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Knowledge is a key strategic resource for building sustainable competitiveness in an organisation in a modern, knowledge-based economy (Le & Lei, 2018b). Knowledge, as the crucial resource, has caused a major shift in the design and adoption of an organisation’s competition model for achieving inimitable economic value and competitive differentiation (Sedighi, Lukosch, Brazier, Hamedi, & van Beers, 2018). Modern organisations have shifted their paradigm of success from creating tangible assets to intangible resources using effective knowledge sharing among employees who help promote organisational creativity and innovation (Xiao, Zhang, & Ordóñez de Pablos, 2017). However, the fundamental issue experienced by many organisations is a deficit in employees’ willingness to share this crucial resource of knowledge with their workmates (Casimir, Lee, & Loon, 2012).
Several knowledge sharing practitioners have attempted to identify diverse components through which knowledge sharing can be encouraged, including the use of effective human resource management (HRM) practices (Collins & Smith, 2006; Naeem, Mirza, Ayyub, & Lodhi, 2017), the exploration of environmental and motivational factors, and the exploitation of individual dispositions (Casimir et al., 2012; Van Den Hooff & De Ridder, 2004; Wang & Noe, 2010). Among these methods, Wang and Noe (2010) highlighted the need to conduct more empirical studies on the role of leadership, as leaders play a decisive role in establishing knowledge sharing processes among subordinates (Wang & Noe, 2010; Xiao et al., 2017). Leadership practitioners have generally recognised transformational leadership as one of the most remarkable styles in terms of encouraging subordinates to share and develop knowledge in the workplace (Al-husseini & Elbeltagi, 2018; Le & Lei, 2017, 2018a). This type of knowledge sharing among subordinates is often carried out via two channels: knowledge donating and knowledge collecting.
Knowledge donating occurs “when individuals willingly share their knowledge, skills, and abilities with their colleagues” (Al-husseini & Elbeltagi, 2018). Knowledge collecting deals with “individuals’ willingness to acquire and gather information, skills, and expertise from their colleagues through consultation or discussion” (Al-husseini & Elbeltagi, 2018). Limited empirical evidence exists to help understand the direct impact of transformational leadership on the process of employees’ donating and collecting knowledge (Al-husseini & Elbeltagi, 2018; Le & Lei, 2017, 2018a), particularly in the context of the pharmaceutical industry of Pakistan.
The pharmaceutical industry of Pakistan has been recognized as one of the most influential contributor in the health manufacturing industry by producing medicines and drugs for patients’ medicament. According to the Pakistan Pharmaceutical Manufacturer’s Association (PPMA), there was an unusual pharma production unit in the country during the period of independence in 1947. However, Pakistan now has more than 800 pharma production units, of which 25 units are multinational. Despite this excessive increment, the pharmaceutical industry of Pakistan is experiencing major challenges in the prize freezing of pharma products and out-dated treatment methods. Moreover, an economic survey of Pakistan (2018-2019) also highlighted the negative growth of the pharmaceutical industry by 8.40%.
The need of the hour in the pharmaceutical industry of Pakistan is to transform this industry into cost-effectiveness in its production and operations, and innovate its treatment methods by encouraging the knowledge sharing process among its employees’ through transformational leadership style of their managers/HODs. Therefore, this study intends to fill this research gap by investigating the influence of transformational leadership (TL) by leaders/managers on their subordinates’ knowledge sharing processes, via knowledge donating and knowledge collecting, in the context of the pharmaceutical industry located in Pakistan.
Looking through the lens of the social exchange theory, the distinct catalytic mechanisms of affect-based and cognition-based trust in the knowledge sharing process between leaders and members of an organization is also examined. Social exchange theory suggests that affect-based trust is developed by dealing with socio-emotional exchange relationships that capture reciprocal exchange; meanwhile, cognition-based trust is built from rational evaluation of organisational members’ salient characteristics that facilitate the process of negotiated exchange (Zhu, 2012). Both affective and cognitive trust between leaders and members can be wielded by leaders to influence their followers’ work outcomes (Miao, Newman, & Huang, 2014; Zhu et al., 2013; Zhu & Akhtar, 2014a, 2014b).