The Road Less Travelled: A New Perspective On Sustained Competitive Advantage Through Knowledge Creation

Knowledge and intellectual capital have become the primary bases upon which organisations construct their core competencies and are increasingly seen as the key to superior organisational performance (Lubit, 2001). At the same time, both the need to and difficulty associated with developing sustainable competitive advantages are rapidly increasing (ibid.). This paper argues that two roads lead to sustained competitive advantage in firms. The well-travelled road is largely based on conceptualising knowledge in terms of information and data and attempting to leverage organisational knowledge by focusing on the management and utilisation of information in organisations. The road less travelled is based on recognising the power of knowledge in general, and knowledge creation in particular, to stimulate creativity and innovation in organisations leading to sustained competitive advantage. On this road, it is recognised that truly innovative organisations 'do not simply process information… they actually create new knowledge and information, from the inside out, in order to redefine both problems and solutions and, in the process, to re-create the environment' (Nonaka and Takeuchi, 1995, p.56). Despite the promise of the road less travelled, existing perspectives on knowledge creation are beset with a variety of epistemological and methodological problems. This paper develops a new perspective on knowledge creation by delving into existing conceptualisations and classifications of knowledge in literature, exploring the philosophical assumptions upon which they are based, probing the conceptual and methodological issues that surround these views and articulating a new perspective on knowledge creation to guide future research efforts.