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Knowledge Forms Embedded in Organisations & its Implications
Many organisations in the Information Age dedicated time and
energy on the mechanics of handling information. This era is
marked by activities like collecting, manipulating, processing,
storing and reporting information. The new era of the knowledge
reaches a higher plane where activities such as analysis,
understanding, creation and dissemination are realised as keys to
organisational success and what experts believe is the lifeblood and
foundation of all organisations. This paper attempts to outline three
forms of knowledge based on the implicit and explicit knowledge
types and critically analyzes their leveraged implications by
Student ID: K0326965
Business Information Technology Framework
Kingston University London
Kingston Business School
Due Date: 18 February 2005
Knowledge in a Nutshell
Before exploring the two forms of knowledge and its leveraged implications, what
is exactly is knowledge? One definition of knowledge can be summed as
"information laden with experience, truth, judgement, intuition, and values; a
unique combination that allows individuals and organisations to assess new
situations and manage change¨ (Huseman, 1999: p. 107).
Karl Erik Sveiby, an icon in the field of knowledge science, described knowledge
as a form of competence. Competence can be defined as the capacity to act
effectively and efficiently and can be viewed as the best way to describe
knowledge in the business realm (1997). Further refining the word competence to
make it relevant to organisations in business, it can be added that knowledge is
".the use of an enterprises intellectual capital on customers, markets, products,
services, and internal processes¨ (Abell, 2001).
There are two forms of knowledge that exist in an organisation. One form of
knowledge is known as explicit knowledge and its counterpart is known as implicit
Explicit knowledge first identified and defined by Nonaka and Takeuchi (1995)
refers to knowledge that can be easily translated verbally and easily transferable
onto an intellectual artefact (media) for user's consumption. For example, explicit
knowledge can be a single word expression or a collection of words; it could also
be a mathematical formula but together with numbers and symbols.
In contrast, tacit knowledge is stored in a person´s mind. It includes cognition
involving individual´s unique experiences, perceptions, beliefs, emotions and other
internal insights therefore tacit knowledge is "highly personal and context
specific¨ (Gourlay, 2000, p.3) That is why it is more difficult to harvest and
accurately express those into words or numbers. So, tacit knowledge can be
acquired and used but cannot be articulated.
Tacit knowledge has two dimensions (technical and cognitive) apart from its four
modes. Nonaka and Takeuchi have identified four different modes of conversion
that encompass aspects of either knowledge types visually presented into a four
square matrix. These modes are: (1) socialization which involves conversion from
tacit knowledge to tacit knowledge, (2) externalization which involves conversion
from tacit knowledge to explicit knowledge, (3) combination which involves
conversion from explicit knowledge to explicit knowledge, and (4) internalization
which involves conversion from explicit knowledge to tacit knowledge (see Figure
1) (1995). Nonaka´s model of these four knowledge modes are not static, but
transfer into a spiraling process (1995). So explicit knowledge can convert to tacit
knowledge and tacit knowledge can transform to explicit.
Knowledge modes aside, explicit knowledge is identified as one form and tacit
knowledge is split into two forms. Those two forms are tacit-technical, and tacit-
cognitive. Nonaka´s split of tacit knowledge was a major departure from Polanyi´s
original concept of tacit knowledge introduced in his seminal work on knowledge
(Gourlay, 2002: p.2) which is discussed in more detail later in this paper.
Organisations whether in business, politics, legal, financial or military contain
these two forms of knowledge. One form may be more pronounced in some
organisations whilst barely discernable in others. Some organisations manage and
store knowledge more effectively than others, whilst other organisations have a
lot of knowledge circulating within its network but have failed to harness both
forms of knowledge into their advantage. Evangelists of various knowledge
management methodologies and business proponents alike emphasize that
leveraging knowledge in all its various forms has become a critical strategy to
ensure a company´s future success.
It could be generalised that the organization´s overall aims to exploit knowledge
both internally and externally are almost always business driven and are common
among many different organisations. Those aims are for competitive advantage,
increased effectiveness, increase innovation and creativity (R & D), and reducing
risk and cost control. These aims serve to avoid or reduce duplication of effort
and waste, mistakes and repeat errors, time waste and missed opportunities
(Abell, 2001). Specifically though, what are the implications of exploiting these
three knowledge forms in an organisation?
Exploiting Explicit Knowledge: 1st Form
As elaborated to in the beginning of this paper, explicit knowledge, sometimes
called declarative knowledge, can be codified into words, algorithms, and
numbers. It can take the `shape´ of metaphors, analogies, and concepts. Stephen
Gourlay´s primer on Knowledge Management describes explicit knowledge as
"systematic formal language¨ that can be easily transmitted among people or via
electronically (Gourlay, 2000: p.4). Things that are conventional part of any
organization can be associated with having explicit knowledge. For instance,
Nonaka describes documents, meetings, computer graphs and printouts as typical
examples. These outputs can be placed on media to be stored, exchanged and
modified to create more explicit knowledge assets in an organization (Gourlay,
2000: p.4) making explicit knowledge measureable.
There are always visible examples in any standard office or educational
institution. Looking at the various tools and media (training books, databases,
computers...etc) to hold as well as transmit knowledge is abundant.
Organizations make great efforts in establishing groupware, intranets, list
servers, e-mail, VPN, knowledge repositories, database management and
knowledge action networks to name a few allow the sharing of organisational
knowledge, company rules, workflow diagrams and information web portals
internally to efficiently distribute the assets to staff to absorb and create new
knowledge. The use of these technologies helps facilitate the production of more
knowledge. One key advantage is that knowledge artefacts could me moved at a
moments notice with information technology, making this form of knowledge
flexible to distribution.
From Nonaka´s description of the explicit form of knowledge there is no doubt
that organizations use explicit knowledge extensively since it easily and formally
articulated making it systematically codifiable to catalogue, sort and order. One
implication of leveraging explicit knowledge is that it helps with traceability. This
makes interrelationships identifiable (Sanchez, 2004) and assembles the
organization´s knowledge base into something that is perceptible and capable of
being studied at a later time. Moreover, the fact that explicit knowledge is
intrinsically expressible and articulable also makes it feasible to view the
Referring back to Nonaka´s model, based on the matrix of knowledge creation,
explicit knowledge will blend some tacit knowledge, only again to generate more
or manipulated explicit knowledge (Gourlay, 2000). For instance, a senior level
engineer reads an existing document written by a subordinate and discovers from
years of experience `know-how´ or mental model developed over the years, that
there are inaccuracies in the document. He modifies the document accordingly.
That is the expected, positive result where knowledge begets knowledge creation.
Thus, a result of explicit knowledge is that codified knowledge may be proactively
spread to people who can use specific forms of knowledge (Sanchez, 2004).
At first glance, the implications of having an abundance of sources or `containers´
of explicit knowledge seem all positive. After all, more documents, training
manuals, myriad different databases and more web-based applications are better
for workforce than having less or none at all. Not to dampen the importance of
explicit knowledge, it certainly has its place in any organization and is a core
element of creating new knowledge for sure, however; the real question is not
how much explicit knowledge an organisation has, but whether it is positively
impacting the workforce to produce new knowledge as the following counter
example will show:
Suppose the senior level engineer reads the subordinate´s document and then
reads another existing online draft written by another colleague. The senior
engineer sees discrepancies from reviewing both documents, but cannot
immediately contribute to the document. He´s stuck and does not produce
additional knowledge or he proceeds in writing the document but his
interpretation is flawed therefore the knowledge is corrupted.
In the first situation, the senior-level engineer had less explicit knowledge to work
with and contributed to building more explicit knowledge into the document,
whereas the second situation, he had more sources of explicit knowledge yet did
not produce anything at all.
The negative implication to this example is that considerable time and effort to
articulate their knowledge may be required to help individuals within an
organization move forward in generating new knowledge. This leads to an
implication that can be seen as both advantageous and detrimental that some
expert forum or group must be formed to judge the validity of the knowledge
asset. Sanchez points out that "a high degree of organizational discipline in
adhering to the organization´s current best knowledge and best practice¨
(Sanchez, 2004: p.16) could be seen as a disadvantage because the amount of
energy devoted is high. On the other hand, positively, the explicit knowledge can
be "discussed, debated and improved.¨ (Sanchez, 2004: p.21).
Another implication of exploiting explicit knowledge in an organisation is its value
is often eclipse by information and information technology. A caveat about explicit
knowledge is not to correlate it with information or its related technology.
Information in organizations appears as a steady flow of measures, standards and
representations of fact. Information can increase knowledge, but the two terms
are not interchangeable. Information can be thought of as building blocksl that
may yield knowledge. Data can be put together as basis for understanding, but it
is not equivalent to "understanding" (Geyer, 2001). Therefore, information
technology is the means and knowledge is the ends. That is, knowledge can be
disseminated by the use of information technology is a more precise description
of the relationship (Sanchez, 2004).
The most misleading statements are that information technologies can distribute
human intelligence. There is an assumption that organisations can predict the
right information is available and ready to distribute and the right resources are
available to distribute it to. "And bypassing the distribution issue by compiling a
central repository of data for people to access doesn't solve the problem either.¨
The fact of information stored in a database doesn't guarantee that staff will see
or act on the information. "Most knowledge management technology concentrates
on efficiency and creating a consensus-oriented view. The data therein is rational,
static and without context. And accordingly, such systems do not account for
renewal of existing knowledge and creation of new knowledge¨ (Malhotra, 2003:
One important challenge that has to be recognized about explicit knowledge in an
organisation is when individuals intentionally fails to articulating their knowledge
for "fear of the individual´s job security or position of influence depends on the
tacit knowledge the organisation needs¨ (Sanchez, 2004: p.14). Once the
knowledge is extracted, dismissal would follow. Overcoming negative implication
of explicit knowledge requires new ways in redefining the human resource
approach of continuing to reward and retain perpetual learners and knowledge
producers. One approach is to create a strong foundation that is built on values
like mutual trust, workplace creativity, and encouragement when an individual
makes a mistake, encourage advancement by undertaking new ventures, and
ignite the leadership potential in all your staff (Nicolades, 2001).
Explicit knowledge is easily represented and organisation can account for all the
explicit knowledge it holds by showing all the patents, designs, products or any
other codifiable item it has in its possession. Although an important knowledge
form, is only less that half the knowledge embedded in an organisation. So, what
accounts for talent and human capital?
Exploiting Technical Tacit Knowledge: 2nd Form
As we briefly explained in the introduction, tacit knowledge is a non-linguistic,
non-numerical form of knowledge. Nonaka´s referred to it simply as the `know-
how´ or skills. Its value is unquestionable and it is considered the intangible
currency contained in the vaults of people's minds. All organizations have tacit
knowledge implanted in the minds of each worker in their workforce and
management takes great steps to ensure that the tacit knowledge flows in the
channels of an organisation's infrastructure. People are hired based on what tacit
knowledge they have. So what exactly differentiates this dimension? Technical
tacit knowledge is transferring of knowledge by "observation, imitation, and
practice¨ (Gourlay, 2000: p. 5). It is created by or through the individual´s actions
and direct experience at the current time. Tacit knowledge does not work in
isolation; there is a relationship with explicit knowledge. "Organizational
knowledge is converted from explicit to tacit, from individual to collective and
back again through processes of socialization" (Geyer, 2001).
In organizations, technical tacit knowledge rely activities like on-the-job training
and apprenticeships to extract this tacit knowledge and spread it throughout the
company (Gourlay, 2000: p.3; 2002: p.2). Because the dimension of tacit
knowledge being intrinsically personal in nature and difficult to extract. It is
unquestionable that technical tacit knowledge as a generator for new knowledge
in organizations is quite valuable because "dissemination of knowledge in an
organization can best be accomplished by the transfer of people as `knowledge
carriers´ from one part of an organization to another. Further, this view believes
that learning in an organization occurs when individuals come together under
circumstances that encourage them to share their ideas and to develop new
insights together that will lead to the creation of new knowledge (Sanchez, 2004).
An example how many organizations are using technical tacit knowledge besides
the conventional trainee-trainer method, the recent advances in technologies
such as videoconferencing have allowed organizations to approximate the tacit-
to-tacit transfer with a larger number of knowledge recipients instead of the one-
to-one interaction of apprenticeships and on-the-job training. This results in
diffusing the knowledge transfer to more than one recipient. One thing about
interactive demonstrations or virtual interactions is that staff feels empowered by
these organised programmes. An after effect is that staff respond positively to the
recognition of the newly found knowledge, leading "to improvements in employee
satisfaction and motivation¨ (Sanchez, 2004: p.10) when an organization
recognizes and makes evident that individuals are considered valuable as
esteemed knowledge assets. Furthermore, the use of on-the-job training or
apprenticeships in an organization makes employees content, resulting in
heightened interest in more knowledge management processes which staff are
more likely to participate in later.
One disadvantage about exploiting tacit technical knowledge is that it can be an
expensive proposition. Take for instance a situation where a manager is locating a
specific person with a unique skill set or knowledge base in a pool of thousands of
employees branched out throughout the company. Many different people in an
organization possessing unique tacit knowledge do not congregate at one point.
The administrative and operational tasks of tracking those who have the
particular knowledge or skill can be daunting when traversing the various
departments of a large organisation. This task requires frequent updating of
personnel database of skillset and knowledge expertise requires more time and
Assuming the organisation's database is extremely accurate and considers the
tracking of the individual's known knowledge or skillset is complete is not enough.
Realistically, a person's knowledge is dynamic and expanding periodically,
therefore the database record at any given time will never contain information
that accurately reflects a person's knowledge or skillset.
Once those people or person in the organization are identified or profiled to
possessing that knowledge, another implication arises when the people or person
does not actually have the claimed knowledge (Sanchez, 2004). This can further
burden human resource departments and managers from matching people to jobs
when the integrity and veracity of the personnel data is questionable leading to
more time, energy and expenses consumed.
Cognitive Tacit Knowledge: 3rd Form
Characteristically similar of being non-linguistic and non-numerical, cognitive tacit
knowledge is much more elusive. This means that it is ingrained schema, beliefs
and mental models that has the ability to be transmitted through language either
written or spoken. Nonaka´s examples of cognitive knowledge included activities
where social activity took place to evaluate problems collectively thus `reorienting
people´s mental models´ (Gourlay, 2000: p.3). This is similar to tacit technical
knowledge because it requires the interaction of people, that is, the tacit
knowledge is passed transferor and the transferee. The difference is, as Linkola
defines, is "the basis of which an interpretation framework is formed to analyse
the reality and possible visions of the future. In many administrative and service
jobs a tacit interpretation framework is an example of the cognitive side of tacit
knowledge¨ (2003). Simply put, cognitive tacit knowledge is transmitted by using
Because of its reliance on a source (individual knowledge holder) the obvious
consequence of tacit knowledge -applicable to both technical and cognitive - is
that if the source leaves the organization, the knowledge transfer may not be
realized, incomplete or interrupted. This disadvantage does not apply to explicit
forms of knowledge where a person or virtual presence of that person to interact
with the knowledge recipient.
Examples of tacit cognitive knowledge within an organization could be a group
that debates on its collaborative e-learning platform. What are inevitably called
"e-coaches" facilitate this learning, and discussions also take place over email or
Another more familiar example is an instructor directly articulating instructions
along with physical and visual guidance. Sometimes face-to-face interviews can
articulate knowledge holder´s hunches, insights and intuitions; however the
amount accuracy is arguable. A new method used by organizations wanting to
haul tacit cognitive knowledge is a tool called "Cognitive Mapping¨. Specifically,
cognitive mapping incorporates the process of externalization highlights the
limitation of the human mind by observing that knowledge is lost out of memory
over time. Implications are that cognitive mapping is biased and incomplete;
therefore knowledge may do more harm than good.
As outlined earlier the numerous implications of exploiting tacit technical
knowledge in an organization, tacit cognitive knowledge shares equally the
positive and negative implications as well.
From the examples in the previous sections, it is important for organizations to
understand the types of knowledge and to take steps to promote the positive
implications and anticipate the impact of the negative implications. Those
organizations prepared for all implications of extracting and exploiting embedded
knowledge within its walls can properly activate various programmes to allow
their employees tacit knowledge to spread among their work peers and continue
to build on it explicit knowledge repository. These actions re-ignite knowledge
creation and dissemination and lower the financial and time costs associated with
setting up, reconfigure and maintain a knowledge management system.
So regardless which forms of knowledge prevails in an organisation, explicit or
tacit knowledge, it is the company´s utilization of these forms of knowledge,
which is, using knowledge to generate actionable value propositions and more,
new knowledge, is the key factor that determines its competitive advantage.
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