Knowledge Management

1. Knowledge is defined as justified true belief. Why knowledge created in organization is defined as justified true belief referring to the process of knowledge creation in organization.

To answer why Knowledge is defined as justified true belief, we need to analyze how is the process of knowledge creation in organization at first.

Based on the SECI model of knowledge creation, the process of knowledge creation in organization including four phases.

The first phase is socialization which means Sharing and creating tacit knowledge through direct experience. It includes four parts. First, capturing tacit knowledge through direct experience (e.g. interaction with suppliers or customers). In the IDEO case, they kept clients involved and learned from their clients by assimilating the things clients did well into their own methodology. Second, by walking around inside the company, knowledge or the latest available information was collected or acquired. In the 7-11 case, through POS data and Tanpin Kanri, 7-11 obtained the latest information of inventory and sell order data, they make the reasonable decision on these valuable information and knowledge. Third, accumulating and systemizing tacit knowledge by and sharing between individuals. In IEDO and 7-11, they both create an environment for knowledge sharing. IEDO use brainstorming and 7-11 use “Box Lunch Corner” to encourage employees to show their ideas. Last, interpreting tacit knowledge by transferring one’s ideas or images directly to colleagues or subordinates. Experience these four steps, the tacit knowledge was created and transferred through individuals.

The second phase is externalization which means articulating tacit knowledge through communication and reflection. It includes two parts. First, articulating tacit knowledge which means express ideas or images in words, concepts, or forms by dialogue, using deductive/inductive and abductive methods (e.g. metaphor/analogy/prototype). In IDEO’s product development process, the Phase I, they visualize and realize the creating process through a gallery of envisioned characters. Second, translating tacit knowledge to explicit knowledge which means interpreting tacit knowledge of customers or experts into readily understandable form. Like at the end of IDEO Phase I, they would have rough three-dimensional models of a product by coordination with the client.

The third phase is combination which means systemizing and applying explicit knowledge and information into practice. It contains three major parts. First, collecting externalized knowledge (e.g. public data) from inside/outside the company and systemizing them. Second, transferring explicit knowledge directly by using presentations or meetings. Third, editing or processing explicit knowledge to make it more usable (e.g. documents such as plans, reports, market data and so on.) In the 7-11 Danpin Kanri management pratice, they encourage the employees to observe the customers to know the customers behaviors which influence in-store purchase decisions as well as three major factors including time, retail context and weather information to improve Kanri. They also systemized their management strategy through practice by POS data analysis.

The four phase is internalization which means learning and acquiring new tacit knowledge in practice. It contains two major parts. First, internalizing explicit knowledge (e.g. on-the-job training) to actualize concepts or methods about strategy, tactics, innovation, or improvements.

Second, learning new concepts or methods in simulation. In IDEO, they emphasize think

different, through the first three phase, they created their knowledge which was verified by the

practice. But they are not satisfied with this, they absorbed the new knowledge and internalized

them into their wisdom. And they continue to devote themselves in the innovation by simulation.

Above all, knowledge is not a textbook or an empty slogan, it is justified true belief verified by

the reality and practice. In other words, it is wisdom from practice. Through the SECI model,

we can see clearly where it is created and how it is justified. That’s why we think knowledge is  

justified true belief.

1. Please describe how knowledge will contribute to the sustainable growth of organization referring to the four core activities constituting knowledge management.

The four core activities constituting knowledge management including creating, sharing, protecting and discarding.

In the creating part, we need to make the tacit knowledge explicit, so we have to create it through the SECI model(analyzed above), we need Pronesis to create Ba, in the Ba, new knowledge is created and it need to be justified through the SECI model, and finally we get justified true belief through knowledge creating. We can see there is sustainable cycle or spiral. Through this spiral, the new knowledge is created and justified, the tacit transfer to explicit and become new tacit again. It would bring sustainable growth. In Toray(my team’s analysis case), we see this cycle very clear which ensure Toray’s innovation.

In the sharing part, e.g. Toray, it create a new department called Life innovation Dep. Which integrate three different department and focus on sharing without boundaries. This high level knowledge sharing from different department and different group ensure Toray’s innovative strategy and bring the core technology innovation and sustainable growth of Toray.

In the protecting part, the knowledge itself and the talents who create the knowledge need be protected. Especially in the high-tech company like Toyota or Toray, its core competitiveness is core technology, so how to protect its core tech and how to retain the most talent people like engineer is crucial. Knowledge like pronesis or wise leadership is the key to solve this problem. The wise leader like Honda and Steve Jobs, they use their wise leadership to attract the most talent people together and to create new knowledge continuously. Eventually, it also bring sustainable growth.

In the discarding part, I’d like to use Nespresso as an example. From the SECI spiral, we know that knowledge need renew and recreate through this cycle. Nespresso System is a production innovation against the odds. With the distinctive brand and luxury image, Nespresso represented a major departure from most Nestle’s products. In my understanding, it is knowledge discarding. Though Nestle won big success use its old strategy like large-scale production and mass marketing, but it is not applicable for Nespresso at that time. So focus on its own situation and discard the odds is the key for knowledge innovation and sustainable growth.