Social capital, knowledge management, and sustained superior performance

Purpose – This article attempts to begin the process of removing the cloak of causal ambiguity by examining the role that knowledge management has in the creation of the wide variety of competitive advantages found in some organizations. Specifically, this article aims to extend understanding in the field of knowledge management by examining how knowledge management can affect organizational performance, and by examining one possible determinant of an organization’s capacity to manage knowledge. Design/methodology/approach – Reviews literature on resources-advantage theory of the firm, social capital and knowledge management to propose ways within the organization to improve their ability to manage knowledge and achieve sustained superior performance. The paper is structured around the following constructs: resource-advantage theory of the firm, social capital, and knowledge management. Findings – Describes the relationship between social capital and knowledge management and how both help organizations achieve a sustained superior performance within the market. Suggests that organizations with high levels of social capital have more knowledge-management capabilities than organizations with low levels of social capital. Research limitations/implications – This article extends prior research of knowledge management by proposing how social capital can positively impact the ability of organizations to manage knowledge. Practical implications – Since resources within all businesses are relatively limited, and particularly so when the business is small relative to its competitors, the revelation that social capital can lead to more effective knowledge management makes the decision to support and nurture social-capital development much more credible. Originality/value – Because there is no existing literature that has examined the relationship between social capital, knowledge management, and organizational performance, this paper provides a foundation for future studies that examine the relationship between social capital and knowledge management.