Knowledge management in offshore software development

Knowledge management has emerged as an important area of information systems research and practice. Over the last few years, related theory and practice has turned to supporting knowledge intensive work in organisations with operations spread across the globe. Waves of specific technologies have been presented as the "silver bullet" in complex distributed or networked organisations but despite the optimism the study of the capacity for information technology to support the management of knowledge remains highly contentious. For example, McDermott (1999) tells how technology led approaches to knowledge management can lead to expensive failures. Offshore software development is an interesting example of knowledge intensive work. For a number of reasons such as cost savings and access to skills, many companies are engaging in offshore software development either by outsourcing to third party vendors or setting up their own offshore subsidiaries in countries such as Ireland, Russia, China and India (Apte 1990, Carmel 1999, Nicholson and Sahay 2001, Sahay et al 2003). The significant reduction in cost, improved reliability and capacity of international telecommunications have provided the conditions for development to be done in locations far removed from end user sites. Despite these improved technical conditions, the problem of knowledge management in these operations is highly significant and still inadequately understood. In order to contribute to the debate surrounding knowledge in such distributed software development operations, this paper presents the results of a longitudinal interpretive case study of British software developers (from a company we call Sierra) working with their counterparts from their Indian subsidiary. Sierra opened an offshore development subsidiary in 1998 but closed it in early 2000. This is an interesting case for two main reasons: firstly it is an example of a failure and so allows us to consider lessons for future ventures. Secondly, unlike the large firms like Nortel and Texas Instruments that have previously established offshore centres, Sierra in contrast is a small, flexible dynamic software house that thrives on innovation and creativity. Firms like Sierra, are what Saxenian (2001) describes as "born global". An analysis of Sierra provides us insights on how these born global firms work in practice. These insights help to illuminate our understanding of the implications of globalisation processes. There is a fast burgeoning literature on the subject of knowledge management and information systems (see Alavi and Leidner (2001) and Robey et al (2000) for comprehensive reviews on the subject). A subset of this literature is concerned with knowledge sharing which is of specific concern to our study. Of importance in this area is the community of practice approach (Lave and Wenger 1991) to understanding learning in professional and social groups. The community could be a group of photocopier technicians as related by Orr (1990). Other community of practice examples might be related to tailoring or midwifery practice or the community of research staff in an academic department. The many communities encountered in organisations are distinct in that they are typically drawn together by some shared mission or goal, a shared understanding of what the community does and how to do it. The community faces common problems requiring solutions and thereby collectively embodies knowledge. Lave and Wenger (1991) define the concept as: a set of relations among persons, activity, and world, over time and in relation with other tangential and overlapping communities of practice. A community of practice is an intrinsic condition for the existence of knowledge, not least because it provides the intrinsic support necessary for making sense of its heritage. Learning is achieved in the community through engagement in situated practice under the conditions of legitimate peripheral participation. Participation for newcomers is initially peripheral but over time through engagement with the community may reach full participation. The feasibility of participation though is governed by issues of legitimacy related to access, social structure and power relations within the community. The community of practice concept has become influential and has been used in a number of recent theoretical and empirical studies (Boland and Tenkasi 1995, Hayes 2001, Hayes and Walsham 2001). These studies in various ways demonstrate the importance and capability of information technologies in supporting a community of practice. Hayes and Walsham (2001) for instance in their analysis of groupware usage discuss the importance of surveillance free "safe enclaves" for effective community learning. To date there is no empirical study that specifically addresses the international dimension in supporting the dynamics of knowledge sharing in communities of practice across time and space in different countries. This issue together with analysis of knowledge sharing in offshore software development are central contributions of the paper. The paper starts with perspectives on the process of evolution of offshore software development relationships and the important role that knowledge sharing processes play in shaping the evolution of the relationship. The unit of analysis here is concerned mainly with the project team and the impact of knowledge sharing on the strategic trajectory at an inter organisational level. This is followed in section three by a discussion of the research approach and a review of pertinent concepts related to knowledge sharing to develop the conceptual scheme. Following this we provide an outline of the case history and analysis drawing on the theoretical ideas outlined earlier. Finally in section five we discuss the more general implications of the case for developing a richer understanding of communities of practice in offshore software development.