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This paper explores the organisation and codification of knowledge in software firms. It analyses various economic incentives to codification, including the need to improve the productivity and quality of software production and the networks of inter-firm alliances. The paper examines the experience of five Italian software firms specialising in software packages and services. It compares their capabilities, main sources of tacit knowledge, specific incentives to invest in knowledge codification and the formal development methodologies and quality control systems adopted. Finally, the paper analyses two distinct technological collaborations that two of these firms have recently established.