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New Knowledge Acquisition

Knowledge

A key driving force since the beginning of the Industrial Revolution has been the activity of entrepreneurs engaged in the discovery and application of new knowledge as the basis for innovation in existing industries and the creation of totally new industries. In the twentieth century there was an exponential increase in the rate of new scientific and technological breakthroughs. Current evidence would suggest that this pace of new knowledge creation will be sustained in the twenty-first century. The implication of this scenario is that the exploitation of new knowledge will remain a critical competence within organisations seeking to sustain long-term growth (Sheehan 2005).

The issue facing senior managers is the degree to which their organisation can rely on exploiting existing knowledge versus the importation of new knowledge to support innovation. Existing knowledge tends to be widely available within an industrial sector and hence is rarely able to support any really radical, innovative new ideas. As a consequence, entrepreneurial organisations which seek to sustain growth through proactive activities have long understood the critical importance of sustaining © The Author(s) 2017

I. Chaston, Technological Entrepreneurship,

DOI 10.1007/978-3-319-45850-2_9

their competence through the exploitation of new knowledge (Day and Schoemaker 2005).

Reliance upon the exploitation of existing knowledge usually only permits an organisation to sustain current business strategies and, in some cases, identify opportunities to utilise existing knowledge as the basis for product or market diversification. This does not mean, however that organisations oriented towards implementing entrepreneurial strategies should ignore existing knowledge. In most cases, existing knowledge can provide a much lower-risk source of future business revenue than is available from exploiting new knowledge. Therefore, even entrepreneurial firms should seek to achieve an appropriate balance over the degree with which different sources of knowledge are to be utilised in deciding about involvement in low- versus high-risk propositions (Chaston 2004).

When new knowledge emerges, there may be no obvious immediate commercial applications. For example when the laser was invented, it was described initially as a ‘solution looking for a problem’ (Shimizu 2010). The important issue in such cases is for the organisation to permit a certain proportion of resources to be applied to looking for new application opportunities. One company which has excelled at applying this philosophy is 3M Corporation. This was the case with Post-It sticky notes: A new glue formulation was developed which exhibited poor adhesive properties. Another 3M innovator sought just these qualities to develop a system for temporarily attaching a piece of paper to another surface without causing any damage to that surface (Garner 2005). Although such cases make fascinating reading, reliance upon being successful in a random search for new knowledge is usually much less certain than situations where a new technology is identified as offering a new source of entrepreneurial opportunity.

Entrepreneurs tend to be attracted to leading-edge technology. This is technology which can provide the basis for above-average business performance through the creation of new products and new industries. In terms of analysing future opportunities and threats, it is necessary to assess how new knowledge can be amplified by combining new knowledge with current leading-edge technology (Ohmura and Watanabe 2006). At the beginning of the twentieth century, the two leading-edge technologies were electricity and the internal combustion engine. These were then overtaken by electronics. This new technology generated solid state devices and provided the foundations for IT to become the current leading-edge core technology. The degree to which firms exploit new knowledge in relation to advances in IT varies by industry sector.

Organisations need to be aware that the interaction between new knowledge and a leading-edge core technology is a dynamic process (Chaston 2015). Firms engaged in the provision of professional services are continually seeking ways to replace extremely expensive staff with machine-based solutions. An example of this is in healthcare, where surgeons having invented a new surgical technique may then turn to computer-based systems to perform part or all of the treatment. Similarly, as understanding of new IT-based advanced manufacturing and service solutions becomes more widespread, the technology will increasingly be incorporated into conventional manufacturing and service process activities. As a consequence what was once a new knowledge/IT solution may eventually cease to be a source of competitive advantage. This means entrepreneurial organisation must continually strive to identify and exploit new approaches for combining the latest advances in knowledge and IT to further enhance organisational performance.

 
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