In this article we are going to analyze the link between the Theory of Resources and Capabilities and Knowledge Management.
In Figure 1 we can see the classic process of Strategic Management (analysis, formulation and implementation of the strategy). Within the Strategic Analysis we find three blocks: Mission and Objectives; External analysis; Internal analisis.
The analysis of resources and capacities seeks to identify the potential of resources and skills that the company possesses or to which it can access (Navas and Guerras, 1998) and is framed within the so-called Internal Strategic Analysis of the organization.
The question is where Knowledge Management, organizational learning, and Intellectual Capital Measurement fit into this process.
The Strategic Management Process - Source: Navas y Guerras (1998)
As we already know, the Resources and Capacities approach is based on three basic ideas:
- Organizations are different from each other depending on the resources and capacities they possess at a given time, as well as on the different characteristics of the organization (heterogeneity). Furthermore, these resources and capacities are not available to all companies under the same conditions (imperfect mobility). Heterogeneity and imperfect mobility explain the differences in profitability between companies, even between those belonging to the same industry (Barney, 1991; Peteraf, 1993; Ventura, 1996). Resources and capacities have a more relevant role every day in defining the identity of the company. In today's environment (uncertain, complex, turbulent, global,…), organizations are beginning to ask what needs they can satisfy, rather than what needs they want to satisfy.The benefit of the company is a consequence of both the competitive characteristics of the environment and the combination of the resources it has available.
The theory of resources and capacities is a tool that allows to determine the internal strengths and weaknesses of the organization. According to this theory, developing distinctive capabilities is the only way to achieve sustainable competitive advantages.
If the resources and capabilities that a company possesses allow it to exploit opportunities and neutralize threats, are owned by only a small number of competing companies and are costly to copy or difficult to obtain in the market, then they can constitute strengths of the company and thus potential sources of competitive advantage (Barney, 1997).
By identifying the company's resources and capabilities and thus establishing its relative strengths vis-à-vis competitors, the company can adjust its strategy to ensure that those strengths are fully utilized and its weaknesses are protected (Navas and Guerras, 1998).
It must be remembered that intangible resources and capacities are usually based on information and knowledge, so they do not have defined limits in their capacity for use (Navas and Guerras, 1998).
Based on this theory, it is more evident every day that the value of the company is related more to intangible aspects than to the tangible ones on which the valuation was traditionally made (Jiménez, 1999). Within intangibles, Intellectual Capital plays an increasingly relevant role. Undoubtedly, Knowledge Management and the Measurement of Intellectual Capital fall within the Theory of Resources and Capabilities. They are tools that will allow us to manage, improve and measure organizational capacities.
For this reason, Knowledge Management has become one of the main issues in current management. Managing knowledge means managing the processes of creation, development, dissemination and exploitation of knowledge to gain organizational capacity (Revilla, 1998).
Linking with the above, we can classify knowledge as a resource and at the same time as a capacity.
Knowledge is a necessary resource to carry out the activities of the company. It is an intangible resource (individual-human or organizational), which can be defended from a legal point of view. In certain cases, it is a scarce and strategically relevant or valuable resource for the organization (Grant, 1998). Companies also differ in terms of the knowledge they use to develop their goods and services, it is therefore a heterogeneous resource, essential for the achievement and maintenance of competitive advantages. Furthermore, knowledge has a great capacity to generate synergies (it can be extended at a reduced cost to other products or markets without diminishing its value); it does not depreciate with use; and its replication can be difficult because of its own tacit and complex nature (Fernández et al., 1998).
Knowledge is a capacity because it offers an explanation of the nature and structure of organizational capacities. It can be observed how a large number of individuals combine their knowledge to create an organizational capacity (Lloria, 2000).
There are various currents of thought on the subject. One of them is the current of "Intellectual Capital", which has a strong economic component. Intellectual Capital is the intangible of the intellect and it should be possible to measure, evaluate, and quantify, since it is more related to value than other elements (Jiménez, 1999).
Another approach is the one that speaks of organizations that learn (Learning Organizations). Today's businesses cannot survive without continual learning; for which a culture of lifelong learning is needed.
The third conception comes from the world of information systems and technologies. The new systems no longer only process information but also manage “knowledge”. The Knowledge Management approach is the basis that integrates other systems to facilitate the development, storage and flow of knowledge throughout the organization. They are systems that facilitate communication, breaking spatial, temporal and organizational barriers, which change the very conception of the company and its culture.
The last concept is that of "Management by Competences", which comes from the Human Resources field, and which seeks to manage people through their competencies, that is, taking into account their abilities, skills and knowledge.
These four conceptions, whose development is independent, can approximate and configure a whole block that, together, can have a tremendous force, since it supposes a new conception of the company.
BIBLIOGRAPHY
- Barney, JB (1991), "Firm Resources and Sustained Competitive Advantage", Journal of Management, 17, pp. 99-120. Barney, JB (1997), "Gaining and Sustaining Competitive Advantage", Addison-Wesley, Reading.Fernández, E.; Montes, JM; Vázquez, CJ (1998), “Intangible Resources as Factors of Competitiveness of the Company”, Management and Organization, nº 22, Sept. Grant, RM (1998), “Strategic Management. Concepts, Techniques and Applications ”, Civitas, Madrid.Jimenez, A. (1999),“ Competences and Intellectual Capital: The way of managing people in the Age of Knowledge ”, Club Intelec Bulletin, April, nº 2, pp. 2-5, Euroforum, Madrid.Lloria, MB (2000), “Knowledge as a resource and capacity. An Approach to Knowledge Management as a Competitive Advantage ”, University of Valencia, Working Paper.Navas, JE; Wars, LA(1998), “The Strategic Management of the Company. Theory and Applications ”, Civitas, Madrid.Peteraf, MA (1993),“ The Cornerstones of Competitive Advantage: A Resource-Based View ”, Strategic Management Journal, 14, pp. 179-192.Revilla, E. (1995), “Determinants of Organizational Learning. A Product Development Model ”, Quality Management Club of Valladolid.Ventura, J. (1996),“ Dynamic Analysis of Business Strategy: An Interdisciplinary Essay ”, University of Oviedo, Oviedo.Quality Management Club of Valladolid.Ventura, J. (1996), "Dynamic Analysis of Business Strategy: An Interdisciplinary Essay", University of Oviedo, Oviedo.Quality Management Club of Valladolid.Ventura, J. (1996), "Dynamic Analysis of Business Strategy: An Interdisciplinary Essay", University of Oviedo, Oviedo.
