Sources of knowledge in the firm: a review on influential, internal and contextual factors in innovation dynamics

The sources of knowledge are diverse, as each firm interacts with multiple actors in pursuing its mission: partners and strategic allies, suppliers, customers, competitors, specialist organizations such as knowledge-intensive business services, universities, technology centres, public research organizations, innovation intermediaries and public administration bodies. Different kinds of knowledge, both tacit and codified, are relevant for firms. Nevertheless, knowledge needs to be translated into the capacity to act. Hence, knowledge generation and absorption can be understood as two sides of the same coin and it is necessary to take factors that shape both facets into account, in addition to the relationship between the production, transfer and valorisation of knowledge. This article reviews crucial factors for knowledge in firms, aggregated as influential, contextual and internal. Influential factors are associated with knowledge tacitness and the existing knowledge base, whereas the internal characteristics of the firm are also crucial and concern aspects such as the existing innovation culture, leadership attributes and internal research and development capabilities. Finally, contextual factors, such as the territorial dynamics, are essential as environmental enablers for generating and absorbing knowledge. Together, these factors reinforce the dynamic capabilities of the firm and influence the decision to either engage in open innovation strategies or prioritize actions that protect and codify knowledge, thus affecting the firms’ competitiveness.