Knowledge Management: Cognitivist And Constructivist Psychology

the theory of the learning organisaiton discussed in previous sections is reflected in the more
recent Interest in knowledge management. Many argue that the global change towards the
knowledge economy has major Implications for the Strategjc management of organisations. First,
professional knowledge workers need to be managed in different ways from manual workers In
the Industrial age. The argument is that to unleash the creativity of knowledge workers they must
be empowered so that they can participate more fully in the development of the organisation and
special measures need to be taken to ensure that Individual knowledge becomes organisational
knowledge. Many argue that this is to be done by codifying the knowledge held by key
knowledge workers and by taking steps to retajn their services. The new knowledge economy
also has major Implications for the nature of an organisation's assets. In the Industrial age,
accounting measures of asset values were close to the capital market valuation of the organisation
because market pricing of the main assets, namely physical resources such as plant and
equipment, enabled them to be measured. Managing the value of a corporation meant managing
measurable physical assets and the 'human resources' who used them. In the new knowledge
economy, however, knowledge is said to be the major asset and, since it is not directly traded in
markets, it is not measured and recorded in corporate balance sheets. As a result, enormous gaps
have opened up between the asset values recorded by a corporation and the value that capital
markets place on the corporation It self. This creates problems for managing assets to produce
shareholder value. The response to this has been a call to measure the Intellectual capital of a
corporation and manage Its knowledge assets.

Nonaka's writings (Nonaka, 1991; Nonaka and Takeuchi, 199 S) have exerted
a major impact on the development of theories of knowledge creation in organisations (for
example, Brown, 1991; Burton-Jones, 1999; Davenport and Prusak, 1998; Garven, 1993; Klemer
and Roth, 1997; Leonard and Strauss, 1997; Quinn et al., 1996; Svelby, 1997). Like Senge,
Nonaka graws on the systems dynamics strand of systems thinking, including some concepts
from chaos and complexity theories, which he treats as extensions of that thinking (see Chapter
10), and Argyns and Schon whose learning theories he traces back to Bateson (1972). In addition,
he relies heavily on Polanyi's (1958, 1960) distinction between tacit and explicit
knowledge.
Creating New Knowledge

According to Nonaka (1991), new knowledge created when tacit knowledge is made explicit and
crystallised into an Innovation, that is a recreation of some aspect of the world according to some
new insight or Ideal. New knowledge, according to Nonaka, comes from tapping the tacit.
Subjective Insights, intuitions and hunches of individuals and making them available for testing
and use by the organisation as a whole. For him, tacit knowledge is personal and hard to
formalize. It is rooted In action and shows Itself as skill, or know how. In addition to being in
technical skills, tacit knowledge lies in the mental models, beliefs and perspectives ingrained in
the way people understand their world and act in lt. knowledge is below the level of awareness
and is therefore very difficult to communicate. The nature of explicit knowledge, however, is
easy to understand: it is the formal and systematic knowledge that is easily communicated, for
example in the form of product specifications or computer programs.

Nonaka gives an example of how tacit knowledge is to be tapped. In 1985 product developers at
Matsushita could not perfect the kneading action of the home bread-baking machine they were
developing. After much unhelpful analysjs, Including comparisons of X-rays of dough kneaded
by the machine and dough kneaded by professionals, one member of the team proposed a creative
approach. She proposed using a top professional baker as a model, so she trained With a top
baker to acquire his kneading technique, and after a year of trial and error she was able to help her
colleagues reproduce a mechanical kneading action that mimicked that of the professional. This
example describes a movement between different kinds of knowledge, the tacit and the explicit:

 tacit to tacit as the product developer acquires the skill of the professional baker through
mimicry;

 tacit to explicit as the product developer articulates the foundations of her newly
acquired tacit knowledge to her colleagues;

 explicit to tacit as the colleagues internalise the knowledge and use it to alter their
own tacit knowledge;

 explicit to explicit as the newly formulated product specifications are communicated to

Innovation then flows from a form of learning: that is, new knowledge creation, that in turn flows
from moving knowledge between one type and another.

New knowledge starts with an individual, according to Nonaka. Tacit knowledge has to travel
from one person to another, in a way that cannot be centrallv intended because no one knows
what is to travel, or to whom, until it has travelled. New knowledge can therefore be created only
when individuals operate empowered teams.

A key difficulty in the creation of new knowledge is that of bringing tacit knowledge to the
surface of Individual awareness, conveying tacit knowledge from one person to another, and
finally making it explicit. This is so difficult because it requires expressing the inexpressible and
this needs figurative rather than literal Ianguage. As new knowledge is dispersed through a group
and an organization, it must be tested, which means that there must be discussion, dialogue and
disagreement.
The distinction Nonaka makes between tacit and explicit knowledge is derived front Polanyi
(Polanyi and Prosch, 197 S). Nonaka and Takeuchi maintain that 'knowledge is created and
expanded through social Interaction between tacit and explicit knowledge' (1995, p. 61) in the
four modes oi knowledge conversion described above. However, as Tsoukas points out, Polanyi
was actually arguing that tacit and explicit knowledge are not two separate forms of knowledge,
but rather that 'tacit knowledge is the necessary component of all knowledge' (Tsoukas, 1997, p.
10).

Another point to note how Nonaka and Takeuchi (1995) talk about knowledge as embodied,
rooted in experience and arising, in Interaction between individuals. They emphasise the
lmportance of dialogue and discussion In this conversion process (p. 13), pointing to the
importance of Intuition, hunches, metaphors and symbols (p. 12). They see knowledge as
essentially related to action and arising from a process in which interacting individuals are
committed to justifying their beliefs. They talk about knowledge as justified belief closely related
to people's values. They talk about the context of ambiguity and redundancy In which knowledge
is created (p. 12). However, they then take their argument in a direction that leaves the
importance of relationships and the social undeveloped and unexplored. Having emphasised the
social, they locate the initiation of new knowledge in the individual when they argue that
'knowledge is created only by individuals' (p. 59).

In this way of seeing things, tacit knowledge is possessed by individuals and the knowledge
creation at an organisational level the extraction of this already existing tacit knowledge from
individuals and its spread across the organisation by socialising, processes. This leads to a rather
linear sequential view of individuals passing tacit knowledge to others, primarily through
imitation, then formalising and codifying it so that it can be used. The emphasis of Nonaka and
Takeuchi on the individual as the origin of knowledge leads them to emphasise the organisation-
wide intentional character of knowledge creation. Having emphasised the ambiguity of the
situation in which knowledge arises, Nonaka and Takeuchi leave this behind and move to the
strategic choice view of knowledge creation. Nonaka and Takeuchi do not pay much attention to
the ever-present possibility of groups Of people becoming stuck in some stable dynamic, or some
fragmenting one that kills off the knowledge-creating process. What Nonaka and Takeuchi end up
with, then, is a process for knowledge creation that can be managed and controlled.

Knowledge management writers focus attention on this process of translation but do not explain
how completely new tacit knowledge comes to arise in individual heads.

5.7 Key debates

As With strategic choice theory, the notion oi organisational learning has generated much debate.
Two key debates are briefly reviewed in this section: representation versus enactment; and the
learning organisation versus organisational learning.

Representation versus enactment

This is the debate between cognitivist and constructivist psychology, which has been mentioned
above. Cognitivism takes the representational perspective in holding that
the human mind constructs accurate representations of an already given reality. These
representations are then built into mental models that form the basis upon which people act into
the real world. Cognitivists accept that mental models can become inappropriate in a changing
world and therefore become inappropriate for action requiring the double-loop process of learning
in which mental models are changed. They accept that people are interpreting their world and in a
sense constructing it through their interpretation. What they are constructing, their Interpretation,
can be appropriate that it is an accurate interpretation of the real world or it may be inappropriate
in the sense of an inaccurate representation. This is a view in which thought comes before action.
Constructivism goes further than this and takes an enactment perspective in arguing that the
human body actively selects what it is able to pay attention to and so constructs the reality into
which it acts. This is a view in which thought comes after action in that the world is first
constructed in action and then understood. These differences will be returned to in Chapter 9.