STRATEGY, KNOWLEDGE, APPROPRIATION, AND ETHICS IN HRM 255This scenario is exemplified in the emerging debate on knowledge manage-
ment, in particular the challenge of managing tacit knowledge (Nonaka and
Takeuchi 1995; Schultz and Jobe 2001). The knowledge debate has developed
along a number of directions, ranging from the earlier concerns with what
it entailed (e.g. Nonaka 1994) and the importance of so-called knowledge-
intensive firms and knowledge workers (Starbuck 1992), to questions about
the unique problem posed by the tacit component (e.g. Kogut and Zander
1993; Schultz and Jobe 2001; Schultze and Stabell 2004), and the dimension
of power and conflict (e.g. Alvesson and Karreman 2001; Hayes and Walsham
2000). While recognizing the difficulties involved in managing and diffusing
knowledge flows that involve tacit knowledge, some commentators offer cod-
ification as a possible solution. For instance, Schultz and Jobe (2001) suggest
that codification can be achieved through encoding knowledge in formulas,
codes, expert systems, budget information, and so forth. Recognizing a human
component to ‘knowledge flows’, they suggest that codification can also be
achieved by depositing it in employees who visit or rotate between different
subunits. These authors treat codification as a prerequisite for transmission,
especially in the case of multinational firms. It is assumed that people will
absorb and internalize these explicit artefacts of knowledge as they come into
contact with different sections of the organization, interact with others, and
as they engage with different processes.
Codification of course raises the prospect of ‘involuntary transfer’. An
important strand in the knowledge management debate therefore relates to
how to protect organizational knowledge from dissipation or spillage. Scholars
as well as managers recognize the need to protect this valuable resource and
retain it within the organization using protective mechanisms such as patents,
copyrights, and in the case of HR, the use of isolationism and physical con-
trols (e.g. Liebeskind 1997). These developments in knowledge management
have reignited debate on the critical question of how best to utilize existing
resources for organizational ends. In the section below, we examine this ques-
tion through the conceptual lens of appropriation.
The challenge of appropriation
Developments in the SHRM debate in recent years have brought to the fore the
important question of appropriation. This question first took root in the early
1990s with the re-emergence of the RBV of the firm as noted above. It had of
course always been recognized that it was in the firm’s interest to seek to retain
the added value from utilizing the resources available to it (Nelson and Winter
1982). In fact, this has been a central question throughout the history of eco-
nomic thought and organized capitalism. In contemporary scholarship, much
of the debate has taken place in strategic management and the management of