ARE ORGANIZATIONAL CAPABILITIES VALUABLE? AN EMPIRICAL TEST OF THE PITFALLS OF LEVERAGING KNOWLEDGE.

This paper challenges the assumptions that more knowledge assets or knowledge sharing within a focal firm represent more value. To assess the strategic value of a firm's knowledge capabilities, we develop a "knowledge-in-use" perspective that proposes that using knowledge from other parts of the firm to complete a task does not necessarily help and may even hurt competitive performance, because the costs and risks of leveraging knowledge may outweigh the benefits in some situations. In a study of 164 sales bids in a management consulting company, we found that leveraging both electronic documents and colleagues' advice increased the chances of losing a competitive bid for a new client contract. This effect was moderated by the team's level of experience, however: experienced sales teams increased their chances of losing the bid but inexperienced sales teams increased their chances of winning the bid when they leveraged more documents and advice from other parts of the firm. These results demonstrate that ...