Knowledge Management

CT024-3-M

Approaches to Managing Knowledge

Dr Alan Eardley
 Learning Outcome

• Explain tacit knowledge approach

• Explain explicit knowledge approach

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 Tacit Knowledge Approach

• Knowledge is personal in nature and very

difficult to extract from people
• Knowledge must be transferred by moving
people within or between organizations
• Learning must be encouraged by bringing the
right people together under the right
circumstances

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 The ‘Tacit Approach’ to KM

• Believes that knowledge is essentially personal and is:

– difficult to store in understandable form
– difficult to communicate from one person to another
• Assumes (often implicitly) that the knowledge available
to an organisation remains in the heads of individuals
• Holds that the dissemination of knowledge can best be
achieved by using people as ‘knowledge carriers’ (e.g.
from one part of an organisation to another)
• Believes that learning in an organization occurs when
individuals come together in ways that encourage them
to share their ideas and create new knowledge in others

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 Managers are urged to:

• Identify the knowledge possessed by various

individuals in their departments
• Arrange the kinds of interactions between
knowledgeable individuals that will help the
organisation to:
– perform its current tasks
– transfer knowledge from one part of the organization to another
– create new knowledge that may be useful to the organisation
• Do managers of organisations today know what
their workers know?

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 The problem of knowing what…

Hewlett-Packard in the 1980s:

‘If only we knew what we know,
we could conquer the world…’
The problem now is that firms are :
• larger in scope and scale
• becoming more knowledge intensive
• being more globally dispersed
Managers need to ‘know what we know’ in order to
manage

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 To improve understanding of
‘who knows what’

• Philips SV created a corporate ‘yellow pages’ listing

experts with different kinds of knowledge in its global
business operations
• On Philips’s intranet if you type in the key words for a
knowledge domain e.g. design of optical pickup units for
CD/DVD players and the system will retrieve a listing of
the people within Philips worldwide who have stated that
they have such knowledge
• Contact information is also provided for each person
listed, so that anyone in Philips who wants to know more
about that kind of knowledge can get in touch with listed
individuals

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 Tacit knowledge transfer in
Toyota

When Toyota wants to transfer knowledge of its production

system to new employees in a new a factory (e.g. Derby)
• It selects a core group of 200-300 new employees and
sends them for 2 or 3 months training and work on the
assembly line in one of its existing factories
• After 2 - 3 months of studying the production systems
and working alongside experienced Toyota workers, the
new workers are sent back to the new factory site
• These workers are accompanied by a team of
experienced Toyota employees who will work alongside
employees in the new factory to assure that knowledge of
Toyota’s processes is implanted in the new factory

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 Quality circles in Toyota

Toyota’s use of Quality Circles (QC) also provides

an example of the tacit knowledge approach to
creating new knowledge.
• At the end of every week, a QC of Toyota
production workers meet to analyse the
performance of their part of the process to
identify actual or potential quality or productivity
problems
• Each QC proposes ‘countermeasures’ to correct
the problems and discusses the results of
countermeasures taken to address problems
identified at the previous meeting

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 Quality circles in Toyota

• This KM practice, which is an integral part of the

Toyota production system, has identified,
eliminated, and even prevented costly errors
• As improvements developed by its QCs are
accumulated since 1970s, Toyota’s system has
become one of the best in the world
Honda is also a big user of QC to support its ‘lean
manufacturing’ programme

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 Explicit Knowledge Approach

• Knowledge can be articulated and codified to

create explicit knowledge assets
• Knowledge can be disseminated (using IT) in the
form of documents, drawings, best practices, etc.
• Learning can be designed to remedy knowledge
deficiencies through structured, managed,
scientific processes

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 The Explicit Knowledge Approach

The explicit knowledge approach holds that

knowledge is something that can be explained by
individuals:
• Assumes that the useful knowledge of individuals
in an organization can be articulated and made
explicit
• Recognises that some form of assistance (e.g. IT)
will be required to help individuals articulate and
record what they know
• Believes that organisational processes can be
used to help individuals articulate their knowledge
to create knowledge assets
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 The Explicit Knowledge Approach

• Believes that explicit knowledge assets can then

be disseminated within an organization through
documents, drawings, standard operating
procedures, manuals of best practice etc.
• Information Systems are usually seen as playing
a central role in storing and sharing explicit
knowledge assets over a company intranet or
between organisations via the internet

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 The Knowledge Sequence

• Believes that new knowledge can be created through a

structured, managed, scientific learning process
• Structured learning processes can be used to remedy
knowledge deficiencies or ‘strategic partnerships’ may be
used to obtain the needed knowledge or to improve an
organisation’s existing knowledge assets
• The recommendations for KM practice usually involve
developing and sustaining organisational processes for
generating, articulating, categorising, and ‘leveraging’
explicit knowledge assets – the ‘knowledge sequence’

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 The knowledge sequence

KNOWLEDGE KNOWLEDGE
TRIGGER/ RESULT
REQUIREMENT Knowledge Knowledge Knowledge
Assets Manipulation Outcomes
Activities

Environmental
Management influences influences

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 Motorola 1

In the late 1990s Motorola was the global leader in the

market for mobile devices:
• Needed to introduce new designs every year. - a new
production factory was designed and built to produce
each new generation of device - Motorola formed teams
to design each device and factory
• At the beginning of the project, each new team received a
manual of design methods from the previous team
• This manual would then be passed on to the next design
team given the task of developing the next generation of
device and its factory, making the tacit knowledge explicit
for each team.

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 Motorola 2

• The team would then have 3 deliverables at the end of

their project:
i. an improved and more configurable next-generation
pager design
ii. the design of a more efficient assembly line for the
factory that would produce the new device
iii. an improved design manual that incorporated the design
knowledge provided to the team in the manual it
received -- plus the new and improved design methods
that the team had developed to meet the product and
production goals for its project.

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 DaimlerChrysler Corporation

DCC forms ‘platform teams’ of 300-600 development

engineers responsible for creating the next generation
platforms on which future automobiles will be based:
• Each platform team is free to explore and evaluate
alternative design solutions for the different technical
aspects of their vehicle platform
• Each platform team is required to place the design
solution it has selected for each aspect of the platform in
a ‘Book of Knowledge’ on the firm’s intranet
• This is then made available to all platform teams to
consult so that good design solutions can be located and
used by other platform teams

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 Advantages of the tacit approach

• Relatively easy and inexpensive to adopt in most

organisations
• Employees may respond well to recognition of
their (claimed) knowledge
• Recognised - likely to create interest in further
knowledge management processes.
• Important knowledge kept in tacit form may be
less likely to ‘leak’ out to competitors or the
industry in general
• Any others?
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 Disadvantages of the tacit
approach
• Individuals may not have the knowledge they
claim to have!
• ‘Knowledge profiles’ of individuals need frequent
updating to be usefully accurate
• Ability to transfer knowledge constrained to
moving people, which is costly and limits the
spread of knowledge within the organisation
• Organisation may lose key knowledge if key
people leave – ‘head hunting’
• Any others?

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 Advantages of explicit approach

• Articulated and stored knowledge (assets) may

be accessed ‘anytime anywhere’ by IT
• Codified knowledge may be proactively shared
by people who can use specific forms of
knowledge.
• Knowledge that has been made explicit can be
discussed, debated, agreed and refined
• Making knowledge explicit makes it easier to
discover ‘knowledge gaps’ in the organization
• Any others?
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 Disadvantages of explicit knowledge

• Considerable time and effort may be required to

help people articulate their knowledge
• Relationship with key ‘knowledge workers’ may
have to be redefined to motivate knowledge
articulation or sharing
• Expert committees must be formed to evaluate
explicit knowledge assets
• Quality of explicit knowledge throughout
organisation must be assured by adoption of
best practices
• Any others?
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 ‘Which approach is right?’

Both are ‘right’ - but in the right combination

• There are important advantages to be obtained
through both the tacit and explicit knowledge
management approaches
• The advantages of each approach can be used
to help offset the disadvantages of the other
• The goal is to create a hybrid design for KM
practice that synthesises the appropriate
combination and balance of the tacit and explicit
approaches.

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 What makes the approach
‘appropriate’?

Some factors of influence:

• The technology the organisation uses
• The market conditions it faces
• The ‘knowledge intensity’ of its operations
• The current attitudes of its knowledge workers
• The geographical position of its knowledge
workers
• The resources available invest in developing
infrastructure and processes for KM practice

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 Reading

• Sharp, P.J., Eardley, W.A. and Shah, H. (2010)

Complexity and Clarity: the Knowledge Strategy Dilemma
– some Help from MaKE. In Uden, L. and Eardley, W.A.
(Eds.) Knowledge Management and Innovation. IGI
Global Publications, Hershey Pennsylvania.
• Sanchez, R. (2001). “Managing knowledge into
competences: The five learning cycles of the competent
organization,” 3-37 in Knowledge Management and
Organizational Competence, Ron Sanchez, editor,
Oxford: Oxford University Press.
• Spear, S. and Bowen H.K. (1999). “Decoding the DNA of
the Toyota Production System,” Harvard Business
Review, September-October, Pp. 97-106.

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