Tacit Knowledge

and Discretionary
Judgment
RAYMOND W. COX III, MICHAEL L. HILL,
AND SUCHETA PYAKURYAL

Abstract
The goal of this analysis is to define the individual and organizational parameters
within which the ethical exercise of discretion may occur. The application of tacit
knowledge is the introduction of judgment prior to deciding. Discretionary judgment
is not an assignment or position. It is not the product of explicit knowledge. It cannot
be delegated based upon explicit criteria. But it will emerge from the practices and
activities of tacitly defined informal networks.

Many scholars have an attitude toward the exercise of discretion that must be
described as ambiguous and even ambivalent. While there is no dispute about the
necessity for exercising discretion, there is little agreement on the normative foun-
dation for such decisions (Bryner 1987). Nor, for that matter, have the necessary
individual and organizational elements by which to study the exercise of discretion
been fully explored. Without a frame of reference for these elements, there is little
basis upon which to judge the use of discretion.
Put most simply, discretion represents a judgment as to what activities in an
agency are to receive priority. Exercising discretion presumes that both the need for
judgment and the capacity to exercise it are not about simply implementing “routine”
activities. Situations and circumstances drive the decision to exercise discretion.
The fundamental question is how to ensure that discretionary decision-making by
bureaucrats is done “rightly.” What will be argued here is that the capacity to exercise
discretion well is not merely the result of thinking or wanting to do things well.
Rather it is the result of judging events and circumstances at a moment in time and
then acting on that judgment (Cox 2004).
A central concern of this paper is to examine the components of those a priori
judgments. It will be asserted that they are informed by an understanding that emerges
from the application of specific individual and organizational tacit knowledge. The
term “understanding” speaks to the capacity to “judge particulars” and then act
upon that judgment (Arendt 2003). Borrowing from Arendt (2003), Weick (2001),
and Weber (1946), this exercise of discretion is preceded by three interrelated and

Public Integrity, Spring 2008, vol. 10, no. 2, pp. 151–164.

© 2008 ASPA. All rights reserved.
ISSN 1099-9922/2008 $9.50 + 0.00.
DOI 10.2753/PIN1099-9922100204
Raymond W. Cox III, Michael L. Hill, and Sucheta Pyakuryal

intertwined prerequisite activities: experiencing or sense-making (which involves

thinking and knowing), judging, and acting. In other words, understanding (whether
organizational or individual) is the result of these three activities.
First, sense-making in any situation comes about by thinking about it in the
abstract, which leads to knowing by defining the situation. Second, a judgment
(and therefore a decision) is made based upon that understanding, in order to take
the third and most critical step—action. Information and knowledge serve as the
foundation or basis for these activities, and exploring the influence of organizational
knowledge and organizational learning is important here (Argyris 1999; Kikoski
and Kikoski 2004; Weick 2001).
Organizational knowledge is viewed as being of two types—explicit and tacit. For
the present analysis, tacit knowledge is the primary focus. Tacit knowledge affects
the sense-making capacity (Polanyi 1962, 1966, 1997), but critically it constitutes
the capacity to understand. To comprehend the exercise of discretion, we must more
fully explore the role of tacit knowledge, which is “learning and unlearning through
experience and knowledge in motion” (Baumard 1999). Knowledge in organizations
moves from individually attained knowledge to organizationally attained (learned)
knowledge. Stated another way, learning in organizations occurs at both the indi-
vidual and the collective level. More precisely, knowledge shifts between tacit and
explicit, and from individual to organizational knowledge.
The goal of the present analysis is to define the individual and organizational
parameters within which ethical exercise of discretion may occur. To reach this
goal, two elements of organizational decision-making must be explored: organiza-
tional knowledge and the framework for organizational decision-making or deci-
sion architecture (Price Waterhouse 1996). The first step is an examination of the
two elements of organizational knowledge—tacit and explicit knowledge. This is
followed by a discussion of the related notion of organizational learning. The third
part examines the relationship among organizational ethics, decision-making, and
tacit knowledge, and then pulls these concepts together to offer the implications for
individual behavior and performance. The analysis concludes with an assessment
of the organizational practices that address the negative implications and strengthen
the positive implications of an ethically based tacit knowledge.

Knowledge in Organizations
Although much has been written about the importance of knowledge in organizational
management and decision-making (Lindblom 1959; Pressman and Wildavsky 1973),
relatively less attention has been paid to the role of one type of knowledge—tacit
knowledge. As the work-related practical knowledge one learns informally on the
job, tacit knowledge is intimately related to action such that it reflects understanding
how, as contrasted with knowing what, and is acquired without direct instruction
or help from others (Brockmann and Anthony 2002). Tacit knowledge is “proce-

An earlier version of this paper was presented at the Transatlantic Workshop on Ethics and
Integrity, University of Maryland, March 21–23, 2007. While many people have helped
refine the paper, the authors acknowledge in particular the assistance of Mark Bovens of
the Utrecht School of Governance, Utrecht University, Netherlands.

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 Tacit Knowledge and Discretionary Judgment

Socialization Organizational Internalization

Tacit
Knowledge
Individual Tacit Organizational
Knowledge Articulation Explicit
Knowledge

Individual
Articulation Explicit
Knowledge
Combination

Figure 1. Organizational Learning

Source: Adapted from Baumard 1999, 25–29.

dural knowledge that guides behavior but is not readily available for introspection”
(Sternberg 1999, 231); it is acquired largely from experience, and its utilization
often results in highly effective execution of tasks.1
When decision-makers utilize tacit knowledge, they experience an automatic,
nonconscious process that draws upon experientially established cognitive struc-
tures (Bennett 1998). Every organization, and every person in the organization,
has a history. These histories are the lens through which each individual judges
the organization. This interpretative system is the result of applying both forms
of knowledge—tacit and explicit—to sense-making. Explicit knowledge emerges
from “facts, knowledge codified, ‘ruled, archived and organized knowledge,’ that
which can be expressed in words and numbers, whereas tacit knowledge represents
learning and unlearning through experience, knowledge in motion—subjective,
interpretive, equivocal and continuous” (Baumard 1999, 8). The weakness of tacit
knowledge is that it is often “invisible”;2 it represents how people act unconsciously
and intuitively. As Baumard explains, “Knowledge is [thus] a mutable and fragile
organizational entity. Its sense is derived from its application, and is lost once it is
removed from the context of its utility” (1999, 16).
People in organizations apply both tacit and explicit knowledge to understand
the world around them (Gherardi and Nicolini, 2003; Stati, 2003). “It is in fact the
interaction of explicit and tacit knowledge that allows organizations to make sense
of their environment, by appealing to both . . . to control and modellization (explicit
knowledge), and organizational memory, to their experience and that of others, and to
intuition (tacit knowledge)” (Baumard 1999, 8). Figure 1 illustrates how knowledge
in organizations moves from individually attained knowledge to organizationally
attained (learned) knowledge.
The processes of internalization (explicit into tacit knowledge) and socializa-
tion (tacit to tacit) are now examined because it is internalized and socialized tacit
knowledge that dominates the judging and acting under conditions and circumstances
where discretion is required. Moreover, as Brockmann and Anthony (2002) state,
tacit knowledge serves to fill the gaps of what can be seen, and provides a more

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 Raymond W. Cox III, Michael L. Hill, and Sucheta Pyakuryal

complete picture of the future, which should set the stage for making higher-qual-
ity decisions.

Organizational Learning

From Thinking and Knowing to Understanding

Arendt (2003), following Kant, asserts that thinking and judging are interrelated but
separate. Thinking is the result of forming abstractions. Judging is the first step toward
deciding (i.e., deciding to decide). It is the product of understanding the situation in
its fullest sense. She goes on to posit that some individuals are better at one activity
than the other. One person could do well at
abstract thinking, and another could be bet-
The “problem” of exercising discretion
ter at judging. Judging follows thinking and
is embedded in the dilemma that knowing, and emerges from understanding.
exercising discretion calls for It is the capacity to understand that is the key
individuals with the capacity for aspect of judging.
judging, not with the capacity for Successful organizational decision-mak-
thinking. ing is predicated upon what Arendt describes
as the capacity to think to conclusions (see
Figure 2). As Arendt (2003) would explain
it, one must think about work before one can do it. But without a particular focus,
abstract thinking cannot become tangible work. The obvious dilemma for organiza-
tions is in recognizing these different capacities and assigning roles that fit those
capabilities. The “problem” of exercising discretion is embedded in the dilemma that
exercising discretion calls for individuals with the capacity for judging, not with the
capacity for thinking. It is a problem precisely because the need for discretion arises
when the situation is not routine, that is, when the situation and circumstances, not
the abstractions, such as SOPs, dictate. Those with the capacity to think can (and
will) develop appropriate standards of performance and behavior; those with the
capacity to judge will understand when it is time to step outside the routine.
In a commentary about policy analysis but focused on the application and utility
of tacit knowledge, Dror notes that

a more advanced type of professional knowledge, which can be used with significant
benefits for the benefit of public decision-making, is needed in today’s policy analysis
process. There should be an extensive reliance on tacit understanding, Gestalt-images,
qualitative models and qualitative methods (instead of main emphasis on explicit
knowledge and quantitative models and tools). This involves imaginative think-
ing, systematic integration of trained intuition into policy analysis, development of
qualitative tools and construction of broad qualitative models of complex issues in
cooperation with social scientists and other professionals. (2004, 253)

Dror’s characterization of professional knowledge and the concept of tacit un-

derstanding presented here is illustrated in Figure 2.
Usually, decision-making is controlled by formal rules and regulations and is
guided by organization preferences and practices. However, when a unique situ-
ation arises in an organization, it brings along new uncertainties as well as new
alternatives; decision-making then selects courses of action that are expected to

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 Tacit Knowledge and Discretionary Judgment

Explicit/Analytical
Decision- Making

Sense-Making Deciding Acting

Thinking Knowing

Figure 2. Analytical Decision-Making Model

perform well given the understanding of goals and the conditions of uncertainty
(Choo 2002). This results in the capacity to develop new knowledge by a complex
interplay between existing knowledge and sense-making, as shown on the left side
of the model in Figure 3.
The capacity to judge, and therefore to understand and then act, is intertwined
with tacit knowledge. This process is demonstrated on the right side of the model in
Figure 3. While explicit knowledge can yield decisions (as an individual act or as an
organizational mandate), it is more closely aligned with Arendt’s notion of think-
ing. Rules and regulations, hierarchical relationships, in fact the entire range of
structural-functional understandings of modern organizations, emerge from thinking
about organizational design and process. The decision is the result of the process
of thinking. The classic model of policy analysis in which the optimal alternative
is uncovered is an example of this form of decision-making. There can be only one
decision; therefore, the analysis yields answers. Working, in contrast, emerges from an
understanding of the circumstances and events that results in actions (Hummel 2005),
which is close to the application of tacit knowledge. In this context, understanding
informs us when the process (analysis) has not produced the right decision.

The Importance of Understanding and Valuing

A variety of authors from Selznick (1957) to Burns (1978) have emphasized the
importance of organizational learning that reinforces the values and mission of the
organization. They see these as the key ingredients in organizational leadership.
The importance of value statements, such as missions, goals, and codes of ethics,
is part of the mantra of “best practice” modern management (Day 1999). However,
unless the decision-making process is supported and reinforced by the individual’s
attitudes, values, and behaviors, it is bound to fail. Day argues that leaders can use
value statements to begin the process of defining an organizational ethic. True to the
notion of the conversion of explicit knowledge into tacit knowledge (internalization),
she warns that “to guarantee compliance with new policies, values should also be
supported by coherent and congruent regulatory practices within the framework of
the existing culture” (1999, 164). In other words, the value system of the organization
(or of the government) must be reconciled with that of the organization members.
But this need not be a reduction to the lowest common denominator of behavior.
Rather, it can be a significant exercise in “cultural” renewal and the foundation
for a collectively defined organizational ethic that can guide practice and thus the
exercise of discretion.

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Raymond W. Cox III, Michael L. Hill, and Sucheta Pyakuryal

Tacit/
Discretionary
Decision-Making

Sense-Making Judging Acting

Thinking Knowing Understanding Deciding

Figure 3. Discretionary Decision-Making Model

But what is the source for the values that Day (1999) finds so powerful? The source
of such a spirit is found in the ideas of Weber (1946) and Kohlberg (1971; Carlson
2002). Weber addresses the importance of vision, purpose, and a “future orienta-
tion.” He speaks to the ethical perspective necessary to be a policymaker. The key
to this perspective is its emphasis on the consequences of actions, not merely their
purpose. This is, as Weber describes it, the ethic of the “mature man”—an ethic fully
conscious of the consequences of actions, yet grounded in principle. His conclusion
to this work is both profound and apt in its depiction of the ethical individual.

Politics is a strong and slow boring of hard boards. It takes both passion and perspec-
tive. Certainly, all historical experience confirms the truth that man would not have
attained the possible unless time and again he reached out for the impossible. But
to do that a man must be a leader, and not only a leader but a hero as well, in a very
sober sense of the word. And even those who are neither leaders nor heroes must arm
themselves with that steadfastness of heart, which can brave even the crumbling of
all hopes. This is necessary right now; or else men will not be able to attain even that
which is possible today. Only he who has the calling of politics is sure that he shall
not crumble when the world from his point of view is too stupid or too base for what
he wants to offer. Only he who in the face of all this can say “In spite of all!” has the
calling for politics. (Weber 1946, 128)

Weber’s challenge to those in the public service is to recognize when to step out-
side the routine of day-to-day affairs and understand the long-term implications of
decisions. His mature man does not shrink from the responsibility to “reach out for
the impossible.” For Weber, ethical leadership lies in the willingness to steadfastly
look to the future, even as the bureaucratic routine insists upon being grounded in
the present. It is a quality of character that Weber expects to be rare. The decision
to act outside the routine is never easy, but it is necessary and even vital.
Lawrence Kohlberg’s moral development theory (1971) stretches the Weberian
notion of the “calling of politics.” “Public administrators must recognize that different
levels of moral judgment exist, and that situational variables such as education, age,
life experience, and degree of autonomy may affect an individual’s moral judgment”
(White 1999, 130). Weber’s mature man and Kohlberg’s post-conventional man are
quite similar. Each is fully conscious of the circumstances surrounding the decision
and the consequences for others in the choices to be made. Similarly, each must
have experience, autonomy, and accountability. Mature man, then, is one who “is
aware of a responsibility with heart and soul. [He] . . . acts by following an ethic of
responsibility and somewhere he reaches the point where he says: Here I stand; I can

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 Tacit Knowledge and Discretionary Judgment

do no other” (Weber 1946, 128). Therefore, grants of discretion are not the product
of rank or title, but instead reflect a judgment of a person’s capacity and capability
to act. Critically, both perspectives emphasize consciousness of the situation and
the exercise of judgment based upon experience and the desire to do what is right.
Stated another way, maturity comes with the acquisition of tacit knowledge. Such
persons are the leaders that Gardner (1986)
and Selznick (1957) define as necessary for As maturity is gained, the recognition
successful organizations.
of the need to balance these values and
One final point is critical, and therefore
worth reiterating. In emergencies, two phe- the capacity to do so is an indicator of
nomena are observed: (1) a tacit organization having achieved tacit knowledge.
between individuals instinctively reappears;
and (2) the social organization of individuals remains ever present (Baumard 1999).
The tacit regains the upper hand over the explicit.
In any case, the speed of the phenomenon leaves neither space nor time for com-
mentary or rationalization (Baumard 1999, 37).
Can Weber’s concept of maturity be linked to the possession of tacit knowledge? It
is internalized and socialized tacit knowledge that dominates understanding, deciding
and acting in emergencies (precisely when discretionary judgment is most needed).
When ethical conduct is internalized, discretionary judgments will reflect some
combination of ethical and moral precepts (see, for example, Audi 2004; Dubnick
and O’Kelly 2005). The constant struggle is to balance the generalized demands of
the normative with the specific requirements of making a decision in the present.
As maturity is gained, the recognition of the need to balance these values and the
capacity to do so is an indicator of having achieved tacit knowledge.

Ethics, Discretion, and Tacit Knowledge

As stated, situation and circumstances drive the decision to exercise discretion, and
it is important that discretionary decision-making by bureaucrats is done “rightly.”
An important aspect of discretion is derived from the desire to behave ethically. In
the words of the old saying, ethics is about doing what is right, not merely doing it
the right way (Burke 1994). The ideal of ethical decision-making as an element of
policy implementation may produce some unexpected results when combined with
other values, such as democracy and representative government (Bowman 1991).
The difficult or hard choice by any public servant (the most critical moment for the
exercise of discretion) is not whether to help someone, but to define the limits of
that help. There are inevitably more who seek help than can be served. The difficult
choice is to determine, ethically, when to end assistance. One must remember that
the longer an official spends on the special case (the nonroutine case), the lengthier
the waiting list of those as yet not helped. Worse, this is precisely the situation for
which neither bureaucratic routines, nor policies, nor court rulings can provide
professional guidance.

Implications
This discussion has intertwined and linked knowledge at both the individual and
organizational levels. Commentaries on organizational culture and learning often

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Raymond W. Cox III, Michael L. Hill, and Sucheta Pyakuryal

treat individual and organizational learning as a feedback system in which learn-

ing is dynamic and synergistic (Argyris 1999; Weick 2001; Yanow 2003). While
not everyone agrees with this comingling, it does permit examination of both the
individual and the organization when looking at decision-making. What follows is
a review of the implications, both negative and positive, that affect decision-making
by individuals in organizations.

Negative Implications
A bureaucrat who lacks tacit knowledge has a severely restricted ability to exercise
discretion. The true problem of discretion is having the wrong person exercise dis-
cretion. What are the sources of the mismatch between the capacity to judge and the
responsibility to judge? The intertwining of tacit knowledge and ethical judgment
suggests four causes:

• Inexperience
• Lack of knowledge
• Burnout (diminished capacity)
• Corruption

Inexperience
While inexperience is most obviously a problem endemic in newly hired (or newly
promoted) workers, it also exists when workers have not been socialized into the
organization. Weick’s (2001) notion of sense-making in the workplace is gained
through experience. Work that is very narrowly defined (faculty vs. administrators
in American universities) or done in isolation (the police officer on the street, or the
worker in a field office) can also reflect a kind of inexperience. In both instances there
is no opportunity (or the opportunity is not recognized) to combine or internalize
knowledge. Inexperienced workers are not yet committed (Weick 2001). As such,
they cannot act, and without that action they cannot make sense of the organization.
They are hesitant and apparently indecisive because they do not recognize the cues
that lead to acting.

Lack of knowledge
From one perspective, inexperience and lack of knowledge are related. But a lack
of knowledge can occur at both the individual and the organizational level, and it
has both explicit and tacit dimensions. There is also the question of the individual
worker’s capacity to learn and gain knowledge. Some have a good “feel” for a job
and learn quickly. For others learning is a struggle. The inability to comprehend and
acquire tacit knowledge plays a significant role in halting learning.
Again, the above commentary has both an individual and an organizational
dimension—individuals may be knowledgeable, but the organization may not lis-
ten. While explicit knowledge is articulated knowledge, tacit knowledge often is
“inarticulate” (Baumard 1999). Unless there is a conscious effort to transform and

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 Tacit Knowledge and Discretionary Judgment

translate individual knowledge into tacit organizational knowledge, this problem will
continue (Gherardi and Nicolini 2003). The “tragedy” of the failure to internalize
and socialize tacit knowledge is in the inability of managers to comprehend and
appreciate the importance of the “feel” for
things that people close to the work may pos-
sess. The shuttle tragedies at NASA, nearly Stopping corruption does not begin or
two decades apart, both had their roots in the end with identifying the criminal act
requirement of senior managers that people of the individual, but in uncovering the
on-site express their concerns in explicit organizational cultural behaviors that
language (because that was the only language
make the criminal act attractive.
the managers recognized as valid).3

Burnout
In the United States the problem of burnout has been noted for many years. This
problem is often associated with role conflict, where the professional expectations
of the worker and the organizational work rules conflict (see, among others, Hum-
mel, 2007; Selden, Brewer, and Brudney 1999). Here burnout becomes a problem
of diminished capacity. The knowledge may still exist within the individual (and
potentially within the organization), but the role conflict leaves the worker without
the will to act. Organizations under threat of dissolution (a common problem in
American government) often display the same ennui that Hummel sees in individual
cases of burnout. These organizations (much like the individuals) just go through the
motions. Framed differently, these are institutions in which the informal organization
is not performing properly and organizational learning has ceased.

Corruption
Corruption is not the simple problem of individual bad behavior. Even where
corruption is common, there is a tendency to focus on individual transgressors as
if to say that the problem only pertains to a few “bad apples” (Johnson and Cox
2004–2005). The present analysis would suggest that corruption is more ingrained.
It is learned behavior. It survives because the organization has learned that such
behavior is justified (i.e., it has become internalized tacit knowledge). While those
on the outside may find the behavior incomprehensible (Bok 1978; Hope 1999),
those on the inside have successfully rationalized the behavior and incorporated
it into the organizational customs. As Arendt noted, corrupt people have a seem-
ingly infinite capacity to excuse their own behavior (“Everyone does it, but I am
different”).

As far as the criminals themselves are concerned, the chief common weakness in
their character seems to be the rather naive assumption that all people are actually
like them, that their own flawed character is part and parcel of the human condition
stripped of hypocrisy and conventional clichés. (2003, 268)

Stopping corruption does not begin or end with identifying the criminal act of
the individual, but in uncovering the organizational cultural behaviors that make the
criminal act attractive. How might these failures be addressed?

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Raymond W. Cox III, Michael L. Hill, and Sucheta Pyakuryal

Positive Implications
Those who possess tacit knowledge often have difficulty articulating it. But the
barrier is often that the knowledge may be neither internalized nor socialized. The
implication of this reality is that new ways of mentoring and socializing people
may accelerate both individual and organizational learning, and that strong informal
organizations may be formed in the process of sharing knowledge.

Informal Organizations
Informal organizations play a vital role in establishing values in any organization.
Such groupings greatly influence the ideas that are considered to have intrinsic worth
or desirability, and the basic standards and principles that guide action. Individuals
do not create their values in a vacuum; instead values are created in a group context
(Gortner, Mahler, and Nicholson 1987). The creation of group values is similar to
the formation of group norms or “informal rules” (Feldman 1984). Although these
rules are “infrequently written down or openly discussed, they often have a powerful,
and consistent, influence on group members’ behavior” (Feldman 1984, 288). These
values and unwritten rules stem from tacit knowledge within the organization.
Workers often consider peer evaluations of their work performance that take place in
an informal structure within an organization to be just as important, if not more so, as
the opinions of their supervisor. The informal organization’s communications network
is the operational side of peer evaluation. Peer evaluations play a dominant role in such
matters as job satisfaction, morale, efficiency, and the firm’s productivity. They help
to counter, or “check,” the negative implications: lack of knowledge, inexperience,
burnout, and organizational corruption. This does not mean that peer evaluations will
eliminate these implications, only that they may help to control their effects.

Formal Organizations
An important aspect of formal organization is a self-conscious selection of mentors.
What is meant here is not the kind of mentor who becomes a worker’s advocate and
cheerleader, providing introductions to the important personages in the organization,
but rather one who understands that the primary role of mentoring is to utilize both
explicit knowledge (articulated, rational, technical knowledge) and tacit knowledge
(inarticulate, intuitive, sensing, feeling knowledge). Such mentoring is found more
frequently in organizations than may at first be apparent. Often the most skilled
workers (i.e., those with the highest level of tacit knowledge) are selected to be the
supervisors of work teams. A supervisor selected in this way is the “puzzle solver”
who teaches others how to uncover and then address problems. Military organiza-
tions, although not generally thought of as using tacit knowledge (commands, after
all, are the ultimate in learned, articulated, explicit knowledge), have created positions
(e.g., squad or platoon sergeant) in which a major responsibility is the conveyance
of tacit knowledge both up and down the organization.
The preceding analysis suggests that tacit knowledge (including tacitly learned
ethical knowledge) influences individual and collective (organizational) behavior
and learning. It is a key ingredient in the development of an organizational culture.

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This is not to suggest that tacit knowledge yields only positive learning. Tacitly
learned behavior may have decidedly negative consequences. But from this reality,
it is possible to develop organizational strategies that reinforce the positive ele-
ments of tacitly learned knowledge and identify those persons who should exercise
discretionary judgment.

Conclusion
Aristotle noted more than two millennia ago that ethics is not a skill to be taught,
but something observed and experienced. Ethics relates to tacit knowledge in that
both begin from a definition of “good” and then attempt to take action. The applica-
tion of tacit knowledge is the introduction of “judgment” before deciding. Science
(and bureaucracy) seeks the routinization of knowledge—there is no judgment. In
effect, the individuals and the organization go from knowing to deciding because
the routine replaces the judging aspect of decision-making. In this process there is
no organizational learning, only rule compliance. The concern here, however, is
with the need for discretionary judgment when the situation is outside the routine.
Under such circumstances there is a need either for new rules or for amended rules.
This requires the creativity that comes from maturity (postconventional wisdom);
in other words, tacit knowledge.
Where do we go from here? The challenge for organizational leaders is to find
a way of synthesizing tacit and explicit knowledge in a manner that fosters sound
judgment at every level of the organization. One way to accomplish this is through
the use of informal organizations that initiate mentoring and peer evaluations
within the organization. These attributes of informal organizations are instrumental
in passing tacit knowledge from senior employees down to inexperienced junior-
level employees (and back up from junior levels to isolated senior levels). The use
of mentoring teams in conjunction with peer evaluation can counteract the lack of
knowledge or inexperience at the junior level, and at the same time reduce the effects
of burnout on senior employees by involving them in the continued development
of the organization. In addition, mentoring and peer review place an inner check
on organizational corruption. Finally, the use of mentoring teams and peer review
put the emphasis on the collective or organization-wide aspects of decision-mak-
ing, thereby creating conditions in which individual responsibility and collective
accountability can both be achieved.
Whereas explicit knowledge allows organizations to react to events after the fact
by using bureaucratic rules or SOPs, tacit knowledge frees organizations from these
confines. Because it is cumulative, it enables organizations to see past the specific
event and instead focus on the big picture, thereby facilitating greater understand-
ing. The first step in valuing tacit knowledge is to ease the processes of individual
and organizational learning. It is easy to recognize and appreciate the skill of the
professional athlete or the master artisan, but we do not translate the capacity to
appreciate or identify those skills with organizational learning in other settings. If
the genius of a master painter or carpenter can be recognized, why cannot the genius
of a coworker with tacit knowledge be recognized and utilized for the benefit of the
organization? In truth, that is exactly what successful organizations do. Directing
the initial choices to those capable of applying tacit knowledge is a way of working
to convert the decisions exercised into institutional norms or habits. In organiza-

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Raymond W. Cox III, Michael L. Hill, and Sucheta Pyakuryal

tional settings, habit is most often presumed to be a routine, something structured.

Aristotle placed great emphasis on the formation of good habits. In his view, habit
is a consistency of good behavior or judgments in the face of the nonroutine. There-
fore it is not the values or laid-out written rules (explicit knowledge) but the tacit
knowledge that leads to good, consistent decision-making (actions). This end result
is what matters most in organizations.
This analysis began by seeking a framework within which to understand discre-
tionary judgment. For all intents and purposes, it suggests that those who should
exercise discretion are those with tacit knowledge. The capacity for judgment—that
is, the skill to fully understand and decide before acting—is embedded in the ability
to internalize and socialize knowledge. More important, from this ability comes the
informally assigned authority to judge. The reality is that most organizations are
driven by and succeed through their informal networks, not the formal organiza-
tion. Discretionary judgment is not an assignment or position. It is not the product
of explicit knowledge. It cannot be delegated based upon explicit criteria. But it
will emerge from the practices and activities of tacitly defined informal networks.
As noted earlier, the problem of exercising discretion is embedded in the dilemma
that the exercise of discretion needs people who have a capacity for judging, not a
capacity for thinking. The determination of who belongs in the realm where discre-
tion is exercised should be based on whether they have a place of authority in the
informal organization and possess the demonstrable capacity for judgment that is
variously labeled maturity, instinct, or skill.

NOTES
1. The analogies and metaphors used to explain tacit knowledge often come from
sports (e.g., someone has a “feel” for the game). Thus there is a tendency to view tacit
knowledge as natural and instinctive. This is not the case. The capacity to acquire tacit
knowledge is what separates people, but this is beyond instinct. Tacit knowledge is
learned, even if the capacity for learning differs among people. Two individuals may
learn the same lessons from explicit sources (education and training), but their applica-
tions of that knowledge may differ. It is the ability to learn “tacitly” that produces the
differences in performance.
The difference between management and leadership can be explained similarly.
Weber’s distinction between the bureaucratic ethic and the ethic of the politician also has
a connection to tacit knowledge. Both of these discussions are topics for another study.
2. The similarity between the notion of tacit knowledge as invisible and Kant’s as-
sessment of thinking as invisible is worthy of exploration but is beyond the scope of this
paper. Kant had quite different ideas in mind when he declared that thinking is invisible,
and ultimately not productive (see Arendt 2003).
3. Ralph Hummel (2005) has done some quite interesting work around the barriers
of language in organizations. It is suggested here that the problem of language is a prob-
lem of knowledge. Those committed to traditional forms of organization believe only in
explicit knowledge and communicate within that framework. Using the language of tacit
knowledge, and the type of learning gained from it, is deemed unacceptable.

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ABOUT THE AUTHORS

Raymond W. Cox III is a professor in the Department of Public Administration and
Urban Studies at the University of Akron. Cox is the author of more than fifty academic
and professional publications, ten reports for government agencies, and more than forty
professional papers. He serves as the chair of the Section on Ethics of the American
Society for Public Administration.

Michael L. Hill is a Ph.D. candidate at the University of Akron specializing in counter-

terrorism studies. He has an M.A. in international relations and is currently working in
the Center for Emergency Management and Homeland Security Policy Research at the
University of Akron. He is a guest lecturer at Hiram College.

Sucheta Pyakuryal is a Ph.D. candidate in the Department of Public Administration and

Urban Studies. She has an M.A. in international politics from the University of Akron
and works as an instructor in the McNair Scholars Program at the University of Akron.

164 • PUBLIC INTEGRITY SPRING 2008