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The Dutch potato sector went through a process of considerable concentration during the past two decades. The number of firms decreased substantially while production levels increased. The process of restructuring was triggered by a combination of shifting consumer demands, internationalisation of markets, and concentration among food retailers. Many potato firms were unable to adjust to these developments and found themselves either for sale or bankrupt. Others engaged in mergers or strategic alliances to meet the changing demands. The resulting concentration process led to higher levels of both vertical and horizontal interdependence between the remaining firms. The rules of competition have changed: opposed to competing individually, successful potato firms achieve substantial competitive advantages through co‐operative inter‐firm arrangements that gain access to high‐quality raw materials, production capacity, and large customers. Consequently, managing inter‐firm co‐operation has become a strategic issue for firms in the potato supply chain.

This paper aims to explain the rapid emergence of corporate universities on the basis of fundamental developments presently shaping the economy and society on a world‐wide scale.

Four key forms of innovation are identified and combined with the corporate university concept. The paper explains why corporate universities are emerging world‐wide as strategic weapons in the competitive battle among companies, countries and international economic power blocs.

Companies endorsing the importance of knowledge innovation cannot get around the corporate university concept as part of their strategy. Three major corporate university types are identified and linked to their strategic role as the driving force of knowledge innovation.

Helps to explain why corporate universities have evolved as an answer to the challenge of competing in a knowledge‐driven economy.