Adaptation and Context
Research Handbooks in Business and Management series
Edited by Anders Örtenblad
Chapter 20: On the complexity of knowledge management given the tacitness of knowledge in organizations
Tacit knowledge is a major topic within the knowledge management literature (Gourlay 2000; Castillo 2002; Freeze and Kulkarni 2007). It is a fundamental issue when discussing knowledge in organizations and considered both a hot topic and a challenge for organizations to understand how best to utilize tacit knowledge for competitive advantage. The theory argues that some knowledge is codifiable and therefore is easily transferred using information technology (Speir and Venkatesh 2002), whereas tacit knowledge is not easily transferred due to its stickness and its reliance on people to be shared (Inkpen and Dinur 1998). However, there is convincing evidence that the effective use of tacit knowledge creates value and enhances financial performance (Fletcher and Harris 2012). This suggests that tacit knowledge can be a source of competitive advantage and it has focused organizations on understanding how tacit knowledge is exchanged, shared and sought by employees (Katz et al. 2000). Tacit knowledge is a key factor in organizational learning (Hau and Evangelista 2007), innovation (Cavusgil et al. 2003) and long-term competitive advantage (Hooley et al. 2005). These outcomes are premised on the ability of an organization to utilize tacit knowledge effectively. However, a number of challenges are evident. First, there is no single agreed definition or understanding of what constitutes tacit knowledge (Castillo 2002; Ray 2008). Second, there is an acceptance that technology and codification are not particularly effective in facilitating the transfer and use of tacit knowledge to enhance organizational effectiveness (McIver et al. 2012, 2013).
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