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In order to better understand the organizational sources of continuous innovation, the article provides an in–depth analysis of Oticon A/S, a leading company in the hearing-aid industry which showed an impressive ability to develop new products in the Nineties. Findings highlight that dynamic capabilities are made up of: knowledge creation and absorption, knowledge integration, and knowledge reconfiguration. Discussion links the findings to previous literature and shows how these knowledge-based processes are all based on a coherent mix of organizational resources
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