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Exploration, Exploitation, and Knowledge Management

David A. Bray

Harvard University; University of Oxford; National Defense University

Proceedings of the Twelfth Americas Conference on Information Systems (AMCIS), August 2006

James G. March conceived organizational learning as a balance between the exploration of new alternatives and the exploitation of existing competencies. This study extends March's model to consider exploration and exploitation in hierarchical organizations. First, the effect of additional tiers is analyzed and related to March's original constructs. Second, the study evaluates additional effects of a knowledge management system that collects and shares knowledge from expert individuals in an organization. This study finds that in the absence of personnel turnover, a knowledge strategy of high exploitation and low exploration for a multi-tiered hierarchical organization reduces the veracity of average individual knowledge when compared to alternative strategies. The magnitude of this reduction in veracity increases as the number of tiers in a hierarchical organization increase; a flat organization will see less of a reduction. A weighted least-squares regression performed on a second set of data corroborates this central observation. This study is the first of three dissertation papers planned by the author, examining the organizational dynamics associated with knowledge management systems.

Number of Pages in PDF File: 9

Keywords: organizational learning, exploration, exploitation, personnel turnover, environmental turbulence, hierarchical organizations, knowledge management

JEL Classification: D23, D70, D83

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Date posted: February 13, 2007 ; Last revised: November 20, 2008

Suggested Citation

Bray, David A., Exploration, Exploitation, and Knowledge Management. Proceedings of the Twelfth Americas Conference on Information Systems (AMCIS), August 2006. Available at SSRN: https://ssrn.com/abstract=962534

Contact Information

David A. Bray (Contact Author)
Harvard University ( email )
1875 Cambridge Street
Cambridge, MA 02138
United States
University of Oxford
United Kingdom
HOME PAGE: http://www.linkedin.com/in/dbray
National Defense University ( email )
Marshall Hall
300 5th Avenue
Washington, DC 20319-5066
United States
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