Date: April 12, 2013 Topic: The Shrinking ... - Georgetown Law

The introduction of a new technology into an organization can change the way
individuals work and how they learn from each other. Technologies such as information systems
and knowledge databases open up access to knowledge that was previously unavailable to
organizational members (Lucas 1975; Zuboff 1988), and can thus disrupt an established social
structure (Leonardi 2007). When knowledge is systematically stored and disseminated using
technology, organizational transparency can increase as people use technology to find where a
specific bit of knowledge resides. Technology, therefore, may reduce the need to rely on
personal relationships or social capital for knowledge search in the workplace. Further,
knowledge that is discovered or located through technology might also more easily be used
directly by others without forming any relationship to the creator of that knowledge.
Although in general technology can clearly reduce human labor and increase efficiency,
several scholars have suggested that technology has important limitations in its application to
knowledge management (e.g., Alavi and Leidner 2001). In particular, technology may not
effectively replace individuals’ social capital when performing knowledge work. Because
knowledge is locally embedded in people and their relationships, social capital (i.e. relationships)
is critical to accessing and transferring knowledge (Tsai, 2001). Complex knowledge is
especially difficult to codify for systematic reuse and dissemination, and people may still have to
rely on their prior social relationships to access and comprehend such complex knowledge
(Hansen 1999).
Prior research on knowledge sharing inside organizations has tended to focus on either
technology use, or on workplace social relationships (e.g. Reagans & McEvily, 2003), essentially
viewing them as separate phenomena. Few studies have examined technology use and
relationship dynamics simultaneously, or distinguished their relative influence (Haas and Hansen,
2007). In this paper, we investigate the tension between technology use and relationships, and we
also show how they may complement each other to create value. Specifically, we ask: How does
technology use compare with prior social capital as the basis for forming new workplace
relationships and creating value?
To address this question, we analyze both qualitative and quantitative data collected from
a large European law firm concerning its implementation of a new technology: a knowledge
management system (KMS) designed to capture, store, and disseminate knowledge in lawyers’
work. We use interview data and meeting records to describe our research context and the KMS
implementation processes and to inform our theory development. In our quantitative analysis, we
use records of KMS document downloads, client billings, and personnel information to examine
the dynamic interplay between technology use and social capital. We examine how the interplay
of those two factors shapes the formation of new workplace relationships among organizational
members and the creation of value through billable-hours revenue generation.
The use of KMS’s for managing professional knowledge work has increased rapidly. A
recent report shows that AmLaw 200 firms invest on average $5-7 million per year in KMS
technology (Cohen 2011). Typically, investments in KMS technologies in professional service
firms are aimed at leveraging the intellectual capital of organizational members and facilitating
transfer of knowledge among them. Yet although the KMS technology is expected to help
management of knowledge work by identifying best practices and keeping track of employees’
knowledge, whether such technology actually creates value for employees has not been proven in
the existing literature. In addition, prior research has not systematically examined the
consequences of using such technology for workplace relationships. In this research, we observe
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