Dynamic Knowledge Flow Theory Nonaka, 1995

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2.3 Dynamic Knowledge

Flow Knowledge flows are dynamic. According to Ibrahim 2005 knowledge flow is the process of moving knowledge by way of communicating to retrieve or allocate working information of any knowledge type either tacit or explicit that would enable an individual or enterprise to complete a workflow process. There are different theories for knowledge flow process which are inspected in the following sections.

2.3.1 Dynamic Knowledge Flow Theory Nonaka, 1995

Some researchers attempted to model dynamics of knowledge flows to help understand such flows. One of the best known models for knowledge flows has been established by Nonaka et al. in 1995. They identified four modes for converting explicit to tacit knowledge or vice versa: 1 socialization, 2 externalization, 3 combination, and 4 Internalization. These are sometimes termed the “SECI” model. Socialization is the process of converting new tacit knowledge through shared experiences. Since tacit knowledge is difficult to formalize and often time- and space- specific, it can be acquired only through shared experience, such as spending time together or living in the same environment. Externalization is the process of articulating tacit knowledge into explicit knowledge. When tacit knowledge is made explicit, knowledge is crystallized, thus allowing it to be shared by others, and it becomes the basis of new knowledge. The successful 40 conversion of tacit knowledge into explicit knowledge depends on the sequential use of metaphor, analogy and model. Combination is the process of converting explicit knowledge into more complex and systematic sets of explicit knowledge. Explicit knowledge is collected from inside or outside the organization of new knowledge. The new explicit knowledge is then disseminated among the members of the organization. Internalization is the process of embodying explicit knowledge into tacit knowledge. Through internalization, explicit knowledge is created and shared throughout an organization and converted into tacit knowledge by individuals. Internalization is closely related to `learning by doing. Explicit knowledge, such as the product concepts or the manufacturing procedures, has to be actualized through action and practice. Some factors that constitute the knowledge-conversion process are explained in the following section. Socialization: from tacit to tacit ƒ Tacit knowledge accumulation: managers gather information from sales and production sites, share experiences with suppliers and customers and engage in dialogue with competitors. ƒ Extra-firm social information collection wandering outside: managers engage in bodily experience through management by wandering about, and getting ideas for corporate strategy from daily social life, interaction with external experts and informal meetings with competitors outside the firm. 41 ƒ Intra-firm social information collection wandering inside: managers find new strategies and market opportunities by wandering inside the firm. ƒ Transfer of tacit knowledge: managers create a work environment that allows peers to understand craftsmanship and expertise through practice and demonstrations by a master. Externalization: from tacit to explicit ƒ Managers facilitate creative and essential dialogue, the use of metaphors in dialogue for concept creation and the involvement of the industrial designers in project teams. Combination: from explicit to explicit ƒ Acquisition and integration: managers are engaged in planning strategies and operations, assembling internal and external data by using published literature, computer simulation and forecasting. ƒ Synthesis and processing: managers build and create manuals, documents and databases on products and services and build up material by gathering management figures or technical information from all over the company. ƒ Dissemination: managers engage in planning and implementation of presentations to transmit newly created concepts. 42 Internalization: from explicit to tacit ƒ Personal experience: real world knowledge acquisition: managers engage in “enactive liaising” activities with functional departments through cross- functional development teams and overlapping product development. They search for and share new values and thoughts, and share and try to understand management visions and values through communications with fellow members of the organization. ƒ Simulation and experimentation; virtual world knowledge acquisition: managers engage in facilitating prototyping, and benchmarking and facilitating a challenging spirit within the organization. Managers form teams as a model, conduct experiments, and share results with the entire department. As stated above, knowledge creation is a continuous process of dynamic interactions between tacit and explicit knowledge. Such interactions are shaped by shifts between different modes of knowledge conversion, not just through one mode of interaction. Knowledge created through each of the four modes of knowledge conversion interacts in the spiral of knowledge creation. Figure 2.2 shows the four modes of knowledge conversion and the evolving spiral movement of knowledge through the SECI Socialization, Externalization, Combination, and Internalization process. 43 Figure 2.2. The SECI Process Source: Nonaka Takeuchi, 1995

2.3.2 Dynamic Knowledge Flow Theory Nissen, 2002