Abstract:
This chapter explores knowledge-acquisition strategies adopted by Bangladeshi
garment suppliers, in pursuit of economic upgrading. The context is characterised by ‘tacit
promissory’ contracting relationships, whereby suppliers make recurrent discrete transactions
with the same buyers over a long period of time, without the existence of any original and
legally binding written agreement. We explore whether and to which extent suppliers in such
contexts can access the knowledge resources of their powerful trading partners. Furthermore,
we examine the strategies these supplier firms may pursue, at a functional level, to compensate
for their lack of knowledge in order to effectively progress towards upgrading. We draw on a
qualitative case analysis of two small and two large Bangladeshi garment manufacturing firms.
The findings show that these suppliers source knowledge externally to the extent to which these
are available and affordable to them, in order to compensate for the lack of access to buyers’
tacit knowledge resources. The small firms in our study are only able to seek locally available
knowledge sources, and thus are constrained to technocratic or output-oriented dimensions of
process upgrading. Large firms, however, are able to afford sourcing tacit and codified
components of knowledge from overseas and thus arrive at higher order functional capabilities
including designing and branding.
