Abstract

The competitive landscape typified by intensifying competition, time compression, and disruptive change places an increasing pressure on firms to more effectively obtain, manage, and make sense of tacit knowledge in order to survive and be competitive. Tacit knowledge is that is not easily described, or transcribed, and must be contextually grounded to be understood (Polanyi, 1967). A firm can have an entrepreneurial or a market orientation. An entrepreneurial orientation is one where top managers are proactive, inclined to take risks, and favor change. A market orientation means that the firm concentrates on customer needs, the creation of products that create superior value, and building long-run mutually beneficial customer relationships (Narver & Slater, 1990). Research has found that both market and entrepreneurial firm orientations are positively associated with firm performance. However, their association to tacit knowledge creation needs to be fully explored. We postulate that an entrepreneurial orientation should be more related to tacit knowledge creation than a market orientation. Further, drawing upon the contingency approach and the knowledge-based view of the firm, we examine the moderating effects of hostile versus benign environments on the direct effects between entrepreneurial and market orientations with tacit knowledge.

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