Abstract:
The fundamental question facing today‟s organisations lies in figuring out how best they can earn high rents and sustain organisational competitive advantage in the face of unpredictable and highly volatile environments. This suggests that there is a need for organisations to estimate the most optimal way of employing their scarce tangible and intangible resources, whilst at the same time augmenting them (Teece, 2007).Today increasing emphasis is being placed upon the necessity to understand both the nature and interrelationships of organisational intangible resources, and their impact on overall performance results (Felin & Foss, 2006). A key and vital attribute of these resources is that of individual knowledge - a tacit dimension that is believed to be the hardest to manage and communicate within the organisational context (Augier & Vendelø, 1999). As such, the manner in which such knowledge is managed and recognized by organisations would determine the evolution of organisational routines, competencies and capabilities essential ingredients of organisational success. The most salient framework to date that recognizes the importance of intangible assets and their integrative affect on organisational performance is the dynamic capabilities paradigm (Schreyögg & Kliesch-Eberl, 2007). The central argument of the dynamic capabilities paradigm lies in the belief that mere possession of unique resources - either tangible or intangible - will not contribute to the achievement of superior performance; rather, organisations need to develop an ability to integrate, build, and reconfigure these resources such that their new recombinations are capable of both addressing and shaping rapidly changing environments. In this respect, many challenges and hazards are unavoidable on the path towards superior organisational performance. Organisations need to be aware of these hazards and develop viable business models to take into account all possible contingencies surrounding organisational processes. Therefore, the objective of this thesis following the main tenets of the dynamic capabilities paradigm, is to develop a robust and valid conceptual framework that reflects the complex interactions of internal and external factors that influence organisational performance. The central purpose of this research is to explore the ways in which individual tacit knowledge is interrelated and interconnected with other organisational processes, and how these interconnections and interrelations affect organisational performance. Additionally, the purpose of this research is to identify the potential hazards of 'Red Queen' effect surrounding these interactions and interrelationships.This research is undertaken through the employment of a single case exploratory study. The case selected is of a Russian telecommunications provider operating in one of the regional markets of the vast Russian territorial landscape. The analysis related to the current position of the company, with data collected from different sources. Content analysis of comprehensive date derived from in-depth semi-structured interviews is performed by the researcher herself. The research suggests that individual tacit knowledge plays a vital role, both in an organisation's dynamic capabilities, and their strategic orientation. Disregarding its importance might lead to fatal strategic mistakes, jeopardizing the organisation's survival and chances for success. The research suggests potential 'Red Queen' effects and proposes ways to overcome these threats.