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

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How have Japanese companies become world leaders in the automotive and electronics industries, among others? What is the secret of their success? Two leading Japanese business experts, Ikujiro Nonaka and Hirotaka Takeuchi, are the first to tie the success of Japanese companies to their ability to create new knowledge and use it to produce successful products and technologi How have Japanese companies become world leaders in the automotive and electronics industries, among others? What is the secret of their success? Two leading Japanese business experts, Ikujiro Nonaka and Hirotaka Takeuchi, are the first to tie the success of Japanese companies to their ability to create new knowledge and use it to produce successful products and technologies. In The Knowledge-Creating Company, Nonaka and Takeuchi provide an inside look at how Japanese companies go about creating this new knowledge organizationally. The authors point out that there are two types of knowledge: explicit knowledge, contained in manuals and procedures, and tacit knowledge, learned only by experience, and communicated only indirectly, through metaphor and analogy. U.S. managers focus on explicit knowledge. The Japanese, on the other hand, focus on tacit knowledge. And this, the authors argue, is the key to their success--the Japanese have learned how to transform tacit into explicit knowledge. To explain how this is done--and illuminate Japanese business practices as they do so--the authors range from Greek philosophy to Zen Buddhism, from classical economists to modern management gurus, illustrating the theory of organizational knowledge creation with case studies drawn from such firms as Honda, Canon, Matsushita, NEC, Nissan, 3M, GE, and even the U.S. Marines. For instance, using Matsushita's development of the Home Bakery (the world's first fully automated bread-baking machine for home use), they show how tacit knowledge can be converted to explicit knowledge: when the designers couldn't perfect the dough kneading mechanism, a software programmer apprenticed herself with the master baker at Osaka International Hotel, gained a tacit understanding of kneading, and then conveyed this information to the engineers. In addition, the authors show that, to create knowledge, the best management style is neither top-down nor bottom-up, but rather what they call middle-up-down, in which the middle managers form a bridge between the ideals of top management and the chaotic realities of the frontline. As we make the turn into the 21st century, a new society is emerging. Peter Drucker calls it the knowledge society, one that is drastically different from the industrial society, and one in which acquiring and applying knowledge will become key competitive factors. Nonaka and Takeuchi go a step further, arguing that creating knowledge will become the key to sustaining a competitive advantage in the future. Because the competitive environment and customer preferences changes constantly, knowledge perishes quickly. With The Knowledge-Creating Company, managers have at their fingertips years of insight from Japanese firms that reveal how to create knowledge continuously, and how to exploit it to make successful new products, services, and systems.


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How have Japanese companies become world leaders in the automotive and electronics industries, among others? What is the secret of their success? Two leading Japanese business experts, Ikujiro Nonaka and Hirotaka Takeuchi, are the first to tie the success of Japanese companies to their ability to create new knowledge and use it to produce successful products and technologi How have Japanese companies become world leaders in the automotive and electronics industries, among others? What is the secret of their success? Two leading Japanese business experts, Ikujiro Nonaka and Hirotaka Takeuchi, are the first to tie the success of Japanese companies to their ability to create new knowledge and use it to produce successful products and technologies. In The Knowledge-Creating Company, Nonaka and Takeuchi provide an inside look at how Japanese companies go about creating this new knowledge organizationally. The authors point out that there are two types of knowledge: explicit knowledge, contained in manuals and procedures, and tacit knowledge, learned only by experience, and communicated only indirectly, through metaphor and analogy. U.S. managers focus on explicit knowledge. The Japanese, on the other hand, focus on tacit knowledge. And this, the authors argue, is the key to their success--the Japanese have learned how to transform tacit into explicit knowledge. To explain how this is done--and illuminate Japanese business practices as they do so--the authors range from Greek philosophy to Zen Buddhism, from classical economists to modern management gurus, illustrating the theory of organizational knowledge creation with case studies drawn from such firms as Honda, Canon, Matsushita, NEC, Nissan, 3M, GE, and even the U.S. Marines. For instance, using Matsushita's development of the Home Bakery (the world's first fully automated bread-baking machine for home use), they show how tacit knowledge can be converted to explicit knowledge: when the designers couldn't perfect the dough kneading mechanism, a software programmer apprenticed herself with the master baker at Osaka International Hotel, gained a tacit understanding of kneading, and then conveyed this information to the engineers. In addition, the authors show that, to create knowledge, the best management style is neither top-down nor bottom-up, but rather what they call middle-up-down, in which the middle managers form a bridge between the ideals of top management and the chaotic realities of the frontline. As we make the turn into the 21st century, a new society is emerging. Peter Drucker calls it the knowledge society, one that is drastically different from the industrial society, and one in which acquiring and applying knowledge will become key competitive factors. Nonaka and Takeuchi go a step further, arguing that creating knowledge will become the key to sustaining a competitive advantage in the future. Because the competitive environment and customer preferences changes constantly, knowledge perishes quickly. With The Knowledge-Creating Company, managers have at their fingertips years of insight from Japanese firms that reveal how to create knowledge continuously, and how to exploit it to make successful new products, services, and systems.

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

  1. 4 out of 5

    Audriane Sani

    This book shows the difference of approaching knowledge from the angle of western and Japanese culture. Eventhough in the tittle this book seems suitable for people who interested management fields, personally I think this is a good reading for people who's curios about source of knowledge. Nonaka and Takeuchi devide Knowledge into two categories, tacit and explicit knowledge. explicit knowledge is formal knowledge, easier to formulize(books, class, manual books, etc);Tacid knowledge known as int This book shows the difference of approaching knowledge from the angle of western and Japanese culture. Eventhough in the tittle this book seems suitable for people who interested management fields, personally I think this is a good reading for people who's curios about source of knowledge. Nonaka and Takeuchi devide Knowledge into two categories, tacit and explicit knowledge. explicit knowledge is formal knowledge, easier to formulize(books, class, manual books, etc);Tacid knowledge known as intangible and personal knowledge such as insights, hunches, and not so easy to formulize. In the first part of the book Nonaka and Takeuchi wrote about their understanding of knowledge. They made brief introduction of Western thoughts such as Kant, Marx, Tofler, Etc. And as the balance they also give summary of Japanese approach towards knowledge. That part preceded with the review of these two approaches and presented their idea about knowledge. Most interesting part is when they explain about knowledge creation theory. If put into simple words their theory is about the interaction of tacit and explisit knowledge is knowledge conversion. Knowledge conversion in a process which happens between individual. In order personal knowledge can develop into group knowlegde there are 4 factors needed : socialization, Externalization, combination and Internalization. For further inquiry....please read the book ok...

  2. 5 out of 5

    Bernd Schiffer

    Almost 5 stars. Very thorough research to knowledge creation. Lots of overlaps with Lean and Agile. No wonder, since it was these guys who inspired Sutherland and Schwaber to create Scrum. Whole approach based on principles. I liked that they saw lots of false dichotomies and usually advocated for the middle ground. Was also surprised by how much tacit knowledge influenced their thinking.

  3. 4 out of 5

    Lídia

    This review has been hidden because it contains spoilers. To view it, click here. TYPES OF KNOWLEDGE Explicit knowledge = theory, can be written down and expressed with words. Objective. Type of knowledge teached in the standard scholar education, with the use of text books, dictation and a notebook. Ex. a mathematical theorem Tacit knowledge = experience and feelings, hard to explain and transmit. Subjective. Type of knowledge l based on doing, losing the fear to the sensation of not being able, inexistence recipe to sucess at the first time. Based on the descovering personal TYPES OF KNOWLEDGE Explicit knowledge = theory, can be written down and expressed with words. Objective. Type of knowledge teached in the standard scholar education, with the use of text books, dictation and a notebook. Ex. a mathematical theorem Tacit knowledge = experience and feelings, hard to explain and transmit. Subjective. Type of knowledge l based on doing, losing the fear to the sensation of not being able, inexistence recipe to sucess at the first time. Based on the descovering personal skills that once learned are hard to forget, you may lose practice but not the basic knowledge of how to do it. Ex. the first year of life like talk or walk, and also senses like fire is hot or lime is acid. Though is diferent for eveyone tacit knowledge exists to have explicit knowledge. Ex. to be able to explain a concept (explicit knowledege) first you need to learn how to talk and articulate words verbaly (tacit knowledge). This is because explicit knowledege was created by humans and can be only learned by them, therefore tacit knowledge gets more interiorized because is the one that uses more than just the brain. Everything that can be learned by an animal is based on tacit knowledge, and all that can’t be learned by a person with diferent capabilities than you too. Ex1. Find food is something done by all living beings in differnet ways (through chlorophyll, collecting fruit, bitting to suck blood, etc.) but with the same end, to get noutrish. Ex2. Reading, we use graphic strokes that can be drawn called letters and each of them have a sound related, but a blind will pronounce the same you will but when insead of looking at the graphic stroke will touch a dotted figure that is equivalent to ours, and a mute will look at those graphs and understand the same you do but when to pronunce they will express the words with gestures, all will get the same words and content (explicit knowledge) but each of us will arrive to it in diferent ways depending on our needs and abilities. MODES OF KNOWLEDGE CONVERSION 1. Tacit to Tacit (socialization/contagion) This process produces “sympathized knowledge”. Socialization is a process of sharing experiences through observation, imitation, and practice. 2. Tacit to Explicit (externalization/conceptulization) This process produces “conceptual knowledge”. Externalization takes the shapes of metaphors, analogies, concepts, hypotheses, or models. 3. Explicit to Explicit (combination) This process produces “systemic knowledge”. Combination is a process of individuals exchanging knowledge through documents, presentations, and meetings. Reconfiguration of existing information through sorting, adding, combining and categorizing of explicit knowledge can lead to new knowledge. 4. Explicit to Tacit (internalization/experimentation) This process produces “operational knowledge”. Internalization is based on ‘LEARNING BY DOING’, and can occur without having to “re-experience” other people’s experiences. (Nonaka, 2008) Ex. Process for the realization of the workshop: First, Nonaka and Takeuchi reflected about knowledege and how it was created (socialization), then got together and exchange their thoughts (externalization) to get to a meeting point, and they wrote the book with all the concepts (combination), after all Virginia read the book and imparted the workshop (combination), in groups we found real examples of the different concepts (combination and intrenalization). 5 CONDITIONS REQUIRED TO PROMOTE THE KNOWLEDGE SPIRAL 1. Intention Vision - Objective The intention is an organization’s aspiration to its goals. Efforts to achieve an intention usually take the form of a strategy. The most critical element of a corporate strategy is to conceptualize a vision about what kind of knowledge should be developed and to operationalize into a management system for implementation. It would be impossible to judge the value of information or knowledge perceived or created, if intention didn’t exist. 2. Autonomy Curiosity - Liberty At the individual level, all members of an organization should be allowed to act autonomously as far as circumstances permit. By inviting their members to act autonomously, the organization may increase the chance of observing unexpected opportunities. Autonomy is also fundamental in order to motivate. 3. Fluctuation and Creative Chaos Courage - Flow Fluctuation means that individuals feel free to challenge the organization and propose changes, modifications, improvements or innovation. It’s the opposite of status quo. Chaos is generated naturally when the organization faces a real crisis, such as a rapid decline of performance due to changes in market needs or significant growth of competitors. It can also be generated intentionally when the organization’s leaders try to evoke a “sense of crisis”. 4. Redundancy Evolutionary - Dialogue Redundancy is the existence of information that goes beyond the immediate operational requirements of organizational members. In a sense it means that the organization tolerate a certain waste of resources (information communicated to members that apparently do not need it) because it’s in fact an investment (thanks to that redundancy we buy an opportunity to create knowledge and eventually innovation). Redundancy of information brings about “learning by intrusion” into each individual’s sphere of perception. 5. Requisite Variety Diversity - Open-mindness - Team Spirit The more complex is the problem you try to solve, the more variety you’ll need in your team. Variety can be enhanced by combining information differently, flexibly and quickly, and by providing equal access to information throughout the organization.

  4. 4 out of 5

    Tathagat Varma

    Knowledge management in knowledge industry is a much abused term. It isn't well understood by leaders in a very structured and actionable manner, though team members in the trenches have a fairly good gut feel of it, especially how tacit knowledge gets shared and internalized at an individual level (the fact that process police from ISO, CMMI and Six Sigma so naively and totally disregarded this fact in the context of knowledge industry must be held as a key learning lesson for the future genera Knowledge management in knowledge industry is a much abused term. It isn't well understood by leaders in a very structured and actionable manner, though team members in the trenches have a fairly good gut feel of it, especially how tacit knowledge gets shared and internalized at an individual level (the fact that process police from ISO, CMMI and Six Sigma so naively and totally disregarded this fact in the context of knowledge industry must be held as a key learning lesson for the future generations). However, all these are highly abstract terms, and an absence of a comprehensive framework rigorously supposed by real-life data is sorely missing. Nonaka and Takeuchi's work is not only a pioneering one, but also a classic for the knowledge era, for their work allows us to elicit key learnings how knowledge gets created, shared, consolidated and baselined in different context. Even though the book was written over twenty years back, and essentially captures the examples from Japanese companies predominantly in electronics and manufacturing, I can very easily see them applied to knowledge-intensive and creative endeavors such as software development. In software development, we have historically relied on documentation as a means to capture and communicate the knowledge, hardly realizing that most of the associated knowledge continues to reside in the heads of the software developers, and can simply never be documented! Agile movement recognized it and built conceptual models that piggyback on it, but most so-called agile coaches have neither read this book nor been in a situation where they are creating knowledge such as examples from the book to really give them a deep and grounded understanding of how knowledge gets created inside a company. This is a great and mandatory read for anyone involved in any form of leadership role, or involved with how knowledge creation.

  5. 4 out of 5

    Joonas Kaijala

    A classic within organizational knowledge management literature that goes through the whole process of knowledge creation from its basics to concrete steps of implementation. The Knowledge-Creating Company is the book that covers the well-known SECI-model and its meaning within organizational knowledge creation. Real company cases are used to illustrate the conversion of knowledge between tacit and explicit and the elevation of individual knowledge towards organizational knowledge. Published in 1 A classic within organizational knowledge management literature that goes through the whole process of knowledge creation from its basics to concrete steps of implementation. The Knowledge-Creating Company is the book that covers the well-known SECI-model and its meaning within organizational knowledge creation. Real company cases are used to illustrate the conversion of knowledge between tacit and explicit and the elevation of individual knowledge towards organizational knowledge. Published in 1995, the book is still a relevant piece within managerial literature and helps understanding the dynamics of innovation. A strong recommendation for anyone interested in knowledge-management or continuous innovation models.

  6. 4 out of 5

    Steve Fenton

    There is a lot of good information in here, repeated a few times for emphasis. I'm not sure how strong the correlation is between organisation design and the four modes of knowledge conversion - I suspect there are some key organisational elements such as setting intention etc, but after those items are satisfied I suspect the exact shape of the organisation matters less. There is a lot of good information in here, repeated a few times for emphasis. I'm not sure how strong the correlation is between organisation design and the four modes of knowledge conversion - I suspect there are some key organisational elements such as setting intention etc, but after those items are satisfied I suspect the exact shape of the organisation matters less.

  7. 5 out of 5

    Syed Naser

    It is more like a 300 page research article ..where i was expecting something on the lines of say "a machine that changed the world".. It is repetitive.. use of the examples are confusing....flipped through pages...was difficult to read cover to cover...2 stars for the nice quotes in the book It is more like a 300 page research article ..where i was expecting something on the lines of say "a machine that changed the world".. It is repetitive.. use of the examples are confusing....flipped through pages...was difficult to read cover to cover...2 stars for the nice quotes in the book

  8. 5 out of 5

    Nicole Flamarique

    https://docs.google.com/document/d/13... https://docs.google.com/document/d/13...

  9. 4 out of 5

    Ariana Da

    https://drive.google.com/drive/u/4/fo... https://drive.google.com/drive/u/4/fo...

  10. 5 out of 5

    Alan

    well referenced and good source of future study

  11. 5 out of 5

    Elena Hernandez

    https://drive.google.com/file/d/1W2Ff... https://drive.google.com/file/d/1W2Ff...

  12. 5 out of 5

    Mateusz Stępniak

    Now I better appreciate why having a wiki together with other knowledge accumulation tools and methods is one of important factors of growing a succesful team or company.

  13. 5 out of 5

    Juanjo Davila

    https://drive.google.com/open?id=17d9... https://drive.google.com/open?id=17d9...

  14. 4 out of 5

    nanto

    Ngomongin tacit dan explicit knowledge susah dilepaskan dari nama Nonakadan Takeuchi. Dari kedua konsepsi itu ia mengembankan matriks SECI (Socialization, Externalization, Internalization, Combination) yang menjelaskan alih pengetahuan dari kedua jenis pengetahuan itu. Dari skema itu terjadilah spiral pengetahuan yang menjadikan setiap pengetahuan untuk direkam/dicatat dengan baik. Buat saya pribadi ketika membaca skema Nonana dan Takeuchi saya cuma terkesan bahwa dengan siapapun kita berhadapan Ngomongin tacit dan explicit knowledge susah dilepaskan dari nama Nonakadan Takeuchi. Dari kedua konsepsi itu ia mengembankan matriks SECI (Socialization, Externalization, Internalization, Combination) yang menjelaskan alih pengetahuan dari kedua jenis pengetahuan itu. Dari skema itu terjadilah spiral pengetahuan yang menjadikan setiap pengetahuan untuk direkam/dicatat dengan baik. Buat saya pribadi ketika membaca skema Nonana dan Takeuchi saya cuma terkesan bahwa dengan siapapun kita berhadapan sesungguhnya kita berhadapan dengan seunggukan pengetahuan yang tersimpan dalam dua jenis pengetahuan itu. Bagaimana kita menyerapnya itu dapat kita menjadi resep bagus dari konsep dan skema itu.

  15. 4 out of 5

    Lukman Haris

    Ikujiro Nonaka reminds us that there are two kinds of knowledge, tacit and explicit. Tacit knowledge is subjective point of view, believes or personal insights about things that are usually hard to be expressed explicitly. And in order to create knowledge in a whole, we cannot take this kind of knowledge for granted. Combining tacit and explicit knowledge can be a very powerful source of innovation one can achieve.

  16. 5 out of 5

    Joaquin Popoca

    En lo personal este tipo de libros no los leo al menos que sea para un trabajo, y eso paso con este. Sin embargo me atrevo a recomendarlo porque habla de los "futuros" modelos de empresa inspirados por la cultura japonesa. Digo futuros porque resulta ser el modelo actual de trabajo, vale mucho la pena por el simple hecho de saber porque las cosas se están haciendo diferente y porque funcionan, sobre todo para aquellos que les gusta eso de la dirección y el managment. En lo personal este tipo de libros no los leo al menos que sea para un trabajo, y eso paso con este. Sin embargo me atrevo a recomendarlo porque habla de los "futuros" modelos de empresa inspirados por la cultura japonesa. Digo futuros porque resulta ser el modelo actual de trabajo, vale mucho la pena por el simple hecho de saber porque las cosas se están haciendo diferente y porque funcionan, sobre todo para aquellos que les gusta eso de la dirección y el managment.

  17. 5 out of 5

    Vincent Van Wylick

    Is a worthwhile paradigm in making company processes more efficient through documenting them and creating standardised approaches. Implementation is far from easy however, and I don't think it can be applied universally to all companies or environments. Is a worthwhile paradigm in making company processes more efficient through documenting them and creating standardised approaches. Implementation is far from easy however, and I don't think it can be applied universally to all companies or environments.

  18. 4 out of 5

    Ramnath

    Awesome - must read for technology startups

  19. 5 out of 5

    Peter Blok

    Classical book on knowledge creation

  20. 5 out of 5

    Lucia

    https://drive.google.com/open?id=1PoA... https://drive.google.com/open?id=1PoA...

  21. 5 out of 5

    Margarida

    .

  22. 5 out of 5

    Hensi

    I really want to have this book. But, I dont have enough money to buy. Hiks.. The best choice is by reading from the library. hehe..

  23. 4 out of 5

    Darren Blanch

  24. 5 out of 5

    Pere Vericat

  25. 4 out of 5

    Anselem Udeagulu

  26. 4 out of 5

    Markku Mäenpää

  27. 5 out of 5

    Trevor

  28. 4 out of 5

    Joonas Laine

  29. 5 out of 5

    Jeffrey Martin

  30. 4 out of 5

    Uriel

  31. 4 out of 5

    Bricoleur (David) Soul

  32. 4 out of 5

    Hardik

  33. 5 out of 5

    Tarun

  34. 5 out of 5

    Jammu Saloniemi

  35. 4 out of 5

    Andrew

  36. 4 out of 5

    Jocari Serio

  37. 5 out of 5

    Lieb

  38. 5 out of 5

    Oliver

  39. 4 out of 5

    Thomas

  40. 5 out of 5

    Duncan

  41. 4 out of 5

    Rowena

  42. 4 out of 5

    Bagas Sweta

  43. 4 out of 5

    ratna

  44. 5 out of 5

    Randy

  45. 4 out of 5

    CY Beh

  46. 4 out of 5

    Sqinger

  47. 5 out of 5

    Mgarriott Garriott

  48. 5 out of 5

    Araz

  49. 4 out of 5

    Silvio

  50. 5 out of 5

    Mark Wiliamson

  51. 4 out of 5

    Melissa

  52. 4 out of 5

    Andrew

  53. 4 out of 5

    Jen Watkins

  54. 5 out of 5

    Jinyhw

  55. 4 out of 5

    Steve Rossiter

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