2.3 Knowledge in An Organizational Perspective

2.3 Knowledge in An Organizational Perspective

            In previous sections we have discussed different types of knowledge that can exist in an organization. In literature, some researchers have categorized knowledge of following taxonomy: fact-based, concept-based, language-based and value-based. Such classification is commonly used in academic environment therefore we will not discuss it in detail and restrict our discussion to organizational knowledge.

Let’s take a closer look at the scope of organizational knowledge and its significance to the knowledge management (KM) process. For this we need to know about organizational knowledge resources to understand the concept of knowledge artifact – discussed in the forth coming sections.

Organization knowledge can exist on several different levels:

  • Individual: often tacit knowledge like know-how. It can also be in explicit form, but it must be personal in nature, e.g. a private notebook.
  • Groups/community: Knowledge held in groups but not shared with the rest of the organization. Business organizations usually consist of communities (most often informally created) which are linked together by common practices. Lave & Wenger (1991) called them as ‘communities of practice’. Such communities may share common values, language, procedures, know-how, etc. They are a source of learning and a repository for tacit, explicit, and embedded knowledge.
  • Structural: Structure knowledge is considered basic to problem solving. It is required in creation of plans and strategies, setting conditions for different procedures, and in determining what to do when failure occurs or when a piece of information is missing.

          A general definition of structural knowledge has not yet been established but in literature  structural knowledge is consist of four aspects: (i) declarative, episodic and/or procedural (Tulving, 1972; Willigham, Nissen & Bullemer, 1989),  (ii) structured by semantic structure knowledge (Preece, 1976; Jonassen & Wang, 1993), (iii) encoded verbally and/or non-verbally (Sadoski, Paivio & Goetz, 1991), and (iv) have its own meta-structure (Boshuizen & Schmidt, 1992).

          Jonassen and Wang (1993) define structural knowledge as the knowledge of how concepts within a domain are interrelated. This definition is similar to the definition of Preece (1976) when he equates structural knowledge to cognitive structure of knowledge, “Structural knowledge is also known as cognitive structure, the pattern of relationships among concepts in memory”. So the structural knowledge not only consists of the mere facts, but also incorporates the inferences.

          Structural knowledge may be understood by many or very few members of the organization. For example, the knowledge embedded in the routines used by the army may not be known by the soldiers who follow these routines. At times, structural knowledge may be the remnant of past, otherwise long forgotten lessons, where the knowledge of this lesson exists exclusively in the process itself.

  • Organizational: The definition of organizational knowledge is yet another concept that has very little consensus within literature. Variations include the extent to which the knowledge is spread within the organization, as well as the actual make-up of this knowledge. Hatch (2010) defines it as: "When group knowledge from several subunits or groups is combined and used to create new knowledge, the resulting tacit and explicit knowledge can be called organizational knowledge." Ekinge & Lennartsson (2000) present a broader perspective: "individual knowledge, shared knowledge, and objectified knowledge are different aspects or views of organizational knowledge".

          There is growing interest in organizational knowledge (Cohen and Sproull, 1991). Many argue that the organization’s knowledge and learning capabilities are the main source of its competitive advantage (e.g. Kogut & Zander, 1992; Starbuck, 1992). But a number of other authors (Bedeian, 1986; Fiol and Lyles, 1985; Huber, 1991; Shrivastava, 1983; Walsh and Ungson, 1991) have argued that the concept of organizational knowledge needs considerable refinement before they can be of real consequence to practitioners or organizational theorists. However, in this book, taking a broader approach, we would define organizational knowledge as ‘all knowledge resources within an organization that can be realistically tapped by that organization. It can therefore reside in individuals and groups, or exist at the organizational level.’

  • Extra-organizational: The Knowledge resources existing outside the organization which could be used to enhance the performance of the organization. They include explicit elements like publications, as well as tacit elements found in communities of practice that extend beyond organizational boundaries, or extra-organizational communities of practice, are linked by what they do rather than where and for whom they work for (Cohen and Levinthal, 1989). The knowledge generated from exchanges between similar communities of practice from different organizations constitutes extra-organizational knowledge. Professional organizations or societies host luncheons and hold conferences on topics of interest to like functioning communities of practice. Journals on shared topics of interest are published as means to capture and share extra-organizational knowledge. Explicit extra-organizational knowledge is particularly valuable if an organization is missing an internal capability or group knowledge base. Expertise and knowledge created by other organizations can be used to fill deficiencies within an organization and add to the value of organizational knowledge.
  • Inter-organizational: The role of inter-organizational knowledge sharing in shaping the innovativeness of individuals and organizations is well recognized (Ahuja, 2000; Baum, Calabrese, and Silverman, 2000; Powell, Koput, and Smith-Doerr, 1996). Recent trend of ‘open up’ organizational innovation activities are based on the idea that individuals should make extensive efforts to network externally to capture and integrate knowledge from outside the firm (Chesbrough, 2003).

          Many studies have shown that there are innovative benefits of drawing upon a broad range of external sources of innovation, compared to relying solely on internal or a small number of external sources (Laursen and Salter, 2006). Within organizations, however, there is likely to be a broad range of external ties that are held by individuals and the nature of these ties may influence an individual’s ability to perform in their assigned role. Such ties can also act as a powerful stimulus to help support internal efforts to innovate by offering resources and expertise that are not available within the organization (Salter,  Criscuolo, and Dahlander, 2009).

          Inter-organizational ties can be developed through a diverse set of external relationships, including working on projects; through having worked together in the past; shared educational experience; joint membership in clubs and societies; or through their involvement in communities of practices that span beyond the boundaries of the firm. In addition, the very nature of the workplace may also have changed during the last decade (Evans, Barley, and Kunda, 2004; Salter, Criscuolo, and Dahlander, 2009).

          With the rise of more fluid, fast-paced and mobile work environments, individual’s networks are likely to be highly diverse, permeable and external-oriented rather than monolithic, closed and internally focused (Saxenian, 1994). At times, external ties may offer richer and more diverse sources of ideas and support than the resources that can be gained from drawing on knowledge from the internal network. Individuals who are able to draw upon a diverse set of external ties may be able to call on network resources that their more inward looking colleagues are unable to. Thus, these external ties may be a ticket to acquire innovative status within an organization (Salter, Criscuolo, and Dahlander, 2009).

            In this section we have observed that organizations are no longer viewd merely as processors of information, machines of transactional efficiency, bureaucratic order, or labour exploration. They are seen as processors of knowledge, repositories of competences, knowledge, and creativity, as sites of invention, innovation and learning (Kogut and Zander, 1992:382; Fransman, 1994). The later view advocates viewing cognitive process essential for organizational knowledge capacity building and internal coherence.

            In previous sections we have seen knowledge is a heterogeneous resource that organization value in different manifestation.  Although differentiation among different types of knowledge have been discussed in this chapter and each has its own merits and demerit, but the most critical factor for organizational learning is its ‘cognitive architecture’ - the way knowledge is produced, store, retrieved, shared and transmitted. It not only influences the organizational learning but also influence the organization’s capacity of innovation and competitiveness as well. It also effects the interaction of knowledge held at different levels – individual, group, organizational, and inter-organizational  (Kogut and Zander, 1992; Nonaka and Takeuchi, 1995; Choo and Bontis, 2002). 

            In literature, this varying perspective of knowledge is grouped in three theoretical approaches: the strategic management approach(parhalad and Hamel, 1990), the evolutionary-economic approach(Nelson and Winter, 1982), and the social-anthropology of learning approach(Lave and Wenger, 1991; Brown and Duguid, 1991). The strategic management approach emphasizes on core competencies and advocates that organizational performance is tied to organizational structure, procedures, environment, and the role of individuals in organization. It mainly follows the governance philosophy of ‘management by design’ – that is, managers deciding on how knowledge should be managed in the organization.  They are considered reponsible of establishing an environment that encourage learning in order to reinforce and simulate the competences accumulated (Amin and Cohendet, 2004).

            The evelutionary-economic approach views organization as a repository of knowledge embodied in organizational routines. This approach is a hybrid theory that includes the fundamental principles of any evolutionary theory – including the principles of heredity played by routines, the principles of generation of variety, and the principle of selection. Organizational routines are considered the building blocks of the core dynamic capability that expresses the organization’s ability to integrate, build, and reconfigure internal and external competences to address rapidly changing environment (Amin and Cohendet, 2004).

            The social-anthropology-of-learning approach centers its intrest in the actual process of how knowledge is formed and made explicit through social interaction. The emphasis is on the working community as an active entity of knowing, which reveals specific forms of knowledge through its daily practices. Knowledge is harnessed too the sociology of interpersonal and collective relations in the organization, language of communication, and socialization strategies. The approach favours organizing for learning in doing, in both an experimental and a path-dependent nature, and based on working the social dynamics of communities and organizational cultures (Amin and Cohendet, 2004).

            Though above approaches have differentiating factors but the importance aspect to be noticed is that organizations do posses knowledge in above discussed forms – explicit, embedded, embrained, embodied, encultured, encoded, etc. Therefore, organizations can behave and organize themselves as knowledge-possession, generation and transmission systems. They themselves are cognitive agents – demonstrating or portraying a particular corporate rationality or mindset. Therefore, the ability for an organization to be agile, successful, improve performance and positively impact its internal knowledge culture will determine the true competitiveness of the organization in today’s knowledge economies.