Page 42 -

KNOWLEDGE-INTENSIVE FIRMS 31

partners of the firm also manage the firm (Greenwood, Hinings and Brown,
1990). Larger ones are often referred to as Managed Professional Bureaucra-
cies (MPBs) (Cooper et al., 1996) and employ a variety of professionals as well
as legal professionals and administrators to deal with the management and
operation of the firm. Notably within the larger MPBs, professionals often
work as part of large teams (i.e they do not necessarily individually control
resources) addressing the needs of similar large, corporate clients. Professional
service firms are characterized by a clear hierarchical, partnership structure
and well-defined career paths, and the management of this type of firm is
already well-documented in the management literature (Lowendahl, 2000).
Some knowledge-intensive firms, in particular large consultancy firms, are
also often loosely referred to as professional service firms. The way in which
the very large, global consultancies such as Accenture, McKinsey and Price
Waterhouse Coopers organize does tend to resemble that of the traditional
professional service firm (although they tend to be output-based rather than
client-based). However, whilst these categories overlap, the features of knowledge-
intensive firms are broader and, importantly, some of the features ascribed to the
traditional professions are not necessarily apparent in all knowledge-intensive
firms. For example, distinctive features of PSFs such as codes of ethics, strong
professional affiliations and specific educational entry requirements leading
to restricted access need not, and do not, exist in many knowledge-intensive
firms.
More contemporary forms of knowledge-intensive firms emerged in the
latter part of the twentieth century including media, advertising and public-
relations agencies, software development companies, and many other high-tech
and specialist consultancy firms. Around the start of the new millennium we
also witnessed the emergence of virtual, Internet-based knowledge-intensive
firms offering specialist services to both individual clients and the general public
(e.g. Napster, Friends reunited). It is the issues around organizing and man-
aging within these typically smaller, knowledge-intensive firms operating in
knowledge-based sectors that are going to be specifically addressed here in this
chapter.
Not surprisingly, a precise definition of a knowledge-intensive firm is elusive
and it is clear from the term itself that it is a socially constructed, broad-
ranging and yet quite ambiguous concept. Alvesson (2004, p. 17) loosely
defines knowledge-intensive firms as ‘organizations that offer to the market
the use of knowledge or knowledge-based products . . . ’. The core of activities
in these companies is based on the intellectual skills of a very large proportion
of the labour force deployed in development, and often also in the sale of
products and in service work and he goes on to define a knowledge-intensive
firm as ‘an organization broadly recognized as creating value through the use
of advanced knowledge’ (p. 29). However, the term ‘advanced knowledge’
here is somewhat ambiguous. Unfortunately, because there is no precise
definition there has been a proliferation of articles on the subject of knowledge
workers and knowledge work in what might be considered fairly traditional

6/5/09 6:58:02 AM
9780230_522015_03_cha02.indd 31 6/5/09 6:58:02 AM
9780230_522015_03_cha02.indd 31