Managing Knowledge in an organizational context
An organization is a legal entity with resources and capabilities, with a permeable boundary. What is a company in terms of knowledge though: a processor (Cohendet et al) or repository (Fransman) or a system of interpretation (Daft and Weick)? GRant argues about resources and capabilities in this respect: resources are the source of a firm’s capabilities, capabilities are the main source of competitive advantage.
Carlisle believes that knowledge is what adds value to resources, hence you don’t only work towards cost efficiencies and differentiation but you should look to enable human interaction and facilitate processes.
Looking at the process Palanyi said: “We know more than we can tell.” and sometimes more than we are willing to tell. Brown and Duguid believe you have to integrate individual, community-of-practice and organizational knowledge. Conversations are an important part helping in that integration. Communities-of-practice are our social learning systems (Wenger), an informal group with shared interests, beliefs and a value system but without a formal organization members belong to.
As CoPs are informal and diverse, they provide an amazing ecosystem of knowledge or expertise that the company can tab into if it knows about it. They are very susceptible to group think though so you might want to foster the enquiring mind, develop a sense of belonging to help people disagree, and put an emphasis on double loop learning. You also need critical mass and could make good use of artifacts, learning projects, connectivity, … .
Knowledge-Sharing Culture
If for knowledge to grow you need interaction and sharing, the culture should fit that idea. Procedural justice is one term that has come up to describe the perceived fairness in decisions which is needed for that. The other important item is that people have to see knowledge sharing as a two way street. Procedural justice can be broken down to:
\- Engagement
\- Explanations
\- Expectations
Organizational Learning
CoPs share and create knowledge, giving it from expert to novice, but does that mean the organization learns? The learning curve for example does seem to apply to products too in that the cost of production will go down over time in a relatively predictable way. Training and R&D are other things that are considered as learning. So in a sense we can be reasonably sure that there will be more learning along the way, with the rate of new learning increasing over time.
There are innovation inhibitors too. In an efficient industry for example, innovation often might violate existing routines and hence make you temporarily less efficient. Short term financial focus has the same result, leading to worse long-term results and then more short-term profit focus, … moving into a downward spiral. It is also hard to put a real value to learning as benefits are coming at an uncertain time in the future.
The learning organization is a broad term to describe an idea. Peter Senge (Fifth Discipline) is one of the biggest supporters of the idea. He sees five disciplines to drive learning in the right direction:
\- Systems thinking
\- Mental models
\- Shared vision
\- Team learning
\- Personal mastery
Knowledge “Capture” in organizations
One way to capture knowledge inside an organization is through processes. There are different kinds of ways to do that:
\- Embrained (double-loop learning, internalized and hard to share)
\- Embodied (depends on physical presence)
\- Encultured (Shared understanding)
\- Embedded (In systemic routines)
\- Encoded (By signs and symbols)
Blackler (95) derived 4 organizations from this with the encoded knowledge is ahred by all:
\- Expert dependent organizations rely on embodied knowledge with the focus being on the individual.
\- Knowledge routinized organization rely on embedded knowledge, putting the focus more on the rules, procedures and technology.
\- The literature talks about a shift towards communication-intensive companies focussing on encultured knowledge, a collective understanding.
\- More individual is the symbolic-analyst-dependent organization focussing on embrained knowledge, mainly used in knowledge intensive work.
This brings us to the idea of organizational memory, because at least embrained and embodied knowledge is hard to keep if employees leave. Letting middle management go is something that has often been said to be bad for loosing exactly that knowledge. It is therefore important to make sure that as much knowledge is made explicit or objectified, if you cannot keep your people for sure. In Blackler’s theory mostly embedded and encoded knowledge is being objectified.
Walsh and Ungson identified six sources of organizational memory: culture, transformation, structures, ecology, external archives and individuals.
Cohen and Levinthal (1990) integrated recognizing, sharing and assimilating knowledge to the term: absorptive capacity of a company. A big part here is to re-thing, unlearn, … . Relevant previous knowledge is also important.
J.C. Spender: Epistemology
Knowledge is by now seen as central to understand a company and there are a lot of different ways to know things and some are only known collectively. Some see knowledge as highly problematic and objectifiable, as a resource to be managed, capturable to become information and hence a managable commodity. But:
knowledge cannot be consumed through use
It is not easily managed
Tacit skills and collective competencies are sometimes invisible until missed
The value of explicit knowledge depends on changing context which is largely not possible to be anticipate.
Another view is that knowledge is highly problematic, involving intuition, emotions and more. The idea is related to Simon’s bounded rationality, in that we have limited information and look for the best compromise out there. He argues that all learning takes place in people’s heads. This means that Simon stops where Spender takes a closer look. Epistemological pluralism means we know things in different ways and looking at companies, they try to solve uncertainty with collective knowledge. This knowledge is not linked to anything specific but rather all encompassing, a form of reference: “The way things are done around here” is a saying that shows this. Epistemology can be seen as the theory of how we know things. Taylor for example argued that management needs to find relevant knowledge and re-package it as “best practice”.
Schumpeter looked at “gales of creative destruction” which are similar but more encompassing than the idea of disruptive technologies. Schumpeter then put the power in the larger firms due to their big R&D departments but Spender believes that he would now say that the smaller firms have a bigger advantage in todays changing environment.
Spender believes the firm exists to integrate and co-ordinate different knowledge. We have component knowledge and integrative knowledge with the second more on the side of the firm. The concept of a community of practice is a powerful one in this case.
Nonaka’s Framework: ba
The Japanese use a more “steady state” system of knowledge, with things happening from within the firm. Employer and employee are committed which is where the continuous technological improvement comes from. Hence Nonaka does not look so much at codifying tacit knowledge but at integration all of the knowledge available to the firm, the context of knowledge creation: ba.
Trust can be a knowledge asseet, an input to the process, essential as an ingredient and an output of working together. Ba doesn’t have a real english equivalent as it is linked to the closed way Japanese companies work. Communities of practice outside of the firm are hard to be envisioned in a Japanese company.
In Western countries you focus more on the individual, labour mobility and explicit knowledge of the individual. Nonaka and Takeuchi use the SECI model: Socialization, Externalization, Combination, Internalization. All this is part of a spiraling process.
Socialization: The key to acquiring tacit knowledge is through experience. You learn with more than using language and work with the master. You need a shared experience.
Externalization: From tacit to explicit. This can happen through metaphors, analogies, … . The writing down of new knowledge shows gaps between tacit knowledge and explicit concepts. The potential wealth of figurative language helps to elicit tacit knowledge from a team. This part is central to knowledge creation as it creates new explicit concepts. Metaphor — -(harmonizes contradictions) — -> analogy (bridges the gap between image and language model) → model.
Combination: from explicit to explicit. MBAs are a good example here, as a lot of new knowledge is created through combination of different concepts.
Internalization: from explicit to implicit. This again is learning by doing part and if socialized starts a new spiral. Documentation of e.g. customer calls is important here because it provides the means for others to re-experience.
In Japan promotions happen by age. Those higher up give vague visions to show that they believe their subordinates will implement the preferred option. They will also look out for their interest though.
Arguably Nonaka’s idea goes against the belief that tacit knowledge cannot be made explicit. It seems to be more the case that Japanese companies are “social containers” making explicit knowledge less needed because it exists in an implicit pool. Due to the long relationship focus in Japan this knowledge can become shared.
Face-to-Face, socialization happens as the originating ba.
Peer-to-Peer, externalization through reflection happens as the interacting ba.
Group-to-Group, combination happens as the caber ba.
On-the-site, internalization happens as the exercising ba.
Cook and Brown on knowledge and knowing in an organization
Knowledge is possessed (see Blackler) but knowing is a process, with knowledge being a tool. A violin player knows how to play at all times but playing might tab into other pools of knowledge as knowing also includes how to handle your nerves.