Abstract
Japanese companies seem able to gain knowledge from their partners in more efficient ways than their European counterparts. Case examples are given in which the European firm, or the Japanese firm begins in the dominant knowhow position. Other examples of strategic alliances between Japanese small businesses are also cited. A learning model is advanced which illustrates the evolution of power through intra‐ and inter‐firm learning processes. An organizational capacity to enhance systemic learning seems to be the key to successful evolution of the firm.
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