Incorporates: Journal of Management History (Archive)
Online from: 1967
Subject Area: Management Science/Management Studies
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|Title:||Measuring organizational wisdom applying an innovative model of analysis|
|Author(s):||Paulo Pinheiro, (Management and Economics Department, Beira Interior University, Covilhã, Portugal & Research Unit in Business Sciences (NECE), Covilhã, Portugal), Mário Raposo, (Management and Economics Department, Beira Interior University, Covilhã, Portugal & Research Unit in Business Sciences (NECE), Covilhã, Portugal), Ricardo Hernández, (University of Extremadura, Cáceres, Spain)|
|Citation:||Paulo Pinheiro, Mário Raposo, Ricardo Hernández, (2012) "Measuring organizational wisdom applying an innovative model of analysis", Management Decision, Vol. 50 Iss: 8, pp.1465 - 1487|
|Keywords:||Knowledge management, Organizational Performance, Organizational wisdom, Portugal, Textile industry, Value creation|
|Article type:||Research paper|
|DOI:||10.1108/00251741211262033 (Permanent URL)|
|Publisher:||Emerald Group Publishing Limited|
Purpose – The objective of this paper is to measure the level of organizational wisdom of firms and verify its influence on the value they produce.
Design/methodology/approach – This study seeks to establish linkage between organizational wisdom and value creation with the development of a new model based on the contributions of North's wisdom matrix and the Jordan and Jones model. The proposed model, using primary data from the Portuguese textile sector, is tested through recourse to a structural equation model.
Findings – The results point to the conclusion that companies with high organizational wisdom do manage to improve their efficiency and effectiveness but this proves insufficient for actually increasing the level of value created when taking into account the industry's prevailing environment.
Practical implications – Firms may apply this model to ascertain their level of organizational wisdom. This model may also be deployed to determine this organizational wisdom level for a set of companies (a company cluster) or even a sector.
Originality/value – The main contribution of this paper stems from the explanatory value of the proposed model as it enables the measurement of a firm's organizational wisdom and its influence on the final value produced.
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