Understanding the Framework of The Dynamics of Organizational Knowledge

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Dynamic Capabilities have been described as the key to firm superior long-term achievements. They are considered to enable creation, deployment, and protection of the intangible assets at firm-level, in particular, assets of knowledge.

They are supposed to support competitive advantages, but neither social nor behavioral sciences have had success in the endeavor to specify the nature and microfoundations of them. Microfoundations have been described as distinct skills, processes, procedures, organizational structures, decision rules, and other similar concepts and labels, which strengthen sensing, seizing and reconfiguring capabilities of the firm.

They are sometimes difficult to identify and analyze, but they are acknowledged as important issues for innovative firms. These not only adapt themselves to their business environments, but also shape those environments, through innovation and inter-firm collaboration.

Most broad literature produced in recent decades about firms, in the fields of Economics, Strategic Management, Organizational Theory, Entrepreneurship, Innovation Management and Organizational Change has not been effective in building bridges between Dynamic Capabilities and Organizational Learning processes, which should be considered processes of Organizational Knowledge Creation. It is easy to note a difficulty to explain the variation in the degree of success of firms to be innovative with reference to different degrees and qualities of their Organizational Knowledge Creation, this means, in other words, their dynamics of Organizational Knowledge.

A more accurate conceptualization of Organizational Knowledge has been relatively neglected, especially if taken into account the centrality of this issue to the understanding of the elements that allow firms to search innovation and, as a result, to create sustainable competitive advantages.

The dynamics of Organizational Knowledge is understood, in the framework proposed in this blog, as responsible for the coevolution of two sets of organizational processes that have knowledge as their main variable: one geared towards the operational functioning of the firm (both staff and line activities) referred herein as Operational Processes of Knowledge, that corresponds to knowledge processes of static routines, the object of which is the knowledge directly involved in the operation of a firm; the other dedicated to the creation of processes, policies and programs to influence, correct and improve operational processes, which will be identified with the notion of Knowledge Structures.

A better understanding of the dynamics of Organizational Knowledge will enable people to realize it as an intangible, dynamic, emerging and specific asset to each company, that does not correspond to the simple sum of knowledge of individuals of the firm, and it will be able, or not, to create sustainable competitive advantages. This blog describes a research that uses the Organizational Knowledge Creation Theory as a point of departure to examine some different frameworks up to now proposed to better understand the dynamics of Organizational Knowledge, and it will propose a new framework that will take into account new and important features, as, for instance, processes of reflection, and will identify Dynamic Capabilities as an integration of different constructs, of first and second order, in the dynamics of Organizational Knowledge and not a simple set of processes, as usual.

This blog sets forth a theoretical account of the genesis and evolution to consider different states of Organizational Knowledge. This approach takes into account the subjectivity of agents, normally not considered in other frameworks. The result of this discussion will be by presenting a general framework linking evolution of structural processes of knowledge, here not being considered the only part of Dynamic Capabilities, to the evolution of static routines, considered as operational processes of knowledge.

The proposed framework can, for instance, help scholars to understand the foundations of Organizational Ambidexterity and long-run firm success. At the same time, it can help managers to delineate relevant strategic considerations and the priorities they must adopt to enhance firm performance.

Forte abraço

Fernando Goldman