Two Major Knowledge Flows

Abstract

As a system, an organization must continuously replenish its stock of knowledge and competencies necessary to use different resources effectively. This is because an organization’s operations are determined by the specific activities or organizational routines an organization can perform in using its resources (Nelson and Winter, 1982). The market’s responses to the company’s products (e.g. project deliveries) generate flows of revenues as well as data about its markets. Data about an organization’s products, operations, and resource stocks also flow to decision makers within the organization’s management processes. From an organization’s management processes emanate the specific decisions, policies, procedures, budgets, and norms that direct the flows of the organization’s financial and other resources to maintain or increase resource stocks in the organization’s operations, tangible assets, intangible assets, or management processes (Maula; 2006; Sanchez and Heene, 2008).