ABSTRACT
Knowledge and knowledge transfer are central to the innovation process, but the definition of knowledge is often blurred and problematic. This paper focusses on Polanyi’s classic distinction between codified and tacit knowledge and emphasises the importance of understanding how these are inter-related. It also disaggregates tacit knowledge into four types: embodied embrained, encultured, and embedded. Tacit knowledge is particularly important because it is more difficult for competitors to imitate and this can be an important source for protecting the competitive advantages associated with innovation. Unsurprisingly, firms therefore pay considerable attention to the management of knowledge, including its creation, transfer, and storage. The transfer of knowledge is particularly challenging, because of its inherent mobility. Firms need to maximise not only the knowledge of transfer within and into the firm, but also ensure that this is assimilated and effectively adapted: in other words that they have substantial absorption capacity. External knowledge is sourced via a number of channels, including collaboration, human mobility, spatial proximity, and observation. Customers are also recognised as an increasingly important source of knowledge, and this has been conceptualised in terms of the service-dominant logic model. However, knowledge is not only transferred into firms, but also originated there through the creativity process.
