Book•
The knowledge-creating company : how Japanese companies create the dynamics of innovation
01 Jan 1995-
TL;DR: In this article, Nonaka and Takeuchi argue that Japanese firms are successful precisely because they are innovative, because they create new knowledge and use it to produce successful products and technologies, and they reveal how Japanese companies translate tacit to explicit knowledge.
Abstract: How has Japan become a major economic power, a world leader in the automotive and electronics industries? What is the secret of their success? The consensus has been that, though the Japanese are not particularly innovative, they are exceptionally skilful at imitation, at improving products that already exist. But now two leading Japanese business experts, Ikujiro Nonaka and Hiro Takeuchi, turn this conventional wisdom on its head: Japanese firms are successful, they contend, precisely because they are innovative, because they create new knowledge and use it to produce successful products and technologies. Examining case studies drawn from such firms as Honda, Canon, Matsushita, NEC, 3M, GE, and the U.S. Marines, this book reveals how Japanese companies translate tacit to explicit knowledge and use it to produce new processes, products, and services.
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TL;DR: In this article, the authors argue that family firms invest less in innovation but have an increased conversion rate of innovation input into output and, ultimately, a higher innovation output than non-family firms.
Abstract: Family firms are often portrayed as an important yet conservative form of organization that is reluctant to invest in innovation; however, simultaneously, evidence has shown that family firms are flourishing and in fact constitute many of the world’s most innovative firms. Our study contributes to disentangling this puzzling effect. We argue that family firms—owing to the family’s high level of control over the firm, wealth concentration, and importance of nonfinancial goals—invest less in innovation but have an increased conversion rate of innovation input into output and, ultimately, a higher innovation output than nonfamily firms. Empirical evidence from a meta-analysis based on 108 primary studies from 42 countries supports our hypotheses. We further argue and empirically show that the observed effects are even stronger when the CEO of the family firm is a later-generation family member. However, when the CEO of the family firm is the firm’s founder, innovation input is higher and, contrary to our initial expectations, innovation output is lower than that in other firms. We further show that the family firm–innovation input–output relationships depend on country-level factors; namely, the level of minority shareholder protection and the education level of the workforce in the country.
562 citations
Cites background from "The knowledge-creating company : ho..."
...In particular, family and founder CEOs are endowedwith superior knowledge, particularly tacit knowledge (Nonaka & Takeuchi, 1995; Polanyi, 1973; Von Krogh, Ichijo, & Nonaka, 2000), about their firm’s members, routines, and stakeholders, which external CEOs possess to a lesser degree....
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TL;DR: In this article, the authors examine the role of a specific type of organizational leadership (knowledge-oriented leadership) in knowledge management (KM) initiatives that seek to achieve innovation.
554 citations
Cites background from "The knowledge-creating company : ho..."
...In a more recentwork, von Krogh et al. (2012) develop a framework for situational leadership in knowledge creation by integrating notions such as Ba – the environment for knowledge creation – the SECI model, knowledge assets and leadership behaviors (Nonaka & Konno, 1998; Nonaka & Takeuchi, 1995)....
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...Moreover, in technological settings, innovation is usually a direct outcome of KM effectiveness (Darroch & McNaughton, 2002; Du Plessis, 2007) as well as being one of the main objectives for knowledge-creating companies in their pursuit of competitive advantages (Nonaka & Takeuchi, 1995)....
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TL;DR: In this paper, the authors identify two distinctive architectures of intellectual capital that facilitate ambidextrous learning, including refined interpolation and disciplined extrapolation, and propose two alternative HR configurations that facilitate this.
Abstract: Both researchers and managers are increasingly interested in how firms can pursue ambidextrous learning; that is, simultaneously exploring new knowledge domains while exploiting current ones. Ambidextrous learning is derived from intellectual capital architectures that underlie unique configurations of human, social, and organizational capital. We identified two distinctive architectures of intellectual capital that facilitate ambidextrous learning. Refined interpolation is an architecture comprised of specialist human capital supplemented by cooperative social capital, and complemented by organic organizational capital. Disciplined extrapolation is an architecture comprised of generalist human capital, supplemented by entrepreneurial social capital, and complemented by mechanistic organizational capital. As organization contexts to support these architectures, we have also identified two alternative HR configurations that facilitate ambidextrous learning. One HR configuration combines job or function-based development, ILM-based employee relations, and error embracing performance/control systems to support refined interpolation. The other HR configuration combines skill-based development, market-based employee relations, and error avoiding performance/control systems to support disciplined extrapolation. Our framework may provide valuable theoretical implications for HRM systems regarding the issues of internal fits and best configurations.
545 citations
Cites background from "The knowledge-creating company : ho..."
...Finally, internal staffing and socialization induce individuals to develop and internalize common architectural knowledge (Nonaka and Takeuchi, 1995)....
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...Common architectural knowledge provides a built-in mechanism to help a diverse human capital pool not only understand how the pieces fit together but also to recognize the sometimes-conflicting demands in their multidimensional jobs (Kogut and Zander, 1992; Nonaka and Takeuchi, 1995)....
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TL;DR: In this article, the authors contribute to the literature on absorptive capacity through the creation and validation of two scales, justified with a thorough analysis of the literature, to measure the key components of the absorbable capacity construct: potential and realized absorptive capacities.
539 citations
Cites background from "The knowledge-creating company : ho..."
..., 1999; Zahra and George, 2002) begin by extending the knowledge-based approach (Kogut and Zander, 1992; Nonaka and Takeuchi, 1995), and for this reason, the conceptualization of the paper follows this theoretical framework....
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...…most far-reaching contributions (Lane et al., 2006; Van den Bosch et al., 1999; Zahra and George, 2002) begin by extending the knowledge-based approach (Kogut and Zander, 1992; Nonaka and Takeuchi, 1995), and for this reason, the conceptualization of the paper follows this theoretical framework....
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...According to Leonard-Barton (1995) and Nonaka and Takeuchi (1995), the creation of knowledge is important, but the conversion of this knowledge into new products is the basis of superior performance....
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References
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TL;DR: The objective of KMS is to support creation, transfer, and application of knowledge in organizations by promoting a class of information systems, referred to as knowledge management systems.
Abstract: Knowledge is a broad and abstract notion that has defined epistemological debate in western philosophy since the classical Greek era. In the past few years, however, there has been a growing interest in treating knowledge as a significant organizational resource. Consistent with the interest in organizational knowledge and knowledge management (KM), IS researchers have begun promoting a class of information systems, referred to as knowledge management systems (KMS). The objective of KMS is to support creation, transfer, and application of knowledge in organizations. Knowledge and knowledge management are complex and multi-faceted concepts. Thus, effective development and implementation of KMS requires a foundation in several rich literatures.
9,531 citations
TL;DR: This research suggests that a knowledge infrastructure consisting of technology, structure, and culture along with a knowledge process architecture of acquisition, conversion, application, and protection are essential organizational capabilities or "preconditions" for effective knowledge management.
Abstract: A hallmark of the new economy is the ability of organizations to realize economic value from their collection of knowledge assets as well as their assets of information, production distribution, and affiliation. Despite the competitive necessity of becoming a knowledge-based organization, senior managers have found it difficult to transform their firms through programs of knowledge management. This is particularly true if their organizations have long histories of process and a tradition of business success. This research examines the issue of effective knowledge management from the perspective of organizational capabilities. This perspective suggests that a knowledge infrastructure consisting of technology, structure, and culture along with a knowledge process architecture of acquisition, conversion, application, and protection are essential organizational capabilities or preconditions for effective knowledge management. Through analysis of surveys collected from over 300 senior executives, this research empirically models and uncovers key aspects of these dimensions. The results provide a basis for understanding the competitive predisposition of a firm as it enters a program of knowledge management.
4,646 citations
TL;DR: In this paper, the authors explore the nature of value co-creation in the context of service-dominant (S-D) logic and develop a conceptual framework for understanding and managing value cocreation.
Abstract: Central to service-dominant (S-D) logic is the proposition that the customer becomes a co-creator of value. This emphasizes the development of customer–supplier relationships through interaction and dialog. However, research to date suggests relatively little is known about how customers engage in the co-creation of value. In this article, the authors: explore the nature of value co-creation in the context of S-D logic; develop a conceptual framework for understanding and managing value co-creation; and utilize field-based research to illustrate practical application of the framework. This process-based framework provides a structure for customer involvement that takes account of key foundational propositions of S-D logic and places the customer explicitly at the same level of importance as the company as co-creators of value. Synthesis of diverse concepts from research on services, customer value and relationship marketing into a new process-based framework for co-creation provide new insights into managing the process of value co-creation.
3,114 citations
TL;DR: In this paper, the authors examined how aspects of intellectual capital influenced various innovative capabilities in organizations and found that human, organizational, and social capital and their interrelationships selectively influenced incremental and radical innovative capabilities.
Abstract: We examined how aspects of intellectual capital influenced various innovative capabilities in organizations. In a longitudinal, multiple-informant study of 93 organizations, we found that human, organizational, and social capital and their interrelationships selectively influenced incremental and radical innovative capabilities. As anticipated, organizational capital positively influenced incremental innovative capability, while human capital interacted with social capital to positively influence radical innovative capability. Counter to our expectations, however, human capital by itself was negatively associated with radical innovative capability. Interestingly, social capital played a significant role in both types of innovation, as it positively influenced incremental and radical innovative capabilities. It is widely accepted that an organization’s capability to innovate is closely tied to its intellectual capital, or its ability to utilize its knowledge resources. Several studies have underscored how new products embody organizational knowledge (e.g., Stewart, 1997), described innovation as a
3,008 citations
TL;DR: In this article, the authors outline a perspective on knowing in practice which highlights the essential role of human action in knowing how to get things done in complex organizational work and suggest that the competence to do global product development is both collective and distributed, grounded in the everyday practices of organizational members.
Abstract: In this paper, I outline a perspective on knowing in practice which highlights the essential role of human action in knowing how to get things done in complex organizational work. The perspective suggests that knowing is not a static embedded capability or stable disposition of actors, but rather an ongoing social accomplishment, constituted and reconstituted as actors engage the world in practice. In interpreting the findings of an empirical study conducted in a geographically dispersed hightech organization, I suggest that the competence to do global product development is both collective and distributed, grounded in the everyday practices of organizational members. I conclude by discussing some of the research implications of a perspective on organizational knowing in practice.
2,670 citations