Nonaka: A Dynamic Theory of Organizational Knowledge Creation
“Tacit knowledge is a continuous activity of knowing and embodies what Bateson (1973) has referred to as an “analogue” quality. In this context, communication between individuals may be seen as an analogue process that aims to share tacit knowledge to build mutual understanding. This understanding involves a kind of “parallel processing” of the complexities of current issues, as the different dimensions of a problem arc processed simultaneously. By contrast, explicit knowl- edge is discrete or “digital.” It is captured in records of the past such as libraries, archives, and databases and is assessed on a sequential basis.” (p. 17).
“The core feature of the hypertext organization is the ability to switch between the various “contexts” of knowledge creation to accommodate changing require- ments from situations both inside and outside the organization. Within the process of organizational knowledge creation, it is possible to distinguish several “contexts” of knowledge creation such as the acquisi- tion, generation, exploitation, and accumulation of knowledge. Each context has a distinctive way of orga- nizing its knowledge creation activities. Nonhierarchi- cal, or “heterarchical” self-organizing activities of teams are indispensable to generate new knowledge as well as to acquire “deep” knowledge through intensive, focused search. On the other hand, a hierarchical division of labor is more efficient and effective for implementation, exploitation, and accumulation of new knowledge as well as acquisition of various information through extensive, unfocused search.”(p. 32)
“The image of the hypertext organization is illustrated in Figure 4. It can be visualized as a multilayered organization comprised of three layers; knowledge- base, business-system, and project team. At the bottom is the “knowledge-base” layer which embraces tacit knowledge, associated with organizational culture and procedures, as well as explicit knowledge in the form of documents, filing systems, computerized databases, ete. The function of this archival layer may be seen in terms of a “corporate university.” The second layer is the “business-system” layer where normal routine op- eration is carried out by a formal, hierarchical, bureau- cratic organization. The top layer relates to the area where multiple self-organizing project teams create knowledge. These teams are loosely linked to each other and share in the “joint creation of knowledge” using “corporate vision.” Thus the hypertext organiza- tion takes different “forms,” depending on the per- spective from which it is observed.
The process of organizational knowledge creation is conceptualized as a dynamic cycle of knowledge and information traversing the three layers. Members of project teams on the top layer are selected from di- verse functions and departments across the business- system layer. Based on the corporate vision presented by top management, they engage in knowledge creating activities interacting with other project teams. Once the task of a team is completed, members move “down” to the knowledge-base layer at the bottom and make an “inventory” of the knowledge acquired and created in the project. After categorizing, documenting, and indexing the new knowledge, they come back to upper business-system layer and engage in routine operation until they are called again for another project. A key design requirement in the hypertext organization is to form such a circular movement of organization mem- bers, who are the fundamental source and subject of organizational knowledge creation. Erom the vantage point of strategic management, the true “core compe- tence” (Prahalad and Hamel 1990) of the organization, which produces sustainable competitive advantage, lies in its management capability to create relevant organi- zational knowledge (Nonaka 1989, 1991). This is a continuous process and the ability to switch swiftly and flexibly between the three layers in the hypertext orga- nization is critical to its success.” (p. 33)
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