Globalization: 2) Japanese Guru Explores East West Differences in Concept of Knowledge Creation


Ikujiro Nonaka

Apr 16th 2009

Akio Morita (see article), Kenichi Ohmae and Ikujiro Nonaka (born 1935) constituted a bridge that connected Japanese industry and management with that of the rest of the world. Morita was the businessman, the founder and creator of Sony; Ohmae was the consultant, an ex-McKinsey man who wrote books that explained Japanese business practices to the rest of the world; and Nonaka was the behind-the-scenes professor, cross-fertilising ideas from one culture to another.

Nonaka’s education and his teaching straddled the Pacific. He spent five and a half years gaining a PhD and an MBA from the University of California at Berkeley. Then in 1997 he was appointed Xerox distinguished professor of knowledge at Haas School of Business at Berkeley, before returning across the Pacific in 2000 when he was appointed a professor at the graduate school of international strategy at Japan’s Hitotsubashi University. There he was one of the main drivers behind the development of business studies on the campus.

His particular field of interest was the process of knowledge creation within corporations—not a typical field of management study for Japan, which has been more innovative in areas such as operations and strategy. With Hirotaka Takeuchi, a colleague at Hitotsubashi University, whom he first met when they were both students at Berkeley, he developed during the 1990s the idea that one of the main ways in which companies create wealth is by creating knowledge, and that this is (and will continue to be for some time) a main source of competitive advantage (see article).

Much of their work is built on an examination of the different concepts of knowledge in the East and the West. In their book “The Knowledge-Creating Company”, the two academics differentiated between what they called implicit and explicit knowledge: the former is the eastern type; the latter is familiar to the West. Implicit knowledge is intuitive, ambiguous and non-linear; explicit knowledge is the exact opposite, laid down in manuals, analysed and stored in databases.

In the US, middle managers are denigrated as cancer. We see middle managers playing a key role in facilitating the process of organisational knowledge creation. They serve as the strategic “knot” that binds top management with front-line managers.

They outlined a four-stage process by which an organisation develops knowledge. They gave it an acronym, SECI, which stands for socialisation, externalisation, combination/creation and internalisation. These are the means by which knowledge is “amplified throughout the organisation, creating a spiral model of knowledge creation”.

Nonaka also coined the term “Ba” to describe a meeting place of minds in an organisation. Ba can be physical—an office or a coffee shop—or it can be mental—shared experiences or the organisational culture. The word has come to be used quite widely. In his book “The Wealth of Knowledge”, Thomas Stewart, editor of Harvard Business Review, described Ba as “a mental space rather than a physical one; it is shared context, which allows people to work together knowing that they are … singing from the same song sheet”.

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