Tacit and Explicit Knowledge

Knowledge management owes its inspiration to the work of the philosopher Michael Polanyi and the Japanese organization learning 'guru' Ikijuro Nonaka. Both of these theorists argued that knowledge has two forms: explicit and tacit, which have some similarity to Stewart's hard and soft knowledge assets.

Explicit knowledge - the obvious knowledge found in manuals, documentation, files and other accessible sources;

Implicit, or tacit knowledge - found in the heads of an organization's employees. Far more difficult to access and use - for obvious reasons. Typically, an organization does not even know what this knowledge is. Worse, the knee-jerk reaction of top managers who fire employees at the first sign of any downturn means that the knowledge is often lost.

Grant (1997) argues that HRM can improve an organisation's competitiveness through its impact on the 'knowledge base' of a business: the skills and expertise of its employees. Management of human resources can provide a competitive advantage through a knowledge management perspective. One strategy is to encourage replication of tacit knowledge within an organisation without allowing it to replicate outside. From this perspective, organisations should:

1. Accept that knowledge is a vital source for value to be added to a business' products and services and a key to gaining competitive advantage.

2. Distinguish clearly between explicit and tacit knowledge.

3. Accept that tacit knowledge rests inside individuals and is learned in an unstructured and informal way.

4. Somehow, identify and tap this tacit knowledge and make it part of the 'structural capital' of the business, so that it can be made available to others.

Drucker* (1998) contends that knowledge management will have a major impact on the structure of future organizations. He predicts that knowledge-based organizations will have half the number of management layers found in businesses today - and the number of managers will be cut by two thirds. Drucker considers that the organizational structures featured in current textbooks are still those of 1950's manufacturing industries. In the future, businesses will come to resemble organizations that today's managers and students would not pay any attention to: hospitals, universities, and symphony orchestras. In other words, knowledge-based organizations 'composed largely of specialists who direct and discipline their own performance through organized feedback from colleagues, customers and headquarters.'

* Drucker, P. (1998) 'The coming of the new organization' in The Harvard Business Review on Knowledge Management (Harvard Business Review Series), Harvard University Press.

In the twentieth century information was collected in order to monitor and control workers. 'Knowledge' was held at the top of the organization where strategies were determined and decisions made. But this Tayloristic view of the organizations ignored the wealth of knowledge held by ordinary workers. In Drucker's view, specialist knowledge workers will resist the primitive 'command and control' model of people management in the same way as professionals such as doctors and university teachers do already.

Knowledge Management

Data, Information and Knowledge

Knowledge Management Practice

The Psychology of Expertise