"It makes sense to describe a core competence as a complex adaptive system, located in the lower regions of the I-Space between an ordered regime in which knowledge assets get frozen into technologies and a chaotic regime in which the stability necessary for effective organizational coordination and integration remains absent. Core competences, then, have their being in a region of the I-Space sandwiched between an excess of usable structure and a total lack of it. We hypothesize that the possession of a core competence is one measure of a firm’s ability to deal with complexity."

“Knowledge management often generates theories that are too general or abstract to be easily testable. In some cases, simulation modeling can help. an agent-based simulation model derived from a conceptual framework, the Information Space or I-Space and use it to explore the differences between a neoclassical and a Schumpeterian information environment.”

“At the level of firms, therefore, only those whose cultural repertoire gives them transactional capacity throughout the I-Space can summon and adequate learning response to any emerging gaps between technology and culture. Those operating from too narrow a cultural base in the space, however, must of necessity lose control of the SLC unless they can complement their limited cultural repertoire through carefully selected interfirm and intercultural collaborations – i.e. through an externalization of transactions that link them with agents located elsewhere in the space. However, they will then confront the same problems of integration that more culturally diverse firms encounter inside their organization when trying to coordinate the activities of different functions or businesses. There is no cheap grace.”

“Although in practice innovative coding is hard to disentangle from innovative theorizing, the latter, over time, has a far greater impact than the former on how we perceive and interpret the world.”

“Data is discrimination between physical states of things that may convey or not convey information to an agent. Whether it does so or not depends on the agent's prior stock of knowledge.”

“Following the lead given by new institutional economics, we shall take the transaction as our unit of analysis. For our purposes, a transaction can be thought of as any act of social exchange that depends on information flows for its accomplishment. Transactions can be as simple and brief as the purchase of a packet of cigarettes, or as complex as and extended as those which bind a Zen master to his disciples. Like institutional economists, we are interested in the relationship that can be established between different transactional characteristics and the phenomenon of institutionalization. Our use of the term transaction, however, will extend beyond that of institutional economics where the focus has tended to be primarily on transaction costs and efficiency considerations. These, to be sure, are relevant. But, as we shall see, they are not the whole story.”

“Knowledge is a property of agents predisposing them to act in particular circumstances.”