Estrategias de mercadeo y plan de ventas

The concept of competitive advantage can be tracked back in the economics literature for centuries, but it was Newman (1951) and latterly Day (1984) and Porter (1985) who linked competitive advantage as an object of strategy. The idea emerged that ‘superior performance’ is the consequence of competitive advantage and subsequently results in higher financial performance (Porter and Millar 1985; Reed and DeFillippi 1990). According to Barney (Barney 1991), a competitive advantage is sustained by implementing a value generating strategy not simultaneously implemented by current or potential competitors. Any understanding of how a firm can protect its competitive advantage, for a longer period of calendar time, forms an important research issue. On the other hand, Rumelt (1984) argued that a competitive advantage is sustained if it continues to exist after competitor efforts to duplicate that advantage have ceased. However, this thesis will follow the definition of ‘sustained’, as a longer period of calendar time. The ‘longer period’ is satisfied when the firm still holds its competitive advantage between the ex-post primary research and the initial achievement of a competitive advantage within the chosen case study.

41 | P a g e There seems to be a general agreement that knowledge and knowledge management represent the most important competitive advantage factor for organisations (Toffler 1990; Quinn 1992; Stewart and Ruckdeschel 1998; Umemoto 2002). The first assumption of the KBV, stated above, was that knowledge is considered to be the most strategically important resource of the firm. Proponents argue that the heterogeneity of knowledge is the main determinant of SCA and superior performance (Decarolis and Deeds 1999, Winter and Szulanski 2001). Hence, the primary challenge for a knowledge-based firm to achieve SCA is to protect the knowledge from competitors but at the same time have a strategy which enables the firm to create (Kogut and Zander 1992), transfer and coordinate knowledge efficiently (Grant 1996b) within the organisation. To put this into a magician’s analogy, the question is: How do managers make sure that the firm can replicate the rabbit appearing out from the hat throughout the firm, without knowledge leakage to competitors?

The KBV argues that success in obtaining an SCA is attributed to the organisational ability to disseminate knowledge effectively (De Geus 1997) by achieving internal replication (Grant 1997) as invisibly as possible (Peteraf 1993). Grant himself refers to the invisibility as avoiding external replication (Grant 1997). The earlier discussion on types of knowledge (section 2.2) stated that the most critical distinction in the KBV is between explicit and tacit knowledge. Explicit knowledge is described by Grant as transferable at low cost due to its ease of articulation, also described as knowing about. Tacit knowledge is less suited to transfer and described as knowing how (Grant 1996a; Nonaka 1994; Grant 1997; Polanyi 1966).

Kaplan and Norton (2001) point out that most theories fail to address the performance aspect which is vital when linking strategic decisions to SCA. The RBV subchapter (section: 2.3.1) already argued that the firm could only achieve SCA if a resource, including knowledge, is VRIN. Hence, explicit knowledge as a standalone resource cannot produce an SCA as it fails to be both rare and imperfectly imitable. However, “tacit knowledge is argued to be difficult to imitate, to substitute, to transfer

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and it is rare” (Ambrosini and Bowman 2001, p. 811). Hence, knowledge production

and coordination that can be linked to SCA involves a higher degree of knowledge complexity and since tacit knowledge has a causally ambiguous nature, making links to actual company performance is difficult to identify and therefore, imposing considerable limitations on measurement (Lippman and Rumelt 1982).

This view is also supported by Reed and Defillipi (1990) who suggests that barrier to imitation is raised with the presence of causal ambiguity. Petraf (1993) states that causal ambiguity restricts rivals to choose which resource to imitate, let alone how. However, there is a contradictory view which opposes such positive effects of causal ambiguity and is concerned with the difficulties to transfer their resources (Szulanski 1996; Simonin 1999). Others go further and argue that causal ambiguity can directly impede firm performance (Law 2014; King and Zeithamel 2001). If managers cannot identify the source of their competitive advantage, it will subsequently result in under-utilisation of such resource. This could even result in resource loss caused by ignorance (Ambrosini and Bowman 2010; Ambrosini and Bowman 2005; McEvily et al. 2000). This conflict is also known as the causal ambiguity paradox (Powell 2006). Hence, the earlier mentioned firm’s ability to sustain a competitive advantage may be based on a depth (continuous specialisation of knowledge) versus breadth (replicate knowledge) trade-off.

The achievement of SCA is best explained by the end of the magician’s show. In other words, the trick did work, and the audience does not understand the trick. Somehow the company pulled the rabbit called SCA from its hat, but unlike the magician, who is in control of the magic show and knows exactly when his/her sleight of hand is happening, the firm is often not sure how they did it as the mechanisms to unveil the rabbit seem very complex. Unarguably, the knowledge of how to pull the rabbit from the hat is important in order to pull the rabbit out again. In this case, by using the KBV as a strategy and by making sure that the appearance of the rabbit stays a mystery for its audience and other competing magicians to guarantee a unique act.

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2.4.4 - KBV: The Themes

The purpose of this section is to take the earlier sustainable competitive advantage (SCA) discussion and identify KBV-themes. This will aid in answering the first objective:

To specify and critically evaluate the KBV as an act of strategy formulation and associate themes key to a KBV

The following table below is mainly derived from Grant’s (1996) paper: Towards a knowledge-based theory of the firm, to provide a clear starting point. The table is an overview and breaks the KBV into its key themes by considering its strategic areas, and assumptions before each KBV-theme will be discussed in more detail (section: 2.4.4.1 – 2.4.4.11).

KBV- themes

Strategic

Area Theme Explained Assumption

Transferability Knowledge specific

Based on Barney 1986 (cited in Grant 1996, p.111) the KBV recognises transferability of a firm’s resources and capabilities as a critical determinant for sustainable competitive advantage. Main distinction between explicit and tacit knowledge.

Explicit knowledge has high transferability whereas tacit knowledge shows low transferability.

Capacity of aggregation

Knowledge specific

Knowledge potential for aggregation is important for the efficiency of KT. KT involves both transmission and receipt which could be individual or organisational level. Absorptive capacity of the recipient is important (Cohen and Levinthal 1990, cited in Grant 1996, p.111). The KBV links the ability to aggregate and transfer knowledge to the optimal location of decision- making authority.

Explicit knowledge can be easier transferred to a single location than tacit knowledge.

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Appropriability Knowledge specific

Appropriability in the KBV links to the market value of knowledge and unless the knowledge is protected by patents or copyright, it will generally be inappropriable by means of market transaction.

Tacit knowledge cannot be easily transferred which makes it in turn not directly appropriable! Specialisation in knowledge acquisition Knowledge specific

Tacit knowledge which is linked primarily to SCA is stored within individuals. This also means that individuals acquire and store existing knowledge and create new knowledge. Therefore, the efficiency in knowledge production is linked to individual absorptive capacity.

KBV requires individuals to specialise in particular areas of knowledge while considering their absorptive capacity to increase success of knowledge integration

Coordination within the firm

Organisation specific

The KBV argues that the fundamental goal for the firm should be to coordinate the efforts of many specialists. Transferring knowledge is not seen as an efficient approach to integrating knowledge. Individual specialist knowledge should be kept by minimising knowledge transfer but emphasising on the importance to achieve effective integration of many people’s specialised knowledge.

Minimising knowledge transfer but emphasising on absorptive capacity and henceforth coordination of people’s specialised knowledge will increase efficiency and success

Integration of specialised knowledge (coordination within the firm)

Organisation specific

The KBV argues that the type of interdependence within a task determines the mode of coordination deployed. The KBV points to four mechanisms for integrating specialised knowledge:

(1) rules and directives, (2) sequencing,

(3) routines (Thomson 1967),

(4) group problem solving and decision-making (Koenig 1976).

Problem-solving and decision- making in groups are reduced to unusual, complex and important tasks as the firm is maximising efficiency through the other formal integration mechanisms.

The role of common knowledge (coordination within the firm)

Organisation specific

Although individuals are required to have specialised knowledge, there is a need to have some common knowledge for knowledge integration to work. The KBV identified five different types of common knowledge which fulfil different roles in knowledge integration: (1) Language,

(2) Other forms of symbolic communication, (3) Commonality of specialised knowledge,

The KBV argues that there is organisational gain in knowledge production if individuals can share and integrate aspects of knowledge which are not common between them (Grant 1996, p.115)

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(4) Shared meaning,

(5) Recognition of individual knowledge domains.

Organisational capability (coordination within the firm)

Organisation specific

The KBV views organisational capability as the outcome of knowledge integration which requires effective integration of many individuals with disparate specialist knowledge. The complexity of a capability depends critically upon the scope of the knowledge which is integrated (Grant 1997, p.452).

The broader the integration of knowledge scope is within each capability the more difficult imitation becomes. This is due to the complexity of a wider scope integration which creates greater causal ambiguity and greater barriers to replication

Organisational structure/ design

Organisation specific

Appropriating the returns to knowledge depends upon the firms’ arrangement to inhibit knowledge leakage and thus protect the firm’s competitive advantage. The result is a strategic view on organisational structure by the KBV which argues that the knowledge based model differs from the traditional bureaucratic model.

Knowledge production, integration and decision- making put emphasis on efficiency and therefore organisational structure and design will be determinant to success Role of hierarchy in decision- making (organisational Structure/ design) Organisation specific

The KBV recognises that hierarchy has emerged as an efficient solution as firms’ face two main problems: the coordination (technical problem) and cooperation (divergent goals of individuals) problem.

Link to knowledge integration: hierarchy is ineffective as a mechanism for knowledge integration (Grant 1997, p.453)

“Once firms are viewed as institutions for integrating knowledge, a major part of which is tacit and can be exercised only by those who possess it, then hierarchical coordination fails” Grant 1996, p.118) Location of decision- making (organisational Structure/ design) Organisation specific

The KBV is mainly concerned with co-location of decision-making. Co-location is based on the idea that, decisions requiring tacit knowledge should be decentralised, whereas decisions requiring explicit (e.g. statistics) knowledge can be centralised.

Co-location of decision-making will produce better decisions if the nature of the knowledge is in tacit form

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2.4.4.1 - Transferability

The KBV follows the research that knowledge can be present as explicit and tacit knowledge (Polanyi 1966). Whereby explicit knowledge is supposedly easier to communicate and transfer as it can be codified (Nonaka 1994). Explicit knowledge can be easier articulated, documented or formalised, for instance, in the form of procedures, forecasts, production schedules or manual and can, therefore, be systematically shared.

In contrast, tacit knowledge is implicit in nature and harder to conceptualise, it has a degree of subjectivity, and is often highly ambiguous (Venkitachalam and Busch 2012). Hence, making it very difficult to articulate and disseminate within the organisation and therefore, seen as a potential source of SCA (Lecuona and Reitzig 2014). Polanyi (1966) describes it as ‘we can know more than we can tell’. Tacit knowledge shows an important cognitive dimension, including beliefs, perspectives and mental models. Researchers argue that tacit knowledge shows slow knowledge transfer as it develops interactive over time through shared experience. Therefore, ‘know how’ is within individual skills sets as a result of learning by doing (Mooradian 2005; Polanyi 1966; Nonaka 1994). However, the types of knowledge have been discussed in the earlier section.

According to Barney (1986, cited in Grant 1996, p.111), the transfer of a firm’s knowledge is a critical determination for sustainable competitive advantage. However, the balance is to minimise or at least to control knowledge leakage to other firms while fostering internal knowledge transfers (Argote, 1999). Kang, Rhee and Kang (2010) argue that knowledge by itself does not create value and competitive advantage until it can be shared and transferred within the firm and further argue to externalise and integrate tacit knowledge for firms’ SCA.

This study is particularly interested in the mechanisms to transfer knowledge across individuals inside the organisation. If the degree of tacit knowledge is increased, then Grant (1996) would argue that it can only be revealed through its application. Kogut

47 | P a g e and Zander (1992) also highlight that transfer is slow, uncertain and costly for such knowledge that can only be observed through its application. Others argue that knowledge (tacit) is not measurable in itself and can only be identified through the observation of action (Kaplan et al. 2001). This leads to a different challenge on how to measure knowledge transfer, especially knowledge with higher degrees of tacit knowledge. However, observing the ‘magic show’ is of minor strategic use if the firm cannot unveil either the magic or the trick.

One particular challenge is to know when knowledge transfer in an organisational context really happened. For empirical research to be of value, one would need to test the knowledge leading to an SCA before the knowledge transfer process and then do another test after the supposed transfer to see if it succeeded. This would have multiple challenges. This thesis argues that, if it is possible to explicitly test a tacit knowledge transfer leading to SCA then that tacit knowledge was already made explicit and hence would be contradictory to its purpose and characteristic. Hence, testing changes in knowledge to unveil KBV-themes to explain SCA will not be attempted in this study.

Another more plausible measurement option would be to investigate changes in performance against a baseline. This concept links to the idea of ‘organisational capability’ which comes closest to capturing the notion of organisational knowledge, which will be discussed as an individual theme further below. The organisational capability concept allows researchers to specify organisational knowledge as productivity activities that an organisation can perform (Grant 2011). This performance-based approach in measuring knowledge was used to highlight the degree of productivity-gains of fast-food stores because of experience in other stores of that franchise (Darr, Argote and Epple 1995). Although this approach would show how overall knowledge transfer affected performance, it may lack specific individual knowledge transfer mechanism as it takes the whole firm as a baseline. This approach would not satisfy the research aim which would like to gather a more in-depth

48 | P a g e understanding of the KBV-themes including how and why knowledge production and coordination took place within a specific context.

Another challenge to measure any change in knowledge from an in-depth perspective is that knowledge may reside in multiple repositories (Argote and Ingram 2000; Walsh and Ungsion 1991; and Levitt and March 1988). Such repositories could include, e.g. the physical structure of the workplace, or individual members who transfer knowledge within standard firm routines which may not be obvious. Hence, in order to capture changes in knowledge within individuals, it is important that those repositories are either eliminated or controlled. There may be different people working on our magic trick which may or may not play a crucial role in the achievement of SCA. Hence, the control of repositories is another major challenge that needs to be understood.

Taking the above points into consideration, it seems to be important, for the aim and objectives for this study, to have a performance baseline for the firm. The performance baseline would not be used to see the difference in performance but to know that an SCA has been achieved in a specific context. By having a fixed context and an already achieved SCA, the knowledge actor’s responsible for the SCA can be researched as long as the multiple repositories challenge can be overcome. Hence, the specific context of the performance activity needs to be somewhat structured and controlled from the outset. The knowledge-based value chain construct subsection will discuss this further (section: 2.6.1).

2.4.4.2 - Capacity of Aggregation

Knowledge aggregation can be both individual and organisational level. Current literature views most organisational level knowledge aggregation as the problem of integrating ‘data’ from various information sources into a so-called unified knowledge base (Zeng and Fikes 2005). However, based on the focus of the research aim and objectives, arguments against the use of information systems in this empirical study formulation were already discussed. Although an organisational level knowledge

49 | P a g e aggregation view may be important, this thesis will concentrate on the individual level of knowledge aggregation. This assumes that knowledge absorption depends upon the recipient’s ability to add new knowledge to existing knowledge (Grant 1996) and hence, to achieve superior performance, aggregation of knowledge into a company structure will bear no effect unless the individual or group of individuals can stipulate some meaning from it. The central question is, how feasible and effective is it to develop further knowledge by connecting and building upon different pieces of knowledge? (Katzy et al. 2000). This is also in line with the third ‘main assumption’ that knowledge is created by individuals and efficiency in knowledge creation and storage is based on the individual’s ability to specialise (Simon 1991). Hence, capacity of aggregation also affects the efficiency of knowledge transfer and therefore, should be used in the context of the optimal location of decision-making.

2.4.4.3 - Appropriability

Appropriability refers to the market value of a resource and the ability of the resource owner to receive a return equal to the value created by the resource (Teece 1987). The literature has two main areas of appropriability. One is mainly linked to the rent- appropriability whereas the other is linked primarily to sustainability discussions.

The term rent and the economies of rent appropriation stem predominantly from the economics literature and are discussed in industry structure, agency, and transaction cost economics literature (Coff 2003). The industry structure literature argues that buyers and suppliers may have bargaining power to bargain away rents (Porter 1980). However, the focus of this research is less concerned with a specific industry structure but emphasises its aim and objectives within the firm hence; this literature will not be further investigated within the appropriability discussion.

The transaction cost economics (TCE) literature offers a similar perspective to the agency theory literature, where individuals are assumed to act opportunistically to