Managing knowledge in loosely coupled networks: Exploring the links between product and knowledge dynamics

The contemporary literature concentrates on 'make or buy' decisions in desi gn and production activities, assuming that decisions about the underlying fields of technological knowledge will automatically be the same. Building on previous research on multitechnology firms and products, this paper argu es that firms know more about technology than they apply in their own produ ction. We propose two major dimensions according to which firms should adju st their knowledge and production boundaries, namely systemic interdependen cies across components and uneven rate of change across components' underly ing knowledge bases. We analyse the implications of this less-than-perfect overlap between knowledge and production boundaries for the management of f irms' external relationships.