Product Description

How have Japanese companies become world leaders in the automotive and electronics industries, among others? What is the secret of their success? Two leading Japanese business experts, Ikujiro Nonaka and Hirotaka Takeuchi, are the first to tie the success of Japanese companies to their ability to create new knowledge and use it to produce successful products and technologies. In The Knowledge-Creating Company, Nonaka and Takeuchi provide an inside look at how Japanese companies go about creating this new knowledge organizationally.

The authors point out that there are two types of knowledge: explicit knowledge, contained in manuals and procedures, and tacit knowledge, learned only by experience, and communicated only indirectly, through metaphor and analogy. U.S. managers focus on explicit knowledge. The Japanese, on the other hand, focus on tacit knowledge. And this, the authors argue, is the key to their success--the Japanese have learned how to transform tacit into explicit knowledge.

To explain how this is done--and illuminate Japanese business practices as they do so--the authors range from Greek philosophy to Zen Buddhism, from classical economists to modern management gurus, illustrating the theory of organizational knowledge creation with case studies drawn from such firms as Honda, Canon, Matsushita, NEC, Nissan, 3M, GE, and even the U.S. Marines. For instance, using Matsushita's development of the Home Bakery (the world's first fully automated bread-baking machine for home use), they show how tacit knowledge can be converted to explicit knowledge: when the designers couldn't perfect the dough kneading mechanism, a software programmer apprenticed herself with the master baker at Osaka International Hotel, gained a tacit understanding of kneading, and then conveyed this information to the engineers. In addition, the authors show that, to create knowledge, the best management style is neither top-down nor bottom-up, but rather what they call "middle-up-down," in which the middle managers form a bridge between the ideals of top management and the chaotic realities of the frontline.

As we make the turn into the 21st century, a new society is emerging. Peter Drucker calls it the "knowledge society," one that is drastically different from the "industrial society," and one in which acquiring and applying knowledge will become key competitive factors. Nonaka and Takeuchi go a step further, arguing that creating knowledge will become the key to sustaining a competitive advantage in the future.

Because the competitive environment and customer preferences changes constantly, knowledge perishes quickly. With The Knowledge-Creating Company, managers have at their fingertips years of insight from Japanese firms that reveal how to create knowledge continuously, and how to exploit it to make successful new products, services, and systems.

Product Details

• Amazon Sales Rank: #211807 in Books
• Published on: 1995-05-18
• Original language: English
• Number of items: 1
• Binding: Hardcover
• 304 pages

From Library Journal
This book addresses the generation-old question of why the Japanese are so successful in business. The authors, professors of management at Hitosubashi University, contend that Japanese firms are successful because they are innovative, that is, because they create new knowledge and use it to produce successful products and technologies. They identify two types of organizational knowledge: explicit knowledge, contained in procedures and manuals, and tacit knowledge, learned only by experience. U.S. managers tend to focus on explicit knowledge and stress approaches such as benchmarking, while the Japanese focus on tacit knowledge. Using corporate examples such as Honda, NEC, Nissan, 3M, and GE, the authors provide insights that reveal how to blend the best of both worlds. This scholarly volume is highly recommended not only for academics (especially in organizational theory) but also for readers doing business in and with Japan.?Joseph W. Leonard, Miami Univ., Oxford, Ohio
Copyright 1995 Reed Business Information, Inc.

Review

"A fascinating, exciting exposure to a new way of thinking about the knowledge-based company....Provides a model of knowledge creation that will be a touchstone of future work in this field....This important, imaginative book will challenge and intrigue managers and management scholars alike."--D. Eleanor Westney, MIT Sloan School of Management in the Sloan Management Review
"A fascinating volume that will interest philosophers, managers, and more common readers....The analyses are so thorough that they make the one- and two-page descriptions in Forbes magazine seem like elementary fairy stories. The authors have done their research well and provide delightful details."--Minneapolis Star Tribune
"Knowledge creation is to the 90s what excellence was to the 80s. I can't imagine a better book on organizational design for innovation. Nor can I imagine a better common focus for managers and scholars. This is the best and most original blend of organizational theory and practice we are likely to see for some time."--Karl E. Weick, University of Michigan School of Business Administration
"This is the most creative book on management to come out of Japan. The same authors who introduced the rugby approach to new product development, now bring us a myriad of new concepts: tacit knowledge, the oneness of mind and body, middle-up-down management, hypertext organization, to name a few. The insights for this book originated in Japan, but the managerial implications are universal. It is a must read for managers competing in the borderless world."--Kenichi Ohmae, Ohmae & Associates
"Nonaka and Takeuchi take on a subject that is truly on the frontier of management: the process by which companies learn and create competitively valuable knowledge. What is refreshing about this book is that Nonaka and Takeuchi go beyond the slogans that have characterized much of the previous work on this subject, and delve into the specific organization structures and processes involved in organizational creativity and learning. They bring a wealth of specific, in-depth company evidence to bear on the task. The result is an important book which will advance both the literature as well as corporate practice."--Michael E. Porter, C. Roland Christensen Professor of Business Administration, Harvard University

About the Author

Ikujiro Nonaka is a Professor in School of Knowledge Science at the Japan Advanced Institute of Science and Technology. Hirotaka Takeuchi is a Professor of Management at the Institute of Business Research, Hitosubashi University.

Customer Reviews

Great source for understanding knowledge creation.
According to authors, the goal of The Knowledge Creating Company was to (1) construct a new theory if organizational knowledge creation; (2) to provide a new explanation of why certain companies are successful at continuous innovation; and (3) develop a universal management model that converges management practices found in Japan and in the West. In my opinion Nonaka and Takeuchi did an excellent job in all three areas! The presentation of topics is clear and well written. I found chapter 3, Theory of Organizational Knowledge Creation, highly insightful, particularly in the discussion of the Two Dimensions of Organizational Knowledge - epistemological and ontological, and the Four Modes of Knowledge Conversion - socialization, externalization, combination, and internalization.

Drawing from companies such as Honda, Canon, 3M, and GE the authors effectively and convincingly use real world examples to demonstrate organizational knowledge creation.

Nonaka and Takeuchi also provide an in-depth view of Western and Japanese dichotomies and how "synthesis" of both philosophies' can create new solutions.

The Knowledge Creating Company is an excellent resource for Organizational Theory and Strategic Management students or anyone with an interest in how knowledge is created in Japanese and Western companies.

BEWARE! Digital version is only a 10 page summary!
Don't get caught like I did.

Japanese Context...Global Relevance
There are already so many excellent books now available on this subject. What sets this one apart is suggested by its subtitle: "How Japanese Companies Create the Dynamics of Innovation." Decades ago, Japanese executives embraced and acted upon Deming's ideas about TQM. Only after many years later was Deming properly appreciated by corporate leaders in the United States. The same cannot be said about knowledge management (KM) and its most prominent advocates in the United States, such as Peter Senge. Nonetheless, there is much of value we can learn about KM from the Japanese.

According to the authors, "the success of Japanese companies is not due to their manufacturing process; access to cheap capital; close and cooperative relationships with customers, suppliers, and government agencies; or lifetime employment, seniority system, and other human resources management practices....Instead, we make the claim that Japanese companies have been successful because of their skills and expertise at `organizational knowledge creation'. By organizational knowledge creation, we mean the capability of a company as a whole to create new knowledge, disseminate it throughout the organization, and embody it in products, services, and systems."

The material is carefully organized and developed within eight chapters:

1. Introduction to Knowedge in organizations

2. Knowledge and Management

3. Theory of Organizational Knowledge Creation

4. Creating Knowledge in Practice

5. Middle-up-down Management Practice

6. A New Organizational Structure

7. Global Organizational Knowledge Creation

8. Managerial and Theoretical Implications

The chapters which I found most thought-provoking are 1, 3, and 8 but all are valuable. I agree with the authors that innovation can be (and is) achieved "by continuously creating new knowledge, disseminating it widely through the organization, and embodying it quickly in new technologies, products, and systems." I further agree that knowledge-creation "is no longer an enigma. ..[nor is the] process endemic to Japanese companies. It is universal." Leaders of any organization (regardless of its size, nature, or national identity) can derive great benefit from this book, one whose primary models and benchmarks may be limited to companies in only one country but whose relevance is indeed "universal."