Implicit Intelligence Mariska Bulten www.intelligent-business.nl

Contents Everyday decision making Traditional BI and its problems Tacit knowledge (in decision making) A broader definition of BI… Required aspects & how to realize them Conclusion & discussion

Everyday decision making

Traditional BI and its problems

Tacit knowledge (in decision making)

A broader definition of BI…

Required aspects & how to realize them

Conclusion & discussion

Everyday decision making Navigation… © 2008 Capgemini. All rights reserved

Navigation…

Decision making in organizations (1) Decision making in organizations based on explicit knowledge is only successful in 50% of the cases (Sinclair & Ashkanasy, 2005)

Decision making in organizations based on explicit knowledge is only successful in 50% of the cases (Sinclair & Ashkanasy, 2005)

Decision making in organizations (2) According to the authors, decisions should be made based on both implicit and explicit knowledge

According to the authors, decisions should be made based on both implicit and explicit knowledge

Business Intelligence Used in organizations to support decision making BI traditionally consists of data and information: explicit knowledge But attention for the use of implicit knowledge in decision making is also needed!

Used in organizations to support decision making

BI traditionally consists of data and information: explicit knowledge

But attention for the use of implicit knowledge in decision making is also needed!

P ositive influences of traditional BI and implicit knowledge on decision making need to be combined… Besluitvorming Tacit knowledge Business Intelligence (Explicit knowledge) + + ++

Explicit and implicit knowledge

What is knowledge? Weggeman (2000): K = I * EVA Combination between new Information, existing Experience, Skills (Vaardigheden in Dutch) and Attitude (opinions, beliefs) Information is the explicit component, EVA is the implicit component.

Weggeman (2000): K = I * EVA

Combination between new Information, existing Experience, Skills (Vaardigheden in Dutch) and Attitude (opinions, beliefs)

Information is the explicit component, EVA is the implicit component.

Explicit and tacit knowledge Explicit Tacit Public Private Conscious Unconscious Certain Uncertain Logical Unlogical Structured Unstructured Rules, methods, facts, proof Instinctive, intuitive

Polanyi (1967) “ We can know more than we can tell.” First and second term – electrical shocks Making the first term explicit destroys tacit knowledge So sharing knowledge by writing documents is not the (only) answer!

“ We can know more than we can tell.”

First and second term – electrical shocks

Making the first term explicit destroys tacit knowledge

So sharing knowledge by writing documents is not the (only) answer!

Some examples…

The role of tacit knowledge in decision making Filling in missing information Reducing complexity Distinguishing more alternatives

Filling in missing information

Reducing complexity

Distinguishing more alternatives

Supporting decision making in organizations… BI traditionally delivers data and information But the meaning of the term Intelligence is broader than that… Intelligence is the Application of Knowledge (K = I * EVA). This means that Intelligence also has an implicit component!

BI traditionally delivers data and information

But the meaning of the term Intelligence is broader than that…

Intelligence is the Application of Knowledge (K = I * EVA).

This means that Intelligence also has an implicit component!

A broader definition of BI is needed… Business Intelligence is the result of the directed process, with its applications / resources, to find data both externally and internally, analyze it and to apply the resulting information in combination with the own experience, skills and attitude and to evaluate this in order to support the decision making in organizations.

Business Intelligence is the result of the directed process, with its applications / resources, to find data both externally and internally, analyze it and to apply the resulting information in combination with the own experience, skills and attitude and to evaluate this in order to support the decision making in organizations.

Bridging the gap…. Desired situation: BI is focused on both explicit and tacit knowledge Traditional situation: BI focuses on explicit knowledge

Desired situation: BI is focused on both explicit and tacit knowledge

Traditional situation: BI focuses on explicit knowledge

T hree aspects required to bridge the gap (based on the role of tacit knowledge in decision making) Extra attention should be paid to tacit knowledge during the following phases of decision making: Identifying the problem Formulating alternatives Evaluation of alternatives Tacit knowledge should be shared face to face or virtually, but not made explicit  as Polanyi states: making tacit knowledge explicit would destroy it. The mindset about supporting decision making with BI needs to change

Extra attention should be paid to tacit knowledge during the following phases of decision making:

Identifying the problem

Formulating alternatives

Evaluation of alternatives

Tacit knowledge should be shared face to face or virtually, but not made explicit  as Polanyi states: making tacit knowledge explicit would destroy it.

The mindset about supporting decision making with BI needs to change

H ow can we realize these requirements? Visualization tools need to be more interactive: tacit and explicit knowledge can be compared Use the techniques of knowledge management combined with the BI (technical) implementation Develop BI tools that enable people to share tacit knowledge: virtually looking over the shoulder of your colleague Organize a workshop for your users about the new concept of BI During the implementation, take both people, processes and IT into consideration (an infrastructural approach: Philips, 2004)

Visualization tools need to be more interactive: tacit and explicit knowledge can be compared

Use the techniques of knowledge management combined with the BI (technical) implementation

Develop BI tools that enable people to share tacit knowledge: virtually looking over the shoulder of your colleague

Organize a workshop for your users about the new concept of BI

During the implementation, take both people, processes and IT into consideration (an infrastructural approach: Philips, 2004)

Conclusion and discussion A theoretical and practical approach Challenges for both technical suppliers as for organizational experts Some points to think about: Ability to measure the influence of tacit knowledge on decision making: if it is tacit, how can we ever measure it? Heuristics (structural flaws) in decision making are not the same as the use of intuition: in daily life they are confused! (Sinclair & Ashkanasy, 2005) Examples from our daily practice: existing? or to be created in the near future? More on these items: www.intelligent-business.nl

A theoretical and practical approach

Challenges for both technical suppliers as for organizational experts

Some points to think about:

Ability to measure the influence of tacit knowledge on decision making: if it is tacit, how can we ever measure it?

Heuristics (structural flaws) in decision making are not the same as the use of intuition: in daily life they are confused! (Sinclair & Ashkanasy, 2005)

Examples from our daily practice: existing? or to be created in the near future?

More on these items: www.intelligent-business.nl

Looking towards the future?