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Introduction
This chapter is concerned with the rapid increase in technological advance-
ment and its transfer across cultures. This is a vital area for the UK in its 
endeavours to seek competitive advantage in exporting in the face of fierce 
global competition. It is helped by the liberalization of cross- border move-
ments, primarily in the EU, and the use of electronic communication, 
research and market intelligence.
Technology transfer
Technology transfer can be split into two main areas:
Trade in goods and services: this consists of manufactured goods and serv-
ices, for example, computer software and financial services. This can be 
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Summary
Terminology
Technology transfer
The challenge
International aid
Profile of the effective aid adviser
Knowledge, turnkey arrangements and management contracts
Resistance to change
Barriers to transfer
Overcoming problem areas
International Joint Ventures
Case study
Effective transfer of skills and knowledge
Licensing and franchising

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242 Cross-Cultural Communication
achieved either by direct exporting, export sales teams or local agents, 
or by joint ventures, for example, BP/Amoco’s liquefied natural gas 
project in Guandong, China. In some cases, financial assistance from the 
International Finance Corporation, a branch of the World Bank Group, 
may be made available for international projects such as infrastructure 
development that will improve a country’s economy.
Trade in skills and knowledge: this consists of direct selling technical 
know- how, licensing, franchising, knowledge agreements, management 
contracts and consultancy. This is an expanding area and with the 
comparative decline in UK manufacturing, it is becoming of increasing 
importance in the UK’s export drive. Examples include HSBC introduc-
ing personal banking systems in China and PricewaterhouseCoopers 
and KPMG providing advice to Eastern European cultures on accounting 
systems.
In both cases, understanding of the impact of culture on assisting in 
the winning of export orders is often of vital importance, particularly in 
the transfer of skills and knowledge to other cultures.
‘Information exchange is an integral, often overlooked, aspect of glo-
balization’ (International Monetary Fund, 2000). Foreign direct investment 
brings technical innovation, including knowledge about production meth-
ods and management techniques that represent a highly valuable resource 
for developing countries.
The advantages of technology transfer are that the receiver country or 
company gains the benefit of advanced technology as a result of the devel-
opment that has already been carried out by the other company. In certain 
countries, the transfer of technology, skills and knowledge is a precondi-
tion for allowing foreign companies to set up operations. The supplier may 
obtain the advantage of access to low- cost labour and materials, a future 
market in the local environment and
first- hand knowledge of the local 
culture’s sensitivities and preferences, as well as the goodwill that the new 
technology has generated and the granting of possible tax concessions to 
encourage investment. In addition, there is the benefit of new jobs being 
created and increasing the skills base of the local workforce. Disadvantages 
can include the squeezing out of similar projects in the domestic market and 
the difficulty in repatriation of income accrued in the receiver country back 
to the provider’s home base.
The transfer of skills and knowledge is not confined to developed coun-
tries; indeed, it applies increasingly to joint ventures in many parts of the 
world. It is also an important role for expatriates working overseas as, for 
example, project managers, members of trade missions, staff in embassies 
and High Commissions, particularly commercial attachés, aid workers in 
government agencies and NGOs, and teachers working overseas. This 
transfer is a complex process involving much planning, including market 
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Transfer of Skills, Technology and Knowledge 243
research, product design, recruitment of local staff and their training, as 
well as complying with the regulations of the receiving country. In many 
situations, the transfer involves elements of management of change with 
the emphasis on building trust, the need for shared objectives, realistic 
expectations and the identification of key change agents, including, where 
appropriate, government officials, managers and supervisors.
In the UK, with the decline in manufacturing, there is an increase in sell-
ing the skills and knowledge rather than the product itself and in providing 
long- term consultancy in such areas as engineering, construction, account-
ancy, educational systems and financial services. Many of these are part of 
foreign direct investment (FDI). Essentially, the process involves ‘translating’ 
knowledge and skills from the cultural context of the provider to that of the 
receiving culture.
Research carried out by the Canadian International Development 
Agency (CIDA) in the early 1990s (Kerley, 1990) shows that although 
high technological standards were a prerequisite for eventual success 
in transfer, much depended on the communication skills adopted during 
the transfer process and on achieving congruence with the local culture. 
This was echoed by Michael Heseltine during his time as Deputy Prime 
Minister in 1995 in charge of revitalizing UK exports, when he said: ‘It’s no 
good being able to design good, new products or new services, if you can’t 
communicate their value to customers in a language and manner they 
understand.’