When using knowledge can hurt performance: the value of organizational capabilities in a management consulting company

When using knowledge can hurt performance: the value of organizational capabilities in a... This paper explores the possibility that utilizing the firm's knowledge resources to complete important tasks can backfire and undermine competitive performance. Drawing on organizational capabilities and knowledge‐sharing research, we develop a situated performance view that holds that the value of obtaining and using knowledge within a firm depends on the task situation. Using a data set of 182 sales proposals for client work in a management consulting company, we show that sales teams that had varying needs to learn and differentiate themselves from competitors derived different levels of value from obtaining and using electronic documents and advice from colleagues. Highly experienced teams were more likely than inexperienced teams to lose the sales bids if they utilized such knowledge. Teams that had a high need to differentiate themselves from competitors also had a lower chance of winning if they utilized electronic documents. There were situations, however, where teams performed better if they utilized the firm's knowledge resources. These results suggest that competitive performance depends not on how much firms know but on how they use what they know. Copyright © 2004 John Wiley & Sons, Ltd. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Strategic Management Journal Wiley

When using knowledge can hurt performance: the value of organizational capabilities in a management consulting company

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Publisher
Wiley
Copyright
Copyright © 2004 John Wiley & Sons, Ltd.
ISSN
0143-2095
eISSN
1097-0266
DOI
10.1002/smj.429
Publisher site
See Article on Publisher Site

Abstract

This paper explores the possibility that utilizing the firm's knowledge resources to complete important tasks can backfire and undermine competitive performance. Drawing on organizational capabilities and knowledge‐sharing research, we develop a situated performance view that holds that the value of obtaining and using knowledge within a firm depends on the task situation. Using a data set of 182 sales proposals for client work in a management consulting company, we show that sales teams that had varying needs to learn and differentiate themselves from competitors derived different levels of value from obtaining and using electronic documents and advice from colleagues. Highly experienced teams were more likely than inexperienced teams to lose the sales bids if they utilized such knowledge. Teams that had a high need to differentiate themselves from competitors also had a lower chance of winning if they utilized electronic documents. There were situations, however, where teams performed better if they utilized the firm's knowledge resources. These results suggest that competitive performance depends not on how much firms know but on how they use what they know. Copyright © 2004 John Wiley & Sons, Ltd.

Journal

Strategic Management JournalWiley

Published: Jan 1, 2005

References

  • Price, authority, and trust: from ideal types to plural forms
    Bradach, Bradach; Eccles, Eccles
  • How valuable are organizational capabilities?
    Collis, Collis
  • The impact of stocks and flows of organizational knowledge on firm performance: an empirical investigation of the biotechnology industry
    DeCarolis, DeCarolis; Deeds, Deeds
  • Knowledge flow within multinational corporations
    Gupta, Gupta; Govindarajan, Govindarajan
  • Network data and measurement
    Marsden, Marsden
  • The persistence of knowledge‐based advantage: an empirical test for product performance and technological knowledge
    McEvily, McEvily; Chakravarthy, Chakravarthy
  • The process of knowledge transfer: a diachronic analysis of stickiness
    Szulanski, Szulanski
  • Dynamic capabilities and strategic management
    Teece, Teece; Pisano, Pisano; Shuen, Shuen

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