Inside the Black-box: Analysing the Generation of Core Competencies and Dynamic Capabilities by Exploring Collective Minds. An Organisational Learning Perspective

Abstract

Inside the Black-box: Analysing the Generation of Core Competencies and Dynamic Capabilities by Exploring Collective Minds. An Organisational Learning Perspective** The paper combines resource-based thinking with perspectives from theories of organisational learning and knowledge management. According to the resource-based view (RBV) strategy can be defined as emergent pattern of interaction generating core competencies and dynamic capabilities. These processes of interaction and their relation to core competencies and dynamic capabilities are of major concern in the presented analysis. A synthesis with learning theories further leads to the basic assumption that processes of knowledge identification, knowledge diffusion, knowledge integration and the enactment of the environment are critical for generating core competencies. Moreover, learning theories show how to approach the causal ambiguityargument that is important in the explanation of core competencies given by RBV. It will be argued that the analysis of the shared mental model of the organisational members is a method to explore critical processes for generating core competencies. A related research instrument will be validated in a case study analysis that was conducted in a medium-sized enterprise aiming at testing the instrument and the aforementioned basic assumption. The instrument can explore the critical processes in which the generation of core competencies and dynamic capabilities is embedded in. It provides a better understanding of the critical processes within the organisation than the RBV. Key words: Causal ambiguity, collective minds, competitive advantages, core competencies, dynamic capabilities, knowledge management, organisational learning, resource-based view, strategic processes 1. Introduction The resource-based view (RBV) of the firm has been thoroughly discussed in strategic management literature. The basic assumptions of this approach have been developed further during the last twenty years, specified for certain organisational functions and validated in hundreds of empirical analyses (see Barney/Arikan 2001; Rouse/Daellenbach 2002; Ray/Barney/Muhanna 2004). As a consequence, the RBV became a leading paradigm in strategic management (Wernerfelt 1995; Bresser 1998). Even though there is considerable theoretical and empirical progress in resourcebased research shortcomings still exist in the theoretical underpinnings of the approach. These restrict related empirical investigations that try to measure critical resources and processes for sustainable competitive advantages. One of the major shortcomings of the RBV is the fact that the organisation remains a black-box even though it is considered as the source of organisational success (Ortmann/Sydow 2001; Priem/Butler 2001). There is a lack in explanations of how heterogeneity arises (Helfat/Peteraf 2003: 997). This is not only a limitation in the eyes of those who regard the RBV as a theory of competitive advantage - if the major interest relies on rules for richness, the causal ambiguity argument of the RBV is somehow dissatisfying. Causal ambiguity means that the link between the resources controlled by a firm, internal processes and sustained competitive advantages can neither be attributed from outside nor from organisational members (Barney 1991). Rather, the causal ambiguity paradox - even though it is inspiring - veils the view on organisational internal processes that might have a strategic impact. The RBV does not only lay emphasis on the internal organisation but also limits a deeper understanding of organisational internal strategic processes. For a further development of strategy research a broader perspective of social action within and between organisations as well as between organisations and environments is essential. As Mintzberg (1978, 1994) points out these processes of forming a pattern of strategic action have been neglected in strategy research (see also Quinn 1984). …