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To explore the collective means through which professional sports teams learn and generate new knowledge forms in order to remain competitive in challenging global arenas, and to examine the applicability of these means to business organizations.

The objectives were achieved by drawing on the business and sporting experience of two executive coaches who have access to current elite‐level sports coaches. Through unstructured interviews with sports coaches and business executives over a period of years, the research question of collective learning in sports teams has been explored and its relevance to business contexts, analyzed.

Using social capital theory as an analytical lens, the research shows that organizational form is a critical determinant of the effectiveness of collective learning. This is the main reason why business teams are unable to emulate the successful learning that occurs in elite‐level sports teams. The research shows that the hierarchical structure of most business organizations constrains the development of the social capital necessary for sustained learning and knowledge construction.

The primary implication of the research findings is that business leaders need to view their role as that of creating and managing a social environment in which mission‐pertinent learning and knowledge construction activities are nurtured. In practice, it means that the nature of business leadership and, in particular, power management practices in business organizations needs to be questioned and re‐conceptualized.Originality/valueUsing social capital theory as a framework for the analysis of this phenomenon is new. The article should be valuable to the leader of any organization that is attempting to sustain superior competitive performance in the global knowledge economy.