The role of knowledge creation within organizations increases in importance within a knowledge economy. Unlike the industrial economy, which inspired basic economic theory, the knowledge economy collapses the time frame for economic agents to obtain relevant knowledge with which to make competitive resource allocation decisions. Further, much knowledge creation still occurs today in an inefficient and unstructured fashion within organizations. In this paper, we examine briefly the process of knowledge creation. We posit that knowledge creation yields an economic benefit to the organization and present an analytic model which examines how formal knowledge creation embedded in formal learning processes provide this benefit. Our model provides an inducement for organizations to increase their management and participation in knowledge creation processes.