Working conditions are increasingly unpredictable, complex, and ungovernable creating severe health risks for employees and potential negative economic consequences for both corporations and society. Considering the growth in understanding human psychology and sociology, and the progression in measuring working conditions and health, this phenomenon is most perplexing. The enigma has yielded a returned interest in firms’ sustainable competitive advantage, where the challenge is to gain insights into work conditions that are beneficial both for the business and for its employees.

In an attempt to shed light on the growing issue, this thesis outlines the features of a structural equation model intended to test organizational and individual adaptability, where learning and interaction are of paramount importance. The central issue concerns the forms of interactions and learning that contribute to consequences of organizational outcomes (i.e. efficiency, effectiveness, and innovation) and to simultaneously assess the influence of these processes on employees’ outcomes (i.e. individual learning, goal commitment, and regeneration).

To provide an enhanced picture of this inquiry, 22 pharmacies encompassing 252 employees have been subject to a cross-sectional study. The role of three interactional perspectives has been tested to ascertain their potential to be enablers of sustainable competitive advantage. These three perspectives are: feedback, knowledge exchange, and social network.

The results of this thesis suggest that these three forms of interaction serve as a vehicle for shaping organizational and individual outcomes. Main findings presented in this thesis are that interactions facilitate organizational outcomes and individual outcomes. However, just as interaction facilitates favourable outcomes, it also has effects that can be constrictive. Generally, it is possible to enhance, decrease, or vary these interactions in order to improve the organizations’ sustainable competitive advantage, to the benefit of employees, stockholders, and customers. This undertaking, however, is not a simple one as certain interactions produce trade-off effects in the attainment of sustainable competitive advantage.