Over the past few years, various concepts and techniques have been introduced into dominant management trends which are aimed at improving company performance. These concepts and techniques include Organisational Learning, Total Quality Management (TQM), Business Process Re-engineering (BPR), Lean Manufacturing, Supply Chain Management (SCM) and Total Productive Maintenance (TPM). Despite all the achievements made, company directors are becoming more and more aware that the best way to create sustainable competitive advantages is through knowledge accumulation. It is for this reason that learning and innovation capabilities (L&I) have become an unequalled source for increasing competitiveness and developing new products, services and procedures that better satisfy the needs of their clients. This article describes the basic procedures that support knowledge accumulation on a micro-scale and the mechanisms through which knowledge is used by companies. It also aims to understand the interaction that occurs between the different functional divisions of a company and their links or exchanges with other organisations. Furthermore, it introduces the concept of “a learning and innovation ladder”, and suggests a model that shows the relationships that exist between learning capacity, knowledge, creativity, innovation, business performance and incentive systems.