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How Knowledge Accumulation changed the Competitive Advantage of Strategy Consulting Firms

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  • van den Bosch, F.A.J.
  • Baaij, M.G.
  • Volberda, H.W.

Abstract

Research evidence confirms that the accumulation of knowledge contributes to the competitive advantage of firms. In the strategy consulting industry, one of the most knowledge-intensive professional services industries, however, established firms that exploited their knowledge accumulation by adding exploitative consulting practices have found their performance has deteriorated. To investigate this phenomenon, this paper will describe how the increasing share of exploitative practices in the strategy consulting industry has attracted both established ICT-related consulting firms and new entrants, and enabled clients to expand their problem-solving abilities. We will argue that these developments in terms of competitiveness and client competencies have reduced the attractiveness of exploitative practices for established strategy consulting firms. To analyse these developments and to provide strategic options for the established strategy consulting firms, a conceptual framework will be proposed. Based on this framework, three strategic option are identified: ‘Follow the herd’, ‘Become ambidextrous’ and ‘Back to the original focus.’ In summarizing our argument, we highlight the pros and cons of these options and the implications for top management.

Suggested Citation

  • van den Bosch, F.A.J. & Baaij, M.G. & Volberda, H.W., 2005. "How Knowledge Accumulation changed the Competitive Advantage of Strategy Consulting Firms," ERIM Report Series Research in Management ERS-2005-026-STR, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    • Handle: RePEc:ems:eureri:6553
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    1. Paul S. Adler & Barbara Goldoftas & David I. Levine, 1999. "Flexibility Versus Efficiency? A Case Study of Model Changeovers in the Toyota Production System," Organization Science, INFORMS, vol. 10(1), pages 43-68, February.
    2. Jansen, J.J.P. & van den Bosch, F.A.J. & Volberda, H.W., 2005. "Managing Potential and Realized Absorptive Capacity: How do Organizational Antecedents matter?," ERIM Report Series Research in Management ERS-2005-025-STR, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    3. van den Bosch, F.A.J. & van Wijk, R.A.J.L. & Volberda, H.W., 2003. "Absorptive Capacity: Antecedents, Models and Outcomes," ERIM Report Series Research in Management ERS-2003-035-STR, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    4. Stienstra, Marten & Baaij, Marc & Van den Bosch, Frans & Volberda, Henk, 2004. "Strategic Renewal of Europe's Largest Telecom Operators (1992-2001):: From Herd Behaviour Towards Strategic Choice?," European Management Journal, Elsevier, vol. 22(3), pages 273-280, June.
    5. Henk W. Volberda, 1996. "Toward the Flexible Form: How to Remain Vital in Hypercompetitive Environments," Organization Science, INFORMS, vol. 7(4), pages 359-374, August.
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    1. Jansen, J.J.P. & van den Bosch, F.A.J. & Volberda, H.W., 2005. "Managing Potential and Realized Absorptive Capacity: How do Organizational Antecedents matter?," ERIM Report Series Research in Management ERS-2005-025-STR, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    2. Jaime Apolinar Martínez Arroyo & Marco Alberto Valenzo Jiménez & Saúl Alfonso Esparza Rodríguez, 2019. "El Recurso Humano como Factor de la Competitividad Sostenida en la Cadena de Valor del Aguacate Michoacano," Capítulos - Los Recursos Humanos como Factor Detonador de la Competitividad, in: Virginia Hernández Silva & Pedro Chávez Lugo (ed.), Los Recursos Humanos como Factor Detonador de la Competitividad, edition 1, chapter 1, pages 13-34, Universidad Michoacana de San Nicolás de Hidalgo, Facultad de Contaduría y Ciencias Administrativas.

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    More about this item

    Keywords

    ambidextrous organization; exploitation and exploration; knowledge; strategy consulting;
    All these keywords.

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • L20 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - General
    • M - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics

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