Customer Reviews

The Knowledge-Creating Company: How Japanese Companies Create the Dynamics of Innovation

5 star:		(13)
4 star:		(3)
3 star:		(0)
2 star:		(1)
1 star:		(2)

 

 

According to authors, the goal of The Knowledge Creating Company was to (1) construct a new theory if organizational knowledge creation; (2) to provide a new explanation of why certain companies are successful at continuous innovation; and (3) develop a universal management model that converges management practices found in Japan and in the West. In my opinion Nonaka and Takeuchi did an excellent job in all three areas! The presentation of topics is clear and well written. I found chapter 3, Theory of Organizational Knowledge Creation, highly insightful, particularly in the discussion of the Two Dimensions of Organizational Knowledge - epistemological and ontological, and the Four Modes of Knowledge Conversion - socialization, externalization, combination, and internalization.

Drawing from companies such as Honda, Canon, 3M, and GE the authors effectively and convincingly use real world examples to demonstrate organizational knowledge creation.

Nonaka and Takeuchi also provide an in-depth view of Western and Japanese dichotomies and how "synthesis" of both philosophies' can create new solutions.

The Knowledge Creating Company is an excellent resource for Organizational Theory and Strategic Management students or anyone with an interest in how knowledge is created in Japanese and Western companies.

Don't get caught like I did.

The website ("Look Inside") shows a 257+ page book. This book is 59 very small pages. I am very unsatisfied that I have to pay to return this.

Interesting title---a little dated. The introductory portion of the book is worth the journey. A few of their examples are dated at best, but their "knowledge spiral" and their exploration of tacit and explicit knowledge was well done. The knowledge model----separated from "structure" is very good, however when they wander into the realm of organization structures I found their analysis wanting----mind you, it was good, but there was too much anecdotal and not enough meat. This was a ground breaking study---their introduction of a "hypertext" model into organization structure is fascinating (I believe their examples don't exemplify/expand their hypothesis as there is very little data to support the correlation of their idea to actuals). Overall the authors did a good job of exposing Western audiences to another way of managing knowledge---and I learned a lot. Highly recommended if you are interested in knowledge management.

The only thing you need to know about this "book" is that it's not a book at all, but an article that is available for free online as a 10 page PDF file. Google the title and save yourself the $8.95 plus shipping that I spent to find that what was shipped to me I already had on my hard drive. The "book" is 56 pages double spaces and the size of a small birthday card. As to the concepts discussed, I find them highly interesting but in fairness I'm still investigating this subject so I'll leave the analysis to others better qualified but the central theme that knowledge is tacit and created in Japanese firms vs. quantifiable, objective and structured in IT systems in the western world is worthy of consideration. Two stars for this idea having value for anyone looking to re-create the organizational knowledge structure of a company, but I'm being generous. It feels like I got ripped off.

There are already so many excellent books now available on this subject. What sets this one apart is suggested by its subtitle: "How Japanese Companies Create the Dynamics of Innovation." Decades ago, Japanese executives embraced and acted upon Deming's ideas about TQM. Only after many years later was Deming properly appreciated by corporate leaders in the United States. The same cannot be said about knowledge management (KM) and its most prominent advocates in the United States, such as Peter Senge. Nonetheless, there is much of value we can learn about KM from the Japanese.

According to the authors, "the success of Japanese companies is not due to their manufacturing process; access to cheap capital; close and cooperative relationships with customers, suppliers, and government agencies; or lifetime employment, seniority system, and other human resources management practices....Instead, we make the claim that Japanese companies have been successful because of their skills and expertise at `organizational knowledge creation'. By organizational knowledge creation, we mean the capability of a company as a whole to create new knowledge, disseminate it throughout the organization, and embody it in products, services, and systems."

The material is carefully organized and developed within eight chapters:

1. Introduction to Knowedge in organizations

2. Knowledge and Management

3. Theory of Organizational Knowledge Creation

4. Creating Knowledge in Practice

5. Middle-up-down Management Practice

6. A New Organizational Structure

7. Global Organizational Knowledge Creation

8. Managerial and Theoretical Implications

The chapters which I found most thought-provoking are 1, 3, and 8 but all are valuable. I agree with the authors that innovation can be (and is) achieved "by continuously creating new knowledge, disseminating it widely through the organization, and embodying it quickly in new technologies, products, and systems." I further agree that knowledge-creation "is no longer an enigma. ..[nor is the] process endemic to Japanese companies. It is universal." Leaders of any organization (regardless of its size, nature, or national identity) can derive great benefit from this book, one whose primary models and benchmarks may be limited to companies in only one country but whose relevance is indeed "universal."

This book has its origins in an article the two authors wrote for the Harvard Business Review in 1986 about new product development in Japanese companies. Rather than construct a complex theory, complete with flow charts and diagrams, they used a simple metaphor: developing a new product is more like a rugby game than a relay race. Under the relay approach, new-product development proceeds sequentially from phase to phase--concept development, feasibility testing, product design, development process, pilot production, and final production--with one group of functional specialists passing the baton to the next group. Under the rugby approach, the product development process emerges from the constant interaction of a multidisciplinary team whose members work together from start to finish. As in rugby, the ball gets passed within the team as it moves as a unit toward the goal.

Because project teams consist of members with varying functional specializations, the issue of learning was considered a key aspect of product development. The article focused on two dimensions of learning: across multiple levels (individual, group, and corporate) and across multiple functions. But although the authors devoted sections to cross-fertilization and transfer of learning, they didn't develop the epistemological dimension of learning, and their focus was more on the learning organization than on the knowledge-creating company. Japanese firms' reliance on trial and error and on learning by doing wasn't analyzed in terms of the prevalence of tacit knowledge and processes of organizational knowledge creation.

In their book, Nonaka and Takeuchi introduce a key distinction between two kinds of knowledge: explicit knowledge and tacit knowledge. Explicit knowledge can be expressed in words and numbers and shared in the form of data, scientific formulae, specifications, manuals, and the like. This kind of knowledge can be readily transmitted across individuals formally and systematically. Tacit knowledge, on the other hand, is highly personal and hard to formalize, making it difficult to communicate or share with others. Subjective insights, intuitions, and hunches fall into this category of knowledge. Difficult to verbalize, such tacit knowledge is deeply rooted in an individual's action and experience, as well as in the ideals, values, or emotions he or she embraces.

There are two dimensions to knowledge creation: epistemological and ontological. The epistemological level describes how knowledge is converted from one type into another through processes of socialization (from tacit knowledge to tacit knowledge), externalization (from tacit knowledge to explicit knowledge), combination (from explicit to explicit) and internalization (from explicit to tacit). The ontological level refers to the knowledge-creating entity: it includes individual, group, organizational, and interorganizational levels. A knowledge spiral emerges when the interaction between tacit and explicit knowledge is elevated dynamically from a lower ontological level to higher levels.

The authors believe that Japanese companies are especially good at realizing this exchange between tacit and explicit knowledge during the product development phase, and that there is a distinctively Japanese approach to knowledge creation. Epistemologically, Westerners tend to emphasize explicit knowledge and the Japanese tend to stress tacit knowledge. Ontologically, Westerners are more focused on individuals, while the Japanese are more group-oriented. These differences give rise to a wholly different view of the organization: not as a machine for processing information, but as a living organism. People in Japan emphasize the importance of learning from direct experience as well as through trial and error. Like a child learning to eat, walk, and talk, they learn with their minds and bodies. This tradition of emphasizing the oneness of body and mind has been a unique feature of Japanese thinking since the establishment of Zen Buddhism.

The Western philosophical tradition, culminating with Wittgenstein, stresses that "we cannot say what we cannot think". But through metaphors, analogies, and pictures, people put together what they know in new ways and begin to express what they know but cannot yet say. As Polanyi put it, "We can know more than we can tell". The concept of tacit knowledge focuses on highly subjective insights, intuitions, and hunches that are gained through practical experience. This messy knowledge can prove indispensable in elaborating new concepts. As the authors underscore, "Ambiguity can prove useful at times not only as a source of a new sense of direction, but also as a source of alternate meanings and a fresh way of thinking about things. In this respect, new knowledge is born out of chaos".

Another important contribution of this book is to highlight the importance of middle managers and the role they play in the knowledge-creation process. Middle managers serve as a bridge between the visionary ideals of the top and the often chaotic reality of everyday business. They synthesize the tacit knowledge of both front-line employees and senior executives, make it explicit, and incorporate it into new products and technologies. Their contribution points toward a model of management that is neither top-down nor bottom-up, but "middle-up-down". In this model, knowledge is engineered by middle managers, who are often leaders of a team or task force, through a spiral conversion process involving both the top and the front-line employees.

Coming from a rich research field that combines theoretical speculation and practical experience, this management book is unlike any other. In no other text you will find discussions on the philosophy of Descartes and Nishida juxtaposing figures depicting the mechanics of a disposable cartridge in a photocopier. The case studies are not just vignette illustrations reduced to their skeletal form, they are thick descriptions replete with technical specifications and biographical details of key participants. There are no laundry lists of implementable measures or mnemonics of keywords that conjure the image of an alphabet soup. Instead the theory is illustrated by rich diagrams and stories, emphasizing the role of pictures and metaphors in conveying knowledge in a non-verbal form. The Oxford University Press ought to be commended for bringing this volume, the first in a series, to the attention of a public that seldom gets management books worthy of a rereading.

Wissen von Einzelnen zu Gruppen und schließlich für das ganze Unternehmen zum Umfeld des Unternehmens. Nach einer theoretischen Einführung wird man über etliche sehr interessante Fallstudien zum Nachdenken angeregt. Den Abschluß bildet eine sehr präzise Anleitung zur Umgestaltung des Unternehmens zu einem "Wissen erschaffenden Unternehmen".

The book explores the eastern and western views of knowledge and how it is formed.

It provides significant insights into how organisations can manage and accumulate knowledge.

It goes way beyond Senge (The fifth Discipline) but includes Satre, Aristotle and others.

It ties in with Peter Checklands Information, Systems and Information Systems in a way that provides a useful guide to anyone challenged by organisational change,or involved in project or program management.

Solid Theory. Inspired case studies. Overall one of the best investments I ever made.

'Knowledge!' - was my inspiration after reading this book. This book, by far, is one of the best books ever written on the hot topic of Japan-US. The authors seem to contend that 'Knowledge' is created through the synergy of divergent IDEAS or cultures. Not necessarily from just identifying, respecting, or fearing different ideas. This book goes beyond the realm of business, and is applicable to your everyday life as some of us are destined to bridge the gap between two or more cultures. It teaches that it's ok to be both American and Japanese, and the most important issue is - to become the best of both worlds and to educate and inspire others to do so. Shogo Richard Tsuru President, Founder Acto.org