Organizational learning, knowledge and wisdom

TLDR

Wisdom is a missing construct in the knowledge‑based theory of the firm, and it hinges on judgment and decision making that balances understanding complexity with simplifying for action. The study proposes a framework linking data, information, knowledge, and wisdom to assess how organizational learning and knowledge influence competitive advantage. The framework associates each construct with a distinct learning type, identifies experience, passion to learn, and spirituality as drivers of wisdom, and discusses transformational leadership, culture, and knowledge transfer as acquisition processes.

Abstract

To improve our understanding of the impact of organizational learning and knowledge on competitive advantage, we propose a framework that includes the constructs of data, information, knowledge, and wisdom. Each of these constructs is then associated with a different type of learning. We further argue that wisdom is an important, albeit missing, construct in the knowledge‐based theory of the firm. A key to organizational wisdom is judgement and decision making, which requires an understanding of the complexity of a situation, but also requires the ability to make sense and simplify so that action can be taken. Three important drivers for the development of organizational wisdom are experience, a passion to learn, and spirituality. Processes for acquiring organizational wisdom such as transformational leadership, organizational culture and knowledge transfer are also discussed.