Determinants of Organisational Learning in the generation of technological distinctive competencies

Int. J. Technology Management, Vol. 35, Nos. 1/2/3/4, 2006 Copyright © 2006 Inderscience Enterprises Ltd. 284 Determinants of Organisational Learning in the generation of technological distinctive competencies Juan C. Real* Department of Business Administration, Pablo de Olavide University, Ctra. de Utrera, Km. 1, Seville 41013, Spain Fax: +34-954-348-353 E-mail: [email protected] *Corresponding author Antonio Leal and José L. Roldán Department of Business Management and Marketing, University of Seville, Avda. Ramón y Cajal, 1, Seville 41018, Spain Fax: + 34-954-556-989 E-mail: [email protected] E-mail: jlrolda[email protected] Abstract: This paper presents an analysis of the influence of Organisational Learning (OL), as a process of knowledge creation, in the development of Technological Distinctive Competencies (TDCs). We also examine how the existence of certain organisational key variables in the OL process, not treated jointly from this perspective, positively affects OL and influences the generation of TDCs. The hypotheses proposed in this respect are tested on a sample of 140 Spanish industrial companies, applying a structural linear equation model according to the Partial Least Squares (PLS) approach. Our findings indicate that factors such as Entrepreneurial Orientation (EO) of the organisation, its Learning Orientation (LO) and Information Technology (IT) have a positive impact on OL; whereas, the technological distinctive competences are the result of the OL. On the other hand, the EO of the organisation and the IT play an important role in the creation process of TDCs. Keywords: Organisational Learning (OL); knowledge creation; Entrepreneurial Orientation (EO); Learning Orientation (LO); Information Technology (IT); Technological Distinctive Competencies (TDCs); dynamic capability; Partial Least Squares (PLS). Reference to this paper should be made as follows: Real, J.C., Leal, A. and Roldán, J.L. (2006) ‘Determinants of Organisational Learning in the generation of technological distinctive competencies’, Int. J. Technology Management, Vol. 35, Nos. 1/2/3/4, pp.284–307. Biographical notes: Juan C. Real (PhD) is a Lecturer in Business Administration in the Department of Business Administration, Pablo de Olavide University, Spain. Prior to that, he was a Lecturer in the Department of Business Management and Marketing at the University of Seville from where Determinants of Organisational Learning 28 5 he received a PhD in Management. He has been a Visiting Researcher at the Cardiff Business School, Wales, UK. He has published several book chapters for Idea Group Publishing and Kluwer Academic Publishers. His current research interests are in the areas of organisational learning, knowledge management, entrepreneurship and technological innovation management. Antonio Leal (PhD) is currently a Professor of Business Administration in the Department of Business Administration and Marketing at the University of Seville, Spain. He is the author of five books on management. He has published several papers and authored numerous international conference proceedings. His recent publications have appeared in OR Insight and Total Quality Management and Business Excellence. Besides, he has published several book chapters for Idea Group Publishing and Kluwer Academic Publishers. He has been a Visiting Professor at various European and Latin American Universities. His research interests include knowledge management, total quality management, benchmarking and organisational culture. José L. Roldán (PhD) is an Assistant Professor of Business Administration at the University of Seville, Spain. He has published three books and several papers on management aspects. His recent contributions have been published in OR Insight, Internet Research: Electronic Networking Applications and Policy and Total Quality Management and Business Excellence. Furthermore, he has published three book chapters for Idea Group Publishing. He has been a Visiting Professor at the Technical University of Brno, Czech Republic and at the Central University of San Salvador, El Salvador. His current research interests include executive information systems, knowledge management systems and structural equation modelling. 1 Introduction Organisational Learning (OL) represents a source of heterogeneity and potentially sustainable competitive advantages because of companies’ different capacities for learning and absorbing knowledge (Crossan and Nicolini, 2000; Easterby-Smith, 1997; Lei et al., 1999). The contributions from the Resource-Based View (RBV) approach and its extension, the Knowledge-Based View (KBV) approach, suggest that competitive advantage stems from the company’s capabilities and abilities, with learning becoming a fundamental strategic aspect. Innovation is the company’s ability to transform and exploit technological knowledge (Zahra and George, 2002). The development of this knowledge is path-dependent (Prencipe, 1997) and, therefore, determined by the company’s history and experience, in which OL plays a key role (Dutrénit, 2000). This explains the historic dependence of innovation on what has happened in the past and its irreversibility with respect to the technological path followed (Pavitt, 1987). Technological Distinctive Competencies (TDCs) are the result of this collective learning process, including the ability to innovate to adapt to changes. This provides the organisation with the ability to generate new products and services more quickly than competitors (Lado et al., 1992). Through this approach, TDCs include both the expertise to develop and design new products, services and processes effectively and learning skills (Teece et al., 1994). 286 J.C. Real, A. Leal and J.L. Roldán Hence, knowledge-based resources are particularly relevant to provide a sustainable competitive advantage and it becomes very interesting to analyse which factors influence the relationship between OL and the ability to introduce new products, processes or ideas in the organisation. This research takes the current position concerning OL and the KBV as its reference framework. Although their theoretical frameworks are different, they share a series of similarities, which enable their integration into a global theory whose contemplation could imply the appearance of a new paradigm (Mahoney, 1995). Thus, using a dynamic model integrating OL and Knowledge Creation (OL-KC), we attempt to analyse how OL influences the process of creating TDCs. We will also examine how Entrepreneurial Orientation (EO), Learning Orientation (LO) and Information Technology (IT) contribute in a dynamic way to the success of such a process. These variables, which are antecedents of the OL-KC process, have not been jointly considered in the field of the theories used as a framework in this research. Moreover, we propose that EO and IT influence the development of knowledge-based resources such as TDCs, along with explaining how OL is a mediator that facilitates this relationship. To achieve the proposed objectives, this paper has been organised as follows: To begin with, we describe the theoretical framework we have applied in this research, from which a series of hypotheses are derived describing our research model. Following this, we describe the sectors that are the objects of this study and the chosen sample of companies, along with the design of the questionnaire and the planning of the fieldwork. Next, we present our results and discuss them based on the analysis of data collected from 140 manufacturing firms. Finally, we present the conclusions, identify several limitations and provide guidelines for future research. 2 Research model and hypotheses This research is focused on learning in organisations, a descriptive approach used to describe certain types of activity that take place in an organisation (Tsang, 1997). OL is understood to take place in organisations, in the sense of an activity or a process as indicated by Örtenblad (2001). Thus, we define OL as a dynamic process of knowledge creation generated at the heart of the organisation via its individuals and groups, directed at the generation and development of distinctive competencies that enable the organisation to improve its performance and results. March (1991) proposes the existence of two types of basic activities for learning in the organisation: exploration or feedforward and exploitation or feedback. Exploration includes characteristics such as investigation, variation, risk, experimentation, flexibility, discovery and innovation. It consists in experimenting with new possibilities and its results are uncertain, takes a long time and are often negative. Exploitation is related to choice, efficiency, selection and execution. It consists in the improvement of existing competencies and technologies by using what has already been learnt, that is to say, by adaptation. Its results are predictable, quickly achieved and positive. OL constitutes a dynamic process of knowledge creation through levels which create a tension between the incremental or amplifying logic, implying exploration or new assimilation of learning (feedforward) and the reductive logic, involving, exploiting or using what has been learnt (feedback). Determinants of Organisational Learning 28 7 The 4I model of OL (Crossan and Berdrow, 2003; Crossan et al., 1999), used in this research to analyse OL as an OL-KC process, defines OL consisting of four related (sub) process: 1 intuition is a preconscious process taking place at the individual level 2 interpretation as a first type of transmission of elementary cognitive elements, acts as intermediary between individual and group levels 3 integration process or how and what is interpreted is inserted in the organisation, acts as a link between group and organisational levels and finally 4 institutionalisation process or how changes are consolidated, is exclusive for the organisational level. This model has been operationalised using the Strategic Learning Assessment Map (SLAM) proposed Bontis et al. (2002). The SLAM matrix integrates the key dimensions of the OL literature. Firstly, an analysis perspective with multiple levels; secondly, a conceptual operative framework and thirdly, the integration of learning into stock and flow magnitudes: three learning stock constructs related to the learning that resides within a level (individual, group and organisation) and two learning flow constructs corresponding to its exploration and exploitation process (feedforward and feedback). In the OL-KC model defined, the learning stocks are an intangible resource related to the knowledge stored in a particular agent (Hedlund and Nonaka, 1993), both in their technical dimension or know-how (capabilities, that is, preparation, knowledge and experience) and in its cognitive dimension (competencies, that is, ideas, values and mental models). The learning flow concept takes shape in the transfer and diffusion of knowledge within and throughout the limits of the organisation (Sanchez, 1997). Vera and Crossan (2004, pp.225–226) state that the feedforward flow moves from the individual and group to the organisation through the 4I learning process: intuitinginterpreting, interpreting-integrating, integrating-institutionalising and intuitinginstitutionalising. At the same time, an analogous flow feeds back from the organisation to the individual and group, forming a new variation of processes: institutionalisingintegrating, integrating-interpreting, interpreting-intuiting and institutionalising-intuiting. The definition of the SLAM constructs is set out in Table 1. Table 1 Definition of SLAM constructs II Individual-level learning stocks Individual competency, capability and motivation to learn the required tasks GG Group-level learning stocks Group knowledge or knowledge incorporated into social interactions, a product of shared understanding OO Organisational-level learning stocks Knowledge or skills internalised in non-human aspects of the organisation, including systems, structures, procedures and strategy FF Feedforward learning flows Transfer of learning from the individual to the collective sphere FB Feedback learning flows The use made of learning which has become institutionalised (learning which is embedded in the organisation, in its systems, structures, strategy, etc.) Source: Adapted from Bontis et al. (2002). 288 J.C. Real, A. Leal and J.L. Roldán Using this perspective of OL as a system of stocks and flows via levels (i.e. individual, group and organisation), the conceptual model we propose is reproduced in Figure 1. The model starts by considering the OL-KC process as a capability of the company to generate new knowledge at the level of the individual or small groups, to disseminate it throughout the organisation and to incorporate it in products and services (Nonaka and Takeuchi, 1995). To do this, it is structured into three large sections. Firstly, the organisational variables antecedent to the OL-KC process appear. To begin with, organisational EO, given its relevance in fostering OL and the development of new knowledge (Dess et al., 2003), allows knowledge stocks and flows to become TDCs. Then, we have LO, which influences the company’s tendency to create and use knowledge (Sinkula et al., 1997). Next, we examine the relevance of IT on transfer and transformation processes and, in all, on the transformation of resources and capabilities in competencies (Andreu and Ciborra, 1996). Secondly, a relationship is established between the OL-KC process and the process of constructing TDCs, as a result of collective learning in the organisation (Prahalad and Hamel, 1990), which is an aspect seldom addressed in empirical research (Lei et al., 1996). This is in addition to the mediating role of these competencies on the influence of OL and Perceived Business Performance (PERF). Thirdly, we analyse the influence of EO and IT on the development of the resources that integrate the concept of TDCs, which include technology, product, process, knowledge, experience and organisation (Guan and Ma, 2003). Moreover, we consider the mediator role of OL in the analysis of the relevance of EO and IT in obtaining the previous knowledge-based resources. Figure 1 Empirical model with hypothesised relationships Determinants of Organisational Learning 28 9 2.1 EO as a determinant of OL The definition adopted in this study is EO denominated as entrepreneurial behaviour (Covin and Slevin, 1991; Entrialgo et al., 2000, 2001; Knight, 1997; Lumpink and Dess, 1996, 2001), which several authors name “entrepreneurship as an activity in the firm-level” (Zahra et al., 1999), “entrepreneurial posture” (Covin, 1991) or “internal corporate entrepreneurship” (Jones and Butler, 1992). All these terms gather together the firms’ strategic orientation, which is related to methods, practices and decision-making styles that managers use to act entrepreneurially (Lumpkin and Dess, 1996). It consists in three dimensions (Covin and Slevin, 1989): innovativeness, proactiveness and risk-taking. Innovativeness refers to the pursuit of creative or novel solutions or challenges, including the development or enhancement of products and services, as well as new administrative techniques and technologies for performing organisational functions (e.g. production, marketing, sales and distribution) (Knight, 1997, p.214). In this study, proactiveness is the opposite of reactiveness and is associated with aggressive posturing relative to competitors (Knight, 1997, p.214). This way, it is similar to “competitive aggressiveness” (Lumpkin and Dess, 1996, p.147), defined as how firms relate to competitors, that is, how they respond to trends and demands that already exist in the marketplace. Risk-taking is defined as the willingness to commit large amounts of resources to projects where results are unknown and the cost of failure may be high (Miller and Friesen, 1978, p.923). EO may be an important measure of how organisations exploit knowledge-based resources to discover and exploit new opportunities (Wiklund and Shepherd, 2003). Zahra et al. (1999) suggest a model in which the influence of EO on OL provides a mechanism to create new knowledge that lays the foundation to build new competencies or revitalise the existing ones. Liu et al. (2002) show that EO is positively related to OL, the former being a cultural antecedent of the latter. On the other hand, Slater and Narver (1995) consider that EO provides a cultural foundation for OL, which, in turn, enables an organisation to achieve a high level of performance and better customer value. Therefore, according to the reasons set out, we propose that: H1: Entrepreneurial Orientation has a positive effect on Organisational Learning as a knowledge creation process. 2.2 LO as a determinant of OL LO is defined as an antecedent to the OL-KC, which synthesises the critical components of learning organisations, a prescriptive approach concerns with the question “How should an organisation learn?” (Tsang, 1997). In our study, following Sinkula et al. (1997), we consider LO as a group of organisational values which influences on the firm’s tendency to create and use knowledge. Sinkula et al. (1997) and Baker and Sinkula (1999) state that one of these values is the commitment to learning, which is closely related to management commitment to support a culture fostering LO as one of its main values (Garvin, 1993; McGill et al., 1992; Stata, 1989). Another value is the open-mindedness, related to mental models that dominate the firm (Day, 1994; Porac and Thomas, 1990, Senge, 1990; Sinkula, 1994) and to unlearning as a driving force to organisational change. Shared vision (Senge, 1990) is different from 290 J.C. Real, A. Leal and J.L. Roldán commitment to learning and open-mindedness which influences the direction of learning, whereas the previous components determine its intensity. Building a shared vision is the shared ideal that agglutinates individual energies of organisational members and guides them in a common direction, generating a tension that leads to learning. Authors such as DiBella et al. (1996a,b), DiBella and Nevis (1998) and Nevis et al. (1995) define LO as a group of values and attitudes determining where learning will take place and the nature of what is learnt. LO determines how organisations acquire, share and use knowledge and it affects the spiral process and knowledge conversion (Kim, 1998). Based on the previous contributions, we propose that: H2: Learning Orientation has a positive effect on Organisational Learning as a Knowledge Creation process. 2.3 IT as a determinant of OL The definition of IT for knowledge management is not only broad but also somewhat difficult to specify (Davenport and Prusak, 1998). For the purpose of our research, and following Gold et al. (2001), we use the concept of IT infrastructure defined as the shared IT capabilities that enable the flow of knowledge in an organisation to be supported. In this category, we include a set of technological resources, both hardware and software applications, which support different utilisation characteristics of knowledge (Grant, 1996) and learning activities (Leonard-Barton, 1995). Examples of these are business intelligence, technologies for collaborating and distributing knowledge, knowledge discovery, localisation and use, knowledge generation and storage and support hardware for these technologies. The existence of IT has been essential for the Knowledge Management movement (Davenport and Prusak, 1998). IT is involved in various knowledge management processes, which include knowledge creation (Alavi and Leidner, 2001; Pawlowsky et al., 2001; Teece, 1998). A great variety of procedures, tools and activities may act as a support to the knowledge generation/creation process (Nonaka et al., 2001). IT contributes to sustainable competitive advantage through its interaction with other resources. Recent literature suggests that OL is a process that plays an important role in enhancing a firm’s capabilities and competitive advantage (Grant, 1996; Lei et al., 1996) and which may benefit from the judicious application of IT. It has also been argued that for firms to be successful they must complement IT with OL (Tippins and Sohi, 2003). In accordance with our presentation so far, we therefore propose the following hypothesis: H3: Information Technology has a positive effect on Organisational Learning as a Knowledge Creation process. 2.4 OL as a determinant of TDCs TDCs are an appropriate concept for describing and studying the process of technological innovation, with the latter being a flow magnitude which serves to describe the process of generating technological knowledge (Nieto, 2004). In effect, companies innovate using a process of continuous learning through which they generate new technological knowledge (Nonaka and Takeuchi, 1995). Converting an activity of the organisation into a routine is the principal way of storing the organisation’s specific operational knowledge Determinants of Organisational Learning 291 (Nelson and Winter, 1982). In accordance with this, TDCs represent the organisation’s expertise in mobilising various scientific and technical resources through a series of routines and procedures, which allow new products and/or production processes to be developed and designed. This signifies a certain technological dominance, which may mean command of a competitive advantage. According to Bessant et al. (1996), there is a broad acceptance that technological innovation is a complex learning process, whereby companies acquire and develop distinctive technological competencies. Some authors, such as Chaston et al. (1999), maintain that OL is a path for achieving competitive advantage and helping organisations to become more innovative and improve their performance. Distinctive competencies are developed through the OL process and with this process, together with its outcome forms a ‘meta-learning’ system. This system is the capability of continuous learning, which is particularly necessary in complex and turbulent environments to develop dynamic distinctive competencies (Lei et al., 1996). For Leonard-Barton (1992b), distinctive competencies may become institutionalised over a long period of time and thus form a part of the company’s knowledge creation system. Authors such as Fiol (1991), Hamel (1991), Prahalad and Hamel (1990), Reed and DeFillippi (1990) suggest that distinctive competencies are based on the organisation’s collective learning. Andreu and Ciborra (1996) share this idea and mention that an OL process occurs during the development of core competencies of the organisation. Lynn et al. (1999) found a positive relationship between learning and the successful development of new products in organisations of high-technology sectors. Helfat and Raubitscheck (2000) provided a conceptual model for generating new products, which explains how organisations can be successful by creating and using knowledge and organisational competencies via a learning system. All the above arguments lead us to the following working hypothesis: H4: Organisational Learning as a Knowledge Creation process has a positive effect on the development of Technological Distinctive Competencies. 2.5 EO and its key role in developing TDCs According to Lumpkin and Dess (1996), a firm’s EO may be a source of competitive advantage and strategic renewal. This is why it has been proposed to be renamed as strategic entrepreneurship (Hitt et al., 2002), given its role in the firm’s strategic renewal that allows companies to adapt and respond to changes in their new markets (Zahra et al., 1999). Other authors, such as Floyd and Wooldridge (1999), state that EO is a mediator between inertia and learning in the competencies’ development process. These competencies provide the basis for the firm’s current competitive situation. Nevertheless, they are not easy to be changed, as they are based on values, and managers avoid actions threatening accepted values and norms. This double paradox, turning core competencies into core rigidities (Leonard-Barton, 1992b), explains why EO, through its strategic renewal, allows organisations to overcome the inertia in the competencies’ development process. EO takes shape as a new competencies’ creation process, which is based on three basic elements: identification of an opportunity and generation of a new idea, 292 J.C. Real, A. Leal and J.L. Roldán transformation of the new idea into a tangible result or initiative and development of the new competence (Floyd and Wooldridge, 1999, p.131). This process is contemplated by Alvarez and Busenitz (2001, p.756) by introducing two entrepreneurial concepts: 1 entrepreneurial recognition, defined as the recognition of opportunities and opportunity-seeking behaviour as a resource and 2 the process of combining and organising resources as a resource. With this, organisations develop the knowledge necessary to use as a continuous source of innovations, to obtain a higher performance to that of their competitors (Kazanjian et al., 2001). Moreover, Hult et al. (2004) recently demonstrated that EO plays a key role in the development and maintenance of innovation. This occurs because EO provides managers with the necessary encouragement to devise new products and processes. These arguments set out lead us to propose that: H5: Entrepreneurial Orientation has a positive effect on the development of Technological Distinctive Competencies. 2.6 IT and its significance in the development of TDCs Andreu and Ciborra (1996) propose an OL model whereby information technologies considered as a resource may participate in the fundamental process of transforming resources into capabilities: 1 sharing work practices and facilitating communication within groups and between individuals 2 facilitating reflection, experimentation and training in routines and work practices and 3 giving support to and making the process of disseminating capabilities possible. IT also has a role to play in the process of converting capabilities into distinctive competencies, endowing them with the attributes of strategic assets, that is to say, rare, valuable, difficult to imitate and imperfectly substitutable. TDCs are a form of technological knowledge that may be defined as a unique combination of knowledge and skills, which allow a series of profitable innovations to be generated (Chiesa and Barbeschi, 1994). Thus, IT plays an active role in the dissemination of knowledge and the relevant know-how for distinctive competencies throughout the organisation. In a similar manner, Lado and Zhang (1998) have examined the different paths whereby expert systems may be a potential source of sustainable competitive advantage, with one of these being their role in fostering the accumulation, updating and the use of distinctive competencies. Subsequently, Zhang and Lado (2001), from a Dynamic Capability Perspective, also showed the influence of IS on the development of the types of distinctive competencies at the operational level and their repercussions in the company achieving an advantageous position with respect to its competitors. Bearing in mind these considerations, we propose the following hypothesis: H6: Information Technology has a positive influence on the development of Technological Distinctive Competencies. Determinants of Organisational Learning 29 9 intangible organisational resources, as is the case for LO and EO, given that the former, by themselves, do not guarantee that the OL-KC process occurs (Powell and Dent-Micallef, 1997; Smith et al., 1996). With regard to EO, the proposed model can only explain 5.3% of the variance of OL. This finding supports the conclusions of Sadler-Smith et al. (2001). With this, we can see how EO induces OL in the creation of new knowledge which lays the foundations of building new competencies (Zahra et al., 1999). Hence, as Dess et al. (2003) state, LO should be considered as one of the most important consequences of EO, which allows the organisation to create new knowledge to update its skills and capabilities. Similarly, it is observed that OL has a role in the development process of TDCs, as it explains 14.9% of its variance. This is in line with the findings of Dutrénit (2000) in affirming that companies construct their technological distinctive competencies through individual and collective learning processes. Taking this into account, OL allows the company to create new knowledge, which will be used to develop innovations by the company itself and its employees, as Forrester’s (2000) empirical study shows. This is why they can be defined as a dynamic capability, given that they are a stable model of collective activity through which the organisation systematically pursues an improved effectiveness (Zollo and Winter, 2002). On the other hand, EO has also a positive effect on TDCs and contributes 15.5% to the explained variance of this construct. This relationship, which was shown by Hult et al. (2004), means that EO embodies the qualities of proactiveness, aggressiveness and initiative that can propel managers into action on new ideas, novelty, experimentation and creative processes, which will result in new technological processes, products or ideas in the organisation (Lumpink and Dess, 1996). The mediating role of OL on the influence of EO on TDCs means the consideration of OL as a knowledge-based resource, which allows the company to create new knowledge by means of exploration and exploitation processes. Nevertheless, the highest predictive power of the level of TDCs is due to IT, because this construct contributes 30.9% to the explained variance of the former. IT plays an active role in spreading the necessary knowledge to foster the accumulation, updating and utilisation of distinctive competencies. Their role in the distinctive competencies development process has been shown (Andreu and Ciborra, 1996; Ciborra and Andreu, 2002; Zhang and Lado, 2001), as it is the case for TDCs considered as transformational competencies (Lado and Wilson, 1994; Lado et al., 1992). Moreover, we must highlight the fact that OL plays a significant role in mediating the effects of IT on TDCs. An explanation of this result can be found, as Adams and Lamont (2003) posit, in the relevance of IT in the development of a learning capability which allows the company to identify, assimilate and apply external information to new processes or products, known as absorptive capacity (Cohen and Levinthal, 1990). 6 Conclusions In this study, we have examined, using the literature on OL and the KBV as theoretical frameworks, the problem of the complexity of OL as a KC process and we have considered it as a latent multidimensional construct composed of stocks and flows variables. A measurement scale has been used which will strengthen the area of study in 300 J.C. Real, A. Leal and J.L. Roldán which there are a number of limited empirical studies and in the development of which there has been a growing interest. Secondly, we have proposed a theoretical model that, starting from the measurement of the OL-KC process, has demonstrated the relevance of LO, IT and EO (in this order) as enablers of this process. LO, the most important predictor, can be explained by the attributes of learning organisations, where learning is a fundamental process. IT allows the identification, acquisition and incorporation of data and information, along with a proper management of them. This way, they contribute to making tacit knowledge become explicit knowledge. However, IT does not guarantee that the OL-KC process occurs. Other resources, such as EO and LO occurring jointly and additionally, are necessary for IT to become a source of competitive advantage. On the other hand, the effects of EO on the OL–KC process result in a strategic renewal process, as it implies new knowledge creation, which lays the foundations to build competencies or revitalise the existing ones. Thirdly, we have analysed the relationship between OL and TDCs. The technological dominance via which TDCs are expressed has a strong learning component, coming as it does from the learning process. As a consequence, we speak about a process of path-dependence learning. Finally, the role of EO and IT on the generation of TDCs is demonstrated. EO means the search for and exploitation of opportunities that allow the company to introduce new products, processes or ideas. IT plays an active role in turning tacit knowledge into explicit knowledge and in the spreading of knowledge throughout the organisation. They may take part in the fundamental process consisting in transforming resources into capabilities and then into distinctive competencies. OL constitutes a high-order capability with a combinatorial character, so that it can generate other competencies, such as TDCs, by the combination of other strategic resources such as EO and IT. 6.1 Limitations and directions for future research We would not like to finish without indicating that the results and conclusions of this study have some limitations. Firstly, there is the cross-sectional character of this research, particularly if we consider OL to be a construct of a dynamic character and TDCs to be essentially of a continuous nature attached to historic determining factors. A research line would be able to contemplate carrying out of a longitudinal study, taking measures at different moments of time, that permits us to ratify the relations established in the theoretical model proposed. Secondly, the significance that the inter-organisational level may have for KC is not been considered. A future research line could bear in mind considering the outer knowledge coming from the stakeholders, which represent valuable sources of intelligence and new ideas. Thirdly, the data employed are mainly the result of subjective perceptions of the managers who were interviewed. Although managers’ subjective evaluations through multi-item measurement scales are in general consistent with objective measurements, perceptions may differ from the objective data. In this sense, it would be interesting to carry out future studies in this line, employing objective indicators obtained from case studies. Determinants of Organisational Learning 301 Fourthly, an effective OL also requires a high organisational absorptive capacity, which is investigated by its role in learning and innovation. In this manner, another work line could prove that the absorptive capacity can have both a positive impact on the creation knowledge and indirect effects through the interaction with IT. 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