Tacit & Explicit Knowledge.

 


·       Tacit & Explicit Knowledge


Within the complex fabric of Multinational Corporations (MNCs), the delineation between tacit and explicit knowledge assumes a pivotal role in moulding organizational learning, fostering innovation, and determining overall competitive advantage (Nonaka & Takeuchi, 1995).

 

Tacit Knowledge, often synonymous with "know-how," encapsulates unarticulated, experiential understanding held by individuals, challenging to formalize. In the context of MNCs, where collaboration spans borders and cultures, tacit knowledge proves invaluable. For instance, an international marketing team may possess tacit insights into consumer behaviours, cultural nuances, and effective communication strategies across diverse regions, contributing significantly to the success of global marketing campaigns (Nonaka, 1991).

 

Conversely, Explicit Knowledge is codified, tangible, and easily communicable through formalized channels like documents, manuals, and databases. It serves as a standardized means of sharing information in geographically dispersed MNCs. In pharmaceutical MNCs, for instance, explicit knowledge takes the form of standardized operating procedures (SOPs) and regulatory guidelines, ensuring consistency in drug development processes globally (Grant, 1996).

 

The Knowledge Conversion process in MNCs, as outlined by Nonaka and Takeuchi (1995), involves the dynamic transformation of knowledge between tacit and explicit forms. This process is vital for fostering innovation and adapting to diverse market conditions. In product development projects, engineers in a global automotive company may engage in face-to-face discussions (tacit knowledge) to address design challenges, which are then codified into design specifications (explicit knowledge) for global dissemination (Nonaka & von Krogh, 2009).

 

Balancing Tacit and Explicit Knowledge emerges as a strategic imperative for MNCs, where tacit knowledge fuels innovation, creativity, and adaptability, while explicit knowledge provides structure for communication and organizational learning (Grant, 1996). A comprehensive knowledge management approach is crucial, involving platforms for tacit knowledge sharing, such as cross-functional team collaborations and mentoring programs. Simultaneously, MNCs invest in robust knowledge repositories, training programs, and information systems to efficiently capture, codify, and disseminate explicit knowledge (Nonaka & von Krogh, 2009).

 

In conclusion, the interplay between tacit and explicit knowledge in Multinational Corporations is a dynamic process that shapes organizational learning capabilities and competitive advantage. Recognizing the unique strengths of each form of knowledge and implementing effective knowledge conversion strategies empower MNCs to harness the collective intelligence of their global workforce, fostering innovation and adaptability in dynamic markets. The balance between tacit and explicit knowledge is not only a strategic imperative but also a linchpin for sustainable success in the diverse and evolving business landscape.




 References

  •  Nonaka, I & Takeuchi, H.  (1995). The knowledge-creating Company:  How Japanese companies create the dynamics of innovation.  Oxford:  Oxford University Press

  •  Nonaka, I.  (1991).  The knowledge-creating company. Harvard Business Review, 96-104.

  •  Grant, R. M. (1996). Prospering in dynamically-competitive environments: Organizational capability as knowledge integration. Organization Science, 7(4), 375–389.

  •   Nonaka, I. and von Krogh, G. (2009) Perspective—Tacit Knowledge and Knowledge Conversion: Controversy and Advancement in Organizational Knowledge Creation Theory. Organization Science, 20, 635-652. http://dx.doi.org/10.1287/orsc.1080.0412.

  • https://www.youtube.com/watch?v=iZZgIkrKz1s

 

 


Comments

  1. Piyumi Wickramasinghe December 20, 2023 at 7:26 AM

    Digging more into the very rare but fascinating topic, the difference between Tacit & Explicit
    knowledge is as follows. Transferring knowledge from one individual to another might be challenging when it comes to tacit knowledge. It is the knowledge that a person has learned on their own and from personal experiences; it is frequently not communicated clearly. This kind of knowledge is crucial because it facilitates creativity, problem-solving, and decision-making. In contrast, explicit knowledge is the kind that is readily documented and conveyed using symbols, language, or any other kind of communication. Knowledge management, organizational learning, and continuous growth all depend on it.

    In conclusion, for businesses to succeed over the long term, converting tacit knowledge into explicit knowledge is essential. Knowledge management and organizational learning, innovation and creativity, performance, efficiency, and competitive advantage are all beneficial to organizations.

    ReplyDelete
    Replies
    1. Bhagya MadhubhashiniDecember 20, 2023 at 8:14 AM

      Adding to the conclusion of yours explicit knowledge can be formally documented and shared, tacit knowledge exists inside the heads of your employees. It comes from experience learned on the job and can be difficult to articulate or express. Thank you so much

      Delete

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