The Knowledge-Creating Company: How Japanese Companies Create the Dynamics of Innovation

More formally, each division has to comply with a corporate requirement that at least 25 percent of its sales must be derived from products that did not exist five years ago.

Japanese engineers learned how to externalize tacit knowledge into explicit knowledge, and internalized it. American engineers learned how to socialize tacit knowledge from interaction with other people or direct experience on-site, and internalized it. Discovering and remedying weaknesses, both at the individual and organizational levels, hold the

Middle managers usually have been portrayed in recent literature as frustrated, disillusioned, stuck in the middle of a hierarchy in dreary jobs (Johnson and Frohman, 1989) with little hope of career progression, and increasingly subject to being replaced by technological advancements (Dopson and Stewart, 1990).1 Doomsayers argue, according to Boru

The study of human knowledge is as old as human history itself.

Once the importance of tacit knowledge is realized, then one begins to think about innovation in a whole new way.

In contrast, middle managers play a key role in our theory, acting as “knowledge engineers” within the company.

Redundancy is important because it encourages frequent dialogue and communication. This helps create a “common cognitive ground” among employees and thus facilitates the transfer of tacit knowledge.

They actually create new knowledge and information, from the inside out, in order to redefine both problems and solutions and, in the process, to re-create their environment.

The intelligence of a corporation does not come from the president nor top management. That must come from the gathering of all knowledge of all members. A big organization is separated into many sections. If that organization does not have the system to integrate the knowledge of each section, the newly created knowledge would be poor. Each sectio