PSFs. First, the resource-based view (RBV) of the firm is introduced. Based on the previous argumentations for competence as an essential resource within PSFs, our paper has its foundation in the RBV. In this view, intangible resources are recognized as fundamental to value creation and competitive ability (Fosstenløkken, 2007). Thereby we will secondly introduce the terms of tangible and intangible resources, whereof the latter will be our focus. Thirdly, within intangible resources, competence and relational resources can be found, where competence is our focal point. Lastly, we will turn to knowledge management (KM) and methods of knowledge transfer, as we find these aspects important for professionals’ CD.

2.3.1 Resource-Based View of the Firm According to the RBV of the firm, performance differences across firms can be attributed to the variance in the firms’ resources and capabilities (Hitt et al., 2001). Resources will be more closely defined under the next section; ‘Tangible and Intangible Resources within PSFs’. Valuable, rare, poorly imitable and non-substitutable resources and capabilities (Barney, 1991, cited in Hitt et al., 2001) comprise the firms unique or core competences (Prahalad & Hamel, 1990) and thus generate lasting competitive advantage. These competences come from previous investments made by the firm, and from learning-by-doing (Prahalad & Hamel, 1990). Managers need to identify how they create value within their organizations in order to create more value relative to their competitors. Due to the characteristics of PSFs, creating firm value through replication of efficient routines and procedures becomes extremely difficult, as the services they produce are heterogeneous and jointly solved Page 19

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between the professionals and clients in each unique project. In PSFs, firm value cannot reside in capital equipment and economies of scale from the use of equipment, so what is then the source of competitive advantage and value creation in these firms? We will look into these sources this in the following section.

2.3.2 Tangible and Intangible Resources within PSFs As illustrated in the model below, Løwendahl (2009) distinguishes between tangible and intangible resources. Tangible resources, as previously mentioned, refer to e.g. production equipment, technology and buildings, and can be referred to as highly flexible and general, or highly inflexible and specialized for particular processes (Løwendahl, 2009). Furthermore, intangible resources can, as illustrated in the model below, range from ‘relational resources’ in terms of reputation, loyalty, and relationships on the one hand, and ‘competence’ in terms of knowledge and capabilities on the other. The intangible resources are more likely to generate competitive information-based resourcesfor the firm (Hitt et al., 2001). resources. I call these advantage, hence value invisible assets, and they
are just as essential for effective operation as the more visible corporate resources. More than that, I believe they are the most important resources for long-term success” (Itami, 1987:12). of distribution, corporate culture, and management skill are all informational

Resources Tangible Intangible

Competence Individual Collective

Relational Individual Reputation Loyalty Relationships Collective Reputation Loyalty Relationships

Knowledge Database Capabilities= Capabilities= Skills+Aptitudes Skills+”Culture”

15 Figure 4. Strategic resources (Løwendahl, 1997: Figure 4. Strategic Resources (Source: Løwendahl 2009:94) 87)

Hence, a company’s resource base broadly consists of the combination of tangibles and intangibles, which may be useful to generate value for the firm Our study focuses on the latter, namely intangible resources. Taken from and its stakeholders. However, for a PSF, the intangible resources in terms of Løwendahl (2009), who in turn builds on existence (Løwendahl, 1997). reputation and competence primarily define itsItami’s concept of information-based According assets, resourcesthe aim defined as the following: ‘…the people, goods, invisible to Itami (1987), can be of strategic management is to manage firm resources such that the firm’s resource base is improved over time. In and capital intangible resources are of interest because their goals. A this respect, a firm can deploy to meet its short- and long-term value, in small but contrast to tangible resources, typically increases as they are used and increasing number of managers adds information to the key source of challenged. In general, intangible resources can represent alist. Consumer trust, brand competitive power because they are hard to 20 Page accumulate, and capable of simultaneous multiple uses. In addition, they are both inputs and outputs of business activities. In this respect, intangible resources “… are often a firm’s only real source of competitive edge that can be sustained over time” (Itami,

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image, control of distribution, corporate culture, and management skill are all informational resources. I call these information-based resources invisible assets, and they are just as essential for effective operation as the more visible corporate resources. More than that, I believe they are the most important resources for long-term success’ (Itami, 1987:12). Even more specifically, since competence development is our major area of focus, competence as an intangible resource is highlighted and we will handle this concept in the following section.

2.3.3 Competence There are many definitions and explanations of competence that are appropriate to bring up within this discussion, however we have chosen to use the strategic resources model presented on the previous page, as a basis for the topic of competence. Hence, we will look into individual competence, as our study sets out to investigate the professionals and their CD. Despite not being our main focus, we will also introduce collective competence as it might facilitate a more complete picture of the interplay between competences that can contribute and constrain competence. Individual competence On an individual level, we choose to apply Nordhaug’s (1993) definition as a basis for further discussion as he defines work-related competences, which is in line with the type of competence we are addressing. He states that work-related competences are ‘the composite of human knowledge, skills and aptitudes that may serve productive purposes in organization’ (Nordhaug, 1993:50). Nordhaug explained knowledge as particular information about a subject or within a field. This type of knowledge can potentially be articulated and transferred. Further, he suggests that skills are a special ability to perform work-related tasks, and that these competences are difficult or impossible to articulate. Lastly, aptitudes ‘encompass natural talents that can be applied in work and that form a basis for the development of knowledge and skills’ (Nordhaug, 1993:51). Aptitudes are as such, hard to develop. Individuals may possess all three types of competence; yet the firms employing these individuals must be able to access and mobilize these resources, in order to fully leverage them. Still, the firms cannot fully control Page 21

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competence residing in individuals, and the individuals themselves are highly mobile as they can walk out of the office any time and leave the firm. Further, Nordhaug (1993) distinguishes between formal competence, gained through e.g. education, training, and real competence. Real competence is referred to as knowledge, skills and aptitudes that can be applied in work situations. Hence, his suggestion is that possession of education or documented experience not automatically can be operationalized in the work-situation. Nordhaug argues that individual skills and knowledge has to be mediated through aptitudes to turn operational. Nordhaug’s definition suits our research question and our initial idea of knowledge contributing to a large part of an individual’s competence. We find support for the importance of our focus in Löfstedt (2001), emphasizing the participation from employees as crucial in the process of CD, and in establishing a learning organization. Types of Competences Since we are dealing with competence, which can be viewed as a quite ambiguous term, we see it as appropriate to further classify competence to determine the different types of competence one may develop. Also we feel that this might contribute to an understanding of the nuances of the broad term competence. By including this we further feel it enables a more concrete discussion in chapter 4, as we will connect these typologies to the contributors and constraints of CD, in relations to our second and third sub research question. There are many different classifications one may apply to competence, however we have chosen to follow Nordhaug’s (1993) typology on competence where he combines the dimensions of ‘task specificity’, ‘firm specificity’, and ‘industry specificity’. A model depicting these competences is included on the next page.

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that it is defined relative to an element of the firm’s external environment. Further, competences can be more or less industry specific, i.e. tied exclusively to one particular industry and not well applicable in others. In table 5, Master Thesis GRA 19402 –the dimensions of task specificity, firm specificity, andinindustry Service Firms Competence Development Professional specificity are combined into a typology. The cells represent different degrees of competence idiosyncracy, and, thus, dissimilar types of competence. Each type of competence is further illustrated below.
F I R M LOW S P E C I F I C I T Y HIGH INDUSTRY SPECIFICITY LOW HIGH I II III MetaIndustry Intraorganizational competences competences competences IV Standard technical competences V Technical trade competences VI Unique competences

LOW TASK SPECIFICITY HIGH

Figure 5. A competence typology (Source: Nordhaug, 1993:58) Table 5. A competence typology (Nordhaug, 1993:58)

‘Meta-competence’in a variety of tasks. industry nonspecific, and can be utilized be utilized is firm nonspecific, Examples of meta-competences:
Literacy; Learning capacity; Analytical capabilities; Creativity; in accomplishing a variety of tasks. Examples of this type of competences are e.g.

-

Meta-competence is firm nonspecific, industry nonspecific, and can Knowledge of foreign languages and cultures; Ability to perceive

literacy, and processcapabilities, knowledge of events; Capacity to and cultures, analytical environmental signals and foreign languages tolerate capacity to tolerate and master uncertainty, ability to communicate, ability to cooperate with others, negotiation skills and ability to adjust to change. The main contributor to meta-competences specificity, low firm specificity, and high characterized by low task is the formal education system. However, certain
industry specificity. Examples of industry competences are: examples of meta-competences such as creativity, analytical capabilities and Familiarity with the history of the business; Knowledge about the
64

and master uncertainty; Ability to communicate; Ability to cooperate with others; Negotiation skills; Ability to adjust to change.

-

Industry competence relates to familiarity with the industry, and is

social capabilities may come from other sources work experience and socialization processes.

‘Industry competence’ relates to acquaintance with the industry, and is known for having low task specificity, low firm specificity, and high industry specificity. Examples of industry competence might be e.g. familiarity with the history of the business, knowledge about the industry structure and current development, ability to analyze the operations and strategies of competitors and knowledge about key persons, networks, and alliances in the industry. Industry competences can be developed through experience of working within an industry, joining industry associations’ meetings and seminars or it might be transferred through external consultants in possession of industry specific knowledge. ‘Intra-organizational competence’ is characterized by low task specificity and high firm specificity. Examples might include knowledge about colleagues, elements in the organizational culture, such as symbols, sub cultures, history, norms, ethical standards, overviews of communication channels, informal networks and alliances within the firm, mastery of organizational dialect or code Page 23

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and knowledge about the firm’s strategy and goals. This type of competences may mostly stem from every-day learning at work, e.g. through interaction with colleagues or observations. ‘Standard technical competence’ has high task specificity, low firm specificity, and low industry specificity and includes a wide range of generally technical competences. This type of competence can embrace knowledge of generic budgeting and accounting principles and methods, skills in computer programming, knowledge of standard computer software, craft skills and technical professional skills that can be applied across industries. The main generators of standard technical competence are identified as education and training. ‘Technical trade competence’ is known to be task specific, industry specific, and firm nonspecific. Hence, one may use this competence in other firms, within the same industry, however it can only be used in accomplishing one or a few limited work tasks. Examples are skills in building automotive vehicles, aircrafts, assembling computer hardware, hair cutting etc. Technical trade competences can be developed through vocational training that is limited to only one specific industry. Also it can be developed through practice and experience in practical work within the industry. ‘Unique competence’ is highly firm specific and task specific and applies to only one or a few tasks in one firm only. It includes knowledge and skills related to operation of unique technology and routines. Examples could include skills related to the use of specialized tools crafted in the firm, knowledge about rationalization devices that have been developed exclusively within the company, skills in operating specialized, local filing or data systems or skills related to the administration and maintenance of organizationally idiosyncratic routines or procedures. This type of competence can only be taught within the one firm however through various methods such as informal learning, in-house training, or mentoring processes. After viewing individual competences, we will now turn to competences on a collective level. Page 24

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Collective competence Despite our focus on professionals’ competence, and thereby individual competence, we still see it as necessary to include an explanation on a collective level since we believe that our findings may touch upon collective issues. At this point, however, we cannot determine to what extent the collective competences influence the individuals develop. On a collective level, competence may refer to information databases, procedures and culture (Løwendahl, 2009). These categories correspond to Nordhaug’s individual competence elements discussed earlier in this chapter; namely knowledge, skills, and aptitudes. Here, competence is concerning collectively developed routines, procedures and ways of doing work that are shared within the organization. This collective competence may include e.g. codified knowledge, norms, routines, culture, language, best practices, and values (Kogut & Zander, 1992; Løwendahl, 1992, 2009). One of the keys to developing and utilizing professional competence to benefit on an organizational level is by ‘reducing the firm's dependence on its key people’ (Sveiby, 1997:66). This is partly the reason for why companies invest in technical tools, as to store and facilitate sharing of knowledge on a firm level. In chapter 4 we will present how technical tools contribute and/or constraints CD. Firms’ competence building and competence leveraging activities, represent gapclosing activities of significant importance for a firm’s competitive position, it represents important input to the creation of the firm’s ‘organizational knowledge’ (Ylinenpää & Nilsson, 2000; von Krogh, Roos & Slocum, 1994). Furthermore we will argue that knowledge is one of the main contributors to a professional’s competence and thereby find it appropriate to devote a part of the thesis to knowledge within PSFs (Løwendahl, 2009). Knowledge As argued by Spender (1996), a firm’s knowledge and its ability to generate specific knowledge are at the core of the theory of the firm. Grant (1996) identified knowledge as the most critical competitive asset within a company. The Page 25

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people within the firm possess a major part of organizations knowledge, and the firms create value through selection, development and use of human capital (Lepak & Snell, 1999). Managers are increasingly realizing that the basis of their competitive advantage is found in their knowledge base, and that development and exploitation of knowledge is paramount for the sustainability of such advantages. Hence, better use of existing knowledge, and more effective acquisition and assimilation of new knowledge, becomes a business imperative (Ladegaard & Syvertsen, 2005). The reality in many professional services is that knowledge is socially constructed, context specific and ambiguous, rather than composed of objective, clearly generalizable rules that can be codified in any form (Alvesson, 1993; Orr, 1996 in Morris, 2001:822). Since knowledge is presumed to be socially constructed, the risk of professionals leaving the firm is a lurking threat, and a method of reducing this risk can be found in the establishment of firm loyalty. We will discuss this matter in chapter 4. We have understood that knowledge is a term with many, and partly conflicting, definitions. Moreover a number of dimensions have been proposed of knowledge, namely explicit and tacit, embodied and embedded knowledge (Polanyi, 1958, 1966; Granovetter, 1985, cited in Løwendahl, Revang & Fosstenløkken, 2001). However we want to keep the explanation of knowledge as being ‘tacit’ or ‘explicit’, and in need of different strategies to facilitate transfer between individuals. Further we will consider knowledge both at the individual- and collective level. Due to our categorizing of CD into ‘daily operations’ and ‘investments’, when dealing with our findings, we found it relevant to choose the following classification of knowledge: Tacit knowledge is partly embedded in individual skills and partly collaborative working relationships within firms (Szulanski, 1996, cited in Hitt et al., 2001). This type of knowledge is often rooted in uncodified routines (Liebeskind, 1996, cited in Hitt et al., 2001) and in firm’s social context. Maister (1993) suggests that tacit knowledge is fundamental to professional skills; and often difficult to imitate and characterized as unique Page 26

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(Mowery et al., 1996, cited in Hitt el al., 2001). On the contrary, explicit knowledge can be codified and thus more easily transferred (Liebeskind, 1996, cited in Hitt et al., 2001). For the professionals, knowledge is gained through formal education, intended to provide explicit knowledge specific for their job, and through learning by doing on the job. At the collective level, Nonaka (1994) identifies knowledge as created by individuals, however suggests that firms are key in the process of development. Løwendahl, Revang and Fosstenløkken (2001) state that knowledge is a combination of skills, routines, norms and values that are developed and shared by more than one professional. Hence, individuals can be argued to be in the center of knowledge creating activities. Still, organizational knowledge creation can rely on the firms creating the right contexts through e.g. organizational set-ups as through technical tools that can generate storing and transfer of knowledge.

2.3.4 Knowledge Management and Methods of Knowledge Transfer When discussing knowledge we find it essential to discuss knowledge management (KM), and methods of knowledge transfer within PSFs. Due to the centrality of the knowledge aspect we find it appropriate to dedicate a section of this study to introduce our understanding of KM in regards to CD. An additional reason, underpinning our choice, is found in knowledge-based organizations frequently being viewed as role models for other firms, in particular when it comes to KM (Løwendahl, 2009), as also mentioned in previous chapters. Lastly, since PSFs can be viewed as role models in KM, and that they have an important function in creating the right contexts for knowledge creation, we hereby assume this will influence the professionals’ CD. KM systems, if well functioning, can contribute positively to professionals’ CD through e.g. having relevant information easily accessible that professionals can utilize for self-studying and application in daily work. There is a common acceptance that KM will symbolize the largest competitive advantage for organizations in the new millennium (Drucker, 1993). As defined by Boh (2007, cited in Zanjani, Mehrasa & Modiri, 2008:390), ‘KM is managing Page 27

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the corporation’s knowledge through a systematically and organizationally specified process for acquiring, organizing, sustaining, applying, sharing and renewing both the tacit and explicit knowledge of employees to enhance organizational performance and create value.’ The institutionalized knowledgesharing mechanisms allow the company to amplify knowledge embodied in individuals to the collective level (Nonaka, 1994), so that the knowledge easily can be accessed and shared throughout the organization. When knowledge is shared, the value of the knowledge grows and multiplies (Cabrera & Cabrera, 2002). As indicated by Alvesson (2002), KM provides the companies with cultural guidance in the norm of knowledge sharing and ‘willingness to help each other with advise and the sharing of experiences’ (Alvesson 2002:7). Through our interviews we expect to gain insight into the way KM is dealt with in the respective firms, and how the initiatives contributes and/or constraints the professionals’ CD. Based on literature, we initially believe that potential critical dimensions with regards to KM, hence CD, will touch upon issues such as willingness and motivation to share knowledge, accessibility, user friendliness of the technological infrastructures, and trust. A discussion of these elements potentially will deem appropriate in chapter 4. KM as a source of competitive advantage has been widely recognized for more than two decades (Nonaka, 1991). Several researchers (e.g. Davenport & Probst, 2001) have argued for the importance of KM in an increasingly globalized and service oriented environment (cited in Forstenlechner et al., 2007). Essential to all services that are provided, is the actual input of knowledge the company receives (professionals), and the output (service) it can deliver based on this (Hunter, Beaumont & Lee, 2002). This in turn provides the firms with the basis for the service that the company can offer to the client. KM involves both the processes and the strategies that the firms choose, in addition to the communication. However there are several important issues that might affect communication within companies, such as the background of the individuals and nationalities (Mäkelä, Kalla & Piekkari, 2007). However, the majority of research conducted on KM seems to be focused on the organizational level, and thereby neglects individuals, although knowledge mainly is shared among individuals and not Page 28

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organizations. This thesis focuses on individual CD, however collectively developed systems for KM might influence our findings, and is therefore included. KM research has shown that consultants and PSFs do not have a uniform method of managing knowledge. According to Hansen, Nohria & Tierney (1999) companies must choose between following a ‘codification’ strategy or a ‘personalization’ strategy. The codification strategy involves knowledge being transferred into information, e.g. through databases and other technological applications. By contrast, in companies that emphasize the personalization strategy the focus lies in dialogue between individuals, and network building (Harvard Business School, 1999). However, what is important regarding these strategies is to choose one of them and not try to implement both. Yet companies can choose to focus on one of the strategies, using the other in a supporting role. When trying to assess the strategy choice it is deemed essential to evaluate the knowledge that the company deals with on a daily basis, and whether it is tacit or explicit. In dealing with tacit knowledge, a personalization strategy might be needed, whereas with explicit knowledge it may be beneficial to focus on the codified strategy (Hansen, Nohria & Tierney, 1999). Concerning the physical sharing of knowledge it is important to keep in mind that this is a somewhat volunteer process, and thereby incentives plays a large role within effective inter-firm knowledge transfer (Hansen, Nohria & Tierney, 1999). Also since employees within a firm cannot be sure of what they will be rewarded for sharing their knowledge, trust is essential. ‘Without trust the internal market for knowledge will not function effectively’ (Davenport & Prusak, 1998; Nahapiet & Ghoshal, 1998; Teece, Pisano & Shuen, 1997, cited in Empson, 2001:210). After viewing the resources within PSFs, whereof competence has been predominant, we will now turn to how competence can be developed, how it is evaluated and thereafter the importance of the competence chain to ensure its utilization.

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2.4 Developing and Using Competence within PSFs

In this section we will present previous literature on the topic of developing and using CD. Firstly, factors that may enhance or inhibit development of competence will be viewed. Secondly, evaluation methods and tools for measuring knowledge will be addressed as this is identified as important for firms in aligning internal behaviors and skills with the strategic direction of the company as a whole. Lastly, utilization of competences will be turned to, as it is deemed difficult, yet essential for the organization to reap the fruits of their work put into competence development (Nordhaug, 1993).

2.4.1 Contributors and Constraints to CD As described in chapter 1, we gained motivation for the thesis subject from Fosstenløkken’s (2007) PhD dissertation. We choose to follow her categorization of contributors and constraints to CD, and further linked them to ‘daily operations’ and ‘investments’ within the firms. These two routes were built on Itami (1987) who identified these routes to develop invisible assets. In this section we will refer to Fosstenløkken’s (2007) main findings in regards to, what she identifies as, facilitators and constraints to CD. We want to include her findings, as we want to see if our findings are in line with this previous research on CD, and because it might generate a better understanding of our second and third sub research questions, set forth in chapter 1. Fosstenløkken (2007) investigated CD within four consultancy firms, whereof two consulting engineering firms and two communication agencies, in Norway. She found that CD received surprisingly little attention from management in consultancy firms. CD was found to be of focus in the firms, however was down prioritized. The responsibility for CD was left to the professionals themselves. CD through daily operations was identified as the major CD facilitator, and was by far more important than CD through investments. In relations to this Itami (1987, cited in Barney & Clark, 2007:20), he stated that ‘the accumulation and maintenance of invisible assets indirectly through operations can take more time than direct efforts, but the results of this process are more reliable’. Itami (1987) Page 30

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here refers to invisible assets at the firm level, despite this we have chosen to include his finding as we believe this might be the case on an individual level as well. Her facilitators to CD were identified as the ‘informal learning by doing going on in the day-to-day work for clients, supported by the interaction in intra-firm relations, client relations, and network relations’ (Fosstenløkken, 2007:291). These findings indicate that CD is an experience-based learning process, recognized as learning by doing (e.g. Dewey, 1916 in Fosstenløkken, 2007). It was due to this that her study emphasized on experience as foundation for learning and development; e.g. the professionals learning conditions. However she also chose to include organizational investments made to facilitate CD and learning in groups, as to incorporate the collective learning. On the other hand, the elements found to constrain CD were concerning ‘high time pressure, uneven work load, and a lack of routines supporting learning through team composition and relevant practice opportunities’ (Fosstenløkken, 2007:291). Fosstenløkken’s findings also suggested that there are between layers differences in the way the professionals within organizations perceive possibilities for CD, and that e.g. newly employed and seniors may have quite diverse views on this issue (Fosstenløkken, 2007, cited in Storey et al., 2009). As the professionals might have different views of CD contributors and constraints, a distinction of experience and tenure among the individuals is deemed appropriate. This is due to the fact that no single individual can have the overall picture of the CD activities in organizations (Tsoukas, 1996). We will now turn to issues of evaluation and measurement of CD.

2.4.2 Evaluating CD Despite an overall recognition of the requirements for success, organizations still strive to find a good method of measuring the development of competence. It is widely recognized that measuring more intangible concepts, such as competence, brings with it a lot of challenges. The purpose of measuring intangible assets is Page 31

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neither to provide a full and comprehensive measuring systems nor to present a full and comprehensive portrait. This is impossible, hence is the reason why previous approaches have failed so far (Sveiby, 2001). The firm can control the elements of tangible assets and organizational competence, whereas the intangible assets, on the other hand, are controlled by the professionals and contracted to the organization. As issues of firm reputation and client loyalty are tightly linked to individuals, rather than firms, the organizations become vulnerable to the potential of professionals leaving the firm. A challenging element in working with competence is management’s obligation and need to simplify competence into a controllable and measurable variable. Management is committed to create overview, consistency, harmony and strategy aligned development, to be able to predict development and hence competitiveness. Concurrently, as indicated by Nordhaug and Grønhaug (1994) and Ulrich (1997) (cited in Boutaiba & Bramming, 2004: 3), ‘management objectives are dominated by a strong strive and need for complexity, creativity, diversity, autonomy and multiplicity of competence in a complex and turbulent market.’ The means to ensure organizational success and the ‘raison d’être’ of competence-based human resource management system, resides on a range of “promised outcomes”. A competence-based management is centered around he ability to hire the right people, train and develop these people to realize their potential, provide appraisal systems, and identify behaviors and skills that are “proven predictors of success” (Lucia & Lepsinger, 1999; Spencer & Spencer, 1993). Among the most popular management development devices in use today, is the 360-degree tool (Toegel & Conger, 2003). The 360-evaluation tool is highly useful in ensuring that employees are ‘doing the right things; clarifying and articulating what is required for effective performance, such models help organizations align internal behaviors and skills with the strategic direction of the company as a whole’ (Lucia & Lepsinger, 1999, cited in Boutaiba & Bramming, 2004:3). As further stated by Lucia and Lepsinger (1999), competence models can facilitate clear job and work expectations, optimize productivity, ensure hiring of top candidates, improve the 360-degree evaluation process, adapt to change, align behavior of professionals with strategies and values of the firm (in Boutaiba & Bramming, 2004). Page 32

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A general trend in human resource management (HRM) is the movement towards a more strategic oriented focus, where HR strategies concerning behaviors and skills are aligned with business strategy. HR-technologies, such as 360-degree feedback, competence assessment and developmental appraisal systems, are used as simple, ‘techno-fix’ solutions to the making, distribution, acquisition, access and application of organizational knowledge (Boutaiba & Bramming, 2004). Companies use the 360-degree evaluation extensively as a tool to observe and regard professionals’ competence, and further compare colleagues up against each other. The problems with such systems are suggested to be that they create employees and individuals with conceited personalities, preoccupied with their own appearance and development abilities (Bauman, 2003). Professionals, who are not evaluated as individuals holding perceptible and classifiable knowledge and skills, will not appear competent. With this type of evaluation individuals will be concerned about their work-life appearance, whether their appearance is aligned with the firm’s expectancies and requirements on employee development and their appearance as a competent, continuously changing and solid employee. Additionally, another concern about this tool, due to its popularity, is that it has been stretched to be used in areas beyond its original purpose (Toegel & Conger, 2003). Originally, the purpose was to measure leadership competences, however today organizations use this tool to measure “everything and everyone”. From an economical view, utilizing one single system for measuring performance is viewed beneficial, however few have taken the time to step back and reconsider its effectiveness. ‘The dilemma is that in employing one tool and one data gathering process for such diverse purposes weakens the tool and its ability to deliver on its objectives’ (Toegel & Conger, 2003:299). In broader lines, defining, capturing and assessing competence and competent individuals, are challenging tasks. As illustrated above, companies implement tools such as 360-degree feedback in order to evaluate the competence level of their professionals, and amongst others tools, this might introduce rather precise performance expectations and measures. On the other hand, in daily operations it can appear totally arbitrary and based on appealingly subjective criteria what competence is evaluated to be (Lucia & Lepsinger, 1999). We hope to gain Page 33

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findings indicating how the evaluation is carried out within the companies under investigation. In addition to being developed and measured, it is essential that competence is planned, acquired and utilized for optimal benefit, which will constitute the last
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section of this chapter.

2.4.3 Process for Utilization of Competence The stages of planning, acquiring, developing and using competence all together comprise what is called the ‘competence chain’ in organizations, as seen in the model below (Nordhaug, 1993). This part of the thesis will mainly be issued around the last stage of Nordhaug’s model, namely ‘competence utilization’.

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Figure 6. The Competence Chain (Source: Nordhaug, 1993:28).

The utilization of competences is vital for the organization to reap the fruits of their work put into competence development (Nordhaug, 1993). Needless to say, otherwise the process and investments put into CD will be of waste. As discussed earlier, sharing competence is important for PSFs. However, sharing alone does not necessarily improve firm performance. More specifically it contributes by laying the ground for effective utilization (Haas & Hansen, 2007). The collection of competences in a firm can be referred to as the organizations portfolio of competences (Nordhaug & Grønhaug, 1994). An essential point Page 34

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regarding this portfolio is that it must be “understood” by both professionals and management (Nordhaug, 1993). However, as consulting firms along with other firms, embrace professionals contributing with different kinds of competences, a challenge for the firm becomes to coordinate and utilize the competences that are spread out among a large number of individuals (Nordhaug, 1993). On the other hand, more difficulties may arise due to the fact that a number of companies, and especially knowledge-based organizations, may not be aware of the competences that are available for potential value creation. In other words they may experience a problem with under-utilization (Løwendahl, 2009). Another noteworthy comment made by Nordhaug (1993) was that it is important to consider the degree of specificity of the competences one possess to determine areas of utilization. In other words, knowing what kind of competence the professionals are in possession of is not sufficient in itself, however it is also vital to determine the potential areas of utilization to ensure optimal usage of the competences. Effective utilization of competences is what may lead to value creation. Our focus is CD, however it would be interesting to look into the issue of utilization as the next natural step in value creation for the firm. We will come back to this in the section ‘Suggestions for Further Research’.

2.5 Summary The purpose of this chapter has been to review literature relevant to our topic under investigation, hence our research questions set forth in chapter 1. First, literature on national culture was presented whereof Hofstede’s (2001) cultural dimensions were presented as we assumed they could influence our findings at later stages. Here ‘individualism’, ‘power distance’, ‘uncertainty avoidance’, and masculinity’ were addressed. Second, literature on PSFs and more specifically management consulting was presented. Herein, competence is central in these firms as it represents an essential resource within the PSFs value creation, linked to the process of (i) selling ‘a credible promise’; (ii) delivering what has been promised; and (iii) learning from Page 35

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the selling and delivery processes (Løwendahl, 2009). Third, resources in PSFs were addressed where intangible resources were identified as essential to a firm’s competitive advantage. Within intangible resources, ‘relational resources’ and ‘competence resources’ were introduced, whereof the latter represents our main focus. When defining competence, Nordhaug’s (1993) definition was highlighted and is comprised by knowledge, skills and aptitudes. As knowledge represents a large part of competence, the last section was devoted to define knowledge and to introduce the importance of KM and knowledge transfer. Lastly, literature on developing and using competence was reviewed. Based on Itami (1987) and Fosstenløkken’s (2007) PhD dissertation, two paths to CD were addressed: CD through ‘investments’ or ‘daily operations’. Further, evaluating and measuring competence and its development represent a critical challenge for organizations. A 360-degree feedback is recognized as being heavily used, however has its concerns. Finally, Nordhaug’s (1993) competence chain was introduced, as utilization of CD is where the organizations can reap the fruits of their efforts.

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3.0 Reserch Methodology
This chapter discusses the methodological considerations and choices that underlie the research process of this thesis. First, we look into the choice of research method. Secondly, the context of the data collection will be attended to in terms of industry, firm, and respondents. Also here the data sources of both interviews and written material will be addressed, and the actual process of conducting the interviews. Third, the data analysis is presented. Thereafter, the quality of the chosen research method and approach is discussed before the last section considers how the actual presentation of the findings will take place at later stages of this thesis.

3.1 Choice of Design and Research Method

Research design is related to choices about how one goes about conducting the actual study. There are three basic designs: ‘descriptive’, ‘exploratory’ and ‘causal’. One of the basic assumptions underlying the choice of descriptive design is that the researchers have a basic understanding of the specific area being studied. This approach aims at describing characteristics of an object to be able to test and determine relationships among two or more variables (Gripsrud, Olsson & Silkoset, 2004). Causal design is most suitable when researchers seek to test cause and effects between variables. Lastly, exploratory design is concerned with generating a thorough understanding and with establishing insights in a particular area of study; hence this is identified as the most appropriate for this project due to our type of our overall research question, as our chosen topic requires insight into the respondents personal experiences, attitudes, and perceptions. Following this discussion comes the important issue of what methodology to use, qualitative or quantitative. The methodology determines what we can study, in addition to the range of possible results and conclusions (Adler, Campbell & Laurent, 1989). The main focus in quantitative research is on matters related to structural-, rather than more complex issues of the process (Van Maanen, 1983). Page 37

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Furthermore, quantitative methods are suggested applicable if the aim of a study is to ascertain ‘how many’, ‘what’, and ‘where’ related questions (Gripsrud, Olsson & Silkoset, 2004). Qualitative research, on the other hand, leaves more flexibility for the researcher, which further enables him/her to take fuller advantage of the richness of data (Wright, 1995). It thereby offers the opportunity to examine the process of ‘why’ and ‘how’, not just ‘what’. We can then explore more complex, interdependent issues whereof number counting and statistical techniques are not of focus, but rather collecting data in its natural setting (Wright, 1995). A qualitative approach is deemed appropriate for our issue under investigation since we are dealing with a research question aimed to indicate how CD is perceived, and we want to explore a complex issue in its real-life setting. Qualitative methods are by Yin (2003) referred to as case studies, which we will turn to next.

3.1.1 Case Studies Within qualitative methods, several methods of research can be found, however we identify case studies as most appropriate. Case studies are frequently used in various fields of research such as anthropology, psychology, sociology, political science, and business administration (Eisenhardt, 1989; Yin, 2003). Despite this, there has in fact not been developed a general definition of case studies adopted by researchers (Andersen, 1997). However, in business- and management studies, Yin’s work has played a rather predominant role, making it a frequent reference in relation to case studies. Yin (2009:18) defines a case study as ‘an empirical inquiry that investigates a contemporary phenomenon within its real-life context, especially when the boundaries between phenomenon and context are not clearly evident’. It allows the researcher to explore both matters concerning individuals, and firms (Yin, 2003). More specifically, three main reasons lay the grounds for the choice of case studies. It is because the form of the overall research question that we have posed implies ‘how’ and ‘why’ type of question, which gives us the desire to understand a complex social phenomenon (Yin, 2003). Also a case study ‘allows investigators to retain the holistic and meaningful characteristics of real-life Page 38

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events’ (Yin, 2003:2). Thirdly, the term CD is, as seen previously, a very ambiguous term which further complicates the research resulting in the need for a more in depth understanding, to be able to make further conclusions at later stages. Another aspect of case studies that we need to consider is whether to choose a single case- or multiple case design. In our study, a case, also referred to as unit of analysis, is each individual professional that has been interviewed. With 37 units of analysis, we thereby have a multiple case design. Also this design is seen as appropriate since we want to be able to draw cross-case conclusions. We want to analyze and draw conclusions about differences and similarities of perceived contributors and constraints of CD on three levels, namely newly employed, senior, and partner level. These categories will be addressed under the section ‘Respondents’. We also want to compare across borders between France and Norway to see if national culture and HQ nationality influences the way CD is perceived. We decided to conduct a multiple-case study, a choice that introduces several important implications. Hodkinson and Hodkinson (2001) have identified positive and negative aspects regarding case studies. Among positive contributions of case studies worth mentioning, are the insights they can offer of complex situations or areas of study. Also multiple case studies can enable researchers to generate novel theories (Eisenhardt, 1989). On the other hand, as the findings may be complex, issues around presenting the results to the readers, arise. The task of presenting and explaining the findings, is not characterized as easy (Hodkinson & Hodkinson, 2001; Patton, 2002). Additionally, the large scale of the data gathered may offer problems regarding the complexity of analysis needed to treat the data (Eisenhardt, 1989). Furthermore, limited generalizability is regarded as a central limitation, as the results cannot easily be generalized from the case study to the entire population. Case study methods may risk describing idiosyncratic phenomena, or that the researcher may be unable to raise the level of generality of the study and theory (Eisenhardt, 1989). However, we have sought to identify patterns of how CD Page 39

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takes place within the PSFs. More about positive and negative aspects of case studies will be viewed within ‘Research Quality’.

3.2. Data Collection and Contexts In the process of gathering data we decided, together with the respondents, that the data would be of confidential matter. Also, we ensured that that information given solely would be used in the purpose of this particular study. It was important that information could not be traced back to the respective firms, and even more important, to each of the professionals that were interviewed. The reasoning behind this was that potential sensitive topics were discussed, of which we had no intentions to reveal the sender of. Due to these confidentiality agreements, only a limited amount of information can here be presented regarding industry details and respondents.

3.2.1. Industry Details The category of PSFs is wide-ranging and encompasses a long list of industries, including accounting firms, law firms, advertising agencies, architecture firms, marketing, public relation service firms, and management consulting firms. These PSFs share common traits, but operate in different contexts in terms of business regulatory regime, and business environment. This study focuses on large management consulting firms in the French and Norwegian context. The empirical part of the study will provide data from a variety of consultancies. The collection of data was carried out in France, Paris, and Norway, Oslo, within six PSFs in Paris and seven in Oslo.

3.2.2. Respondents Regarding the choice of companies to include in this study, we turned to Yin (2003), suggesting an either maximizing-, or minimizing differences approach. Although we in our empirical research have regarded various types of industries within the broader umbrella PSFs, we chose to follow the minimizing differences guideline in the choice of firms, and hereby solely selecting management Page 40

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consulting firms. In the selection of informants we were concerned about differences in experience, gender, nationality, and positions. In each company a minimum of two professionals in France-, and three in Norway, were interviewed on different levels of the firms; newly employed, senior, and partner levels, making it possible to identify potential differences in what may contribute and constraint CD on the respective levels in the organizations. Also this was done in order to get an idea of the contrast between the firms’ visions (top management) and the actual performance (the professionals) of the organization. This can be referred to as talk-action gap, supported by Tsoukas (1996) who emphasizes that it is essential not only to study what the company says it does (in terms of its top managers) in its CD efforts, but also how professionals themselves perceive the CD within the firm - both regarding particular investments in learning facilities, and as part of daily work. With seniority we follow Sveiby’s definition (1997) referring to the number of years employed in the same organization. Although we have not rigidly defined degree of seniority on number of years employed, we have left this consideration to the respondents themselves to define. As a general remark, however, we can state that the average newly employed category refer to one to two years of firm experience, senior consultants between three and five years, and partners as more than five years. Nevertheless, it is important to note that the different firms describe e.g. different evolution paths in terms of career development and number of years associated to each level. Also the firms have different labels for the different levels, therefore we hereby refer to them by the levels mentioned above, as to facilitate comparisons and also in order to not reveal sensitive information in terms of enabling readers to trace statements back to the specific firms. In the majority of cases we were unfamiliar with the firms and hereby not able to choose the respondents. Therefore, potential participants were initially approached via contact persons, such as HR personnel or CEOs, via phone or directly by email. Almost all of these approaches were successful in terms of the low degree of rejection. However in our opinion, having HR personnel and/or CEOs assisting us Page 41

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in identifying suitable respondents in accordance to our selection criteria, was clearly a benefit in many cases, as they have familiarity with individuals within the respective firms. After receiving at least one contact in each firm, they further suggested volunteers for the interviews. Furthermore, information was also collected from two ‘expert’ interviews and their statements have been used in terms of contributing to our interpretation and discussion of findings. These key informants were approached through both an academic network and a talent network where we had access. They were contacted and included, as they presumably were especially knowledgeable on the issue of interest. They both had extensive experience within PSFs in various stages both with- and without managerial responsibilities. Furthermore, one of the key informants has predominantly focused on PSFs in Norway, whereas the other key informant has more experience with France and international PSFs. Approaching key informants has previously been criticized as it can be discussed to what extent the information given is transferable on large firms. Our conversations with the key informants were conducted at later stages of our interview process. Their input was valuable in terms of not only sharing their insight, but also in the way that they contributed to reassuring that our perceptions and interpretations were in line with their experience on a general level. Hence, our conversations were of a more informal matter. Statements from our key informants will not explicitly be addressed however we believe that their insight provided us with wider perspectives and possibly a higher level of insight when interpreting our findings. Overall, the key informants only served a supportive role to us personally in the investigation process. All together, our data consists of 37 in-depth interviews, whereof 14 with French professionals, 21 with Norwegian professionals and two with key informant interviews - one in Paris and one in Oslo. Finding interviewees in Paris proved to be more of a challenge than in Norway. In two of the firms it was impossible within the set timeframe to find respondents on all three levels, as not everyone who was contacted wanted to participate. In the model presented on the next page, an overview of the respondents is presented. Newly employed is referred to in the model as NE, senior consultants as S, and partners as P. Despite differentiating between males and females in the table, we have chosen not to further Page 42

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differentiate between them in our analysis, since we do not view it as central to answer our sub research questions.

Total: 37 interviews including two key informant interviews Company A

Norway (21 interviews) NE (x2): f S: f P: f

France (14 interviews) NE: m S: f P: m NE: m S: f P: m NE: f S: f P: f NE: m P: m NE: m P: m P: m

Company B

NE: f S: m P: m

Company C

NE: m S: m P: m

Company D

NE: m S: f P: m

Company E

NE (x2): m + f S: f P: m

Company F

NE: f S: m P: f

Company G
Figure 7: Overview of respondents

S: f

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3.2.3 Interviews and Written Material The main sources of data are interviews and previous research on the topic under investigation. According to Patton (2002), there are three types of qualitative interviews that can be conducted, requiring different preparations, conceptualization, and instrumentation. These alternatives are; ‘the informal conversation interview, the general interview guide approach and the standardized open-ended interview’ (Patton, 2002:342). These alternative approaches to interviews differ in several areas, one of them being the extent to which the questions for the interview are prepared and standardized in advance. The ‘informal conversation interview’ depends heavily on a spontaneous generation of questions from the interviewer during the interview, and is sometimes referred to as unstructured interviewing. When utilizing the ‘general interview guide approach’ a set of issues or topics is identified before the interview starts, serving as a checklist for the interviewer in the process. The ‘standardized open-ended interview’ has a set of clearly defined and carefully worded questions in order to guide the respondents through a similar sequence, leaving little room for individuality and flexibility (Patton, 2002). Based on these arguments, the general interview guide approach has been used for our interviews, as it is deemed the most appropriate method for the issue under investigation. We had a list of key words and specific questions that were predefined. It was important for us that the respondents touched upon certain key words and issues. However it was also important that we could maintain the flexibility to adjust conversations to the respondents and his/her unique experience, and to what would be of interest to retrieve in-depth information about. Therefore we found the informal conversation interview too general and not to the point, and the standardized open-ended interview too rigid.

3.2.4 The Interview Process and Transcription The interviews were conducted between early January and late July, 2011. The duration of the interviews varied based on time available of the interviewees, however all interviews lasted between ½ and two hours. Most interviews were conducted at the respondents’ respective work place in meeting rooms, however some were held at external locations such as at BI Norwegian Business School, Page 44

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and at cafés/coffee shops. Both authors conducted the majority of the interviews jointly, however a few were conducted separately as one of us was in Paris/Oslo at the time. The majority of interviews consisted of face-to-face conversations with the respondents, however due to cost and time constraints, some interviews were conducted via phone or Skype. Skype was preferred when possible, as it enabled video conversations, leaving room for visual observations and making it more close to a face-to face conversation. Most interviews were done once, however a few were interviewed twice in order to elaborate on findings revealed in the first interview. When starting the interviews we introduced our topic more thoroughly and gave the respondents information about the interview and how it would go about. Also we ensured the interviewees that the information from the interview was of confidential matter. Thereafter we asked each respondent to briefly introduce themselves and their background, to enable an assessment of their degree of responsibility. The questions regarding background included e.g. education, seniority in the company, and work-related tasks. Further, the conversations became more specific, focusing on the topic of CD of both positive and negative matters, as well as culture. Throughout the interview we asked follow-up questions on interesting subjects and made sure they covered the relevant key words of interest. When ending the interview, all respondents were given the opportunity to add information on their own initiative. Also, they were asked if they would be available for questions at a later point if necessary. Some follow-up phone calls and/or e-mails were sent. This was due to new findings occurring later in the process of conducting interviews, which we found interesting to retrieve more information on from a larger number of respondents. Since most interviews were conducted jointly, a tape recorder was generally not used, however in the cases where interviews had to be conducted by one of us, a tape recorder was included to enable us to capture as much information as possible. During interviews, we emphasized on writing down statements as nuanced as possible, often including general observations such as pauses and body language. As soon as each interview was completed, information was transcribed in the aim of preserving as much information as possible, as it was fresh in mind Page 45

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(Eisenhardt, 1989). In the process of transforming the interviews into written transcripts, the presentation naturally became somewhat more formal. However, preserving the spoken form was emphasized. The interviews in France were conducted in English and thereby transcribed in English, whereas the interviews conducted in Norway in Norwegian, were transcribed in Norwegian. This translation process can have important implications and concerns regarding especially interpretation, which we will turn to now.

3.2.5 Interview Concerns As with other types of research and methods of conducting research, interviews are also in risk of biases and general attentive issues that should be considered. Firstly, a concern may be to what extent the professionals are able to discuss, express, and communicate their opinions, feelings, experiences and perceptions. This concern could be especially predominant as our issue under investigation (CD) in the first place is recognized as being rather ambiguous. However, interviews compared to other approaches, such as observations, may provide the respondents with time to more closely think and reflect upon the questions or topics at matter. We did in many situations experience that the interviewees took the time to think carefully through their responses. Being able to take their time to think seemed to be appreciated by the respondents, and we also opened up for clarification questions if questions were unclear or if language would become a barrier. However, we were aware of the potential biases that may arise due to respondents talking about previous experiences and perceptions. Here, faulty memory, exaggeration, dishonesty and misunderstanding of the interview purpose, can lead to bias in our results (McCrank, 2002). Since we have based our reporting and analysis of data on the respondents statements, we will leave it to the readers to make decisions about the credibility of our analysis and our responses to the sub research questions. Secondly, the issue of language and translations is an important concern as interviews with French professionals were conducted in English. In general we seemed not to have issues regarding misunderstandings or language barriers, as the level of English was high among all respondents. In some cases, questions Page 46

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needed to be repeated and/or specified, however it seemed to be related to the complexity of the topic, and not language barriers. The French interviews in general required a bit more time, however we considered this as positive as it might enhance the quality of the output. Also, a concern regarding language is that the perception of words and concepts may differ. The differences in perceptions of the concept of competence and CD are examples which one should be aware of. Therefore, we initially asked respondents to briefly explain how they perceived the concepts. In almost all cases, after we had introduced our study and issue of interest, this seemingly posed no concerns on the issue of perception. In the few situations where the respondents had a different perception than the relevance within this study, we briefly explained and gave examples to make sure that we had ensured a similar point of departure. Furthermore, when translating and transcribing the Norwegian interviews, we were again aware of potential translation barriers. This is because it can pose challenges regarding alterations due to translations of interviews, used for findings at later stages. However in dealing with this, we focused on translating the meaning of statements rather than on the explicit words. Lastly, the aspect of confidentiality also raises important questions in terms of what kind of information the respondents are willing to give. Respondents may not be comfortable talking about sensitive matters, especially if they may think or fear that their colleagues, or even partners, can gain access to this information. Therefore, we assured the respondents of the information being of confidential matter in the beginning of each interview. We also explained how they would be referred to in the study, namely by labels of newly employed, senior consultant or partner, and also sometimes by female/male. This would then ensure that no statements or information could be traced back to each respondent. The confidentiality agreement worked effectively in the way that most respondents were perceived as open and willing to discuss potentially sensitive areas. Actually, the respondents sometimes seemed to enjoy being asked about themselves and their work, and to talk freely about issues without consequences or judgment.

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Despite aspects or concerns described above, the general interview guide approach were by us seen as a fruitful way of investigating complex processes, such as CD. 3.3 Data Analysis

The sub research questions identified in chapter 1, will guide the data analysis that was carried out through a cross-case analysis. According to Yin (2003) a crucial point in this kind of analysis is to look for similarities and differences. In our situation, similarities and differences have been identified in terms of what contributes and constraints CD across levels of professionals, and across borders. The viewpoints have been themed looking for patterns of similarities and contrasts, as Patton (2002) suggested. These viewpoints were themed based on what was repeatedly mentioned by the professionals in the way that it was either within or through these arenas, that CD was facilitated or constrained. The themed viewpoints have thereby served as a basis for comparison for our cross-case analysis. These areas are in the next chapter referred to under the headings ‘CD through Investments’, and ‘CD through Daily Operations’. More specifically, examples of the areas are e.g. ‘Mentor and Support Systems’, ‘Courses and Training’, ‘Learning by Doing’. We believe that this categorization can lead to a sharpening of the findings, as patterns of similarities and differences might be easier to grasp by grouping them. For the analysis and discussion on national culture, and its influence on CD, the basis for comparison was built on how the professionals perceived certain aspects related to culture. More specifically we asked questions about areas that we could link to Hofstede’s (2001) cultural dimensions such as hierarchy and their culture for asking questions. The culture section does however not include a cross-case comparison in this context. This is because we expected culture not to influence one level more than the other, but rather on a collective level. Overall comparisons have however been made between France and Norway, illuminated by national culture of the professionals and HQ nationality.

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After presenting more thorough information regarding the research methodology, it is here deemed appropriate to look more into the issue of research quality.

3.4 Research Quality In the early stages of the methodology sections, positive and negative aspects of qualitative case studies were addressed, and now more specific considerations on the matter of quality will be reviewed. Patton (2002) states that validity and reliability are two factors that any qualitative researcher should be concerned about while designing, analyzing results, and judging the quality of the study. Methodologically, the overall aim for all kinds of studies is to research reliability and validity (Patton, 2002). The two terms however, usually refers to quantitative methods and may not always be directly transferrable to qualitative research (Golafshani, 2003). Reliability Reliability is concerned with the consistency of your measurement (Pedhazur & Schmelkin, 1991). If another researcher were to carry out the same study again, would it generate the same results? An important issue to keep in mind regarding this is that in qualitative research, the researchers impact is prominent as she/he is the ‘instrument’ (Patton, 2002). The researcher is actively engaging in the processes of collecting data, interpreting reality, and participating in the context (Patton, 2002). In this study, to enhance reliability, we have been conscious about these issues throughout our research, as suggested by Patton (2002). However, people and relations change over time, knowledge about competence, organizations and society can be viewed as relative (Fosstenløkken, 2007). Furthermore, the interaction between the researcher and respondent may influence data. This may be due to fact that the strength of the analysis is depending on credibility, competence, and rigor of the researcher (Fosstenløkken, 2007). Thereby, the exact same results may be hard to yield despite having the same purpose and point of departure, using the same methods, and focusing on the same issues. We hope in this thesis to strengthen reliability by making the research open for potential scrutiny, as Eisenhardt (1989) suggests. This includes many aspects Page 49

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of consideration. For example by a stated awareness of the research process, detailed descriptions of the research design, context, data sources and analysis, avoiding biased questions in interviews, and by reassuring our understandings of the respondents answers. Also, we have had a focus on honesty and openness throughout the whole interview process. With regards to the researchers abilities and skills in any qualitative research, Patton (2002) states that reliability is a consequence of the validity in a study. Validity ‘Validity determines whether the research truly measures that which it was intended to measure or how truthful the research results are. In other words, does the research instrument allow you to hit ‘the bull’s eye’ of your research object?’ (Joppe, 2000:1, cited in Golafshani, 2003). To enhance validity in this thesis the main concepts and dimensions used to classify and sort data have derived from theory. The research question outlined has led the data collection. Additionally, by relying on multiple people, companies and sources of data (interviews and written material), the relationship between the concepts studied and the empirical data seen as indications of the concept, were possibly enhanced. Interviews were in most cases conducted together by both of us, enabling subsequent discussions between us, which is likely to enhance the validity of our interpretations. Furthermore, since we have worked together throughout the process, our perceptions of statements from interviewees have not always been aligned. When this issue occurred we contacted the respondents to reassure that our perceptions of their responses were correctly interpreted. This was done in order to not misjudge meaningful responses that could consequently influence our findings and analysis. Where our perceptions of concepts and theories were not in line, we searched for answers through lengthy discussions and in additional literature. Generalizability Generalizability refers to the ability to generalize the results of our study to other settings (Lincoln & Guba, 1985). So in our case, could we generalize our results to other industries? According to Andersen (1997) it is generally viewed as being more difficult to generalize from qualitative case studies based on theoretical representation, because of the typically smaller sample. Despite this, our study Page 50

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includes data found within seven firms (in total 13 divisions in total), which likely increases the potential for providing more comprehensive insight into the complexity and variety of CD processes in our firms under investigation, than a single firm study. However, generalizability will here not closely be discussed, as we at not aiming at generalizing the results to a larger population. Rather, this thesis aims at describing considerations and proceedings in order to make the research and insight accessible for others. This is done in order to allow comparisons with other settings and evaluate the potential analytical transferability of the findings (Yin, 2003). Through stating the supporting evidence and making explicit arguments, the readers may themselves judge the soundness of the statements and claims made in our thesis. Credibility Credibility refers to whether the results of qualitative research are credible or believable from the perspective of the participants in the research or study (Research Methods Knowledge Base, 2006). From this perspective, the purpose of qualitative research is to describe or understand a phenomenon of interest from the participant's view; the participants are the ones to judge the credibility of the findings or results (Eisner, 1991; Patton, 2002). This study can enhance credibility by providing information about the industry and respondents in general, but also through providing discussions of the methods used, including the sequence of empirical investigation and presentation of findings. Additionally the presentation of the empirical findings is supported by the use of quotes from the interviews, as suggested by Patton (2002). Also, thorough comparisons between our findings and theory are made and illustrated in this thesis. By doing so, it is illustrated how our findings can relate to existing theory and thereby one may argue that the trustworthiness of the results can be strengthened. In addition to the quality criteria for research we also found it appropriate to address the ethical aspects as this too relates to the quality of a study. Ethical Considerations The National Committee for Research Ethics in the Social Sciences and the Humanities (NESH, 2009) has developed guidelines for research ethics of which Page 51

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many could be applied in this study. However, when relating the guidelines to the methodology, three are of obvious importance and will here be addressed. These three are; the obligation to obtain consent, the obligation to inform research subjects, and the confidentiality requirements. First, as a general rule, projects that include individuals, may only take place after the participants’ free and informed consent (NESH, 2009). When contacting the interviewees, they were informed that their participation was voluntary. The respondents always had the freedom to cancel their participation, without bearing negative consequences. None of the respondents made use of the latter opportunity. Second, this study has considered the obligation to fully inform the respondents (NESH, 2009). This in practice means that the professionals who have been interviewed, have been given all the information necessary to form a reasonable understanding of the research field, the consequences of participating in the research, and the purpose of the research. This information was provided both via e-mail prior to the interviews, and was repeated at the beginning of each interview. Respondents were given the opportunity to ask clarifying questions if necessary. However, due to this study being exploratory, it was important not to give the respondents any predisposed ideas, which might have reduced trustworthiness. Therefore, only sufficient, and not a detailed presentation of the study, were given before the interviews started. Third, participants are entitled to receive information about that personal matters are treated confidentially. The researcher must prevent the use and dissemination of information that can harm individuals that are subject to the research (NESH, 2009). In the beginning of each interview, all respondents were told that the information from the conversations would be treated confidentially. Respondents were also told that statements made, would only be referred as statements stemming from the respective levels; newly employed, senior consultant or partner either of French or Norwegian origin, and sometimes also female/male. At this point, we have sought to provide thorough information about the Page 52

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methodology of our study, and we will now more closely address how our findings will be presented in chapter 4.

3.5 Presentation of the Findings

In chapter 4, where the main findings regarding culture and CD will be presented, we had to make choices on what to include and how to present it, as Patton (2002) have emphasized the importance of. To make the data material comprehensible, it is necessary to make a selection from the findings. Therefore, readers have to rely on our choices of findings included. In qualitative analysis, it is important and necessary to make decisions that provide indications regarding the variations in the credibility of different findings (Patton, 2002). ‘Hence, selecting material strengthens credibility and quotes that illustrate what we believe are “representative” views of the respondents’ (Fosstenløkken, 2007:103). The statements from the respondents will be presented in italics. Using expressions such as e.g. ‘all’, ‘most’, ‘few’, and ‘none’ indicate the relative strength of the findings. The findings will in our study be presented together with the analysis and discussion, since in case-studies it may not always be appropriate to impose a strict line between the three components; findings, analysis and discussion (Thomas, 2011). Further reasons for the appropriateness of combining these chapters are several. Firstly, we find it appropriate as to avoid repetition. Additionally we feel that it facilitate a more fruitful and thorough discussion, because we see the issues as naturally interrelated. Hence, we do not see it as beneficial to impose a strict line between findings, analysis and discussion, since one infiltrates and merges into the other. We feel that by doing so, the sub research questions can be discussed in a way that enables broader and more nuanced “answers”. Different approaches can be used to present the data in qualitative research. Despite this, descriptions and quotations are the essential ingredients, and are thereby used (Patton, 2002). Due to confidentiality agreements, as mentioned previously, the findings will be referred to as stemming from a newly employed, Page 53

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senior consultant, or partner.

3.6 Summary This chapter has described how our study was conducted. In relations to the sub research questions that have been outlined, an exploratory, qualitative case study design has been used. Our data are based interviews conducted within six management consultant firms in France and seven in Norway, in total 37 interviews. Additionally, two key informants have been interviewed whereof one French and one Norwegian. The respondents differ in terms of gender, tenure, experience and education. The data sources for this thesis are mainly interviews, however supported by selected literature. To enhance research quality and credibility, we pursued openness in relations to the research process and also ethical guidelines were followed. The next chapter of this study will contain the main empirical findings from the 37 interviews. These findings will be presented together with the cross-case analysis and discussion.

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4.0 Findings, Analysis and Discussion
This chapter of the study contains the empirical findings of the sampled firms. We have chosen to conflate the findings with analysis and discussion altogether. Thomas (2011) suggested that findings, analysis and discussion might be conflated into one chapter, depending on the nature of your work as mentioned in chapter 3. First, the cultural aspect and its influence on CD development will be discussed. A comparison across borders will here be addressed as to see to what extent one may find differences in firms with the same HQ nationality. Then, the main contributors and constraints to CD through investments made by the firms, and through daily operations, will be of focus. Here, the three levels of professionals will be referred to, to be able to compare and view contrasts and similarities of what contributes and constraints CD among the three levels. The comparisons are guided by the three sub research questions, as posed in chapter 1. Also, the types of competence developed or inhibited from the CD processes will briefly be presented. This is done as competence has been identified as an ambiguous term and we want to illustrate the nuances in competences, enabling more concrete examples of what the CD processes can generate.

4.1 Culture

(i) How does national culture of the professionals and the companies’ influence their development of competence?

4.1.1 National Culture Differences do exist on the four cultural dimensions posed by Hofstede (2001), however the effects of culture are less significant compared to our initial beliefs. In the initial stages, national culture was expected to have an influence on the companies and their way of operating, which in turn could influence how the professionals develop competence. However, we are not in a position to state to what extent the culture may influence, but only how it may influence CD. When Page 55

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comparing the different cases across the national borders the findings were surprising in the way that national culture seemed to have less influential power than first expected. We will here not compare the different levels of professionals, as culture did not seem to influence one level more than the other, rather it influenced more on a collective level. Here the comparisons will be made between France and Norway illuminated by national culture of the professionals or HQ nationality. We also asked professionals if they had any thoughts on the potential difference one may find across borders. Most respondents thought similarly as us, that differences would occur and be clearly evident in certain cases across the four cultural dimensions that were discusses in chapter 2. None of the two cultural dimensions - uncertainty avoidance and masculinity seemed to influence how the professionals developed competence across borders. Regarding uncertainty avoidance, we assumed that the French culture, scoring higher on uncertainty, could influence the need for clearer task specification and/or need for frequent feedback and evaluations. Few differences could be found across borders as professionals, both in France and Norway, on all levels appreciated autonomy and feedback on their work and had no special needs for clear task specification. Regarding masculinity we raised the question whether this dimension could influence in terms of focus and priority on CD. However no major differences could be found across borders. CD seemed to be viewed and prioritized quite equally. We will come back to the prioritization of CD under the next two parts of this chapter, namely CD through daily investments and through daily operations. However on the dimension of power distance, differences could be found across borders regarding CD. The French culture is known to have larger power distance, which may influence the communication and asking culture within companies. This was evident in some situations, meaning that it seemed to influence on a collective level within some of the firms in France. This in turn, had a negative effect on CD. Other respondents when being asked to tell about the French perception of hierarchies could not relate to this being a problem at all. More specifically it seemed to influence the asking culture and interaction between professionals across layers. Regarding vertical interaction, which is concerned Page 56

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with interaction between layers, accessibility was clearly affected by the higher power distance in France. This could be exemplified through the fact that few newly employed in France, felt they could approach especially partners with questions. The horizontal interactions, which deal with e.g. within-layer interactivity and collaboration seemed not to be affected as much. Individuality was expected to influence in the way that HQ nationality could influence degree of collaboration and willingness to share information. Most firms are U.S.-based and thereby score extremely high on the index for individualism. Less willingness to share was clearly evident, however only in France. Thereby we started questioning if HQ nationality was the factor that could explain our results. If so, we should also find a lower willingness to share in Norway as well we did not. Then we started questioning if organizational culture could help explain the difference. Since organizational culture was not reviewed in the chapter 2, and this issue occurred during our investigation, we here see it as important to present theoretical aspects of the organizational culture as an influential element on CD processes. Organizational culture is by Kubr (1996:108) known as ‘a peculiar mix of values, attitudes, norms, habits, traditions, behaviours and rituals that, in their totality is unique to the given organization.’ Furthermore, Nordhaug (1993) states that culture shapes the environment for learning through values and norms attached to the development of competence. According to Kubr (1996), organizational cultures are reflections of national culture however including other aspects as well, such as values and norms. The fact that organizational cultures are reflections of national culture, could potentially explain our results to a certain degree in the way that differences occurs in organizational culture across borders. Since many of the companies are U.S. based, the organizational cultures are assumed to be reflection of that national culture. However, if organizational culture were solely a reflection of the U.S. based culture, and that the norms and values are based on this, we would not see such evident differences regarding the willingness to share. Hence, we assume the organizational culture is just as much, reflections of the French and Norwegian culture. If so, the differences that thereby occur in the organizational culture, in terms of norms and values, may influence Page 57

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how knowledge is shared, and in turn CD. Through our interviews, a Norwegian partner said that for sharing of knowledge to happen, there needs to be a culture for it, it must be anchored in the organizational culture through norms and values, not necessarily through rules and obligations. When viewing the organizational culture we do feel that it might be the additional norms and values across borders that can partly explain the differences. However not fully, and we therefore want to introduce another possible element of culture that might influence, namely Hall’s (1990) key concepts of nonverbal communication. Hall is best known for his work in intercultural relations and communication and especially his studies on nonverbal communication (2011). He has developed key concepts of the underlying structure of culture, whereof high and low context culture is one of these concepts that might contribute to an understanding of this finding. The characteristics of each of the two cultures are identified in the table below.
High Context Cultures (France) Ø Less verbally explicit communication, less written/formal information Ø More internalized understandings of what is communicated Ø Multiple cross-cutting ties and intersections with others Ø Long term relationships Ø Strong boundaries- who is accepted as belonging vs. who is considered an "outsider" Ø Knowledge is situational, relational. Ø Decisions and activities focus around personal face-to-face relationships, often around a central person who has authority. Low context Cultures (Norway and the U.S.) Ø Rule oriented, people play by external rules Ø More knowledge is codified, public, external, and accessible. Ø Sequencing, separation--of time, of space, of activities, of relationships Ø More interpersonal connections of shorter duration Ø Knowledge is more often transferable Ø Task-centered. Decisions and activities focus around what needs to be done, division of responsibilities.

Figure 8: Characteristics of high and low context cultures (Source: adapted from JB Intercultural Consulting, 2003).

France is according to Hall (1990), defined as a high context (HC) culture and Norway and the United States as low context (LC) cultures. A few of the characteristics in the table above seem to be in line with our findings. One example is the fact that in the French culture, there are strong boundaries between social groups and between who is regarded as being within and who is an outsider. One can relate Hall’s work to that of Sumner’s early work, as he in his Page 58

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book ‘Folkways’ (1906) made distinctions between ‘in-groups’ and ‘out-groups’ (in Schneider, 2004). In the French culture it seemed to become an issue of “them” and “us” as a French senior explicitly put it: we are French… we don’t like to share with people we don’t know. Another French senior consultant followed the same path by saying that I’ve been in the same team for a long time. We haven’t included any new members and we don’t want to include people we don’t know. When following up his statement, he reasoned that this was because they did not want to share their knowledge and spend time on this effort if the team functioned well already. The seemingly lack of culture for sharing can further be explained by Hall (1990), as he stated that some foreign employees view the French as sometimes difficult to deal with. The French ‘tend not to relate well to others; the French are too individualistic to be good team players’ (Hall, 1990:124). One must keep in mind that much may have happened since this book was published, however our findings do indicate that traces of these cultural traits still exist. Also HC cultures have less verbally explicit communication and less written/formal information because they do not always feel the need for contexting which is ‘the process of filling in background data’ and to explicitly state all information (Hall, 1990:7). In LC cultures on the other hand, more knowledge is codified, public, external, and accessible in different situations, and thereby appropriate to assume in work contexts as well. Due to the high and low context cultures depending on different methods of conveying information and knowledge, conflicts between the two cultures could arise (Soley & Pandya, 2003). We feel that these arguments might be possible explanations to the differences we have experienced in willingness to share information especially across the French border. Even though, no matter the reason for why professionals seemed to be more individualistic in France, this cultural aspect functioned as a clear constraint of their CD. We believe it is a clear constraint as learning from others was identified through the interviews as an essential contributor to CD. Learning from others his will be illuminated in under ‘Daily Operations’. To answer the first sub research question, national culture influences how professionals develop competence in the way that it affects the interactions among individuals in the management consulting firms, in both countries. In France, the culture reflects negatively upon CD in aspects related to the culture for asking Page 59

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questions and sharing knowledge. In Norway, the culture for asking questions can be perceived quite different due to the lower score on Hofstede’s (2001) power distance dimension. The attitude for sharing knowledge was found to be more positive in Norway, despite the similar score on the individuality dimension. We thereby posed a possible explanation through Hall (1991), who differentiates between how the French and Norwegian people communicate.

4.2 CD Through Investments

(ii) What are the main contributors and constraints of the professionals’ competence development through investments made by the firms in CD processes? All firms in our sample, in both France and Norway, seemed quite conscious about designing CD efforts for their professionals. CD through investments is here understood as activities on CD, initiated and invested in by the firm. During our interviews many activities were mentioned however the following arrangements were highlighted: ‘Mentor Programs and Support Systems’, ‘Training and Seminars’, ‘Evaluation Systems and Measurement’ and ‘Technical Tools’. Within these investments, the main contributors and constraints can be found. Our findings suggest that investments made by the firm influence the CD processes of professionals, at all three levels. Hence, these findings support Itami’s (1987) suggestion that such investments represent an important route to CD.

4.2.1 Mentor Programs and Support Systems In all of the companies where respondents were interviewed, a mentor support system can be found. Consultants face extremely challenging and stressful development requirements. Among numerous other pressing issues, they will face an increased range and complexity in responsibilities, requests and demands for leadership and professional skills, meeting the requirements from colleagues, managers and other professionals, and all this in the context of meeting and placing a large number of new people within a short period (Maister, 1993). In Page 60

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order to support the new consultants they are often given access to at least one designated colleague – recognized as a mentor, coach and/or personal manager. The benefit of this support is that this person is intended to be available for professional and personal advice and support. The role of the mentor is to assist the less experienced professionals in their development, and to advise them on issues such as time management, deciding on priorities, delegation, managing conflicts and problems, and professional development. Whereas some had support systems mostly for the newly employed, others had extended the duration up even to a young partner level. We believe that the need for mentor systems at partner level might have been identified in newer times as markets are changing more rapidly and clients are becoming even more demanding (Wiley Knowledge for Generations, 2010). Contributors When comparing the respondents, almost all viewed mentor support systems as positive and crucial for individual development in terms of CD. Most respondents in both countries, on all three levels, identified mentors as major contributors to CD. Not necessarily directly, however indirectly through receiving ‘guided experience’ that contributed to the professionals’ development (Maister, 1993). Among the reasons mentioned for this positive view, was that mentors contributed to e.g. professionals setting appropriate goals for their career development, that they advised them on a broad set of issues, and that they encouraged the professionals to explore new projects. Most professionals at newly employed level, mentioned that learning from more experienced consultants was an important element in their own CD. They referred to their mentors as teachers, helping them making sense of the system they were a part of. The main contributors identified through the interviews are in line with previously identified benefits in literature. Despite our agreement with Maister (1993), who suggested that the existence of these systems is favorable, our findings moreover indicate that also senior professionals find mentor systems important. When comparing across cases, we see that many seniors and partners in both countries find mentors crucial on their level as well. A French partner stated his appreciation of mentor system, as it recently was implemented on partner level Page 61

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within his firm: The first year of partnership is very difficult! We have seen a clear need for this, especially in order to ensure that our partners still develops and not stagnates after achieving partner status. A Norwegian partner, whom turned partner exceptionally quickly, acknowledged that this would not have been feasible without the help from his mentor. The relationship with his mentor was stated to be central in his fast-tracked development. His mentor had been key in helping him developing a fortunate client portfolio, with varied projects as to maximize his insight within several industries and through different types of projects. Mentors themselves also argue that by sharing their knowledge and experience, they develop themselves in turns of evolving leadership abilities. Constraints Despite the positive aspects mentioned by all three levels in both France and Norway, negative aspects were revealed as well, although mostly identified by seniors and newly employed in Norway. Mainly this concerns the issue of availability, but also regarding the issue of being “lucky”. Some pinpointed that the personality and willingness of the mentor to share knowledge and care for their professionals, as being factors heavily influencing the effectiveness of the mentors, hence influencing the potential for the professionals CD. In a few cases, newly employed in both countries stated that they did not take advantage of the mentoring systems due to poor personality matches between themselves and the mentor, and partially also due the feeling of bothering their mentors when asking questions or requesting assistance in different situations. Even though the professionals were allowed to request a different mentor, we got the impression that they did not dare to do so, as this was perceived as a negative signal to send. The issue of the professionals’ perceptions of bothering the mentor could be explained by the fact that the time spent on mentoring juniors do not count as billable hours (Maister, 1993). A senior consultant in France stated that he could acknowledge this problem, linking it to a matter of heavy workloads and time constraints. He was a mentor for a subordinate himself and stated that: It is not ideal, because you tend to lose a lot of time, and you will not be patient enough to invest sufficient time and energy into the recruits´ trial-error approach. He thereafter stated that this was a problem both for the general CD, of both the mentor and the professional. Mentoring is a time consuming activity, as stated by Page 62

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Maister (1993). Our remark is that the systems clearly are well intended, however lack of interaction not only has a negative impact on the usefulness of the systems, but definitely also for the parties involved as low interaction hinders fruitful relationships. Reimers (2011) argued that a large part of the success of a mentoring relationship lies in the trust that evolves over time through informal and regular contact. We will deal with the issues of trust and interaction more carefully at later stages of the chapter. It seems as for the mentor and support systems to function optimally, there is a need of lowering the barriers for a potential switch of mentors. A senior consultant in France suggested that one might impose mandatory switches after a certain period of time. However, in the cases where the professionals are content with their mentor, and have identified them as a crucial part in their development, a switch can again foster stagnation, which could have been prevented if there was no mandatory switch. The argument for establishing long-term relationships would be that it allows the professional to learn thoroughly from one master. Regarding availability, the mentors in most cases were situated at the same location as the assigned professional, however a only few newly employed in France and Norway identified lack of availability as a major constraint. A senior consultant in Norway mentioned that this was due to the lack of follow-up systems or procedures that ensures that the professionals receive the support they are entitled to, possibly resulting in the professionals not reaching their CD goals. He further stated that it is then the professional’s responsibility themselves to initiate changes. Our reflection on the fact that it is up to the professional to initiate, as they initially are supposed to jointly develop with help from mentors, lead us in the direction that some professionals might feel left on their own. A few of our respondents on newly employed level indicated this, in both countries. However, this especially seemed to be the problem in France where signs of hierarchy and barriers between levels seemed more evident. A newly employed in France stated in relations to this: I have never asked a colleague on a partner level a questions, and I probably never will. This illustrates our general perception of the culture for asking questions across levels in-, especially, French firms. Without approachable mentors, the professionals within the lower levels of the Page 63

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hierarchy might have few people to turn to within the company. This is, in turn, unfortunate. As indicated by Maister (1993), mentoring is a tool intended to develop tacit knowledge, and hence CD. However in order for this to function effectively, face-to-face interaction is fundamental. Through our findings we can support this statement. When considering the type of competence that can be developed through mentor and support systems, we identified these as socialization processes. Examples of competences that can be developed through interactions with other people are mainly meta-competences, intra-organizational competences, industry competences and unique competences. Within meta-competences, examples of issues that the mentors can contribute to are the professionals’ capacity to tolerate and master uncertainty through helping professionals becoming more confident in their own decisions. Mentors can also contribute to professionals’ ability to communicate and cooperate with others. Regarding intra-organizational competences, the professionals can learn about colleagues, the elements of organizational culture, information channels and informal networks etc. Concerning industry competence, an important generator of this competence is, according to Nordhaug (1993), through other people with specialized competence within the field, which we assume mentors in certain cases have. For unique competences, mentoring processes can enhance understanding and CD on operation of certain technologies and routines within the company, which may not necessarily be provided through courses and training. We view these competences to be important for all levels, however, industry competence is viewed as being essential on the level of newly employed, as they may be new to the industry and in need of quickly establishing an acceptable competence level in this area for their further work.

When comparing the different cases, there are more similarities than differences, as close to all respondents view mentor and support systems as positive and highlight the same main contributors and constraints. So what happened to the “fly solo” attitude that management consulting firms are recognized by? Due to the well-established up-our-out systems among PSFs and management consulting firms, we would not have been surprised if this was discovered visible in our Page 64

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findings. Rather, we found that partners and firms in general actively promoted mentor systems as to help their aspiring professionals to survive. Indeed, seniors’ functioning as mentors have a challenging task in sharing their tacit insights and knowledge with their receivers, but the intention in itself, is good. Nevertheless, the mentor system is by us viewed as a “lifeline” for, especially, the young professionals, where the mentors play a critical role in the transition from being a rookie turning into a mature professional. From the perspectives of the seniors and partners serving as mentors, our impression is that being a mentor is perceived as a complicated role, where finding the right balance between teaching and coaching, pulling and pushing, holding close and letting go, seems challenging (Ibarra, 2000). In statements from respondents we also find support for these issues. In addition, as evident in our findings, the professionals are forced to firstly serve their clients and secure income, and hence the time available for mentoring, is reduced. Another constraining element is the rather diffuse boundaries of the mentor role, where the professionals have no training in performing as mentors.

4.2.2 Courses and Training Training, along with other developmental opportunities such as mentoring, was found to be highly present in all the firms we studied. They heavily tend to rely on seminars and courses to continuously develop and staying updated, and it is through the formal training the professionals gain explicit knowledge (Hitt et al., 2001). The firms could both internally and externally arrange these courses. External courses were identified by most partners as being an opportunity that was given to all of their professionals, however, in reality the case seemed to be quite different. Many of the respondents on the two lower levels had never received the opportunity of attending external courses, and some was not even aware of this possibility. All of the companies had introductory courses and seminars primarily focused on development of standard technical competence, ensuring an equal skill- and competence level. All of the companies had annual mandatory training, to a large or less degree, some run courses in concentrated periods of time, others had them spread out over longer periods – everything having its positive and Page 65

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negative aspects. The mandatory courses and seminars were often partner initiated, as all partner respondents referred to one of their responsibilities being to help develop the knowledge of other professionals of the firm. Contributors In general, our findings indicate that courses and training is necessary and helpful contributors to CD on all levels in both countries. When comparing, differences could be found in why training was important, however these differences could mainly be found across levels, and not borders. This was despite the fact that all respondents agreed that CD through daily operations is far the most important and helpful part. I believe that only 10% of my competence comes from courses, whereas 90% comes from what I experience and what I do, this was stated by a newly employed in Norway. Furthermore, many identified training and seminars as helpful, but not necessarily due to the initially intended reasons. Some senior consultants and partners in Norway stated that the most positive aspect about training was that it served as a platform for network development: Connecting with- and getting to know your colleagues is essential, also this contributes to another important notion, namely getting to know “who knows what”. This was found to be vital by a senior consultant in Norway, since it is important to know whom to contact when you need advice and/or help from more experienced colleagues in e.g. new project issues. Quickly findings the “right” people was also crucial in order for the company to put together the “best” team to be able to deliver optimal service to clients. Further he stated that no system could compete with this. In addition to the formal courses, many of the companies had developed different arrangements to contribute to the CD of their professionals through e.g. crash courses, summer academies, monthly group discussions and more. One of the partners in Norway expressed his satisfaction with the system of having crash courses before new projects as it enhanced the likeliness for his superiors developing an equal knowledge foundation. It would also reduce the number of hours required to reading and self-studying outside the office. Furthermore, a newly employed in Norway expressed that she was very content with the firm initiated monthly meetings. This system mainly aimed to gather a few people Page 66

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from the same level once a month, to discuss a technical topic. The participation was mandatory for every newly employed the first two years within the firm. Practically the agenda included that two of the participants presenting a topic, which further introduced a thorough technical group discussion. A superior or subject matter expert, “SME”, was present to assist the participants in drawing the correct conclusions, and supervising the sessions. The outcome was thereafter logged in the company’s internal database. The summer academies, available for professionals at all levels, was by a partner in Norway found to be a central element in the professionals CD, as this was a perfect setting for getting to know colleagues and learn from their experiences. Another company had started having one or two annual meetings with partners in sister companies abroad. Here they discussed and shared what they viewed as effective training, and further shared and reviewed domestic experiences on trainings and seminars. This was highly appreciated among the partners as it opens for continuous updates of the training repertoire and content, contributes to implementation of best practice training, and hence potentially motivates the professionals to develop new competence. Also it functioned as a motivational factor for partners as they hereby have an arena for discussing technical competence with people on the same level. Even though most of the respondents viewed training as a contributor to CD, it was difficult to determine to what extent. This was firstly because the internal trainings seemed to differ in matters of content across borders. A senior consultant in France identified this, and explained that this was due to different client portfolios, market dynamics and potential differences within the same industries across borders. These differences would consequently lead to differences in types of trainings and methodologies needed. In practice this makes it hard to determine to what extent training is contributing to CD, as different firms have different ways of training their employees internally, and thereby the professionals do not have the exact same perception of training.

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Constraints During interviews, negative aspects of trainings were also revealed. The issues repeated the most were down-prioritization, lack of external training, training being provided at the wrong levels or inappropriate times of the year, and training sessions being too general. All respondents in both countries recognized the down -prioritization of training as a major constraint to CD. Courses and seminars seemed forced down on third place in the firms prioritizing scale, after clients and business development. This was supported my most respondents, and was due to the time constraint and heavy work load as the clients comes first and now sets shorter deadlines than before it seems, as stated a senior in Norway. Another Norwegian senior consultant further explained this by stating that the overall problem is facilitating consultants’ availability to participate in necessary trainings. This company has tried to plan the training well in advance in order to improve the probability of consultants participating. However, the primary mindset based on clients first and exceeding client satisfaction, complicates training attendance. Despite the professionals’ awareness of this issue, many respondents in both countries agreed that courses offered after office hours, reduced their motivation to participate. The issue of clients first has during our interviews not only been expressed as a concern among newly employed and seniors, but also by a Norwegian partner. He could acknowledge the frustration that time pressure and heavy workload imposed, and that the clients first focus resulted in difficulties in finding time to develop competence at firm level and development of the firm in general: This was because you always needed to be present and available for the client. Regarding the issue of too general courses, not relevant to the professionals specific field or level, a newly employed in Norway stated that sometimes it seems that the courses are offered solely to ensure that the consultants possess the skills that our employer is known for – and their reputation. There seems to be no focus at all on my reputation as an individual consultant, or on what that could be helpful for me, or the people within my team. Senior consultants in both France and Norway further supported this and revealed that it sometimes seems like the company is forced to invest in courses, and hence blindly impose them as a matter of duty. This consequently was found to result in irrelevant courses, not adjusted Page 68

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to the different levels of expertise, or offered at inappropriate times and/or periods. To our minds, this line of reasoning might also explain the limited access to external courses, as most of the firms in our study only required mandatory attendance on internal courses. That being said, we are certainly aware of other explanatory elements defending the low degree of external courses – e.g. financial considerations, logistical issues, and in-house, tailor made solutions, however we will now look more into the issue of external training. Regarding external training, most newly employed, however also seniors expressed dissatisfaction. The partners were found to be the most satisfied. Most partners stated that they had European training sessions and meetings abroad where knowledge was shared in various fields. By the newly employed and seniors, however, it was stated during several interviews that when they first got the chance to participate on external training sessions, their attendance was purely for social reasons. A senior consultant in France stated European training is crap, it’s too general, it’s about things you usually already know, and let’s be honest we all go there just to have a good time. He further said that since these seminars were arranged once a year, the consequence was that the content was not updated and/or specific enough, and thereby irrelevant for many. Also, the consultant mentioned problematic aspects about the intercultural setting as matters such as type of clients, and hereby the consultant-client interaction, differs between countries. Another Norwegian senior consultant also expressed his concern about the generalization of training, as he believed that the partners did not really understand the negative effects. He said that too general courses and seminars led to employees developing similar knowledge and competences, instead of complementary competences. This could in turn lead to disasters for the company’s value creation processes since the effects of the general training were that the professionals were moving in the direction of becoming a more homogeneous group. He further responded that a company needs expertise in various disciplines to be chosen by clients. Also he said that many courses did not contribute at all to his CD, closer to the opposite, as he rather would have spent time on reading up on technical issues himself. One can argue that through creating a more homogenous group of individuals, trainings might actually serve the opposite purpose of what the firms initially seek. They want their Page 69

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professionals to have a variety of competences, possessing different kinds of knowledge to create the most value in teams and thereby for the clients. If we turn to Nordhaug (1993), he states that organizations embrace individuals who have different types of competence. We then question if the type of training described above, evening out the initial heterogeneity within the firms, reduces the firms’ chances of creating client value? We are only in a position to speculate, therefore we will move on to the additional issues addressed under subject of external training. A newly employed in Norway speculated that external courses were offered in periods when time pressure and high workload would make it almost impossible for the consultants to participate. He suggested that it should be obvious for the partners that participation would be close to impossible during these periods, and low participation would further lead to cancellation of the courses. This however, resulted in the company having, as he referred to it, a “clean conscience” regarding fulfilling their “duty” of providing these courses, leaving no room for the professionals to complain about not being offered external courses. A partner in Norway further argued the following regarding the lack external courses: There is a huge lack of opportunities for the employees to go abroad if requested, because our measurements made by the company indicates that the learning curve and effects on CD is better when professionals gain experience by working on projects, rather than being formally trained abroad or externally. Several newly employed and senior consultants expressed the need for explanations of the importance of-, and area of utilization of, the courses they attend, as this would, as they expressed, contribute to the motivation for attending. If you don’t know how you can use the information, you first of all won’t remember it, and secondly you will never use it, a senior consultant in France stressed. If the respondents will not utilize the knowledge, they do not get full appreciation of the courses as this knowledge need to be put in context and utilized for optimal CD. Regarding the quality of courses, most firms in this study have no post-course evaluation. Partners hereby seldom receive feedback on the effectiveness of the Page 70

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courses, content, relevance etc., and consequently miss out on valuable response on the professionals learning outcome. Of course, the potential effect of the courses can be seen in the professionals’ performance over time, however the long-term effect does not seem to be measured or reviewed. As a French partner said: they had forms that were given to the attendees right after the course to receive feedback, but they had no long-term follow-up or measures capturing the true effectiveness of the training. If this is the case, we believe partners loose valuable information that may help them in improving training sessions. Also, without proper measurement systems they can neither measure to what extent the accumulated knowledge is utilized in daily operations. However, to be able to do so, partners must acknowledge the explicit need for identifying how and why the different kinds of training are important, so that the professionals get to optimize the use of knowledge gained through training. We believe that mandatory evaluations after training sessions in itself not are an adequate measurement. To some extent it may also loose its meaning and/or reveal inaccurate results if the respondents not fully understand the reason and goal with the training in the first place. This is because, in this case, that the professionals cannot say anything about how they will apply the knowledge in the future; in what areas, how, and to what extent. We do see that when comparing cases, the perception of training contributing to CD, is similar among our respondents. However in what way it contributes, differs across levels. Different types of competences seem to be developed at different levels. For newly employed meta-competences, industry competences and standard technical competences, are the main competences developed. On a senior and partner level, intra-organizational competences were developed - more specifically; knowledge about colleagues was highlighted as important. However, several of the senior respondents clearly stated that it was not only knowledge about colleagues within the firm that was of importance, but colleagues across borders. Thereby intra-organizational is not fully covering the types of competences developed. To comment on the overall findings on the issues of training, we were very well aware of the respondents being highly educated, highly committed to their work Page 71

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and in general seemingly satisfied with their status as a consultant. We expected that the firms under investigation would be “good” at training their professionals, as the essence of a consultancy firms’ work is to teach others how to do things differently. So did the findings support our expectations? To a certain degree, absolutely – the firms’ initial attitude towards learning appeared sincere and positive. However with time constraints, high workload, indications of too general courses, and lack of external training and clear training outcomes, the professionals’ motivation for participating in trainings seemed blunt.

4.2.3 Evaluations and Measurement Regarding the evaluations and measurement of the professionals, their work progress and CD - several findings became evident. The main reasons for measuring and evaluating the professionals were many, e.g. to ensure optimal CD, create benchmarks for career development and promotion, and long-term profit. Evaluations and feedback in itself was not found to influence CD directly, however we choose to include this discussion, as it seems to influence CD indirectly. In most cases, the evaluations appeared to serve a functional role as accelerators of processes of CD. These issues will now be more closely exemplified and discussed. Contributors For most respondents in both countries, evaluations and feedback functioned as a motivation, which in turn, indirectly influenced CD. Most of our respondents said that they highly appreciated the specific feedback given. This was identified as factors contributing to the professionals’ willingness to continuously develop, as they knew how and where to invest their time for improving effectively. Also, the fact that their work was acknowledged through evaluations and feedback functions, served as a motivational factor. In some firms, evaluations were mandatory after each project, or each season (four times a year), whereas some only once a year. In other firms, it seemed not to be mandatory, but was implemented in the company culture and norms. As a Norwegian partner stated: no one will hit you in the head if you’re not providing the evaluations, however we have a culture for giving our consultants feedback in their everyday work, and I Page 72

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believe most of our consultants get the feedback they need from their supervisors through their continuous performance. Within a few firms, the professionals themselves could request certain fields of which they were to be evaluated on, whereas in others the scales/areas of measurements were fixed, some also applied a mix of the two. Furthermore, in some cases, the firms used a few scales or areas, whereas others had numerous parameters to be measured on. In general, the areas of measurement after projects, varied, however most firms evaluated technical skills, some also measured consulting skills- referring to e.g. communication abilities, problem solving abilities, project management skills and their ability to ensure positive client-consultant relationships. Additionally, in some firms, the professionals could choose to be evaluated by his/hers superior (upwards), by colleagues (sideways) or by people on lower levels (downwards). The Norwegian partner who shared this information, found this solution to enable a more varied evaluation, including different perspectives of the firm, as people on different levels have different focus. A newly employed acknowledged that sideways evaluations were more relevant in terms of receiving soft skills evaluations, as the colleagues who evaluated him based it on daily interaction. The downward evaluation, on the other hand, was more hard skills focused, where he was evaluated on his standard technical competence. Through measurements and evaluation of their employees, a Norwegian partner said that CD was “systematized”: Through these evaluations one can clearly see if the goals of each individual are reached or not. As CD is an essential criterion for further promotion within the firm, which further is linked a company’s’ long-term profit, consultants’ competence level is measured and rated internally. In this firm, the clients also rated the competence level, however this was far from the case within all our firms. An unexpected findings to us, was that in the cases where the senior consultant/team leader received client evaluation on the consultancy team, these evaluations were not brought on to the professionals themselves. We found this surprising, as we believe client feedback could be an essential element to be incorporated in evaluations. As we see it, client evaluations would be potentially less subjective as the evaluations are stripped from personal relationships bias. Perhaps this could increase fairness in terms of introducing more objective viewpoints where consultants are evaluated in a natural setting? Page 73

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The high appreciation of evaluation amongst the respondents indicates that the people we met with were highly motivated individuals, wanting to perform well and highly committed to their jobs. These findings are in accordance with our expectations formed by reviewing PSFs and the management consulting industry, where the individuals were characterized as highly skilled and self-driven individuals. Constraints Concerning the negative aspects, two constraints were identified as more evident and predominant: The evaluations were found to be down prioritized and too subjective. The main constraint that was clearly identified by most respondents in France on the two lower levels was the down-prioritization of feedback and evaluations. Even though it seemed evident that evaluations were intended to be given after each project, the evaluations were conducted late (from six months to one year post project) or even, in some cases, never conducted at all. A French partner stated her concern regarding the late evaluations: If the evaluations are not given at the right time, they are meaningless. Both parties might forget details that may be crucial for the individuals’ and their CD, as well as the firms CD. We found it interesting to note, that this respondent also had long experience serving as an HR manager. Another French partner supported that postponed evaluations would clearly lead to inaccurate feedback due to memory issues. He further stated: After the evaluations you usually have 10% of the consultants performing very well, and 10% who have performed not up to mark. The 80 % of the people in the middle are difficult to classify and differentiate between. Sometimes we are not able to explain why some of them are put before others. In these cases, we argue that the professionals “in the middle” becomes a part of the large “grey crowd” of the firm, not being acknowledged, seen, hence possibly loosing motivation. The second major constraint to CD regarding evaluation systems is the fact that the measurements are perceived too subjective. As colleagues make the evaluations the personal relationship will naturally affect the results, in both positive and negative ways, depending on the relationship. A French senior consultant stated: my partner, who knows me and trusts me, always gives me great Page 74

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feedback, even though I know that I could have performed better. He expressed his concerns, as he perceived the feedback system as confusing. He rarely received instructions on where and how to improve. Thereby for him, the evaluations served in almost opposite purpose of being a contributing factor of development. In order to become successful and of value to the company, you need to grow and learn on a continuous basis, a French partner stated. Several of the respondents on partner level in both countries, acknowledged the positive effects these systems might have if applied properly. Therefore, our findings suggesting that evaluations are down prioritized, is surprising. Again, we believe that this is due to the high time pressure, since the respondents seem to be aware of the benefits in the first place. We believe that by delaying the feedback, insecurity among the professionals might arise, as they “risk” not being credited for their work, and/or are not provided directions for further improvement. According to Bridgespan (2003) the situations that originally could be viewed as minor glitches, could develop into becoming a serious problem, and we hereby pose our concerns about the utilization issues described above. Regarding types of competences, it is here difficult to identify since evaluations and measurements are viewed as having an indirect effect on CD. Respondents themselves highlighted these systems as having positive and negative effects on CD, however what type of competence they developed based on the evaluations and measurements are hard for us to determine. During our interviews the respondents gave examples on what they had to further develop, for example analytical skills, which can be found within meta-competences. However, several examples were given that was found within most competence categories and so identifying those are here seen as neither necessary nor appropriate. As a general remark to our observations and findings with regards to evaluation and measurement, our initial belief was that the respondents would appear eager to continuous improve themselves, as our perception is that these individuals are career driven, committed and highly motivated. To a certain degree we are left with the impression that this definitely was the case among most respondents. Page 75

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They are highly concerned about performing well, and also highly focused on receiving feedback and evaluations “proving” their success. Through our interviews, however, concerns arose due to professionals feeling evaluated subjectively, and/or often a long time after ended projects – leaving them with inaccurate evaluations. The problem of subjective evaluations seemed to be even more predominant in France. The Norwegians also acknowledged this problem however seemed to have applied a “laissez faire” attitude, more settled with the issues concerning e.g. subjectiveness. As consultants can be characterized as having an unrealistically high ideal of performance (Argyris, 1991), inaccurate evaluations and a sense of wrongness in the way that evaluations are conducted might nurture defensive attitudes among the professionals. This can spread out in the organization, and this would be extremely unfortunate, as we see it. Another side of this, is that the evaluations might cause the individuals turning overly obsessed with achieving within the parameters of the evaluations, causing them to blindly focus on themselves and their performance, worried about “not making it”, and trying to hide CD shortcomings from his peers and subordinates. Consequently, the effect of this is less openness and conceited personalities (Bauman, 2003), fostering individualistic behavior instead of collectivistic values. Through literature presented in earlier chapters wee find it evident that this would be extremely unfortunate for companies in general.

4.2.4 Technical Tools

Hansen and Haas (2001) suggested that explicit and tacit knowledge are complementary within a firm. Our findings have provided us with an idea of the different mechanisms implemented in the firms, aimed to facilitate knowledge sharing at organizational level. These are tools that help articulate the competence ingrained in the brains of the firms members (Hansen & Haas, 2001). This section of our thesis will introduce the technical tools implemented to store competence at firm level. More specifically we will address the information databases/knowledge pools available within the firms, containing e.g. Page 76

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professionals CV’s, templates, methodologies, and best practice examples. Our findings indicate that they serve as both contributors and constraints to CD, and that the technical tools put in place in order to store competence are applied quite differently in the respective firms. Contributors The technological tools functions as contributors mainly with regards to individual CD, as they enable professionals having quick and permanent access to knowledge. The systems contain brief summaries where e.g. the subject at matter is addressed, the methodology described, and the results presented. Many newly employed, especially in Norway, stated that the systems provide background info important for the self-studying process pre-projects, and also security in terms of knowing that information is available. These findings are in line with research suggesting that KM, and hence CD, enhances as technological tools extends the reach and speed of knowledge transfer (Rasli, Madjid & Asmi, 2004). In general, the technical tools invested in seemed to be more positively viewed by the partners and newly employed. According to a French partner, the technical tools contribute to developing internal intellectual capital within the firm. It was identified as being helpful when working on new projects, as the professionals could turn to databases to review what previous consultants had done before. Amongst partners in both countries, the database was referred to as enabling a more effective communication and collaboration amongst the professionals. This was because they could refer to templates and methods broadly addressed in the databases, which the professionals would more quickly grasp as they all had access to the same knowledge. A partner stated that the methods referred to in the databases provide us with a common language. I want communication to flow effectively, so when I talk about a specific process model that is widely covered in our databases, people will immediately recognize what I am referring to. Furthermore, a Norwegian partner stated that they also stress the positive and negative aspects of solutions previously developed, as to ensure improvement and enhancement in the future. By having the descriptions of the different solutions stored they could easily go back and review outcomes, detecting shortcomings. One might presume that one of the reasons for partners viewing the tools so Page 77

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positively is because they are the ones who have initiated and invested in the systems. The systems are according to a Norwegian partner very costly, however, if they function well, it allows information to be reused and consequently enable cost reduction in the long run. Though partners in both countries did acknowledge that the systems were not flawless, they viewed them as enablers of quicker communication, and hence quicker knowledge sharing and consequently CD. We will now present the areas where our findings have suggested that the tools have weaknesses.

Constraints The central value building activity around information is managing and structuring the content as to make information easy to find, enable reuse, learning from previous experiences and reducing the amount of work being duplicated (Rasli, Madjid & Asmi, 2004). After comparing across levels and countries, we found that the main constraint of CD with technical tools was that the IT systems were extremely difficult, and time consuming to navigate in. The scope of data was huge and the professionals seemed to get lost the “ocean” of data. This was especially the case if you did not know exactly what you are looking for, or if you did not have the correct key words to use in your search. A senior consultant in Norway made a comment: I would never start searching if I did not know exactly what I was looking for. I would need a clear purpose. Several respondents on all three levels, in both countries, identified the utilization issue. This seemed in the extreme cases to lead to less usage, or even no usage, and this was the case for both the general databases as well as the CV databases. A senior consultant in Norway stated: I do not even to spend my time on these systems I rather use Google. As we see it, the problems with navigating could partially relate to lack of experience to proper utilize the system, and partially personal preferences as people use different means in their search for information. It could moreover also reflect the inherent challenges of capturing tacit knowledge in written form. It is impossible to fully transfer the “whole” picture, and hence professionals may quite frankly be disappointed about the blunted written version they find in the databases.

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Second to the most constraining factor, was the fact that the systems were time consuming to maintain. Many respondents, on all levels, in both countries, identified this constraint. Most of the companies had a CV database aimed at capturing the overall competence the professionals were in possession of. The CV databases were argued to contribute to an overview of who knows what within the company, which is important in terms of knowing whom to approach when e.g. composing teams for certain projects. Also this was identified as helpful for improved utilization of competence at company level. However major concerns were identified. The professionals seemed not to have incentives or uniform standards for updating their CV databases. A French partner said that people are not updating their CV’s, and one never has the full overview over who knows what. A Norwegian partner, who was completely aware of these problems, and in search of a better way to gain overview, further supported this. He realized that far from the company’s full potential was utilized due to this: If only we knew what our company knows. Another Norwegian partner stated that the system is far from optimal and it can take days to find the right people. The system needs to be upgraded, as well as the routines and the incentives to continually update the database. This then becomes a challenge as Nordhaug (1993) stated when he addressed the problem of not having an overview of the available competences in the firm. A completion of the competence chain cannot be obtained, as the last stage, namely competence utilization, cannot fully be set forth or be optimized. A French partner openly shared that they did not have these kinds of systems at all due to the maintenance challenges. Instead they had a planning manager in each business unit, responsible for identifying e.g. people’s skills, language skills and experience – a solution that seemed to function better than the CV databases in this case. A Norwegian partner also suggested, independently of the other partner, that they were considering such a system. He clearly could see the advantages of not spending time on updating and/or finding the right incentives for his professionals to update themselves, but rather delegate the responsibility to someone else. An additional constraining element regarding the time consuming maintenance was addressed among seniors and partners in both countries. The most important reason for the updates being time consuming was that a lot of the information the Page 79

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consultants dealt with, was tacit, and therefore extremely hard to convey in a written format (Hansen, Nohria & Tierney, 1999). As a French partner stated: many of these systems work on paper, but not in reality. Professionals on senior and partner levels argued that they rather would spend their time gaining new knowledge from other sources than the databases, as this often proved more efficient. The reasons mentioned was that it mainly was less time consuming, and that the information they gained often was more up to date, compared to reusing of old information and/or solutions. A third constraint identified was that a majority of the communication between HQs in country of origin and international divisions was in English. To us, this was rather obvious finding, and we could not find any noteworthy problems with information stored in English among the respondents. The issues rather arose when back-translating information from the knowledge systems into domestic languages. Respondents shared issues concerning interpretation, and thereby appropriate use and application of knowledge. One of the problems regarding the experience libraries, frequently mentioned among our respondents, was that one is never confronted with the exact same problem definition in the exact same context. In other words, the reports could never be fully reused. Hence, the translation problem further complicates the already existing de-contextualization problem. Furthermore, regarding the issue of context and reuse of stored information, several of the professionals, and especially partners, identified this as a problem. In our view, this can be attributed to application of knowledge requiring a “knowing subject” who can translate the knowledge in order to fully grasp the content and its application value (Czarniawska & Joerges, 1996). This suggests that especially newly employed with limited experience might experience challenges. Despite recognizing the weaknesses of this system it was not identified as a constraint to CD, as it may benefit the newly employed in their learning curve. Based on statements from a few consultants in France early in our interview process, it became evident that they simply did not update the databases. As we approached completion of our interview process, we gained a fuller picture indicating that the information in the databases was in fact not being updated Page 80

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continuously at all in certain companies in France. The result of this was that our French respondents actually not were able to find information from projects conducted in France, only information from international projects. We find the following statement, made by a senior consultant in France as rather extraordinary: In France we do not want to share, especially not with people we don’t know. He mentioned that the extremely problematic side of this was that if the individuals not actively sought for information and updates elsewhere, they would not be sufficiently updated in general. In relations to this, the French professionals neither seemed to take advantage of other countries’ project reports, due to the unfamiliarity with the sender. Nevertheless, central to the transformation from individual knowledge turning collective, the individuals need to share, and therefore the sharing issues identified above are highly unfortunate. So what can be done about this problem? According to the same senior professional it is the people that need to change, not the systems. The sharing and storing needs to be anchored in the mentality of people, and the company culture through the support of the top management, for sharing knowledge to become a part of everyday life. The top managers must signalize and state examples. This can also be supported by literature. Ragsdell (2009) stated that enhancers and inhibitors to sharing knowledge can be found within top management support, top management commitment, a culture that enables knowledge sharing and trust, appropriate technology to facilitate sharing, and internal knowledge sharing. A French partner also stated that low degree of sharing through IT systems has become a problem. He questioned if the French people were “lazier” than others, however he also acknowledged that the time pressure was the main reason for limited sharing. Despite some of the partners being aware of the problems, it might seem as though they are not aware of how little the systems actually are used. We were a bit amazed by the fact that it seemed as none of the firms in our study had proper measures aiming to track to what extent the systems were used. We believe that by generating data on this, firms might gain a clearer view on where money is well spent and where great improvements, or even removals of certain systems, are beneficial.

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We believe it is not relevant to discuss the fact that there seem to be more constraints than contributors in the case of technical tools, however one should rather view the relative strength of them. We are not in a position to do so therefore we cannot state to what extent we feel that the tools are constraining more than facilitating. What we can state is that major problems have been identified, that indicate a need for improvement in order for the tools to become more meaningful means of CD. Hansen, Nohria & Tierney (1999) suggest that it is important to make a choice between following a codification strategy or a personalization strategy, where one of them can have a supportive role. It seems as though the companies have chosen a personalization strategy by depending more on interactions rather than a codification (Hansen, Nohria & Tierney, 1999). Our findings indicate that technical tools are functioning as supportive elements in the professionals CD. Regarding types of competences developed, technical tools may both contribute to- and constrain CD. The main type of competence that could be developed is standard technical competence of which Nordhaug (1993) states could be developed through education, training, hence also by self-studying through information found in technical tools. We, however think that it may also generate industry competence, and knowledge about the industry. Nordhaug (1993) on the other hand states that industry competence mainly can be developed through working within an industry, talking to industry experts or by joining industry associations’ meetings and seminars. From our point of view, we also identify self-studying as a generator of industry competence, just as we gained insight into the consulting industry through doing research ourselves. We have found, in accordance with previous literature (e.g. Itami, 1987; Fosstenløkken, 2007) that investments made by the firm is an important route to CD. The knowledge “banks” identified within the firms under investigation enable each individual consultant to access a broad variety of knowledge and information, containing search engines that allows them to find specific project or problems related to present work tasks. The aim is that these systems contribute to the creation of organizational competence, as well as professionals CD. All firms within our study are large companies, and hence the volume of data is huge. As an Page 82

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overall remark we can conclude with findings indicating that technology is an important component in the professionals CD, whereas IT, in theory, provides the foundation for automating and centralizing the CD, use, deployment and sharing of knowledge. Technical tools are enforced to enhance and enable companies’ knowledge generation and codification, however we have found that certain cultural barriers exist, constraining full utilization. As suggested by Rasli, Madjid & Asmi (2004), the organizations need to overcome these barriers by nurturing an atmosphere where knowledge and innovation is valued. On a more general note, our findings are in accordance with Løwendahl (2009) and Nordhaug (1993) pointing to a major challenges within especially knowledgebased organizations: the firms have no overview of the competence potentially available for value creation. This introduces another issue, namely not addressing latent competence within the organization (Løwendahl & Nordhaug, 1994). Hereby the firm is likely to under-utilize competence, due to ignorance on the company’s behalf and/or reluctance from the employees to sharing their competence. It is the interplay and interaction between technology, techniques, and professionals that allow an organization to manage its knowledge successfully (Bhatt, 2001). In answer to the second research sub question, all three levels in both countries rely on a mix of internal training, mentoring systems, evaluation systems and technical tools to develop their competence. IT tools are recognized as one of the central factors for effective KM (Sarvary, 1999; Choi, 2000). However, through these investments also major constraints to CD could be found. From the crosscase analysis a surprising finding was that what the professionals view as contributors and constraints to CD is more similar than different. The model on the next page serves as a summary of the main contributors and constraints to CD through investments. Findings related to France and/or Norway are indicated with F and/or N, where F and N are not specified, findings concerns respondents in both countries.

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CD through investments:
Mentor Programs and Support Systems

Contributors
- Contributes to career development (Most) - Enables variety in projects (All) - Discussions on technical matters (NE) - Mentors functions as role models and motivators (NE)

Constraints
- Lack of availability of mentors (NE) - Difficult to switch mentors (NE) - Heavy workloads hinders optimal mentoring (NE + S)

Courses and Training

- Contributes to network building and knowledge about colleagues (All) - Contributes to several types of competences: meta, industry, intra-organizational and standard technical competence (All)

- Down-prioritized (NE + S) - Time pressure hinders ability to participate (All) - Courses after office hours/busy periods reduce motivation to participate (NE + S) - Restricted access to external courses (NE + S) - Too general trainings (NE + S) - Not adapted to levels of the professionals (NE + S)

Evaluations and Measurement

- Specific feedback on areas of improvement functions as a motivation to improve (Most NE, F)

- Down-prioritized (delayed or not given at all) (Most) - Subjectivity (All, especially in F) - Not detailed enough (NE + S) - Dishonesty, and preoccupation with individual performance (NE, especially in F)

Technical Tools

- Availability of information serves as a safety net (NE) - More effective communication (P)

- Navigation problems and time consuming (All) - Maintenance is time consuming (All) - De-contextualization (Most)

Figure 9: Summary of CD through investments.

Next, CD through daily operations will be addressed. Page 84

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4.3. CD Through Daily Operations

(iii) What are the main contributors and constraints of the professionals’ competence development through daily operations? Our findings suggest that the overall most important ground for CD is ‘daily operations’. This is in line with Itami (1987) stressing the importance of learning through daily operations in CD, stating that ‘the “learning by doing” effect enables the firm to accumulate the necessary invisible assets to carry out future strategy in the course of its everyday operations’ (Itami, 1987:161). The main contributors to CD through daily operations were found to be learning from others, and learning by doing. Our main constraints were found to be high pressure, and low willingness to share knowledge. Compared to Fosstenløkken’s (2007) results, she also found daily operations to be the most important CD arena, where learning by doing in project work for clients was the primary facilitator of CD, and time pressure the main constraint.

4.3.1 Learning by Doing After comparing the different cases we found that all respondents, in both countries, pointed to learning by doing in project work as the main contributor to CD, and learning. Both when working alone and together with colleagues this experience and hands on learning was identified as crucial to CD. In other words, our findings suggest that the overall similarity in CD in daily operations is that the professionals learn from both individual experiences (e.g. Kolb, 1984) and from collective social interactions (e.g. Lave & Wenger, 1991). In addition to these general similarities, we have observed differences and distinctions between the three levels of professionals. Most of the newly employed highlighted the importance of working with more experienced professionals in their daily work. For the senior professionals, they found great value in guiding the less experienced as well as working with client responsibles. A senior consultant in Norway stated 99% of his learning comes from informal learning in everyday work. Further, as emphasized by all respondents, the learning output will differ due to project role, -phase and –size. Most partners pinpointed the fact that the Page 85

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daily operations can be viewed as a socialization process, where the professionals gain understanding of their individual roles within the organization (Kaiser & Ringlstetter, 2011). The socialization process is closely connected to corporate culture that establishes values and norms for knowledge sharing and interaction, as mentioned in the previous section concerning national culture (Kaiser & Ringlstetter, 2011). The findings support the notion of the companies exercising a personalization strategy, as described in ‘Knowledge Management and Methods of Knowledge Transfer’. On the other hand, most respondents bring forth high time pressure, repetitively similar projects and team composition as constraints to CD. For the further discussion of these issues we find is suitable to deal with these separately. High Pressure Almost all French and Norwegian respondents emphasized the high workload and pressure of their job as a major constraint to CD. As indicated by Maister (1993), time represents a scarce resource in PSFs. ‘Many PSF projects are characterized by time pressure towards deadlines and also face heavy cost pressure’ (Kvålshaugen et al., 2006:6). The professionals are expected to dedicate ‘enormous working hours, highest flexibility and constant employee motivation’ (Kaiser & Ringlstetter, 2011:117). The high pressure introduces several challenges and we will deal with some of the most profound issues from our findings in this section. Firstly, our findings suggest that pressurized and rushed professionals do not have the time to engage in the interaction needed to develop the sometimes necessary competence on both an individual and collective level. As suggested by Hitt el al. (2001), complex forms of knowledge require face-toface interaction between partners and associates. Several statements from our respondents indicate a certain lack of interaction within the firms, but there are between country differences in this case. Within the firms in both countries, the professionals acknowledge the challenges created by pressure, but in comparison we found more indicators negatively affecting the interaction, in general, in France compared to Norway. To illustrate this we are hereby presenting some examples: A French senior stated that everybody is experiencing a high workload and pressure, hence everybody will not be willing to devote time to assist coPage 86

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workers. Almost no degree of interaction is found between juniors and partners, and from what I have seen in France there is a more formal separation between the different levels. There is some kind of natural hierarchy here, and more so than in other countries. When talking to a partner you weigh your words carefully. Further, he added that figuring out the informal rules of the company is an especially difficult task in the early phases within the firm. He experienced that the availability of partners was close to non-existent with regards to approaching them asking questions. On the question of why this could be, he stated that they seemed occupied with impressing and maintaining authority by being less approachable. Another explanatory element mentioned was also that the partners seemed to not have the time to spend on being approached by subordinates, nor being willing to devote it: They do not have time and do not want to take the time. I think that this is a French phenomenon. Partners and seniors not being available was a surprising finding due to literature suggesting the importance of interaction in the aim of knowledge sharing at organizational level. This findings were not in line with previous literature such as Senge (1996) stating that the traditional role of managers being “bosses” are moving towards managers turning into teachers, with primarily concerns of supporting organizational knowledge development and learning. Senge (1996) also stressed that the very key in establishing a learning organization was by ensuring mixtures of people from all levels in the organization, and not through traditional hierarchies. As we see it, an additional explanation to the availability issue may be found in the companies’ responsibility to nurture networks, more specifically client relationships. As the companies under investigation are highly dependent on their client portfolio, the client themselves will often also expect to have a personal interactive relationship with the consulting firm, next to achieving good results (Czerniawska, 2007). Establishing and maintaining these types of relationship seems as a primary responsibility at the higher levels of the firm (seniors and partner), hence also occupying a lot of their time. On one of our questions regarding culture for asking questions within the company, a French partner suggested that the size of the Paris office in itself was a huge barrier for managing people and developing “fair” relationships: the ability Page 87

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to coach them properly, to know them and to be sure that the people discover all the opportunities within the company is a complex task within a firm having several hundred partners and several thousand employees. This company had dealt with the size issue by dividing the firm into smaller business units to better facilitate interaction and create a sense of belonging and attachment. Another partner stated that people quit if they do not develop a fruitful dialogue and relationship with their colleagues and superiors. We feel that this exemplifies the importance of internal company interaction. We find it natural to link these findings to statements found on issues concerning evaluation and measurement, presented in the previous chapter. To our minds, the size and barriers for interaction illustrated here, further illuminates the difficulties of providing good evaluations within the firms. How can superiors possibly establish a thorough base for evaluation if his superiors are spread out over large firm-internal distances? We find the initiative of dividing the company into smaller divisions as fruitful in terms of facilitating closer relationships, more interaction and potentially also more accurate evaluations. On a more general note, our perception is that the organizational hierarchy is to a larger degree present in France, compared to Norway. Consultants at newly employed level in France, experience the hierarchy as very strong and stated in interviews that they have little contact with partners, feel small compared to them, and that they do not know what they are doing. Our overall impression was that the professionals’ title was perceived as reliable indicators of competence, and that the French consultants seemed to have great respect for-, and compliance with, formal hierarchy (Alvesson, 2002). When including cultural aspects, we find additional explanations for our findings on hierarchy by turning to Mole (2001). Mole (2001) argues that French companies, in general, are highly centralized. Further, he suggests that French managers rarely open their mind, and even less their heart, to their subordinates. These descriptions can provide some explanatory value concerning the rather low degree of between-layers interaction found in France. As introduced in chapter two, the newly employed professionals experience a steep learning curve during the early stages of their careers, and most of the Page 88

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respondents at this level mentioned high time pressure as a constraint to their CD. For the senior professionals, spending time on guiding less experienced professionals was by a few stated to reduce their speed and general work efficiency, and hence personal CD. A partner in Norway further illustrated this by saying that keeping a focus on delivering to clients, developing my employees, and at the same time trying to develop our business is something I find close to impossible. Consequently something has to be down prioritized. Sometimes, sadly enough, that down-prioritization falls on development of my employees. Repetitively Similar Projects Repetitively similar projects were identified by some of the respondents as a constraint to CD. For the firm, engaging in similar or repetitive projects will be more cost-effective as the expertise, knowledge and basic methods already developed can be capitalized all over again. From the professionals’ view, this is seen quite differently. Exciting, new and challenging assignments are vital to their motivation and CD development. Many respondents on all three levels, in both countries, stated this. Quinn, Anderson and Finkelstein (1996) stated that intensity and repetition of information and tasks are proved to be critical to the development of advanced skills. People with such intensive experiences increase their competence and value within the firm. If these people are provided with growth opportunities through continuously heightened complexity, coaching and mentoring, and strong incentives to further engage, this will be a facilitator for success for the professionals. Vise versa, these people will be less satisfied if they experience a mismatch between the tasks they are given and their competence level. As identified, challenging and exciting tasks are crucial for the professionals’ development of CD. However, as stated by a majority of newly employed in both countries, certain projects require that the people involved have experience in specific fields. Consequently, many newly employed and even seniors do not receive the opportunity to participate in these projects, even though it is in line with the personal development plan often created together with their mentors. This, in turn, have sometimes led to professionals being put on the same type of projects over again. In extreme cases, if the professionals are in possession of ‘unique competences’ (Nordhaug, 1993), they are put on the same types of projects over and over again, since s/he cannot easily be substituted. Many Page 89

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realized that this was a natural consequence of the, among other issues, hierarchical structure of the companies; nonetheless they were frustrated about this issue. As a Norwegian partner stated: We mustn’t forget that we are running a business here. Furthermore, a newly employed in Norway stated that junior coworkers are given too little responsibility in projects. Also, most of the respondents in our study points to exhaustion to be a problem if they are pushed too far. A Norwegian senior said that: If you are not able to develop and ensure a continuously updated personal knowledge- and skills base, you will not be delegated to the most prestigious projects. Staying updated is required, and there is no time during work hours to ensure this. Our findings imply that a few of the newly employed are not exposed to the professional challenges they need to steadily develop. This is problematic as lack of diversity in projects cause the professionals to not get sufficient practice in crucial methodologies and skills. A French partner illustrated this by stating that it is a potential problem if new knowledge cannot be practiced in relevant projects afterwards. The acquired knowledge will be forgotten more easily. As stated above however, the natural consequence of the hierarchical organizational form of consulting firms is that the majority of the “doing” will be conducted at the lower levels. A Norwegian partner commented on this, stating that: A general remark would be that the lower in the hierarchy, the less exciting tasks. However, mastering these tasks is fundamental and necessary in order to fulfill the requirements for enhanced positions later on. Team Composition and Underdelegation Problems Most respondents mentioned team composition as a crucial determinant for their CD. Especially the newly employed, in both countries, viewed their project teams as a highly determining CD factor. Among these respondents, most of them characterized their company as somewhat impersonal and many of them indicated that they felt-, or previously had felt, a sense of alienation within the large corporate system. Conversely, when working in teams they indicated that they developed close and personal relationships with co-workers, and these social relations were identified as central CD contributors. Naturally, a consultant would wish for getting to be a part of the “best” team, however due to logistical issues, composing the optimal teams at all times is not possible. As stated by a French Page 90

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senior: The team members will not always consist of the “best” or most optimal players, but in general the sufficient set of competence across the team is often obtained. Even though we only gained a limited insight into the procedures for resource utilization and team staffing, due to this not being a primary goal with our study, the impression we got indicated that some professionals might suffer from learning arbitrary due to unfortunate team allocation. A senior consultant in France suggested that the team allocation and resource utilization is basically based on economic concerns on behalf of the company, overruling issues of staffing in relation to individuals CD. This is business. Within every firm in this study, the project manager was responsible for selecting team members, and most newly employed identified this as a potential area of conflict. This was due to the project leaders picking teams based on subjective preferences rather than objective qualifications. A Norwegian partner commented on the importance of being submitted to the so-called “A-teams”: …a colleague’s lack of-, or slow-, progression can relate to bad luck as the team he or she is a part of might cause him or her to get stuck on a stereotype project portfolio. As suggested by Kaiser & Ringlstetter (2011), professionals experiencing certain gaps between requirements for a specific task and his or her available skills will strive to improve and compensate. Still, this might prove difficult, as the professionals might perceive themselves “stuck” in a situation with less fortunate clients and/or teams. A newly employed in Norway commented on her perception of fairness regarding staffing of projects, and said the following: It provokes me that some colleagues are doing better than me due to luck rather than hard work. In the beginning there is nothing you can do about changing the team and/or clients you are given, and if you are unfortunate to end up with less attractive clients, your CD will be relatively lower compared to your more fortunate colleagues. This is where the competence gaps emerge. Here we would like to add that our findings suggest the tendency of so-called ‘in-groups’ and ‘out-groups’, as earlier discussed under national culture. Several respondents acknowledged that every team has their own identity, functioning as independent units and where it is hard for outsiders to enter and being “granted access”. Our reflection on this issue is that teams naturally seem to focus inward, turning isolated due to their focus on team goals and bonding with team members. We believe that even if team members intend to share knowledge with “outsiders”, they are already suffering Page 91

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from team goals pulling them into the team again. Hence, we are here touching upon one of the main CD constraints addressed in our study: high workload and pressure. As we see it, a possible side affect of isolated teams is that it hinders generation of new ideas to develop, hence perhaps also CD, as they lose contact with the outside world. As a general remark to our findings we see that the major CD contributor is found in the doing. With regards to the knowledge accumulation at organizational level, exemplified by the organizational databases in the previous chapter, we would like to make reference to Cook and Yanow (1996) suggesting that knowledge accumulation involves continual development and shared understandings among groups. This implies that tacit knowledge arises through social interactions among the professionals in their daily operations. Further, as argues by Lave and Wenger (1991), the inclusion of newly employed in the continuous work and problemsolving actions is crucial. ‘In many firms, teams are the building block of the organization’, as indicated by McDermott (1999:1), and to us, it seems purely beneficial to compose teams consisting of people with different backgrounds as to enable a full range of services to a client. We also believe that as a member of a team, the social glue within the team can promote a sense of safety for the professionals – enabling them to more easily share their thinking, ask questions, and learn from others. Thus, we suppose that this will support a more open and collectivistic attitude within the team-, and potentially also within companies, as a whole.

4.3.2 Learning from Others Learning from others was found to be the second largest contributor of CD among most professionals on all levels, in both countries. All the companies in our study have a set of tools implemented to manage and articulate knowledge, namely technical tools, which we have already discussed. But in spite of these efforts, they cannot substitute personalization strategies in terms of transferring tacit knowledge (Hansen, Nohria & Tierney, 1999). When dealing with more standardized and repetitive work, articulated and stored knowledge is in some cases more convenient and appropriate. However, in situations where creative Page 92

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problem solving is required, interaction between competent and knowledgeable individuals is needed, as indicated in the previous section. The companies need an underlying philosophy that guides them in their daily interaction and aid them in turning knowledge into action. Creating competence on both an individual and collective level is in this sense a social act, placing the responsibility on individuals to trigger the development of competence, firstly on an individual level – consequently enabling development on an organizational level. For less experienced consultants, meeting client’s face-to-face with- or without colleagues, was an important component in their development. For the more experienced consultants, collaboration with competent clients and colleagues was mentioned as key contributors to their performance, development and project output. Respondents at senior level have emphasized competence diversity within teams in general as crucial for dynamics and their own learning. Among the partners, it was frequently stated that they learned from knowledgeable buyers and other partners. Company Mentality and Culture We have chosen to categorize the companies’ need for an underlying philosophy, as mentioned on the previous page, to be a part of the company mentality and culture. As the more general aspects on national- and corporate culture have already been addressed, we will here focus on issues of trust and loyalty. We would like to remind the reader that these elements were not within our primary focus during interviews, nor did we pose explicit questions addressing trust and loyalty. Nevertheless, as several of our respondents naturally focused on these subjects when describing the main issues under investigation, we find them relevant to include as they possibly can contribute to giving the reader a broader insight. Also, at later stages of the interview process we realized that these issues directly seemed to affect interaction within the companies, which in turn influenced knowledge sharing, hence CD. In addressing these issues we turned to Maister (1985), who proposed a model of professional firm success. He identified so-called ‘one-firm firms’, remarkable at establishing institutional loyalty and group effort. By favoring group identity and teamwork, the one-firm firms were successful in creating institutional Page 93

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commitment, hence also employee satisfaction and attachment. After viewing our findings we certainly find signs of willingness among the firms, to be recognized as one-firm firms, however our findings indicate discrepancies. This is mainly on the area of loyalty, and especially in France. If we turn to other research, it has been demonstrated that increased identification with an organization more generally promotes a number of beneficial consequences generally for the firm: enhanced support and commitment; intergroup cohesion; cooperation and altruism; loyalty and adherence to group values; and norms and homogeneity (Turner, 1982, 1984; Ashforth & Mael, 1989 in Alvesson, Robertson & Swan, 2001:6). As some of our respondents indicated lack of loyalty, trust, and therefore lower willingness to share knowledge, the firms may question what they are missing out on. The lack of trust was by a few respondents mentioned to have a constraining effect on CD. When comparing levels, it was mainly the professionals on the senior and partner level in France, who mostly identified this as a constraint. The companies included in this study can be identified as, what we label, elitist companies (Greenwood & Suddaby, 2006), claiming to recruit the “best people” and openly promoting an “up-or-out” system. ‘Obviously, such orientation hardly fosters a communal spirit and loyalty’ (Alvesson, 2002:9), and the companyemployee relationship can, as we see it, be characterized as fairly calculated and instrumental. Alvesson (2002:9) illustrated the hierarchy of loyalty within the two IT/management consulting firms he studied, with the following quote: ‘First, you are loyal to yourself. Second, you are loyal to the project. Third, you are loyal to the company.’ We are not in a position to fully determine whether this hierarchy is present among our respondents and firms, however we chose to include it as we certainly found Alvesson’s (2002) findings interesting. As an overall remark, we think that if such a hierarchy actually exists; this would be a noteworthy issue for firms. Might the professionals’ predominant loyalty to themselves nurture opportunistic mindset, where the professionals focus on individual benefits rather than collective benefit? We have chosen to illustrate our impression of the French culture for trust by referring to a French partner’s experience regarding lack of trust: When I arrived Page 94

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in this company, I was quickly made aware that there was no such thing as trust. I was exposed to an unusual high pressure that I have never experienced before. He had not been able to meet target on a project, due to what he called an inhumanly heavy workload and time pressure, however when approaching his superior with the problem he had been verbally insulted: If you don’t meet target you are worth nothing. After this incident he learned that the non-negotiable attitude amongst managers was a culturally established behavior. When becoming a manager himself, he learned that the team he was responsible for neither was trust-oriented and that they seemed “programmed” to not deliver results until they were pushed or triggered to do so. The problems this would introduce were that in situations where team members were not able to successfully fulfill project requirements, they would naturally try to cover this up by dishonesty towards him as a subordinate. When he realized this, he reorganized his team by recruiting new team members stressed on the importance of trust: Today, in my team, we have established a trust relationship. They tell me when something goes wrong. The simple explanation is that with terror bosses you impose the wrong control behavior. People will start hiding the truth. In my team today, in cases where they are not able to fulfill target, they will let me know and I will involve in the aim of finding a solution. If you force terror management style, people will try to cover up the truth. However, within the organization in general the terror management is still highly present and when my team is not able to deliver decent results I will try to put makeup on my figures to make them look more decent. He further expressed frustration and concerns on the consequences that this management style would create in the long run, if the inhuman pressure put on the consultants not would be outbalanced. We turn to literature in order to address the issue of trust found in this particular example as well as throughout statements made by French respondents. We find that France is characterized as a low trust society, and with high power distance (Samovar & Porter, 2004; Hofstede, 2009), in general and compared to Norway. This further indicates that the strong relationships are reserved for the family and close friends, and that people need to know each other well in order to trust each other (Fukuyama, 1995). Additionally, the country acknowledges power and hierarchy as a part of their society, and superiors are recognized as seldom informally mixing with lower ranks (Mole, 2001; Scholliers, 2001). Nevertheless, Mole (2001) also indicated that Page 95

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communication in French companies have two dimensions; one for professional settings, where the external impression appear orderly professional, and one for personal relationships, applied in informal settings. As we see it, this may serve as mitigating “evidence” in relation to the rather discouraging findings concerning the effects of the French hierarchy. This is because we think that biases may arise due to the culturally established expectations of French managers. Culture may have established certain expectancies on how managers are supposed to behave, and these expectations in themselves may enforce the maintenance of the hierarchical structure, both on national- and organizational level. Either way, we believe that managers are likely to feel forced to behave in accordance to expectations when “performing” their role at work. However beneath the orderly professional surface, our impression is, from interviewing the French managers ourselves, that in more informal settings we are not able to identify behavioral differences beyond natural variations personality-wise, based on our interaction. As we perceived our interactions with the French partners as informal, open, and trusting, we hereby question if this was due to us not being recognized as within their formal category. Several types of competences can be developed through learning by doing and learning from others. For all three levels, learning by doing through working together with colleagues in teams through daily work, enhances their competences. For newly employed especially meta-competences are developed whereof analytical skills, communication skills and collaboration skills are of importance. Also intra-organizational competence can be developed in the way that they e.g. learn about their colleagues. We view this as especially important for partners as we saw in the previous discussion on CD through investments, that CV databases were not updated, and rarely used. Having an overview of the competence the firm is all together in possession of, is important for optimal utilization (Nordhaug, 1993). Furthermore, technical trade competence and industry competence can be developed through daily work and experience. We find this to be of especial importance on the lower levels of the firms, as professionals at this stage mainly have no familiarity with the industry, neither has the competence needed to perform certain tasks within the consulting industry. For learning from others, more or less the same type of competences are Page 96

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developed, however, technical trade competence is not necessarily developed as this is gained through practice, and not necessarily the socialization processes. This might be because much of the technical trade competences contain tacit knowledge. To view it from a different angle, due to high pressure identified, these are the types of competences that the professionals may miss the opportunity to develop. These are the three competence types that we here view of importance and that needs experience in daily work to be developed. Linking our findings to literature, there are several factors affecting the knowledge sharing activity, and as suggested by Chowdhury (2005, cited in Akgün et al., 2007), the main question is what makes individuals share knowledge efficiently with others in the organization. Trust is identified as an important element behind individuals’ decision to share knowledge. As stated by Lucas (2005), trust improves the quality of dialogue and discussions that further facilitates the sharing of knowledge; hence, trust is key to effective communication. The model below serves as a summary of the main contributors and constraints to CD through investments. The figure is structured in accordance to our two main headings under ‘Daily Operations’: ‘Learning by Doing’ and ‘Learning from Others’. Further we have chosen to indicate the sub headings within these two categories, in bold.
CD through Daily Operations
Learning by Doing

Contributors
- Challenging projects (All) - Repetitively similar projects (Few NE + S, N): Professionals become subject matter experts/SMEs. - Team composition (All): facilitates trust, commitment and attachment, building block in organizations, social glue. - Under delegation

Constraints
- High pressure (All): time pressure, heavy workloads, negative effect on interaction, limited availability of superiors, “bosses” not teachers, clients first. - Repetitively similar projects (Most NE + S): do not meet CD goals since they cannot participate on new and challenging projects,

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problems: no clear findings indicated that this is a contributor to CD.

decreased motivation. - Team composition (Most NE + S, especially in F): isolated teams and “in”- and “out” groups, luck, differences in competence levels. - Under delegation problems (Most NE): get too little responsibility in projects, not assigned to new and challenging tasks, utilization of knowledge, reinforcing hierarchy

Learning from Others

- Competent clients and colleagues (Most S + P) - Competence diversity (All) - Meeting the client face-toface (All) - Meeting the client together with colleagues (Most NE) - Company mentality and culture (Most P): perceived willingness to be one-firm firms.

- Availability of partners/superiors (Most NE, especially in F) - High time- and workload pressure (All) - Willingness to share knowledge (Most S, especially F) - Company mentality and culture: hierarchy negatively affecting trust and loyalty (All, F), dishonesty (All, F).

Figure 10: Summary of CD through daily operations.

4.4 Summary In this chapter we have presented our findings together with a cross-case analysis and discussion. We have addressed three main issues directly linked to our sub research questions; namely that of culture, CD through investments, and CD through daily operations. Throughout this chapter we have sought to incorporate our opinions and perceptions, however these must not be confused with the statements from the respondents. At the end of each section within this chapter, we have added general remarks, and responded to the three sub research questions set forth in chapter 1. We will however not further elaborate on this as the first section in the next chapter contains concluding remarks. Page 98

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5.0 Concluding Remarks and Managerial Implications
In this chapter we will firstly present concluding remarks on our main findings. Secondly we will move to managerial implications. Thirdly, the limitations of this study are reflected upon, and lastly, we finalize this thesis by turning to suggestions for further research.

5.1 Concluding Remarks The purpose of this study was to view how CD takes place in PSFs in France and Norway, emphasizing on identifying the main contributors and constraints to CD. In line with previous literature (e.g. Itami, 1987; Fosstenløkken, 2007), our findings and analysis highlighted that, across cases, CD takes place through two main routes; (i) investments made by the firm, and (ii) daily operations. A surprising finding was that national culture seemed not to influence how professionals develop competence as heavily as we initially expected. However the differences found across borders may have important implications and effects on CD. Primarily the cultural differences effected the interaction among professionals. In France, we found indications suggesting a lower degree of knowledge sharing and culture for asking questions. This may further negatively reflect upon CD. In Norway, the attitudes towards sharing knowledge were perceived as more positive and attentive. We further found that what professionals perceived as contributors and constraints were more similar than different across cases. From the comparative analysis we found that the main contributors of CD primarily were found within daily operations, whereas the main constraints can be related to the investments made by the firms. Overall, the main contributors to CD from our findings were learning by doing, learning from others, and mentoring systems. Learning by doing and learning from others were identified as contributors by all three levels in both countries, whereas Norwegian professionals mostly identified mentoring systems as a contributor. The main constraints were identified as general high pressure, willingness to share information, lack of relevant practice opportunities, Page 100

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and repetitively similar projects. Down-prioritization of CD was found to be an overall constraint. The main constraints identified have been more evident on the newly employed- and senior level. We question if this may be because the partners are the ones with an inherent responsibility for initiating, enabling-, and investing in several of the CD processes within the firm. Hence, we may thereby further question if their responses suffers from “glorified biases”. The focus on CD is present in all of the companies, however the prioritization seems to be lacking. In other words, it seems as though long-term CD efforts are found to be far down on the priority list. Thereby, one may question if CD is to be left to the professionals and their own initiatives. The fact that clients are becoming more demanding and the fact that companies are down-prioritizing CD, we believe is quite contradictory, in terms of long-term firm sustainability. All in all, we can conclude that to be able to draw conclusions on a general matter, future research is needed.

5.2 Managerial Implications Managers of PSFs have an important task in laying the foundation for advantageous CD processes that can generate an improved resource base for the firm, to enable attracting the right professionals and clients. Balancing this act is, as we view it, far from simple. There are several challenges managers are facing that need to be considered in order to orchestrate CD in PSFs. We are here going to suggest several implications for managers, that we have identified based on our main findings related to our sub research questions. Due to our findings being quite similar to those of Fosstenløkken’s (2007), certain of our implications are along the same lines.

5.2.1 Communication – the Crucial Glue Our findings indicate that culture influences how professionals develop competence. Therefore managers should assess their resources in terms of its effective and/or ineffective utilization. It might be that allocating resources Page 101

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differently could improve the flow of communication, and thereby knowledge sharing, both within- and across firms and countries. We identified that the area mostly affected by cultural differences, seemed to be communication – which we identify as a crucial glue in firms generation of knowledge, hence also CD. Regarding the somewhat strained culture for asking questions across layers in France, investments made by firms could be allocated to mentoring systems as we found that in several of the firms, mentoring systems had been discontinued. Most respondents in both countries viewed mentoring systems as an important contributor to CD. Our findings suggested that in the firms without these facilitations, the lack of culture for asking questions seemed to be more of an emphasized problem, as newly employed and seniors had fewer to turn to. In terms of the lower degree of culture for sharing knowledge in France, trust and openness were identified as crucial matters that should be of focus to generate a sharing culture. Also, firms should increase awareness of the value of communication and knowledge sharing among professionals within the firm and across firm divisions, in order for the professionals to fully grasp its importance. In turn, this suggestion, together with creating trust and increased openness, could potentially make professionals prioritizing-, and maybe becoming more willing to, share information. Also, lower willingness to share knowledge influences the use of technical tools in which the firms have heavily invested. Our findings related to this indicated that France experienced more challenges as professionals did not seem to contribute to the collective competence of the firm by sharing experience in databases. As a French senior consultant said: I don’t think you’ll find even one French project. Moreover, the French professionals neither seemed to take advantage of other countries’ project reports, due to unfamiliarity with the sender. Increased awareness among professionals regarding benefits of using technical tools seems to be appropriate. Despite the fact that even explicit knowledge is time consuming to store, it can potentially save the professionals’ time in the long run as it facilitates quick access to information. This should be important due to time being identified as a scarce resource. More specifically, they can save time in terms of e.g. to some extent reuse previous reports containing methodologies and Page 102

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templates to solve complex client problems. Additionally, the firm needs to stress the importance of the potential affects the professionals low usage rate can have on firm level. Examples of these important potential effects can be waste of resources spent on creating systems not being used, the benefit or reusing certain components from previous projects in terms of saving time, hence costs, and the fact that it can generate increased quality deliverance to clients as a consequence of an overall increased competence base at firm level. As our findings indicated that firms are not measuring degree of usage of the technical tools, we suggest that this should be addressed in terms of assessing the value of their investments made, in these supporting activities to CD.

5.2.2 Aligning Firm Goals with CD of Professionals One of the major issues identified through our findings was the surprisingly low priority CD seemed to have in the respective firms. This served as a major constraint according to the professionals in general. Despite the fact that clients come first, the quality of the deliverance of the professionals to the client largely depend on their competence level and ability to deliver what has been promised (Løwendahl, 2009). Managers should here see if priorities could be set to ensure alignment between the strategic goals of the firm, and CD of their professionals. This balance is complicated to achieve, especially because the firms in real life are largely complex. One explanatory factor of this might be that most firms are experiencing difficulties in the positioning of the firm (Fosstenløkken, 2007). For managers, our suggestion then is to reflect upon their choice of strategy, in terms of what kind of strategy they are utilizing for creating value. The reasoning behind this could be linked to the companies included in this study having applied different strategies whereof it is suggested that the firms should develop different competences. If the firm’s focus is solely on billable hours, and if client projects are allowed to dictate a large degree of what the professionals are learning, firms may risk that CD and value creation gets “jammed” on a short-term level. For example, if firms are client-relation based, the focus should be on developing CD that can enhance the positive and strong relationship with clients. Another suggestion is that if the firm has an output-based strategy, the focus might be appropriate to put on CD processes that enable reuse of solutions, hence efficient service delivery. By identifying the firms’ overall strategy, it might enable a better Page 103

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facilitation of appropriate CD processes that are aligned with the firm’s overall goals.

5.2.3 Supporting the Contributors and Reducing the Constraints of CD Another challenge for managers is to support professionals in circumstances that contribute to CD, parallel with diminishing the constraints. Our findings suggest that the main arena for CD contributors is through daily operations, more specifically through the professionals project work. The main constraints are identified as being high pressure, low willingness to share knowledge, firms down-prioritizing CD, and lack of relevant practice opportunities. As our findings indicate that learning through daily operations, and especially learning by doing, are major contributors, firms could emphasize and nurture these informal learning processes. The issue, according to both our and Fosstenløkken’s (2007) findings, is that learning by doing can more easily be neglected in daily operations due to high pressure and client expectations. Generally speaking, it might be important to enhance explicitness, awareness, and reflection on the identified informal CD processes, among all of the professionals. Similarly as previously mentioned, we stress the importance of not only focusing on billable hours, as this in general supports short-term outcomes, but maybe rather enhancing focus on getting projects where there exist opportunities for CD. Focusing on billable hours, and comparing with competitors on this basis, may not necessarily contribute to longterm growth, and may neither reflect companies’ quality and/or level of competence. It might be that competitors with a seemingly lower productivity, in fact are investing and focusing in CD processes, identified as crucial for the future. Since the constraints and contributors are within different areas, this implies and requires different approaches and actions taken. Could it be that to support the learning by doing in daily operations, managers can direct individuals to the projects that are relevant for the competence they either possess, or needs to develop? If so, systematized team staffing to lead professionals on different levels to the different projects, becomes even more important. The focus must not only be on what is appropriate team staffing for one certain project, but also in terms of what competences individuals can develop to enable allocation to a wider project range in the future. Matching and mixing individuals, teams and projects Page 104

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seem to be important to increase CD both on an individual- and company level, as it is identified as an essential part for value creation. Another important finding was that new and challenging projects is a major contributor to CD. In relation to this, delegating professionals to projects that can enhance their CD is not only positive for the firm in terms of long-term value creation, but also for retention. It might contribute to reducing the potential of the firm “loosing” competence in terms of loosing important professionals, hence often also clients. Overall, enhancing professionals CD through new and challenging projects may in turn potentially reduce the firms’ costs related to training new professionals, due to the potential higher retention rate. Constraints due to high time pressure will in the short-term not necessarily be reduced, however by doing this, it enables individuals to develop needed competences, and maybe even a wider range of competences, which in the longer run could lead to a higher number of professionals matching different projects. This in turn could potentially reduce the constraint of high time pressure to a certain extent, in the way that they have more professionals with competence needed in the different projects; hence the issue of finding the available people might not be so prominent. Through creating consciousness in relations to these managerial challenges, it is suggested that managers might be in a better position to assess their investments and allocation of resources, to be able to improve the foundation on which decisions regarding CD in management consulting firms, are taken.

5.3 Limitations

As with all research, our study has its shortcomings and limitations. We will introduce and reflect on the research conducted in this study and the potential shortcomings. The limitation will here be particularly related to (i) choice of literature and the issue under investigation, and (ii) methodology.

5.3.1 Choice of Literature and the Issue under Investigation

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Choice of Literature Our choice of literature included forms our analysis and the interpretations made in the discussion. If other literature was selected, results and interpretations may have been different. By making a choice of relevant literature, in terms of answering our sub questions, other important and potentially influential literature might also have been overlooked. Our theoretical lens is to our best ability applied in the aim of addressing applicable issues. The Issue under Investigation We have found studying the concepts of competence, to be challenging. We have chosen to apply a rather broad definition and have relied on in-depth interviews in order to be able to capture some of the richness and complexity that may be fundamental to the concepts within the firms (Henderson & Cockburn, 1994). However we realize that our preconceptions and beliefs may have been influenced by the way we conducted the study, and that our approach is only one way of going about investigation of the issues. On the contrary, due to our initial unfamiliarity with the subject under investigation, the time we spent on learning about the industry allowed us to develop our own perceptions, viewing the industry from a fresh perspective. In this process we matured, and we truly believe that this has benefited us in our process. On a more general note, we have sought to identify patterns of how CD of professionals takes place within the PSFs of this study. On the question on whether firms will be able to perform better due to the CD of professionals, we are not in a position to answer.

5.3.2 Methodology

Research Design and Process It is not possible to make causal conclusions from exploratory case studies. This is due to that these case studies are concerned with assessing phenomena, and that alternative explanations cannot be ruled out (Yin, 2009). Concerning generalizability, the case study refers to individuals, and the behavior and/or statements from one individual may not reflect the behavior and/or statements of Page 106

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the general group or population (Eisenhardt, 1989; Andersen, 1997), in our case PSFs and/or management consulting firms. To what degree our research can be used as a base to draw comparisons with other settings, is left to the reader to decide. The readers will have to judge the usefulness of our research, however we have only sought to identify patterns of how CD takes place within the PSFs in this study. To our best ability, we have tried to minimize limitations by gathering, analyzing, and reporting data as systematically as possible, with care and discipline. However we acknowledge that possible shortcomings and/or errors related to the interview questions could have been reduced by conducting a pilot study. Patton (2002) states that validity and reliability are two factors that qualitative research should be concerned with, just as much as in quantitative research. On the other hand, Golafshani (2003) suggest that there is a need for redefining the terms reliability and validity in the naturalistic, and thereby qualitative approach. This is because the two terms originally are rooted in the positivist perspective. To be more specific with the term of reliability in qualitative research, Lincoln and Guba (1985) suggest that one should rather use the term ‘dependability’, corresponding to the notion of reliability in quantitative research. Furthermore, Creswell and Miller (2000) suggest that the researchers and their perception of validity influence the validity of studies. Consequently, several researchers have created their own concepts of validity and thereby terms viewed appropriate such as, quality, rigor and trustworthiness (Davies & Dodd, 2002; Lincoln & Guba, 1985; Seale, 1999; Stenbacka, 2001). Since the terms reliability and validity are commonly used terms in describing the quality of methodology, we have for practical reasons chosen to apply these terms in our study. Sample Size and Respondents We have achieved a response rate of 82,22% by conducting 37 interviews out of the 45 professionals contacted in total. Out of these 45, five respondents did not respond to our request, and the remaining three did not manage to find a suitable time for the interview. Nevertheless, this sample size, in addition to being case studies, naturally makes broad generalizations impossible. As this project is set out to be a case study, our aim was not to generalize to a population. However, we Page 107

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still believe that the results may be applied in other contexts, as a practical introduction. This is, however left for readers and future researchers to determine. Another aspect of the sampling is that fewer cases would have enabled more time with each informant. That being said, we found it valuable to achieve 37 interviews as each and one of them contributed to a broader understanding of the issues under investigation. By conducting case studies within the same industry (management consulting) we excluded the possibility of depicting between-industry comparisons. On the other hand, our approach will, in our view, facilitate a more thorough insight of CD among the professionals and within the firms selected. By limiting the research to one specific sector we have gained more in-depth knowledge about this specific industry, and we felt that this provided us with a more solid ground for asking relevant questions when conducting the interviews. Despite the high response rate, more time would possibly have facilitated a larger sample and possibly an even higher response rate. Nevertheless, gaining a large enough sample to draw representative conclusions about a population would not have been in reach within the limits of our design and this thesis. This was neither our goal. Representative sampling cannot always be achieved in qualitative research. We started our process by approaching several management consulting firms. Participants were initially approached via contact persons, such as HR responsibles or CEOs. In the process of getting acceptance, we followed up the subjects via phone, email and/or by meeting with them directly. Due to a presumption that the most efficient way for us to get contacts within the French companies would be through contacts within the Norwegian sister company, we initially approached the Norwegian companies. In this process we got a total of three rejections among the firms we contacted in Norway, leaving us with seven out of ten possible firms participating. We then preceded targeting the sister companies of these firms in France. Some were approached directly based on contact information given by the Norwegian colleagues, others through being introduced by Norwegian partners. In France six out of the seven wanted to Page 108

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participate. With the process described above one can hardly identify this as random sampling. Random sampling however is identified as more important when generalizations are to be made, which is not our point (Yin, 2009). Also it was important for the purpose of our study to receive participators on the three different levels of seniority. Response Bias Self-reported data contain several potential sources of bias. On one side, it allows us to investigate CD from the view of the respondent. Yet, the subjects may consciously or subconsciously have given answers that project their ideal self, or answers that are politically correct and in accordance with the image of the company. Biases Linked to the Researchers Our data has been gathered through interviews where we have been aiming to tap into the depths of reality of the situation and experience of the respondents. It has been essential for us to develop empathy with the interviewees and to win their confidence in order for them to open up. None of us have experience in conducting interviews and both of us are students. This may have implications for the conduction of the interviews as well as quality of the outcomes. Potential bias may be found in subconscious clues given when interviewing. Body language, tone of voice and phrasing of questions may influence the subject into giving answers skewed towards our own opinions and prejudices. Also, with our status as students, the respondents may consciously or subconsciously be reluctant to opening up, interpreting us as less influential and/or serious than e.g. a more experienced researcher such as a professor. Our experience, however, is that the possible weaknesses linked to our status not has been a noteworthy limitation. Since we have conducted interviews based on the general interview guide approach, this leaves the majority of the talk to the respondents. We have paid careful attention to our manner of approach, acting professional, and trustworthy. Close to all interviews have been conducted with both of us present, allowing us to ensure that all questions are asked properly, that interview transcripts are compared and summarized in collaboration, and that data and interpretations afterwards have been handled thoroughly. Also, in order to allow the readers to Page 109

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draw their own conclusions about whether the findings are plausible, we have chosen to include quotes from interviews. Both researchers are of the same sex and have the same educational background and the results might have been different if we were of the opposite gender and/or had differing educational orientations. None of us had previous work experience with- and/or hands-on experience and insight into, the PSF industry itself before starting this project. We picked our thesis subject due to pure fascination and interest, and we have spent extensive time on learning about the industry by reading and interviewing respondents. Other sources of bias could potentially also be found in our treatment of data, concerning issues of selective memory, telescoping, attribution and exaggeration. Access Our study has been dependent on getting access to firms and respondents within the industry of interest. We have gone through a time- and somewhat cost consuming process in the aim of gathering data and interpreting results. To a certain degree this of course limited our time to analyze our findings. On the contrary, the fairly thorough data gathering extended our understanding and insight into the issue under investigation. For us, this part of the process was extremely valuable in terms of personal development. We also recognized that our interview style improved in terms of efficiency, and that it with time enabled us to see an even broader picture. Interpretation Since we have conducted a foreign language research, this has had implications for the research- and writing process. Possible biases can be linked to cultural differences with regards to word connotations, interpretation and presentation of findings. Interviews conducted in France were conducted in our second language, English, hence potential bias related to interpretations and translation may have occurred. Also, potential bias could occur when translating the Norwegian interviews into English. The same biases are also present for the French respondents, communicating in a foreign language. Examples of issues that may occur in relation to translation, and the fact that interviews were conducted in Page 110

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foreign languages, are e.g. comprehension and connotations, conveying nuances in responses about especially feelings and perceptions, responses “loosing” its original meaning during translation. After viewing the limitations of this study we will now turn to suggestions for further research avenues.

5.4 Suggestions for Further Research

First and foremost we would find it personally interesting to further investigate the meaning and effects CD may have with regards to firm performance. We feel this would be a natural next step to more thoroughly investigate this since PSFs are highly dependent of competence, yet they down prioritize CD. How are these two rather contradictory aspects going to add up in the long run? Furthermore, based on Maister (1993), stating that firms that fail to generate new knowledge will sooner or later face problems. One example is that our findings indicate that both time and cost pressure limit the professionals’ ability to develop customized problem solving solutions. By not being able to develop these creative problem solutions, the professionals, hence firm, might “loose out” acquiring new knowledge in the long run. Our findings suggest that the degree of knowledge sharing across borders is lower in France compared to Norway. We found that Hall’s explanations of high- and low context cultures could be a possible explanation to some extent. Personally, we would find it interesting to look deeper into the other plausible explanations for this as this might contribute to a deeper understanding for both managers and professionals to enable finding alternative ways to approach this problem. Our respondents also identified that it might be an issue of trust. Future research should examine the roles that trust play both internally amongst professionals and externally with stakeholders. Another thinkable extension element would be to include an analysis of the Page 111

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respondents’ background more systematically as to identify possible explanations to their CD stemming from education, previous work experience etc. Also, this could be done at firm level. In a non-anonymous study, a broader data collection, including secondary data such as firms’ websites, annual reports, databases, training material and other internal documents could be used, and would allow a more thorough impression of each firm. Further research on this could examine how this background information could influence how CD is developed. Additionally, an extension of this research could be to include more or different firms, -industries, and –nationalities, as this could generate different findings. Extending the study to other organizations under the broader umbrella PSFs would facilitate an interesting foundation for comparison across firms, and we believe this would be of great interest as well. Also, a study comparing the findings found within our study with non-PSFs could give exciting insight. Another interesting path would be to compare small firms with larger ones, both domestically and globally. Further research could also investigate the relationship between professionals and clients. Investigating the consequences of increasingly more sophisticated clients and the effect on e.g. relationships, quality, loyalty, demand could be an interesting path. Here, also investigating the effect on CD could be looked into. Another area for further research could be to dig deeper into the development and maintenance of firm reputation; e.g. to what degree individuals within the firms contributed to firm reputation, how the competitors impact on the reputation of firms within industries and to which extent media and specific projects contributes. Additionally, a thinkable extension in general could also be to conduct a longitudinal study, gaining insight into the development and evolvement of CD over time.

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Appendices
Appendix 1: Information letter sent to companies in France Hi We are two graduating Master students (MSc in International Management) at BI Norwegian Business School, currently working on our master thesis. The purpose of the paper is to analyze how professionals (employees) experience and perceive competence development in professional service firms (PSFs). Mainly, the focus will be on what contributes and constraints competence development on three different levels of employees (newly employed, senior- and partner level). The study is cross-cultural since we have the privilege of one of us studying in Oslo (BI) and the other in Paris (ESCP Europe). We will explore the similarities and the diversity within the views of the professionals on competence in the two countries. We hope this could be of interest for you and we are aiming to interview three employees ranging from newly employed, senior and partner level. The interviews will have an approximate duration of 30 minutes. We are flexible concerning where and when these interviews can be conducted. The information will be treated confidential and will not be able to be traced back to the individuals. With our study we hope to contribute with insight of what your employees perceive as contributors and/or constraints to competence development. Since competence among employees is essential for high quality service delivery to clients, we view our choice of topic as important. We would highly appreciate having you in our sample and hope that this would be of interest. Have a nice day and we look forward to hearing from you. Best regards, Maja Øidne Korsen e102153@escpeurope.eu +47 959 17 948 Linn Langangen linn.langangen@student.bi.no +47 908 43 351

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Appendix 2: Information letter sent to companies in Norway Hei Vi er to masterstudenter ved Handelshøyskolen BI, Oslo, som i disse dager skriver vår avsluttende oppgave om kompetanseutvikling i kunnskapsintensive bedrifter. Denne studien vil i all hovedsak kartlegge potensielle fremmere og hemmere av kompetanseutvikling i slike firmaer. Studien er komparativ siden vi intervjuer ansatte både i Paris og Oslo. Vi vil undersøke forskjeller og likheter i henhold til de ansattes syn på kompetanseutvikling, i begge land. I den sammenheng ønsker vi å intervjue minimum tre ansatte i deres bedrift, helst av begge kjønn og gjerne på tre forskjellige nivåer (nyansatt, senior, partner). Intervjuene vil ha en varighet på ca. 30 minutter og kan gjerne foregå på deres arbeidsplass og premisser. Eventuelt ønske om konfidensialitet er respektert og informasjonen fra disse intervjuene vil ikke kunne spores tilbake til enkeltindivider. Med forskningsprosjektet ønsker vi å bidra med innsikt i hva deres ansatte føler kan medvirke til, eller hindre kompetanseutvikling og hva som vil være av viktighet for ledere. Videre, siden kompetansen til hver enkelt ansatt er essensielt for å kunne levere gode resultater til klienter, vil vi kunne bidra til å gi dere innsikt i tillegg til å kunne kartlegge hva som eventuelt kan være fallgruver eller bidragsytere til kompetanseutvikling. Vi håper dette er interessant og vil også kunne tilby dere et ferdig eksemplar av den ferdige oppgaven. Vi ser frem til å høre fra dere. Med vennlig hilsen, Maja Øidne Korsen e102153@escpeurope.eu +47 959 17 948 Linn Langangen linn.langangen@student.bi.no +47 908 43 351

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Appendix 3: English General Interview Guide This information is concerning both this appendix (4), and appendix (5), which contains the Norwegian general interview guide. Below follows a description of the interview guides used when collecting data from respondents in the respective firms. The two interview guides reflects approximate descriptions. Each respondent and situation required adaptation as to how the interview developed and if themes of particular interest surfaced in each interview. The questions were also adapted in terms of who was being asked – at what level he or she was employed. Therefore, the interview guides serves as illustrative examples of topics and questions central to the interview process.

Introduction Introduction of ourselves. About the study: the reasoning behind and purpose of our project, interviews being conducted on three levels in France and Norway. About confidentiality and how we will use the information received in interviews. Ask for acceptance of using tape recorder, if used. Personal Background and work related tasks Could you please introduce yourself and tell us briefly about your background? (E.g. education, previous work experience, why did you choose to work for this firm, tenure, development path of career and work related tasks and responsibilities). Competence development Could you please describe your work? What is your perception of competence development and learning? How has competence developed been organized to support your career in this firm? Are there any particular factors that you consider particularly helpful in your competence development? (E.g.: IT systems, mentor systems, training, collaboration, daily operations etc.). Are there any factors that inhibit your personal development in this firm? (E.g.: IT systems, mentor systems, training, collaboration, daily operations, stress, high pressure etc.). Does your expectation regarding competence development match your experience within the firm? International matters: Page 132

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Could you please tell us about how you view the culture for sharing information and knowledge in this firm? Could you please tell us about how the hierarchical structure within the firm, and to what extent you feel it is predominant? Could you please tell us how you experience differences between layers/levels of professionals in this firm, and how this influences your every day work and competence development? At work, how does collaboration with others take place? Do you collaborate with people outside the firm? Additional comments: Is there anything you would like to add to your previous comments? What did we forget to ask you about? Is there a possibility that we can contact you at a later stage in case we need to ask you any further or clarifying questions? If so, how would you prefer to be contacted? (Via phone/e-mail?). Thank you for your time! If you have any questions at a later point in time, please do not hesitate to contact us.

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Appendix 4: Norwegian General Interview Guide Introduksjon: Introdusere oss selv. Om studien: Begrunnelsen og intensjonen med prosjektet vårt, intervjuer foretatt på tre nivåer i Frankrike og Norge. Om konfidensialitet og hvordan informasjonen fra intervjuene vil bli brukt i studien. Ta opp spørsmålet med båndopptaker hvis dette tas i bruk. Personlig bakgrunn or arbeidsrelaterte oppgaver og ansvarsområder: Kan du vennligst fortelle litt om deg selv og din bakgrunn? (Eksempelvis om utdannelse, tidligere jobberfaring, bakgrunnen for valg av arbeidsgiver, fartstid, karriereutvikling innenfor selskapet, arbeidsrelaterte arbeidsoppgaver og ansvarsområder). Kompetanseutvikling: Hva legger du i begrepet kompetanseutvikling og læring? Hvordan har din kompetanseutvikling blitt tilrettelagt i dette selskapet for å støtte din karriere? Er det noen faktorer/aspekter ved ditt arbeid som du ser på som spesielt viktige for din kompetanseutvikling? (Eksempelvis: IT, mentor systemer, opplæring/kursing, samarbeid, daglig prosjektarbeid etc.). Er det noen faktorer/aspekter ved ditt arbeid som du føler har hindret din kompetanseutvikling? (Eksempelvis: IT, mentor systemer, opplæring/kursing, samarbeid, daglig prosjektarbeid, press etc.) Samsvarer dine forventninger til kompetanseutvikling med hva du har opplevd i dette selskapet? Internasjonale forhold/Kulturrelaterte arbeidsforhold: Kan du fortelle litt om hvordan du ser på kulturen for informasjon- og kunnskapsdeling her? Kan du fortelle litt om hierarkiet i dette selskapet og om hvor mye eller lite fremtredende det er? Kan du fortelle litt om hvor ”store” forskjellene mellom nivåer (nyansatt, senior og partner) er, og eventuelt hvordan dette påvirker din hverdag og kompetanseutvikling? Hvordan foregår samarbeid med andre på jobb? Samarbeider du med personer utenfor bedriften? Page 134

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Tilleggskommentarer: Er du noe du avslutningsvis har et ønske om å legge til? Hva føler du vi har glemt å spørre deg om? Er det i orden om vi kontakter deg på et senere tidspunkt dersom det skulle forekomme tilleggsspørsmål, eller det skulle oppstå et behov for oppklarende spørsmål? I så fall, hvordan foretrekker du å bli kontaktet? (Via telefon/e-mail?) Tusen takk for din deltakelse! Kontakt oss gjerne hvis du har noen spørsmål på et senere tidspunkt.

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Appendix 5: Preliminary Thesis Report

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