Firm Knowledge and Learning

Previous posts discussed how the Resource-Based View of the Firm (RBV) and Dynamic Capabilities were two theories that emerged from strategic management. A third theory is the Knowledge-Based View.

This theory consists of viewing knowledge as the most important resource of the firm. Naturally, this theory is based on RBV as initially described by Penrose (1959) and expanded by Wernerfelt (1984) and Barney (1991).

Knowledge is difficult to imitate, and can be a source of competitive advantage. Furthermore, knowledge is embedded in organizational routines, and is part of the culture and systems of the organization.

There are a number of ways contemporary research is concerned with firm knowledge and firm learning. For example:

  • Kogut and Zander 1992: The knowledge-based view of the firm provides alternative answer to the question why firms exist. They argue that what firms are better than markets is the sharing and transfer of the knowledge of individuals and groups within an organization.
  • Cohen and Levinthal 1990: The ability of a firm to recognize the value of new, external information, assimilate it, and apply it to commercial ends is critical to its innovative capabilities (absorptive capacity), and its a function of a firm’s prior knowledge.
  • Crossan, Lane and White 1999: Organizational learning involves search and exploration. It is a multi-level process: individual, group, organization,.
  • Rosenkopf and Almeida 2003: Knowledge is localized within technological and geographical contexts. Mobility facilitates knowledge flows more than alliances.
  • Yang, Phelps, Steensma 2010: The effectiveness of learning from knowledge pool is size and similarity.
  • Dahlander and McFarland 2013: Tie formation depends on opportunity and preference, but persistence is tied to tie strength and types.
(Adapted from course notes)
(Flashcards and other resources here)
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