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Architectures of KnowledgeFirms, Capabilities, and Communities$
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Ash Amin and Patrick Cohendet

Print publication date: 2004

Print ISBN-13: 9780199253326

Published to Oxford Scholarship Online: October 2011

DOI: 10.1093/acprof:oso/9780199253326.001.0001

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The Firm as a Locus of Competence Building

The Firm as a Locus of Competence Building

(p.36) 3 The Firm as a Locus of Competence Building
Architectures of Knowledge

Ash Amin

Patrick Cohendet

Oxford University Press

This chapter examines the idea of the firm as a competence-builder and explores how competences relate to organizational knowledge production. It argues that the competence-based approach to the firm renounces seeing the firm as a processor of information, to considering the firm as a processor of knowledge. This shift necessitates a reconsideration of the classical features of the firm: its boundaries, coordinating mechanisms, incentive mechanisms, and the role of the entrepreneur. The chapter also explores the complementarities between the competence-based approach and the transaction-cost approach to the firm, which, despite its limitations on the firm as a processor of knowledge, identifies inescapable cost and governance considerations. Finally, the chapter argues that, in the context of knowledge formation, the firm's central imperative is to align the functioning of communities of practice with the managerial needs to build competences.

Keywords:   firm, competences, competence builder, organizational knowledge, knowledge formation, knowledge, information

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