Chapter 2: Routines as Technologies and as Organizational Capabilities
2. Routines as technologies and as organizational capabilities Richard R. Nelson INTRODUCTION The focal theme of the conference at which the chapters in this volume were ﬁrst presented was on the relationship between the behavioral and cognitive aspects of routines. I interpret the cognitive aspects as being about understanding how and why a routine works as it does, as contrasted with the know-how that is required simply to ‘do it’, that is the behavioral knowledge base. Also, I would argue that the former – the understanding – tends to be articulated to a considerable extent, while the latter – the ability to do – can be largely tacit. The theme of this chapter is that the importance, and the power, of the understanding bearing on routines varies greatly across diﬀerent kinds of routines. The diﬀerences matter profoundly in terms of how diﬀerent routines, or aspects of routines, evolve. Let me begin my discussion by reminding you that in our book Winter and I (1982) highlighted two diﬀerent aspects of a ‘routine’. From one point of view, a routine is a ‘technology’. By that we did not mean that it necessarily involved fancy equipment or materials, but rather that it was a productive technique for doing something, as a program, or a recipe (including the steps that transform the inputs into the intended output), that could be described without specifying any particular way the actions required by the technique were to be assigned to particular individuals and groups, and coordinated. Many...
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