The document discusses knowledge creation in companies. It contrasts Western and Eastern/Japanese approaches to knowledge, finding that the Japanese approach taps into tacit knowledge like intuition and personal commitment. There are four patterns of knowledge conversion: tacit to tacit, explicit to explicit, tacit to explicit, and explicit to tacit. Knowledge spirals through these conversions as tacit knowledge is articulated and then internalized as more tacit knowledge. Honda provided metaphorical goals that allowed for individualistic and innovative car designs. For knowledge creation, companies should use metaphors, then analogies, and finally models, while also enabling redundancy and an ambiguous yet clear vision.

1. Nonaka, I. (2007). Managing for the Long Term. Harvard Business Review, Nov-Dec, 162- 171 1
“The Knowledge-Creating Company” Summarization
In the recent economy companies face difficulty understanding what is “knowledge”
and how to make the most of it. Western Management has a systematic approach
towards knowledge and considers ‘information’ to be quantifiable and explicit.
However, looking at Eastern Management techniques, their approach towards
knowledge taps into the intrinsic details and proves them to be quick to respond to
their markets ever-changing demands. Additionally, the Japanese approach towards
knowledge is not based solely on quantifiable elements. The Japanese make use of
intuition, subjective opinion, suspicions, notions, and impressions. It seems the
Japanese believe that employees must have a personal commitment with their
organization and identify with the company’s mission in order to contribute to it. All in
all, a knowledge-creating company has to be an idealistic one.
Furthermore, Japanese management proves that personal knowledge has the potential
to be transformed into organizational knowledge. This theory is applicable to all levels
of a company and is continuously changing. Additionally, Japanese management makes
use of tacit knowledge, or knowledge based on actions. This is an ideology that people
generally know more than they can say. Therefore, there are four basic patterns for
creating knowledge (1) Tacit to Tacit: learning to knead a dough (action) by watching
another person knead a dough (action). (2) Explicit to Explicit: collecting information
(quantifiable information) from different departments and creating one report on it
(quantifiable information). (3) Tacit to Explicit: observing employees behavior (action)
and creating one report on it (quantifiable information). (4) Explicit to Tactic: a
company deciding to make decisions (actions) based on a report (quantifiable
information).
Based on these patterns, the spiral of knowledge is based on converting actions into
measurable knowledge, and using that new knowledge to increase one’s tacit
knowledge. The process of the two, articulation and internalization, proves to have a
very holistic approach. For example, management of Honda provided their design team
with metaphors that were highly idealistic and figurative goals on how to approach a
new car design. This led to Honda’s young and ambitious design team to create a car
that was different than any other car on the market, inexpensive, and surpassed the
typical human-machine relationship. Such a use of metaphors shows that every person
perceives a metaphor in their own context and is able to approach it in their own
individualistic way.
Therefore, the first step in knowledge-creation is metaphors. However, metaphors
should be followed by analogies. If a metaphoric phrase represents two ideas, an
analogy explains how those two ideas are different and not so different. Lastly, the last
step in the knowledge-creation process is creating a model. A model transfers concepts
and resolves conflicts systematically.
Once a knowledge-creation process is achieved, initiating redundancy in an
organization allows for common grounds to be established. This also allows for
transference of information to pass smoothly and due to information overlap, people
can anticipate another person’s actions. Redundancy can also be created through
strategic rotation of information and by providing free access of company information
to others. More importantly, this proves that creating knowledge is not the job of one
department, or individual, but a collective approach. Additionally, providing a vision
that is ambiguous, and yet clear, allows freedom for individuals to set their own goals.