Handbook of Organizational Learning and Knowledge Management, Second Edition

Informal Knowledge and Innovation: Next Steps

We have identified external knowledge drawn from informal sources (often linked by social communities) and the internal knowledge management process as the central process through which firms create innovation. Our inquiry into the sources of knowledge and the process by which it is utilized offers further insights into the literature on knowledge and innovation. We believe our study highlights the importance of knowledge from external informal sources. It also points to some of the challenges faced by firms in effectively utilizing this knowledge. By unbundling the components associated with utilization of this knowledge, we attempt to shed new light on the challenges faced by firms as they attempt to build and protect internal knowledge and yet fully utilize knowledge from external, and often informal, sources. The knowledge management process associated with innovation consists of three related yet distinct sub-processes: the search for external knowledge, its subsequent sourcing and transfer, and finally its integration.

We suggest that the fact that informal sources play an important role in enhancing organizational innovation has implications for how we design innovation processes in particular, but also organizational structures, systems, and processes in general. The challenge associated with designing and managing organizations has an added dimension and the processes get more complex as the process gets closer to culminating ...