Existing theories have recognised the importance of expert knowledge in the formation and survival of professional service firms (FSFs), such as accounting and consulting firms, but have not fully explained its role. We argue that knowledge is a key determinant of the organisational structure and performance of PSFs. We examine forms of knowledge and knowledge management strategies within PSFs and develop a framework linking the firm's knowledge base and organisational structure. Two contrasting case studies are presented to illustrate these arguments. The paper concludes with a set of propositions to guide further research. © 1998 Elsevier Science Ltd. All rights reserved.
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