Article Summary: A Dynamic Theory of Organizational Knowledge Creation

Nonaka begins by pointing out that the traditional approach to knowledge in organizations focuses on knowledge processing. He argues that for organizations to thrive, they cannot be simply processors of knowledge, but must become creators of knowledge. He then focuses the remainder of the article on knowledge creation in organizations. The objective of this paper is to develop the essential elements of a theory of organizational knowledge creation.

Based on definition by Nonaka, he uses a traditional definition of knowledge as justified true belief. Important here is that knowledge is always, in this sense personal in the sense that it is person specific. Information is belief neutral data. When information is incorporated into a belief system, it then becomes knowledge. If I understand Nonaka correctly, what he is trying to say is that information is different from knowledge in that it is not yet justified, in other words, it has not yet been validated within the personal belief system of the individual, it is not yet true, since it has not yet been tested within that system, and it is not yet belief, since it is not yet accompanied by conviction or commitment.

Generally, the difference between knowledge and information is that information is a flow of messages, while knowledge is created and organized flow of information, anchored on the commitment and beliefs of its holder. By this definition, knowledge is related to human actions. Information can be viewed as a syntactic aspect or volume of information rather than the content. Knowledge is more relevant to a semantic aspect or conveyed meaning.

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Knowledge creation consists of two dimensions: explicit knowledge, declarative knowledge, or codified knowledge; and tacit knowledge, procedural knowledge, or knowledge that is hard to formalize or communicate or involves in a specific context. Individual members of an organization drive organizational knowledge creation.

Nonaka stated that; in this study there have three important factors influencing the formation of new knowledge which are intention, autonomy, and a certain level of environmental fluctuation. Intentionality, in this schema, is the ultimate purpose of the thought/value system. Following Husserl, Nonaka rejects pure consciousness and claims that all consciousness is commitment bound by what he describes as the manifest purpose or problem consciousness of a thought system. The bottom line is, all thought schema tend toward action in support of a goal. This tendency can be described as intentionality. Autonomy is the capability of self-organization. This capability is essential for knowledge creation in organizational settings as well. Where it is absent, knowledge creation does not occur or never becomes wedded with intentionality. Environmental fluctuation also becomes essential to knowledge creation since most creation occurs in chaotic environments. That is, only when fundamental commitments are challenged through previously unaccounted for fluctuations can old thought paradigms be questioned and new thought paradigms be constructed. Old commitments must be undermined before new commitments can be made.

After reviewing this article, there are four modes (SECI modes) of knowledge conversion, it consist (1) from tacit to tacit knowledge; (2) from explicit to explicit knowledge; (3) from tacit to explicit knowledge; and (4) from explicit to tacit knowledge. From tacit to tacit knowledge mode is called socialization. To acquire tacit knowledge is learning from experience, observation, imitation,

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and practice. Examples of mechanisms to trigger the explicit to explicit mode or combination are meetings and telephone conversations, which combine different explicit knowledge held by individuals. The tacit to explicit knowledge mode or externalization is processed by using metaphor to reveal hidden tacit knowledge that is hard to communicate, while action, trial-and-error experimentation, or learning by doing is related to the explicit to tacit knowledge or internalization. Organizational knowledge creation takes place when all four modes are organizationally managed to form a continual cycle.

In this study, Nonaka makes a big deal of the importance of metaphor in knowledge creation. Following Polanyi, he posits that tacit knowledge is incapable of reduction and often can only be expressed in metaphor. Metaphor differs from analogy in that metaphor is vaguer, less precise. It focuses on macro continuity and overlap and does not seek a point by point correspondence between two thought systems. It is often more symbolic than descriptive and intentionally so.

In that sense it serves as an important intermediary step between discontinuity and analogy. Metaphor is an important instrument for moving from tacit to explicit knowledge. It allows for the comparison and adjustment of personal thought systems toward a shared understanding. I thought this had particular importance for the process of cross-cultural learning. Cultures represent two very distinct commitment systems. They are embedded and tendentious. Metaphor is an important tool, then, for moving between cultures. Infusing symbolic transitional values with meaning allows for fluid movement between paradigms and ultimately facilitates they type of analogous thinking that is required for the incorporation of knowledge from one thought system into another.

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There are five organizational knowledge creation processes: enlarging individual knowledge, sharing tacit knowledge, crystallization, justification, and networking knowledge. Individual knowledge can be enlarged if the individual has various and in-dept knowledge. The knowledge remains personal until it is shared to others. Mutual trust among individuals in a group is formed through shared experience. The knowledge created in an interaction of group members is crystallized into some concrete forms such as a product or a system by experiments. The quality of gained knowledge is justified if it is truly worthwhile to set up a criteria or standard for the organization. The new knowledge must be disseminated across the organization in order for it to become seated in the culture of the organization. Access to new knowledge must be quick and widespread by using networking system.

Summarily, the knowledge creation knowledge starts from combination to socialization, internalization, and externalization modes. Based on this study, two management models are proposed: middle-up-down management and a hypertext organization. In the middle-up-down model, all members are important actors because a major characteristic of the model regarding to knowledge creation is the wide scope of cooperative relationships among top, middle and lower managers.

In addition, the major role of middle managers is to synthesize the tacit knowledge of both employees and top management to explicit knowledge. In hypertext organization, knowledge creation is more effective and efficient with an ability of employees to acquire, create, exploit, and accumulate new knowledge continuously and repeatedly in a circular process similar to a concept of hypertext in the Internet world.

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In conclusion, this study emphasized that knowledge in several aspects which are information versus knowledge definitions, syntactic versus semantic views, explicit versus tacit views, knowledge conversion modes, knowledge creation processes, and new perspectives of organizational knowledge. Due to rich details and definition of organizational knowledge creation, this paper provides a primary look of the IS knowledge management domain. Subsequent articles employ insights from this article as theoretical resources in following works.

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