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European Management Journal Vol. 19, No. 6, pp.

599–608, 2001
Pergamon  2001 Elsevier Science Ltd. All rights reserved
PII: S0263-2373(01)00085-8 0263-2373/01 $20.00

Knowledge Management:
The Benefits and
Limitations of Computer
GEOFF WALSHAM, Judge Institute of Management Studies, University of Cambridge

Much organisational effort has been put into does not necessarily lead to improved human com-
knowledge management initiatives in recent years, munication and action (Walsham, 2001). This article
and information and communication technologies explores the issue of the benefits and limitations of
(ICTs) have been central to many of these initiat- computer systems in supporting human activity,
ives. However, organisations have found that lever- with a specific focus on the topic of knowledge man-
ing knowledge through ICTs is often hard to achi- agement.
eve. This paper addresses the question of why this
is the case, and what we can learn of value to the Knowledge has been a fashionable subject in recent
future practice of knowledge management. The years, with significant attention focussed on areas
analysis in the paper is based on a human-centred such as the key role of knowledge workers, the need
view of knowledge, emphasising the deep tacit to generate and share knowledge, and the creation of
knowledge which underpins human thought and knowledge-intensive organisations and societies.
action, and the complex sense-reading and sense- ICTs offer many potential opportunities in these
giving processes which human beings carry out in domains. For example, the Web provides a wider set
communicating with each other and ‘sharing’ of data sources than any previous technology, with
knowledge. The paper concludes that computer- a massive range of information available for easy
based systems can be of benefit in knowledge- access. Electronic communication across time and
based activities, but only if we are careful in using space is faster and can carry much higher bandwidth
such systems to support the development and com- than in previous eras. So, in principle, ICTs seem to
munication of human meaning.  2001 Elsevier offer human beings, and the organisations for which
Science Ltd. All rights reserved. they work, much faster, cheaper and broader sources
of data and means of communication to enable them
Keywords: Knowledge management, Information to generate and share knowledge. It is not surprising
and communication technologies, Tacit knowledge, that many organisations have invested significant
Meaning, Communication, Knowledge-sharing amounts of time and money in knowledge manage-
ment initiatives over the last few years.

However, the picture which is emerging is not a clear

Introduction cut one in terms of the success of these initiatives.
For example, McDermott (1999) noted that most com-
Information and communication technologies (ICTs) panies soon find that levering knowledge through
have become an essential component of contempor- the use of ICTs is hard to achieve. Why is this the
ary society, not least through the growth of the Inter- case? And what can we learn about the benefits and
net. However, many issues concerned with the limitations of computer-based systems in this area
human aspects of the use of computer-based systems which will be of value to improved future practice?
remain problematic despite technological advances. The purpose of this article is to try to provide some
An enhanced ability to collect and process data, or answers to these questions, drawing on the signifi-
to communicate electronically across time and space, cant amount of research and experience reported in

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the academic and practitioner literatures. So, this is performed in the pursuit of knowledge. This shaping or
a stock-taking exercise to some extent, but I hope that integrating I hold to be the great and indisputable tacit
the reader will find some interesting new insights power by which all knowledge is discovered and, once dis-
covered, is held to be true. (p. 6)
from my attempt here at synthesis.
This tacit power produces the deep tacit knowledge
which we have of the world in which we live, and
this power is different for each individual due to our
Knowledge and Knowledge-Sharing different initial dispositions and experiences. In com-
menting in a later work (Polanyi, 1969) on the nature
I want to start with an obvious question, namely of ‘explicit knowledge’, such as the contents of books
‘what is knowledge?’. Now this question has con- for example or even the meaning of a single word,
cerned philosophers for thousands of years, and it is Polanyi is clear that there is no objective explicit
unlikely that I can provide a new or definitive answer knowledge independent of the individual’s tacit
here. However, some reflections on the question are knowing:
crucial in my view, not least in attempting to refute
naı̈ve and simplistic views of knowledge, some of The ideal of a strictly explicit knowledge is indeed self-
which can be found alive and well in elements of the contradictory; deprived of their tacit coefficients, all spoken
management literature. For example, I wish to argue words, all formulae, all maps and graphs, are strictly mean-
against the simple view of knowledge as a com- ingless. An exact mathematical theory means nothing
unless we recognise an inexact non-mathematical knowl-
modity, or a quantifiable tradeable asset. I wish to
edge on which it bears and a person whose judgement
take a more human-centred view of knowledge, with upholds this bearing. (p. 195)
a strong focus on what is in people’s minds, how they
represent this to others, and how others interpret What have these philosophical reflections to offer on
these representations. the practical subject of the use of ICTs for knowledge
management? I believe that they are highly relevant.
A key figure in the literature on knowledge manage- All databases, on-line data sources, or the contents of
ment in the 1990s was Ikujiro Nonaka (Nonaka, e-mails are ‘explicit knowledge’, which should not be
1994). He popularised the distinction between ‘tacit’ confused with the much deeper tacit knowledge
and ‘explicit’ knowledge, and developed the well- which has created them in the first place. And will
known spiral of organisational knowledge creation they be meaningful and helpful to others using them?
drawing on conversions between these knowledge Only if they connect well to the tacit knowledge of
types. Nonaka drew heavily on the work of the phil- the user, and offer something new or interesting to
osopher Michael Polanyi in creating his knowledge this person. A manager of a multi-national company
management models, and whilst he himself seemed recently described his company’s intranet to me as ‘a
to have a good grasp of Polanyi’s thinking, Nonaka’s large warehouse that nobody visits’. It seems that the
work is sometimes used to justify approaches which ‘explicit knowledge’ contained on the intranet had
are not in the spirit of the original ideas. For example, not succeeded in connecting to the users’ tacit world.
Davenport et al. (1998) report some interesting
empirical work on knowledge management projects, But before we look at why such occurrences are not
but perpetuate the view of knowledge as an object uncommon, I want to go back to Polanyi one more
which can be transferred by highlighting the follow- time to see what he had to say about communication
ing: between people, since this is clearly what we are try-
ing to achieve when we design our databases, send
To transfer tacit knowledge from individuals into a reposi- our e-mails or create our on-line sources. Firstly, he
tory, organizations usually use some sort of community-
based electronic discussion. (p. 45)
identified a distinction between attempts at sense-
giving and sense-reading, both acts of tacit knowing:
In order to see why this is not in keeping with Polan- Both the way we endow our own utterances with meaning
yi’s ideas, and how the Chinese whispers through and our attribution of meaning to the utterances of others
Nonaka and Davenport have distorted the original are acts of tacit knowing. They represent sense-giving and
message, let us go back to what Polanyi himself had sense-reading within the structure of tacit knowing.
to say about the nature of knowledge and knowl- (Polanyi, 1969, p. 181)
Polanyi goes on to tell a story about these processes.
In discussing the way in which human beings per- He asks us to suppose that person A is travelling in
ceive the world, Polanyi (1966) introduced the notion a country which he has not visited before. By the end
of tacit power as the way in which we actively shape of the first morning, person A is full of new experi-
or integrate new experience to discover and believe ences and reports them by letter to a friend, person
new knowledge: B. In Polanyi’s view, this involves three ‘integrations’,
or the blending of experience through tacit power as
However, I am looking at (perception of the world as a defined above. The first is an intelligent understand-
whole) … the outcome of an active shaping of experience ing of the sights and events (person A: sense-

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reading), the second is the composing of a verbal introduced into the literature by Lave and Wenger
account of his experience (person A: sense-giving), (1991), who argued that learning is a process of par-
and the third is the interpretation of this verbal ticipation in communities-of-practice, participation
account (person B: sense-reading). Polanyi under- that is at first peripheral, when the person is a new-
takes some elegant philosophical analysis of this, comer to the community, but increases gradually in
which I will not dwell on here, but a key point is that engagement and complexity to ‘full participation’.
this is not a simple process of ‘knowledge transfer’ as Brown and Duguid (1991) argued that a key task for
depicted by the ‘knowledge as commodity’ literature. organisations is thus to detect and support existing
The sense-reading of person A is not perfectly or emergent communities. Brown and Duguid (1998)
depicted in the attempt at sense-giving in the letter, developed this later in terms of ‘organising knowl-
and is certainly not the same as the sense-reading edge’ in communities-of-practice, arguing the need to
which is then carried out by person B. support formal and informal processes in such com-
munities, using ICTs where appropriate. So, how can
The philosopher Polanyi wrote this material in the this be achieved, and what are key problems which
early days of computer and communication techno- need to be addressed? I will come to these questions
logies, and he makes no reference to such media. But in a moment, but firstly, what exactly are communi-
I am immediately reminded of ties-of-practice?
a customer database in a phar- An attempt at knowledge-
maceutical company in which I
carried out some research with sharing is only valuable if What is a Community-of-Prac-
a colleague (Hayes and Wal- tice?
sham, 2000). The salespeople one’s views differ from that of
visited customers such as doc- At some level, we all recognise
tors to try to sell them products the other parties in the communities-of-practice, since
such as drugs. They recorded we are all members of such
material on their meetings in a communities. These include,
sales database, this being made
exchange, since one learns for example, a group of salespe-
available to other reps to aid ople in a particular pharma-
‘knowledge-sharing’. This is an nothing from total ceutical company, a computer
identical situation in essence to support team, the academic
Polanyi’s story of the traveller homogeneity of view staff in a specific university
and the letter. The message is department, or the senior man-
that the database in the pharmaceutical company did agement team of an organisation. However, we are
not contain objective explicit knowledge which could all members of multiple communities, in our work-
be shared with colleagues in an unproblematic way. place and social life, and communities can be broken
The contents of a specific entry in the database down into smaller subsets, such as the group of sales-
reflected the tacit sense-making and sense-giving people in a particular region. Lave and Wenger
activities of the salesperson who had visited the doc- (1991), despite introducing the term, are not parti-
tor, and the sense-reading processes of other col- cularly helpful on its precise definition:
leagues determined whether these contents were or
were not considered useful. The concept of community-of-practice is left largely as an
intuitive notion, which serves a purpose here but requires
a more rigorous treatment. (p. 42)
So what? Well, if we recognised the complexity of
these processes a little more, we might have less data
warehouses which nobody visits. The solution, how- Brown and Duguid (1998) suggest a definition
ever, is to not to abandon the use of ICTs for knowl- related to ‘shared understanding’ as follows:
edge management because the processes of creating Through practice, a community-of-practice develops a
and using ‘knowledge management systems’ are not shared understanding of what it does, of how to do it, and
simply a matter of transferring objective explicit how it relates to other communities and their practices —
knowledge between different human beings. Rather, in all, a ‘world view’. (p. 96)
the challenge is to design systems and approaches to
their use which recognise the tacit basis of all sense- I wish to make two comments on this statement, one
reading and sense-giving activities, and try to make positive and the other more critical. Firstly, the state-
these activities more meaningful and valuable to all ment provides a clear justification as to why com-
parties. In the rest of the article, I will discuss ways munities-of-practice are a sensible focus for knowl-
of trying to go about doing this. edge management initiatives. Going back to the
earlier material on sense-giving and sense-reading,
these processes are surely easier in a community
Supporting Communities-of-Practice which shares some common language, purpose and
ways of acting. For example, it is much easier for a
One approach to knowledge-sharing has been to pharmaceutical salesperson to attempt sense-giving
focus on ‘communities-of-practice’. This concept was and sense-reading with other such professionals,

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rather than with a member of the lay public for plier and consultancy. In this paper, we identified
example. three categories of knowledge management initiative.
The first of these involved large top-down data-
This may seem obvious, but a word of criticism and driven activities such as the creation of knowledge
caution is in order here. Referring back to Polanyi, repositories, presentation slides, and reports. Much
there is really no such thing as shared norms and of the ‘knowledge’ contained within these reposi-
values in a total sense. So-called communities are tories was felt to be irrelevant to the personal circum-
composed of individuals, each with their own differ- stances of the ‘knowledge user’. Such initiatives were
ent tacit knowledge. A common purpose, such as generally considered unsuccessful, and can be classi-
selling drugs, and common vocabularies, such as fied in the ‘knowledge as commodity’ type of
specialist jargon, do not imply a shared world-view. approach criticised earlier in this article.
Thompson and Walsham (2001) develop this point
to argue that the term ‘symbolic community’ might The second category of knowledge management
capture the sharing of common symbols better than initiative in A1 involved approaches to codify ‘raw
the original term of community-of-practice. This may data’ into more readily useable forms of information.
seem like splitting hairs, but it has considerable rel- Examples included decision-making tools, templates
evance to computer-based support to communities- intended for customisation by individuals, and ‘tech-
of-practice as I will attempt to show in some of the nology-push’ reports and news. These initiatives
following material. were only felt to have been successful where the
needs of the user had been successfully anticipated.
For example, salespeople and consultants found the
ICT Support for Communities technology-push news bulletins to be an essential
method of appraising themselves of new technical
As an example of computer-based support to com- developments. It is important to note that these bull-
munities, Orlikowski (1996) described the use of etins were heavily tailored to the requirements of this
Lotus Notes technology in a customer support limited user group, and would have been relatively
department of a software company, called Zeta, with indecipherable to users outside this group. In other
headquarters in the Midwest of the United States. words, in the language of Polanyi, the sense-giving
The department’s responsibility was to provide tech- activity of those writing the technology bulletins had
nical support via a telephone hotline to all users of tried to anticipate the sense-reading activity of a
Zeta’s products. Technical support was a complex particular group of users, with some degree of suc-
activity, since the products involved advanced net- cess.
working and database technologies that allowed
users to build their own applications. Customer calls Knowledge management initiatives in the third cate-
were rarely resolved with a brief response, but typi- gory were felt by all respondents to be the most use-
cally involved several hours of research, including ful, and these relied on continual inter-subjective
searches of reference material, attempts to replicate communication between individuals. Such activities
the problem, and review of program source code. included mentor relationships between new and
experienced recruits, communities-of-practice
Lotus Notes was acquired in 1992 and an Incident indexes showing who was knowledgeable about
Tracking Support System was developed, containing which topics, special interest groups, email interac-
a log of interactions with clients and approaches to tion, and other informal personal interaction. The
the resolution of their problems. Orlikowski notes most valued knowledge management initiatives were
that the nature of the support specialists’ work thus those in which an individual could interact with
changed, with an increasing emphasis on docu- other individuals in a community-of-practice through
menting work process and searching of the estab- various forms of one-to-one or one-to-many interac-
lished ‘knowledge base’ thus created. This was seen tion. The sense-giving and sense-reading processes
to have a number of advantages: helping an individ- are greatly facilitated when one is operating at this
ual specialist to keep track of a particular problem personal level, in a community with common sym-
and attempts at its solution; ‘sharing of such knowl- bols such as specialist language and job purpose, in
edge’ with others so that a wider group could con- stark contrast to large data warehouses designed for
tribute to problem-solving; and creating a database of nobody and often used by nobody.
such incidents to aid the solution of similar customer
problems in the future. So, should this interaction be face-to-face or through
electronic means such as e-mail and on-line dis-
This case study provides an optimistic assessment of cussion forums? The answer to this depends greatly
the use of groupware technology to support this on individual circumstances, but it is likely that a
particular community-of-practice. We found a rather mixture of modes will be better than either extreme.
more mixed picture in our work (Thompson and Let’s look at this in terms of sense-giving and sense-
Walsham, 2001) in assessing a whole range of knowl- reading activities. Face-to-face interaction has major
edge management initiatives in a company which we advantages in terms of both giving and reading
called A1 Software, a leading US-based software sup- meaning since participants have access to a whole

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range of non-verbal clues and can adjust their input in our work in the pharmaceutical company referred
to an interaction in a dynamic manner to try to to earlier, a group known as the medical liaison man-
respond to others. On the other hand, face-to-face agers developed a computer-based discussion datab-
meetings are expensive in widely-dispersed organis- ase to review and contribute to specific medical
ations, and electronic interaction can be very effective issues on a regular basis. However, the medical direc-
if one already has good ‘knowledge’ of the other per- tor asked if he could take part in the discussions.
son. Evidence to support this view of the need for a Soon after he had access, the use of the database
blend of face-to-face and electronic interaction is declined. One of the liaison managers commented
offered in a paper by Maznevski and Chudoba (2000) as follows:
on the work of three ‘virtual’ teams. They concluded
that team interaction was composed of a series of The medical liaison database was really well used but has
‘communication incidents’, with effective interaction petered out now. This happened soon after our boss, the
blending regular face-to-face meetings interspersed medical director, asked if he could be included in it
because he had heard how successful it was. No one felt
with less intensive shorter incidents using various that they could comfortably share views in the knowledge
electronic media. that he was reviewing the database.

On this basis, we have argued the need for ‘safe’

Knowledge, Power and Organisational Politics enclaves (Hayes and Walsham, 2000), electronic or
otherwise, where individuals in a community-of-
The material to date in this section has assumed that practice may share views, knowing that their organis-
individuals in communities-of-practice want to share ational superiors have no access to their exchanges.
their knowledge and expertise with others in the
community, and that the issue is how to achieve this
is an effective way. However, writers such as Fou-
cault (1977) have noted the inseparability of knowl- Sharing Knowledge between
edge and power, in the sense that what we know Communities
affects how influential we are, and vice versa our
status affects whether what we know is considered
important. The implication of this for knowledge- Support for knowledge-sharing within communities-
sharing is that there may be some good reasons why of-practice is a valuable focus for contemporary
individuals may not wish to participate, or may mod- organisations, but there are many circumstances in
ify some aspects of their sense-giving activities, for which knowledge-sharing between communities is
reasons related to organisational politics. also crucial. This applies both within organisations
and between different organisations. In addition, in
For example, financial reward systems are an aspect our increasingly globalised world, interaction
of power relations which may play a significant part between communities also takes place across cultural
in stimulating or constraining collaborative behav- divides. In this section, I will look at some of the
iour. In a context where individuals see little in the issues which arise in these circumstances, but it is
way of financial reward for knowledge-sharing worth noting at the outset that knowledge-sharing
activities, it is not surprising that forms of knowl- between communities is likely to be harder than
edge-hoarding may take place. One of our Cam- within communities. Sense-giving and sense-reading
bridge MBA students carried out some research on of the views of others will generally be more difficult
knowledge management in a large advertising due to the lack of shared symbols such as pro-
agency, and he discovered that the ‘creative’ staff, fessional language, job purpose, and cultural norms
charged with producing new ideas and images for of behaviour.
use in client advertising, were extremely reluctant to
share their ideas with colleagues at similar levels. The
strongly individual-based reward system did not Intra-Organisational Communities
encourage collaborative behaviour.
Brown (1998) argued, based on work in Xerox, that
A second reason why individuals may be reluctant organisations should be seen as ‘communities of
to share their views in an ‘open’ way concerns the communities’, and that new technologies such as
danger of being seen to be politically incorrect in intranets are well suited to provide support to the
terms of current organisational thinking, in particular development of effective communication, both
being seen as out-of-step with the views of more within and between communities. He discussed the
senior staff. There is an irony here, since an attempt need to design organisations and their technological
at knowledge-sharing with others is only valuable if systems to support this perspective:
one’s views differ from that of the other parties in
Any design of organizational architecture and the ways
the exchange, since one learns nothing from total communities are linked to each other should enhance the
homogeneity of view. Nevertheless, people are aware healthy autonomy of communities, while simultaneously
of power-knowledge relations as part of organis- building an interconnectedness through which to dissemi-
ational life, and take action accordingly. For example, nate the results of separate communities’ experiments. In

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some form or another the stories that support learning-in- We can provide a story of such a person from the
working and innovation should be allowed to circulate. pharmaceutical company referred to earlier. One of
The technological potential is available to support this dis- the senior medical advisors, who we will call James
tribution (e-mail, bulletin boards, home pages, etc. are cap-
able of supporting narrative exchange). (p. 232) Black, was enthusiastic about trying to cross com-
munity boundaries to provide effective support for
the sales reps in terms of medical advice. His
The technological potential to support collaboration
approach to this was to form relationships with indi-
may be available, but problematic socio-technical
vidual reps by harnessing opportunities to meet them
issues with respect to intra-community knowledge-
in person, for example at training and induction ses-
sharing have already been highlighted. With respect
sions. He made a particular effort to meet with reps
to inter-community communication, the ‘stories that
on both a formal and informal basis. In his own
support learning-in-working’ may circulate, but will
they be effectively incorporated in the sense-reading
activities of their receivers in a different community?
I make it my business to meet reps on their training courses
The difficulties of coping with the ways of working, and at regional meetings. I do this so they feel confident
methods of describing this, and taken-for-granted enough to call me if they need me. I also try to go out and
assumptions of people in other communities are meet doctors with reps where possible.
likely to be exacerbated where electronic media are
used, removing the bodily cues and dynamic inter- This made the reps more comfortable in contacting
personal interaction of face-to-face contact. Black for assistance, as well as providing Black, and
other medical advisors adopting a similar approach,
Newell et al. (2000) supported this view of the dif- with a deeper appreciation as to what was involved
ficulty of inter-community collaboration in reporting in being a medical sales rep and vice versa. Interest-
their study of a major organisational initiative to ingly, from the perspective of computer-based sup-
encourage ‘global knowledge-sharing’ in a large Eur- port for knowledge-sharing of this type, electronic
opean bank, operating across seventy countries, interaction was then stimulated by the face-to-face
which they called Ebank. They described, in parti- relationships that had been built. Black explained
cular, three specific intranet projects which took place how, as reps became more familiar with him as a per-
under this umbrella, with varying degrees of success. son, he had noticed that they would increasingly
Each of these was developed within a specific com- send him e-mails, and complete a considerable
munity, and Newell and colleagues drew the con- amount of detail on the sales databases. The actions
clusions that the technological systems tended to taken by ‘translators’ such as Black was to open up
reinforce rather than dissolve existing organis- a forum, both face-to-face and electronic, within
ational boundaries: which the assumptions and perspectives of experts
from different functions could be more effectively
… a whole range of intranet projects sprang up almost exchanged.
spontaneously and with little linkage across the projects …
the actual impact of developing these independent
intranets was to reinforce existing functional and geo-
graphical boundaries with what could be described as Inter-Organisation Knowledge-Sharing
‘electronic fences’. (p. 94)
I move on now to knowledge management issues
The metaphor of ‘electronic fences’ provides a nice outside the boundary of a single organisation. There
counter to any misplaced idea that freely circulating has been much emphasis in recent years on the part-
electronic data, on intranets or anywhere else, are nering of organisations, and their interconnection in
necessarily a way of effectively sharing knowledge networks. These initiatives are designed, for example,
across community boundaries. to exploit synergies between partnering organis-
ations, or to improve links with suppliers and cus-
But, I would not wish to argue that electronically- tomers. They are normally related to the striving for
mediated inter-community knowledge-sharing is increased efficiency and speed of response in rapidly
doomed to failure from the outset; rather that it changing markets, and inter-organisational infor-
presents a major challenge that needs to be mation systems (IOS) are often seen as a fundamental
addressed. How can the challenge be tackled? There component. These systems are increasingly carried
are no simple formulae, and each organisation needs over the medium of the Internet, as the scope, famili-
to look carefully at its own emergent and existing arity and ease of use of the Net increases.
communities to think of ways of bridging the sense-
making gaps between them. Brown and Duguid As an illustration of knowledge management in an
(1998) suggest that organisational translators are one inter-organisational network, facilitated by IOS, I will
approach to this: outline the results of some of our research on the
London Insurance Market (Barrett and Walsham,
Organisational translators are individuals who can frame 1999). The Market is an important part of the UK gen-
the interests of one community in terms of another com- eral insurance industry, built up around Lloyd’s of
munity’s perspective. (p. 103) London. It is a network of hundreds of semi-auton-

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omous players, including underwriting groups, with a highly complex risk, such as the loss or dam-
brokerage firms and Market managers. In the late age to a ship for example. They undertook a sense-
1980s and early 1990s, the Market suffered huge reading process using their specialised tacit knowl-
insurance losses due to a combination of circum- edge in this area supported by documentary evi-
stances. As part of its response to the disastrous fin- dence, and then tried to communicate this in a sense-
ancial results, and to the tough competitive climate, giving process to the underwriter. The underwriter
the Market sought to develop and use IT to lower undertook his or her own sense-reading process, and
costs by streamlining business processes, and to further communication took place with a view to
increase service quality and inter-organisational arriving at a deal. The basic reason for the wide-
efficiency in the Market. spread rejection of the EPS was that it was not con-
sidered adequate to support this knowledge-sharing
A particular focus for this was to use electronic data and negotiation process since sense-reading and
interchange (EDI) standards and messages to support sense-giving are difficult in the area of complex
inter-organisational communication, and a joint ven- insurance risk, and involve subtle power relations
ture called the London Insurance Market Network between the negotiating parties. The basic details
(LIMNET) was created to develop and manage transmitted electronically through the EPS were
appropriate systems. LIMNET made significant pro- thought to be an inadequate representation of this
gress in a number of work areas, including systems complexity, and face-to-face was considered a more
for claims management and settlement, and account- appropriate mode in which to communicate for this
ing systems. However, the development and use of particular purpose. In the words of one of the brok-
electronic systems to support the critical area of the ers:
negotiation and agreement of insurance business
between underwriters and brokers, known as place- The business is based largely on relationships and trust.
ment, was less successful. A system called LIMNET This is why it is so vital to carry out business in a face-
EPS (electronic placing system) was developed in the to-face manner … You are negotiating the business. It is
early 1990s, but low levels of adoption and use were important how well you put across the case … You use a
lot of different skills in negotiating. You emphasise and de-
still being experienced several years later. emphasise certain aspects, handle objections … It is a
sales situation.
So, how do we explain the relative success of the
inter-organisational systems in facilitating knowl-
This is only one brief example of knowledge-sharing
edge-sharing in areas such as accounting and claims
across organisations, and I am not of course arguing
management, and the relative failure of the EPS?
that all inter-organisational negotiations need to take
Space prohibits an exhaustive analysis of these ques-
place face-to-face, or that inter-organisational infor-
tions, but we can gain some insights from our earlier
mation systems are of no value. There have been
theories of communication and knowledge-sharing.
many successful applications of such systems, includ-
Although they were used across communities and
ing the accounting and claims systems in the London
organisations, the accounting and claims systems
Insurance Market itself. Rather, I am arguing that we
contained data which adhered to widely shared con-
need to think very carefully about the sense-reading
ventions as to their meaning. Thus the sense-reading
and sense-giving processes of knowledge-sharing
and sense-giving processes were relatively unprob-
and negotiation in any particular inter-organisational
lematic, and the systems were seen by all parties as
communication process, and ask whether, and to
helpful in knowledge-sharing.
what extent, computer-based systems are adequate to
support the processes involved. I frequently book air
In contrast, the EPS system was seen as highly
tickets on-line, using data on web sites with no need
deficient by many of the Market participants, and less
for face-to-face negotiation. However, I would not
effective than the older approach to risk placement.
wish to take a new job without visiting the organis-
The traditional method involved face-to-face interac-
ation involved, although I might use a web site and
tion between an underwriter and a broker, normally
other information on the company as one input to
in the underwriter’s office. The details of the risk
my sense-reading process.
were entered on a paper ‘slip’ and supporting docu-
mentation was carried around by the brokers. The
new EPS was designed to replace this with the elec-
tronic passing of risk packages between brokers and Working Across Cultures
underwriters. Brokers would be responsible for
inputting an electronic record of the risk, called the The complexity of the processes of knowledge gener-
common core record, at the start of the placement ation and sharing takes on a further dimension when
process. The concept was that the risk details would we consider work needing to take place across cul-
then be available to all participants involved in the tures. Lam (1997) provided a fascinating grounded
risk at different stages of its life cycle. case study of the different approaches to knowledge
in both a Japanese and a British high-technology firm,
The relative failure of this new approach can be ana- attempting to collaborate on particular joint ventures.
lysed as follows. The brokers were normally dealing Lam examined the education and on-the-job training

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of Japanese and British engineers in the two firms, ments, leaving each team to pursue its own part of
and analysed why they worked in very different the projects in its own way.
ways that made co-operation and knowledge-shar-
ing difficult. What can we learn from the case study using the per-
spective on knowledge taken in this article? Firstly,
The engineers in the British firm based their specialist I do not wish to make a value judgement between
expertise primarily on abstract theoretical knowledge the British and Japanese engineers as to which was
acquired through formal university training. In con- the ‘better’ approach to knowledge generation and
trast the Japanese engineers relied heavily on practi- sharing. However, the sense-reading and sense-giv-
cal know-how and problem-solving techniques ing approaches were radically different in the two
accumulated in their workplace. Product develop- groups, and this made the cross-cultural working
ment in the British firm was organised on a sequen- very difficult. The role of computer systems,
tial and hierarchical basis, with the view that the although not an explicit focus of Lam’s paper, would
knowledge required for each stage tended to be rela- also be seen rather differently by the two parties.
tively self-contained. In contrast, product develop- Clearly, the British engineers saw a bigger role for
ment in the Japanese firm was typically undertaken explicit procedures, guidelines and specifications,
by a multi-functional team, consisting of members which would imply a more significant role for ICTs.
with diverse backgrounds, and took in all the stages On the other hand, the Japanese felt that much of
of planning, design and development, quality assur- their ‘know-how’ could not be ‘captured only by
ance and production. reading the documents’, implying a greater need for
personal contact.
These differences in educational background, bases
of skills, and approach to co-ordination of work were The analysis above should not be generalised to con-
reflected in different methods of ‘knowledge trans- clusions about the infeasibility of cross-cultural team
mission’ through the product cycle. In the British working, or the lack of usefulness of computer-based
firm, co-ordination across the functions was achieved systems in this context. But, cross-cultural working
by passing on detailed documents and full specifi- involves the interaction of people whose tacit knowl-
cations from one stage to the next. This required edge has been developed in different ways, and who
‘externalising’ knowledge and coding and structur- have learnt different approaches to sense-reading
ing it into procedures, guidelines or specifications for and sense-giving. A necessary first condition for try-
transmission to others. In contrast, the Japanese firm ing to facilitate effective cross-cultural working is to
was highly dependent on intensive human-network- take these cultural differences seriously. This may
based communication. Knowledge required for over- seem an obvious remark, but the Lam case is not
all project achievement was seen as being stored unique in my experience (Walsham, 2001) in largely
‘organically’ in team relationships and behavioural ignoring these differences, at least at the project out-
routines. set. An understanding of the ‘other’ is a good starting
point, but it is one thing for a team of British engin-
Attempts were made to get the British and Japanese eers to gain some understanding of Japanese
engineers to work together and to share knowledge, methods of working, but another for them to wish to
but these were largely unsuccessful. The mutual adopt such methods themselves. Nevertheless, some
incomprehension is nicely captured in Lam’s paper adaptation and compromise are likely to be necessary
by two quotes from a British and Japanese engineer on both sides to offer any real chance of effective col-
respectively: laborative work. Choosing an appropriate role for
ICTs in the cross-cultural work process is an
You’ve got two ways of doing something. You are either important issue, but this needs to be located within
very much more rigorous about the way you design it and a broader consideration of how to facilitate effective
try to ensure you do it right, or you just have a scatter- cross-cultural understanding and knowledge-shar-
brain effect and just hope something will work. This is the ing.
way I see the (Japanese firm) … A lot of people do lots of
little things and it’s like waiting for revolution. (p. 982)

They (the British Engineers) can read the specifications but Conclusions
I am not sure they have the ability to make the product. I
think we have far more technical capacity — we’ve got the
know-how. On this project, we have to supply them with The key thrust of this article has been to analyse the
a lot of our know-how but it’s really difficult. There’s so benefits and limitations of computer-based systems
much of it which simply cannot be captured only by read- for knowledge management by taking a human-
ing the documents. (p. 982) centred view of knowledge. This approach has
emphasised the complex sense-reading and sense-
In the end, the management of the British and giving processes which human beings carry out in
Japanese firms abandoned attempts at genuine joint communicating with each other and ‘sharing’ knowl-
development work between their respective engin- edge. McKinlay (2000) provides a quote from an
eers, and divided the work on projects into compart- interview that he conducted with the manager of a

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particular knowledge management initiative, which the need for personal relationships, which normally
nicely summarises the role of management in sup- cannot be developed and maintained effectively
porting such processes: solely through electronic media. Nevertheless, I do
believe that computer-based systems can be of benefit
We have to accept that we cannot manage knowledge in to human activity if we are careful about assessing
the sense of hard wiring a system. We have to allow people their benefits and limitations in supporting the devel-
to make their own links, to give them the techniques to
opment and communication of human meaning. I
allow them to construct, interact with knowledge. We can’t
put in a technological fix. It’s not about finding specific have tried to make a small contribution to such an
answers but allowing people to problem solve, gain knowl- assessment in this paper.
edge in unexpected ways. (p. 117)

I have discussed a number of ways of going about Acknowledgements

this task in the article. With respect to communities-
of-practice, these approaches include facilitating I would like to acknowledge the contribution of Michael Bar-
communication between individuals through rett, Niall Hayes and Mark Thompson to some of the ideas
used in this paper.
methods such as mentor relationships and special
interest groups. Other contextual approaches include
appropriate reward systems, and the creation of
‘safe’ enclaves for electronic debate. In inter-com- References
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Judge Institute of
Management Studies,
University of Cambridge,
Trumpington Street,
Cambridge CB1 1AG. E-
mail: g.walsham@jims.

Geoff Walsham is
Research Professor of
Management Studies at
the Judge Institute of Management Studies, Cam-
bridge University, UK. His teaching and research is
centred on the social and management aspects of the
design and use of information and communication
technologies, in the context of both industrialised
and developing countries. His publications include
Interpreting Information Systems in Organiza-
tions (Wiley, 1993), and Making a World of Dif-
ference: IT in a Global Context (Wiley, 2001).

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