The Wise Leader

-Communitarian Theory of Sustainable Innovation

Ikujiro Nonaka
Professor Emeritus, Hitotsubashi University Xerox Distinguished Faculty Scholar, UC Berkeley The First Distinguished Drucker Scholar, Claremont Graduate University Chairman, Economic Research Center, FRI

August 30, 2012

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Knowledge-based View of Strategic Leadership

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Drucker: We Need Innovation, and We Need a New Theory
 “Knowledge is the only meaningful resource today.”  “How knowledge behaves as an economic resource, we do not yet fully understand […]  We need an economic theory that puts knowledge into the center of the wealth-producing process. It alone can explain innovation.”
P. F. Drucker. (1993) “Post Capitalist Society” p.183

P.F. Drucker

(1993)
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I.  An essential feature of innovation that it is something that is carried into practice. or method of production. or financial organization. 2012 . new form of commercial.  A new product. 4 Copyright.  Mutation: Innovation incessantly revolutionizes the economic structure from within. Nonaka. business.  No dynamic equilibrium exists and innovation is essentially a disturbance of the existing static equilibrium. a new market or source of supply. process.Schumpeter’s “Innovation” The Theory of Economic Development (1912)  Creative Destruction: Innovation is merely the destruction of an equilibrium.  New Combinations: Innovation is a commercial or industrial application of something new.

R. Stanford. F. CA: Hoover Press.Nishiyama.). I. C. Leube (Eds. The Essence of Hayek. Nonaka.A.A.). 5 Copyright. Hayek  Importance of context-specific knowledge …there is beyond question a body of very important but unorganized knowledge which cannot possibly be called scientific in the sense of knowledge of general rules: the knowledge of the particular circumstances of time and space (p. Leube (Eds. 2012 . K.  Competition as a discovery procedure Economist usually ascribe the order which competition produces as equilibrium – a somewhat unfortunate term. In C. Competition as a discovery procedure. (1978).Knowledge Needs to be Discovered H. Stanford.R. CA: Hoover Press. F. In “The essence of Hayek”. Use of Knowledge in Society.A. Source:Hayek.259). because such an equilibrium presupposes that the facts have already all been discovered and competition therefore has ceased (p.Nishiyama and K. Heyek.214). The Essence of Hayek.

 “Present” is a state which stand on the “past” and is opened to the “future”. 6 Copyright. particular and concrete events. Nonaka. I.Process Philosophy of Whitehead “Process is Reality”  There is no such thing as substance.  “Substance” is the state of a “noun”.  World is made up of occasions. cut from the continuum of “events” in the state of a “verb”. Process towards creativity  It is the becoming rather than being. 2012 .  Events flows in relationship with other various events.

Propositions of The Knowledge-Creating Company and Managing Flow A firm is a knowledge creating entity (1995). Nonaka. I. A firm is a relentless process of converting knowledge to wisdom (2008) A firm is a prudent community for sustainable innovation (2012) 7 Copyright. 2012 .

8 Copyright.” Knowledge is: A dynamic social process of justifying personal belief towards the truth. 2012 .Strategy is About Creating the Future The most significant characteristics of knowledge is that “Knowledge is created by people in their interactions with each other and the environment. Strategy is an intelligent capability to interpret the current situation and continuously create future in the social context. Innovation itself is a knowledge creating process. Nonaka. I.

Leading Business Creating Model of Sustainable Innovation Pursuance for Common Good Vision -Common Good Existential Value Proposition Institutional Net work with Partner (re-source) Knowledge creation (SECI) Ba-plattforming Net work with Community (customer) Organizational Cost Financial Profit 9 Market Value .

Value Proposition .

Apple Not a thing (mono). easy to carry. I. easy to manage. 2012 . but an event (koto) Not iPod. and take video/photo) 11 Copyright. but multimedia experience (easy to download. view. Nonaka.An Organization has to Offer a Unique Value . can listen.

C. 2012 . Nonaka.Business Model of iPod Organization al Base Hardware Software Development Contents Production Hardware Production Product・ Software Design Offering Lifestyle Brand Customer iPod Apple Store Dealer Network iTunes e-Commerce Copyright Management of Multimedia Multimedia Download High-end Customer Brand Management Hardware Sales Contents Delivery Contents Music Anywhere Profit Cost Structure Source: De Kluyver. (2009) 12 Revenues from Hardware Revenues from Multimedia Copyright. I.A.

 One phenomenon appears out of combining multiple factors. T.D. Y. Chikuma Gakugei Bunko.  Marx perceived a commodity as not a visible thing but a social relationship between capitalists exploiting workers. Tokyo. Source: Based on Maki.40 13 Copyright. 2012 . See the phenomena not by itself.Oxford. Nonaka. Source: Harvey.(2010) The Enigma of Capital and the Crisis of Capitalism. Source: Based on Kariya. I.P. Fukuganteki shikouhou (Think multifaceted ).” Search for a subject that caused XX. (2003). but see as “XX-zation. By so doing.  Commodity (Mono) is one form of a social relationship. Tokyo. Koudansha. Kiryu no naru oto (Sound of air current).  Capital is not a thing but a process in which money is perpetually sent in search of more money. (1996).Methodology for Transforming a Thing (Mono) to an Event (Koto)  Event (Koto) starts from changing noun to verb.” “a process to become XX. he captured reality as not a fixed object but as an active subject.

Nonaka. I.SECI Model 14 Copyright. 2012 .

I. Nonaka.Plato (left) & Aristotle (right) School of Athens: Raphael 15 Copyright. 2012 .

Wisdom is embedded in practice. a contradiction?  Plato: Wisdom is theoretical. 2011 .  Truth is. Practical Wisdom. and take the right action. & Sharpe.Attention to Practical Wisdom is Increasing Synthesis of Idealism and Pragmatism  Practical Wisdom. (2010) Source: Schwartz. (2010). only practical wisdom can solve daily issues. B.  Aristotle: Wisdom is to make judgment in everyday life with deliberation and emotion. abstract and for the few elites. K. New York: NY. I. Riverhead Books. it has nothing to do with practice. 16 Copyright Nonaka.

and art and science. 17 17 Copyright. I. All knowledge is either tacit or rooted in tacit knowledge. scientific. . and explicit knowledge as the knowledge. we need to restore the perspective on knowledge which will balance belief and rational. 2012 Copyright 2012 Nonaka. – M. Augustine Belief precedes knowing. Nonaka.Why Tacit Knowledge? We can know more than we can tell. – St. I. To free ourselves from the prejudice of considering only objective. by admitting that “knowing” requires the commitment of the individual. Polanyi Unless you believe. you will not understand.

sentences. numbers. sentences. . or formulas (context-specific) Cognitive Skills beliefs images perspectives mental models Explicit Knowledge Objective and rational knowledge that can be expressed in words. I. or formulas (context-free) Theoretical approach Problem-solving Manuals Database Technical Skills craft.Two Dimensions of Knowledge Tacit Knowledge Subjective and experiential knowledge that can not be expressed in words. know-how Spiral up through dynamic interaction Analog-Digital Synthesis 18 18 Copyright. numbers. 2012 Copyright 2012 Nonaka. Nonaka. I.

Explicit Explicit I = Individual. Perceiving reality as it is from activities 2. Konno 19 . recognizing and foreseeing 3. Creating relationship and hypothesis among concepts. modeling. Communicating and sharing explicit knowledge 8. prototyping 7. Empathizing. E = Environment Ⓒ Nonaka I. Contemplation in action Internalization Tacit G I E O Combination Explicit E G G Org. Transferring tacit knowledge Individual I Learning and acquiring new tacit knowledge in practice (Practicing) 9. resonating.. Takeuchi & N. G = Group. O = Organization. H. Editing and systemizing explicit knowledge Copyright 2012 Nonaka.Organizational Knowledge Creation Process SECI Model Sharing and creating tacit knowledge through direct experience (Empathizing) Socialization Tacit Environment I Externalization Explicit E I O I I Group I I Articulating tacit knowledge through dialogue and reflection (Conceptualizing) 4. I. Articulating tacit knowledge using symbolic language 5. G G Systemizing and applying explicit knowledge and information (Modeling) 6. hypothesis testing and reflection 10. Embodying explicit knowledge through experimenting. Translating tacit knowledge into a concept or prototype 1.

software. products. at the same time. and embody the knowledge (Internalization) and. create value in the form of technology.Innovation as SECI Spiral Empathize with reality through actual experience (Socialization). services and experiences.I. stimulate the emergence of new knowledge in the organization. a firm can build its synthesizing capability of knowledge to pursue both creativity and efficiency. market and environment. Copyright. Nonaka. condense the essence of awareness into concepts (Externalization). Through continuous and fast spinning of the SECI spiral. 2012 2012 . and spiral up to the Socialization step. I. relate the concepts and systemize (Combination). 20 20 Copyright Nonaka.

I. 2012 . Nonaka.Ba -Platforming for Knowledge Emergence- 21 Copyright.

Nonaka. 22 22 Copyright. then it becomes our subjectivity. Shared context becomes the base of emerging knowledge. 2012 2012 Copyright Nonaka. . Intersubjectivity is established when people accept others as a whole being. I.I.Knowledge is Created in Ba Shared Context in Motion Co-Creating Meaning Open Close Intersubjectivity Ba(Platforming) Close Open Individual contexts are shared at “here now” context of Ba. resonate and empathize with others.

and the view in front. (2012) . angle of the body and the bicycle. Analytic Thinking Break the whole into parts. The Power of Tacit Knowing When on a bicycle. partial action can be taken. Nonaka. I. I. Holistic Thinking The whole is unified and coordinated by fluctuations and functions of the parts. we can instantly synthesize the handlebars. response of the muscle. 2012 Copyright Nonaka. when a part is affected. 23 23 Copyright. force on the pedals.Humans Create Meaning in Ba Essence of Analog Thinking  Meaning resides in the whole: Digital thinking diminishes the meaning.

Tacit Knowing: From Particular to Comprehensive Entity
Michael Polanyi
A process of changing perspective from the lower particular to the upper whole. A whole can become the part. A whole is determined by the purpose.

Greece in EU

The Parthenon

Greek Crisis

Crocus at the Parthenon
Anti-Government Demonstration Greek Culture Greek Philosophy

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Ba Promotes Socialization
Through Physical and Mental Touching
 Interpenetration of the body senses: Intercorporeality (Merleau-Ponty)  Embodied Mind (Francisco Valera)  Socialization occurs in the brain by copying the actions of others: discovery of the mirror-neurons. Through mirror neurons, we can understand the intentions of others…The interdependence between self and other that mirror neurons allow shapes the social interactions between people, where the concrete encounter between self and other becomes the shared existential meaning that connects deeply. (Iacoboni, et
al:2005, Rizzolatti:2005)
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Boundary Object
Ba for Connecting Ba
A boundary object is a symbol, metaphor, concept, organization, system, culture, and ICT, that resides in the boundary of different communities or systems; it is an object that connects communities by creating a new community.
community community

Boundary Object
community community community community

Source: Nonaka, I. and Konno, N. (Forthcoming). Kenryo no keiei (Prudence-based Management)
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2012 2012 Copyright Nonaka.Knowledge Ecosystem Organic Configuration of Ba Knowledge is created in relationships. I. . collaborate and transcend the organizational boundaries.I. Knowledge ecosystem dynamically interacts and evolves the relationships between the stakeholders in the multi-layers of ba. stakeholders compete. Nonaka. Customer Firms Universities Government Ba Ba Supplier Firms Community Ba Firm 27 27 Competitor Copyright.

Phronetic Leadership -Prudence /Practical Wisdom- 28 Copyright. 2012 . I. Nonaka.

2011 Nonaka.. Diamond Harvard Business Review. & Takeuchi.. Nonaka. May.. 2011 29 Nonaka. The Wise Leader. 2012 . & Konno. (2011). I. & Takeuchi.Wise Leader See Through the Context and Realize the Value Source: Nonaka. N. H. (2011). I.. H. I. I. Sep. 2012 Copyright. I. (2007). Kenryo no Leader [Wise Leader]. NTT Shuppan. Harvard Business Review. Bitoku no Keiei [Virtue-based Management]. Copyright Nonaka.

Phronesis by Aristotle Prudence. .  Ability to find the right response in a particular context  Ability to synthesize the particular and universal. I. 2012 2012 Copyright Nonaka. contemplated rationale and improvisation on the spot  Contemplation in action  Contextual judgment and timely balancing 30 30 Copyright.I. Nonaka. Practical Wisdom Phronesis is practical wisdom for exercising the best judgment for the common good in a particular context.

4. 2012 . 2. Nonaka. 6. 5. Source: Nonaka & Takeuchi. Ability to articulate the essence. Ability to foster phronesis in others. 1. HBR May 2011 31 3. Ability to see the reality as it is. Ability to exercise political power. Ability to make judgment on goodness. Copyright. Ability to create ba.Six Abilities of Phronesis Phronesis is a virtuous habit of making judgments and taking actions that serve the common good. I.

Phronetic Leaders: Soichiro Honda. I. Nonaka. Steve Jobs. 2012 . and Konosuke Matsushita  Soichiro Honda (1906-1991) Founder of Honda Motor Corporation  Steve Jobs (1955-2011) Co-founder of Apple Computer 32 Copyright.

seems to seek some good. Nicomachean Ethics Example: Self-sufficient values such as happiness and self-actualization. I. 2012 . Aristotle. MacIntyre 33 Copyright. Nonaka. Internal Good: Realized in the course of trying to achieve those standards of excellence (artisanship). Ability to make a judgment on goodness Every sort of expert knowledge and every inquiry. and similarly every action and undertaking.Phronetic Leadership 1.

that is the source of creativity. 2012 . (Rescher. Stanford University Press. Human interests: Reflections on philosophical anthropology. 1990) Rescher. (1990). I. Nonaka. we can go beyond our limits.Humans are Purposeful Beings Optimal results are claimed to be attainable only by trying for too much – by reaching beyond the limits of the possible. but because we challenge to achieve. Palo Alto: CA. N. Humans are living the worlds of the reality and the possibility. What motivate us is the wish and will for the ideal. Ideal can never be achieved. 34 Copyright.

Technology Married with Liberal Arts and Humanity: Steve Jobs Apple’s DNA: “Technology alone is not enough. Nonaka. It’s technology married with the liberal arts. Apple 35 Copyright. 2012 .” Steve Jobs. I. that yields the results that makes our hearts sing. married with the humanities.

philosophy without action is meaningless. ‘The good theory’ is the necessary premise for working hard. Nonaka. but the buyer who will be using the product in daily basis […]” Source: Honda Top Talks “Passing down the basics” 36 Copyright. The person who knows the value of the product and gives final evaluation is not the manufacturer or the dealer.” “Joy of buying determines the value of the product in a most fair way.Need for a Good Theory: Soichiro Honda Respect for Sound Theory: “Action without philosophy is a lethal weapon.” “Just to be hard working has no value. I. 2012 .

2012 . and to elicit empathy in return. Ability to create ba Imaginative capacity to understand and empathize with others through daily verbal and nonverbal communication. Nonaka. I. 37 Copyright. to read the situation to judge the best timing for interaction.Phronetic Leadership 2.

It exists only for that particular moment. Nonaka.. to joke is to understand human emotion. 2012 . You have to grasp the atmosphere of the occasion and the opportunity. and not anywhere else.” Soichiro Honda 38 Copyright. I.Joking is Difficult Soichiro Honda “Joking is very difficult. The joke is in the timing and it doesn’t work at any other moment ..

• Thorough discussions lead to conflicts but there is no escape. understand the beliefs of others. I. • As time passes. • Accept the opinions of others. frustrations and conflicts. Day 3: Leap of the minds • With constructive thinking. a leap of the minds and concepts happen. 2012 . superficial explicit knowledge runs out and individual barriers disappear. Nonaka. good spa) away from the daily work environment. good food. Day 1: Conflict between the individuals • Start with “bad mouthing” the boss. 39 Copyright. Day 2: Mutual understanding and acceptance • Accept the differences.“Waigaya” at Honda  The company prepares the ba (good hotel.

He has these movie-star eyes that are very hypnotic. Nonaka. P. He looks directly in your eyes with that laser-like stare.28. But what really gets you is the way he talks – there’s something about the rhythm of his speech and the incredible enthusiasm he conveys for whatever it is he’s talking about that is just infectious. I. 2012 . 40 Copyright.Magnetic Pull Steve Jobs He uses your first name very often. Source: Gallo. The Presentation Secrets of Steve Jobs: How to Be Insanely Great in Front of Any Audience. C. McGraw-Hill Professional. (2009).

Phronetic Leadership 3. 41 Copyright. 2012 . I. Nonaka. Ability to see the reality as it is. The ability to recognize the constantly changing situation correctly. God is in the details. and quickly sense what lies behind phenomena to envision the future and decide on the action to be taken.

htm Picture: Honda Motors Corporation Soichiro: Use all five senses to sharpen the common sense. . it will strengthen the power of imagination and judgment.businessweek.com/ss/09/09/0929_jobs_presentations/index.Grasp the Essence from the Actual Situations http://images.

I. 2012 .g. Nonaka. with the five senses and through empathy with others.g. Actuality (Koto) Action: a situation in progress. situated experience. Can only be grasped by those committed to and dwelling in The actual.. put apparent preconditions into bracket and directly sense actuality (“epoché” phenomenological suspension of judging reality). verb). 43 Copyright.  To convert “mono” term (e. noun) to “koto” term (e.. Can be recognized and Managed by logic.Reality and Actuality Reality (Mono) Substance: an existing object That could be observed.

Phronetic Leadership 4. I. 2012 . Ability to articulate the essence The ability to conceptualize and articulate subjective ideas in a clear language. 44 Copyright. Nonaka. link these ‘micro’ concepts to a macro historical context. and convincingly articulate them as vision and story for the future.

businessweek.htm Source: Honda Motor Company 45 Copyright.Harmonize the Concepts in Ba /Make Full Use of Metaphor http://images. I. 2012 . Nonaka.com/ss/09/09/0929_jobs_presentations/index.

I. 46 Copyright. combining and synthesizing everyone’s knowledge and efforts in pursuit of the goal. 2012 . by choosing and utilizing the means and rhetoric (the art of effective or persuasive speaking or writing) suitable to each particular situation with shrewdness and determination. Ability to exercise political power The ability to bring people together and spur them to action.Phronetic Leadership 5. Nonaka.

are the growth you achieve as human beings. and press through with all the minute demands of work and research. he would throw you off balance and suddenly adopting your own position as his own. to win through to this glorious achievement. Source: Honda Top Talks “Passing down the basics” Reality Distortion Field The reality distortion field was a confounding mélange of a charismatic rhetorical style. he would deftly switch to another. The advances made by Honda Motor Co. and the burden rests on your shoulders. Nonaka. pp. its future. and indomitable will. Source: Karney. I want you to turn your surging enthusiasm to this task. and an eagerness to bend any facts to fit the purpose at hand. (2008). 2012 .Leadership to Exercise Political Power Soichiro Honda and Steve Jobs Declaring participation in the Isle of Man Tourist Trophy Race I address all employees! Let us bring together the full strength of Honda Motor Co. The future of Honda Motor Co. depends on this. and your growth is what assures our Honda Motor Co. endure every trial. In one line of argument failed to persuade. Sometimes. L. Inside Steve’s Brain (expanded edition). without acknowledging that he ever thought differently.162-163 47 Copyright. making this your own chosen path. I.

Ability to foster phronesis in others The ability to create a system of distributed phronesis by fostering and transferring the existing phronetic capabilities of individuals to others to build a resilient organization which can respond flexibly and creatively to any situation to pursue its own good.Phronetic Leadership 6. Nonaka. I. 2012 . 48 Copyright.

 Growth is accelerated by challenging. 2012 . Nonaka. Leaders at All Levels. (2008). complex jobs and by timely and detailed evaluation and self-reflection  Can expect giant leaps in learning Charan. I. R. 49 Progression A B C Time Copyright.Provide Phronetic Examples (Apprenticeship)  Practical Wisdom = Classroom Instruction (most MBAs)+Practice+Feedback & Self-Correction  Leadership can only be developed through practice.

50 Copyright. Nonaka. 2012 . Good Kata functions as archetype that fosters creative routine but provides higher freedom.Practice as Kata Kata 型 (form) : “Way of doing things. and Ri 離 (create) steps are critical in continuous selfrenewal processes.” core of the ideal action. I. Ha 破 (break). Shu 守 (learn).

Insist on the seemingly impossible. Hash it out. Respect sound theory. Portfolio. Work people hard. Say “no”  When it comes to idea. Inside Steve’s Brain (expanded edition). New York. Seek out the highest quality  Include everyone.What is your specification? (Operational)  Apple Simplify. Strip back. A00 -What do you do this for? (Ontological) A0 . Source: Karney. I. Embrace the team  Engage in intellectual combat. be realistic (genjitsuteki). know the actual product (genbutsu) and situation (genjyou). everything is game. (2008/2009). and focus. 51 Copyright. Motives make a difference. develop fresh ideas and make the most effective use of them. Nonaka. get way down in the details. 2012 . Argument and debate foster creative thinking  Find a passion in your work.What is your concept? (Conceptual) A .Creative Routines Honda 3-Gism: Be at the actual place of work (genba). Willing to try new things  Don’t compromise. L.

Every worker should be Soichiro Honda. 2012 … etc . I. -Takeo Fukui. CEO of Honda LPL In charge of development Engineering PL ●Engine ●Body ●Suspension ●Rigging … etc Source: Honda Motor Company internal material Test PL ●Engine ●Wind-tunnel ●Crash ●Emission ●Durability … etc 52 Design PL ● Layout ● Exterior ● Interior ● Color ● Design data ● Design model Copyright. Every one at the frontline is very important. Honda is not a company in which only top management plays an important part.System to Distribute Leadership LPL and PL to nurture Honda DNA Honda’s exemplar is Soichiro Honda. Nonaka. It is important for Honda to create many Soichiro Honda.

culture.Fractal Organization  Matrix and Fractal organization connects multiple ba. reduces the organizational hierarchy. symbol. A.  Project team reports directly to top management. 2012 . “Game-fication” NHK Publishing. because matrix tend to coordinate between project and business layers. I. dialogue will be deepened. can maximize the use of resources and energy in a limited time.  Business and Project layers create and accumulate knowledge on their own way.  The key of Knowledge Layer is the “boundary object” that stimulates the conversion of knowledge. “Chishiki base kigyou no kouritsu soshiki design” Copyright. communication will be condensed. ICT. Nonaka. Fractal organization flexibly combines various knowledge from each layer. 53 Fractal Organization Project Team Layer Knowledge Layer Business System Layer Knowledge Ecosystem Source: Inoue. Source: Kikuzawa and Nonaka.  Matrix organization cannot convert knowledge effectively. and promote middle-up-down spiral. (2012). (2012). etc. system. concept.

2012 . procurement. concept car was presented at the Tokyo Motor Show. and sales.DAIHATSU: Mira e:S “Polish up the Ecology Power of the Small Cars with Existing Technologies”  Facing headwind. But due to the sudden increase of oil price and the launch of hybrid cars. I. Changed the concept “e:S” from “energy saving” to “eco and Smart”.  Keep the target launch timing at 2011 as scheduled. but changed to tailwind: Lehman shock and Prius shock  In 2009. expectation for small cars changed drastically.  2 innovations led to launch in 17 months  Innovation in Organization: from partial to total optimization “e:S optimization”. Nonaka. Reduced 60kg from Mira.  Innovation in Technology: realize 30km/l at JC08 mode. while improving fuel efficiency for 40%. but redo everything from the product planning phase. 54 Copyright. reduced parts for 15%. production. development. start from 7. set up a virtual company of 30 experts in planning.95 million yen.

but change the way of DAIHATSU Stop the matrix of vertical and horizontal organizations.aspx 55 Copyright. low price. Nonaka. share objectives. and ecological Not extension of the past. and unite their actions Create a sense of surprise with TV ads Bruce Willis http://gazoo. 2012 . transfer members to the project team.Reset All the Existing Processes and Minds Questioned the Raison Détre of a Small Car  The 3rd category of Eco-car Small car needs to be fuel efficient. I.com/G-Blog/tampyou/488549/Article.

I.ismedia. and production collaborate from the early stage. Create. 2012 .htm Project Members Copyright.  Use new terms for new activities  Synchronized designing: set an agile scrum so that design. Chief Engineer: Toru Ueda  Make judgment on the spot based on the actual situation. “ticket with no return” for the members. accumulate. but act for the benefit of the project (total optimization) in a same vector. 56 http://www. but realize maximum feature within the budget.jp/business/news/110926/bsa1109260501000-n2. “no http://wedge. evaluation.sankeibiz.  Material oriented: back to the basics of design and maximize the quality of material for all the parts.  Budget approach: not cost down approach. and utilize knowledge.Innovation at Organization and Technology: Self-contained Virtual Company  Transfer members to project teams  Set the taskforce under the top management.  Members should not represent their home division (partial optimization).  Chief Engineer is given personnel management authority. Nonaka.jp/articles/print/1653 place to go back”.

Agile Scrum Innovation Software Development is a Knowledge Creating Process “Agile scrum encourages team members to socialize. thus allowing technical expertise to become community property for the community of practice [Nonaka 95]. I. Scrum Meetings are therefore rituals with deep cultural transcendence. (1986). Source: Takeuchi. Meeting at the same place at the same time and with the same people. externalize. The new new product development. & I. 2012 . internalize and combine technical knowledge on an ongoing basis. enhances a feeling of belonging. Scrum: An extension pattern language for hyperproductive software development. Harvard Business Review January-February. and creates the habit of sharing knowledge. Nonaka. Copyright. et al. 1986. H. Nonaka. J.” 57 A (Relay) Phase B (Sashimi) 1 2 3 4 5 6 Phase C (Scrum) 1 2 3 4 5 6 Phase 1 2 3 4 5 6 Source: Sutherland.

” Did not Problem Solution  Through the dialogue. “Problem”. and “Done. K. “Doing”. Presentation material at Agile Japan 2010 58 Copyright. 2012 .Human Touch with IT Key Points of Scrum Development  Pair Programming  Two developers (roles of a driver and a navigator) share one PC  Change roles every 5~10 minutes. I.”  Everybody can start working on their task autonomously without any instruction  Check every morning at the 15 minutes of Scrum Meeting  Feedback (KPT:Keep/Problem/Try) Experiment. Nonaka. (2010). socialize tacit knowledge work and convert to explicit knowledge (externalize and New problem combine) New Ideas Source: Hiranabe. everybody share their ideas on “Keep”. “Try. Agile development and scrum. Worked Keep Try  In a casual atmosphere. Change pairs several times a day  Task “Kanban” (Visualize the tasks)  Way to manage “ToDo”.

& H. I.Middle-up-down Knowledge-Creation Process Grand Theory (What ought to be) (Top) Solving contradiction Mid-range theory (Middle) Contradiction Reality (What is) Cross-leveling of Knowledge (Front-line) Copyright Nonaka I.Takeuchi 2010 59 Copyright. Nonaka. 2012 .

and enables the real-time communication)  Nurture agile and proactive employees who exercise timely and “just-right” judgments. 2011 from http://www.org/hbr/hbreditors/2008/10/cisco_ceo_john_chambers_on_tea. Retrieved April 8.html Source: Fryer. counties. Distributed Creative Engine. Fact Company. Nonaka. (2008).Distributed Idea Engine -Cisco’s CEO John Chambers From a top-down command-and-control company to teamwork and collaboration. (2008). Source: McGirt. B. How Cisco’s CEO John Chambers is turning the tech giant socialist.html 60 Copyright. connected communities of distributed leaders.a. I.  Remove barriers of divisions. Harvard Business Review blog. a. 2012 .000 employees participated in the intracompany SNS  Create one’s profile page with information on their expertise and business know-how. positions.com.fastcompany. Cisco CEO John Chambers on Teamwork and Collaboration .com/magazine/131/revolution-in-san-jose. etc.k.hbr. 20011 from http://blogs. so that wisdom around world can instantly be shared (a ba that unifies the HR system. Retrieved April 12. Search allows one to find new contacts.  More than 70. E.

Cisco Japan (Winner of Japan Management Quality Award) Organization for Continuous Innovation  Middle manager who knows top management strategy as well as what’s happening at the frontline An environment where all employees can share. and resonate with the vision and the culture. Company wide strategy framework  “Soccer” style organization where individuals can move dynamically An organization that makes timely judgment and balancing while utilizing the network of proactive individuals. around the middle managers who are close to the frontline and who understand the management vision Hybrid Management with the sense of frontline Human resource system with ICT tools. From an ICT company to BT company From selling products to selling business model . empathize.

Idealistic Pragmatism - 62 Copyright. Nonaka.Communitarian View of Management . 2012 . I.

History. Literature. Nonaka. Biology. Art. Theology  Peak and Diverse Experience Pure Experience (sense of awe). Political Science. Urban Planning. Shared-experience with the exemplar. High Standard of Excellence. Cross-cultural experience …  Practice and Tradition Artisanship. 2012 . * Anthropology. I. Relentless Pursuit for Excellence 63 Copyright. Psychology. Design. Success/Failure experience.Basis of Phronesis  Humanity/Liberal Arts Philosophy. Kata.

I. Nonaka. 2012 . Communitarianism:  People born and live as a member of society. (2009). universal proposition applicable to all people. provided the choices don’t violate anyone’s rights. Source: Sandel.  Justice before good: No value judgment on good. Straus and Giroux 64 Copyright. some freedom of choice is restricted  Good before justice: Ask for “way of life” (value and purpose of good) of the particular context in the social relationship With the logical. M. universal and standardized “Justice. Justice: What’s the right thing to do? Farrar. justice as logical.” we cannot judge according to the differences of particular situations.Justice or Good? Prioritizing – 2 Views Libertarianism:  People have basic rights of freedom of choice.

Justice: What’s the right thing to do? Farrar. M. political and moral values. Based on Sandel. that is. Straus and Giroux 65 Copyright. (2009).Communitarian View In the pluralist societies with diversified religious. we can establish respect and realize a fair society. by discussing in public and understanding mutually. “good life” in a global viewpoint. Nonaka. we must question ourselves the duties of the citizens and the common good of the society. 2012 . I.

A Knowledge-Creating Firm/Organization/Community … Phronesis is to synthesize the ontology and epistemology through value and ethics in action • Ontology: How to be. • Epistemology: How to know  “What is the truth?”: the SECI spiral which synthesizes objective and subjective views.e. i. • Creation: How one can transform one’s self. towards common good  “For what do we live?”: the vision to the future and the commitment to it. firm and the environment  Leadership promotes value-driven processes towards common good. 66 Copyright. I. 2012 . “a way of life” rather than a tool to make money. Nonaka.

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