Information technology as a facilitator for enhancing dynamic capabilities through knowledge management

Research on dynamic capabilities is an emerging field: it studies the activities of firms during turbulent administrative environments. Current management interests are also focused on knowledge management as a major determinant of business excellence and competitive advantage. Our motivation for this paper was to answer the research question: Does knowledge management (KM) contribute to the enhancement of dynamic capabilities and thus to the enhancement of business excellence and competitive advantage? Our effort examined the use of KM in enhancing dynamic capabilities. Based on results from a survey of major Taiwanese firms, we tested a set of hypotheses with regression models. Empirical findings suggest that management of both endogenous and exogenous knowledge through IT applications significantly enhances dynamic capabilities.