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Heterogeneous Combinations of Knowledge Elements: How the Knowledge Base Structure Impacts Knowledge‑related Outcomes of a Firm*

01 Apr 2013-Research Papers in Economics (Research Institute for Economics & Business Administration, Kobe University)-

AbstractKnowledge is the preeminent resource of a firm. Although many scholars have focused on the firm's knowledge base, few studies have examined the effects of the knowledge base structure—how knowledge elements are linked or separated from each other in clusters—on firm's knowledge-related outcomes. This study examines the knowledge base structure, and tests hypotheses about the effects of heterogeneous combinations of knowledge elements on the outcomes. Through an analysis of the patents related to LCD technology, (1) the usefulness of an organization's inventions correlates positively with the density of the knowledge links between technologically different knowledge components, (2) the average usefulness of a firm's inventions correlates positively with the density of the knowledge links between technologically disparate knowledge components, (3) the number of inventions correlates negatively with the density of the knowledge links between excessively disparate knowledge components. more

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Abstract: Much of the prior research on interorganizational learning has focused on the role of absorptive capacity, a firm's ability to value, assimilate, and utilize new external knowledge. However, this definition of the construct suggests that a firm has an equal capacity to learn from all other organizations. We reconceptualize the firm-level construct absorptive capacity as a learning dyad-level construct, relative absorptive capacity. One firm's ability to learn from another firm is argued to depend on the similarity of both firms' (1) knowledge bases, (2) organizational structures and compensation policies, and (3) dominant logics. We then test the model using a sample of pharmaceutical–biotechnology R&D alliances. As predicted, the similarity of the partners' basic knowledge, lower management formalization, research centralization, compensation practices, and research communities were positively related to interorganizational learning. The relative absorptive capacity measures are also shown to have greater explanatory power than the established measure of absorptive capacity, R&D spending. © 1998 John Wiley & Sons, Ltd.

329 citations

Journal ArticleDOI
TL;DR: This paper aims to help organizations define the demand structure and distribution characteristics of human resources’ functional knowledge, business process knowledge, environmental knowledge, logical thinking knowledge, based on the situated functional levels of human Resources.
Abstract: The importance of studying organizational human resources knowledge structure is self-evident for organizational human resources selection and training It is also significant for organizations to conduct knowledge management and gain competitive advantages In this way, how do we understand the relationship among the knowledge structure owned by the organizational human resources, the functional levels and the business process situated, and the logical thinking applied? This is what this paper will further explore This paper aims to help organizations define the demand structure and distribution characteristics of human resources’ functional knowledge, business process knowledge, environmental knowledge, logical thinking knowledge, based on the situated functional levels of human resources Furthermore, it endeavors to provide a framework for determining the knowledge system and structure which are closely related to human resources selection and training From the perspective of System Theory, each organization is an independent system The work of any individual within the organization is one part of a system engineer Naturally, system engineering methodology becomes its methodology Based on the four-dimensional structure of system engineering methodology, this paper analyses human resources knowledge structure from the perspectives of function levels, environment, process and logic, and further constructs the organizational human resources knowledge four-dimensional structure model (HRKFDM) The knowledge of organizational human resources is closely related to business process, environmental conditions, function levels and thinking logic The organizational HRKFDM shows that organizational human resources knowledge is made up with functional knowledge dimension, environmental knowledge dimension, process knowledge dimension, and logical knowledge dimension In the problem-solving process with logical thinking and decision-making, human resources need to comprehensively use the functional knowledge, environmental knowledge, process knowledge and logical knowledge In each knowledge dimension, the functional knowledge, environmental knowledge, process knowledge and logical knowledge requirements for grass-roots workers, middle-level workers, and senior workers follow trapezoidal distribution, yamagata distribution and trapezoidal distribution respectively The organizational HRKFDM can be used as an important reference framework for promoting organizational learning, as well as an instruction for organizational learning, knowledge management, building a learning organization, and developing the core competence of an organization

7 citations

Cites background from "Heterogeneous Combinations of Knowl..."

  • ...The literature focusing on knowledge structure mostly discussed the influence of knowledge structure on organizations, such as the different impacts of element knowledge and structure knowledge on enterprise competitive advantage [14, 15]....


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Abstract: This study develops an evolutionary theory of the capabilities and behavior of business firms operating in a market environment. It includes both general discussion and the manipulation of specific simulation models consistent with that theory. The analysis outlines the differences between an evolutionary theory of organizational and industrial change and a neoclassical microeconomic theory. The antecedents to the former are studies by economists like Schumpeter (1934) and Alchian (1950). It is contrasted with the orthodox theory in the following aspects: while the evolutionary theory views firms as motivated by profit, their actions are not assumed to be profit maximizing, as in orthodox theory; the evolutionary theory stresses the tendency of most profitable firms to drive other firms out of business, but, in contrast to orthodox theory, does not concentrate on the state of industry equilibrium; and evolutionary theory is related to behavioral theory: it views firms, at any given time, as having certain capabilities and decision rules, as well as engaging in various ‘search' operations, which determines their behavior; while orthodox theory views firm behavior as relying on the use of the usual calculus maximization techniques. The theory is then made operational by the use of simulation methods. These models use Markov processes and analyze selection equilibrium, responses to changing factor prices, economic growth with endogenous technical change, Schumpeterian competition, and Schumpeterian tradeoff between static Pareto-efficiency and innovation. The study's discussion of search behavior complicates the evolutionary theory. With search, the decision making process in a firm relies as much on past experience as on innovative alternatives to past behavior. This view combines Darwinian and Lamarkian views on evolution; firms are seen as both passive with regard to their environment, and actively seeking alternatives that affect their environment. The simulation techniques used to model Schumpeterian competition reveal that there are usually winners and losers in industries, and that the high productivity and profitability of winners confer advantages that make further success more likely, while decline breeds further decline. This process creates a tendency for concentration to develop even in an industry initially composed of many equal-sized firms. However, the experiments conducted reveal that the growth of concentration is not inevitable; for example, it tends to be smaller when firms focus their searches on imitating rather than innovating. At the same time, industries with rapid technological change tend to grow more concentrated than those with slower progress. The abstract model of Schumpeterian competition presented in the study also allows to see more clearly the public policy issues concerning the relationship between technical progress and market structure. The analysis addresses the pervasive question of whether industry concentration, with its associated monopoly profits and reduced social welfare, is a necessary cost if societies are to obtain the benefits of technological innovation. (AT)

22,526 citations

Proceedings ArticleDOI
01 Jun 1993
TL;DR: An efficient algorithm is presented that generates all significant association rules between items in the database of customer transactions and incorporates buffer management and novel estimation and pruning techniques.
Abstract: We are given a large database of customer transactions. Each transaction consists of items purchased by a customer in a visit. We present an efficient algorithm that generates all significant association rules between items in the database. The algorithm incorporates buffer management and novel estimation and pruning techniques. We also present results of applying this algorithm to sales data obtained from a large retailing company, which shows the effectiveness of the algorithm.

15,011 citations

"Heterogeneous Combinations of Knowl..." refers methods in this paper

  • ...In this study, the algorithm used to perform the analysis “apriori” (Agrawal et al. 1993) employs the R statistical environment data analysis package “arules” (Hahsler et al. 2005), and derives the two knowledge components’ association rules in the knowledge base of the firm j in the year t.…...


Journal ArticleDOI
Abstract: This paper considers the relation between the exploration of new possibilities and the exploitation of old certainties in organizational learning. It examines some complications in allocating resources between the two, particularly those introduced by the distribution of costs and benefits across time and space, and the effects of ecological interaction. Two general situations involving the development and use of knowledge in organizations are modeled. The first is the case of mutual learning between members of an organization and an organizational code. The second is the case of learning and competitive advantage in competition for primacy. The paper develops an argument that adaptive processes, by refining exploitation more rapidly than exploration, are likely to become effective in the short run but self-destructive in the long run. The possibility that certain common organizational practices ameliorate that tendency is assessed.

14,959 citations

"Heterogeneous Combinations of Knowl..." refers background in this paper

  • ...If an organization has a broad knowledge base, it also has greater ability to explore external knowledge (Brusoni et al. 2001; March 1991)....


Journal ArticleDOI
Abstract: How should we understand why firms exist? A prevailing view has been that they serve to keep in check the transaction costs arising from the self-interested motivations of individuals. We develop in this article the argument that what firms do better than markets is the sharing and transfer of the knowledge of individuals and groups within an organization. This knowledge consists of information (e.g., who knows what) and of know-how (e.g., how to organize a research team). What is central to our argument is that knowledge is held by individuals, but is also expressed in regularities by which members cooperate in a social community (i.e., group, organization, or network). If knowledge is only held at the individual level, then firms could change simply by employee turnover. Because we know that hiring new workers is not equivalent to changing the skills of a firm, an analysis of what firms can do must understand knowledge as embedded in the organizing principles by which people cooperate within organizatio...

12,100 citations

"Heterogeneous Combinations of Knowl..." refers background in this paper

  • ...The primary function of research and development (R&D) is to combine differing technology components to create new knowledge (Fleming 2001; Kogut and Zander 1992)....


01 Jan 1969
Abstract: Continuing his exploration of the organization of complexity and the science of design, this new edition of Herbert Simon's classic work on artificial intelligence adds a chapter that sorts out the current themes and tools -- chaos, adaptive systems, genetic algorithms -- for analyzing complexity and complex systems. There are updates throughout the book as well. These take into account important advances in cognitive psychology and the science of design while confirming and extending the book's basic thesis: that a physical symbol system has the necessary and sufficient means for intelligent action. The chapter "Economic Reality" has also been revised to reflect a change in emphasis in Simon's thinking about the respective roles of organizations and markets in economic systems.

11,841 citations