The Nonaka and Takeuchi Knowledge Spiral

Creating and Managing New Knowledge

The Nonaka and Takeuchi Knowledge Spiral - Creating and Managing New Knowledge

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Peterfactors

Create new knowledge in a continuing spiral.

Many teams possess a wealth of knowledge and experience, but only some manage this advantage in an effective way.

For example, in the late 1970s, the Japanese car manufacturer Honda took a bold new approach to developing its next model. The company wanted to come up with a completely new concept and to make a car that was inexpensive but not cheap. They adopted the slogan, “Let’s gamble,” which allowed them to tap into the knowledge, skills and unconventional ideas of their young designers in order to come up with something “new.” The result was the Honda City®, an affordable, compact-but-spacious car that defied traditional design and engineering.

The Honda story is an example of how a company shared its existing knowledge and experience across departments to spark ideas and create "new knowledge."

The concept of shared knowledge turning abstract ideas into actionable plans in a self-perpetuating cycle of innovation is the basis of the Nonaka and Takeuchi Knowledge Spiral.

In this article, we examine this theory. We also explore six activities that you can use to apply it.

What Is the Nonaka and Takeuchi Knowledge Spiral?

Ikujiro Nonaka, professor emeritus at the School of International Corporate Strategy at Hitotsubashi University in Japan, and Hirotaka Takeuchi, a professor at Harvard Business School in the U.S., were the first people to link Japanese companies' success to their ability to create new knowledge and share it effectively.

Nonaka and Takeuchi asserted that, when you create new knowledge, you can respond quickly to customer demands, create new products and ways of working, and sustain a competitive advantage. So they created a model, the Nonaka and Takeuchi Knowledge Spiral, to show how knowledge can be generated, transferred and recreated within organizations.

They describe their model as a spiral, rather than a circle, because it represents the continuous forward movement of knowledge.

Nonaka and Takeuchi call the process by which knowledge is shared and created "SECI": Socialization, Externalization, Combination, and Internalization. We explore SECI in more detail, below.

Two types of knowledge are commonly defined within business and knowledge management: explicit and tacit. Explicit knowledge is formal knowledge that is contained in manuals and procedures and can be easily shared. Tacit knowledge is personal, informal knowledge or a skill that is learned by experience, and is rarely shared through documents or processes. For example, the best way to pass on your skill at riding a bicycle is to show someone how to do it, rather than give him or her an instruction book.

Making tacit knowledge explicit means that it doesn't get locked into one individual, and you don't lose it if that person leaves your organization. Formalizing knowledge also significantly reduces the time it takes for new team members to learn how to do their jobs, meaning that the organization can scale more quickly.

Note:

Nonaka and Takeuchi's knowledge creation model also involves "Ba," a difficult concept (loosely translated as "space") that refers to the places where people interact with one another and share their knowledge as the "source" of knowledge creation. The places can be physical, such as an office, virtual, such as email, or "mental," such as shared experiences or ideas.

Sharing Knowledge With "SECI"

Nonaka and Takeuchi proposed four ways that knowledge can be shared and created. And as knowledge is shared, it can move from tacit to explicit or from explicit to tacit, or remain as either. They called this process "SECI," which stands for Socialization, Externalization, Combination, and Internalization.

  • Socialization (tacit to tacit): knowledge is passed from one person to another through shared experiences, imitation, observation, and brainstorming.
  • Externalization (tacit to explicit): your tacit knowledge becomes explicit when you express your ideas, which allows it to be spread more easily through the organization.
  • Combination (explicit to explicit): this is the simplest form of knowledge sharing because practical sources of knowledge, such as documents, are combined, sorted and categorized to create new knowledge.
  • Internalization (explicit to tacit): as knowledge is shared and used throughout the organization, it becomes part of people's knowledge. It can then become tacit knowledge as they "internalize" it and add it to their own ideas and experiences, so creating new knowledge.

Reproduced with permission from Professor Hirotaka Takeuchi.

Figure 1 – The Nonaka and Takeuchi Knowledge Spiral

The Nonaka and Takeuchi Knowledge Spiral

The diagram above illustrates how knowledge is shared and transferred with SECI. The process should be viewed as a spiral rather than a circle, as it represents the continuous creation and forward movement of knowledge.

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Applying the Tool

Here are six activities that can help you to encourage and support knowledge creation for your organization, expanding on ideas from Enabling Knowledge Creation by Georg von Krogh, Kazuo Ichijo, and Ikujiro Nonaka:

  1. Identify the People You Want to Be Involved. Try to involve the largest possible number of people in creating knowledge, and empower them to participate. Certain individuals, such as those with specialized expertise, will trigger the creation of knowledge and can also inspire everyone who's involved.
  2. Plan Knowledge Management. Think about what your organization needs to know to make it more competitive. Once you understand its vision and how it expects to grow, you can work out what tacit knowledge needs to be made explicit. For example, a person in accounting may have years of experience that can be turned into an innovative new approach to budgeting, which can be shared with others to cut costs.
  3. Create the Right Context. Build and maintain good connections and relationships within your team. For example, make time available for team members to discuss their ideas, create quiet spaces and places for them to talk, and offer technical support for knowledge management initiatives.
  4. Provide a Framework for Conversations. People need to have the opportunity to talk about their knowledge regularly. When they do, they can share information, offer different points of view, and create new perspectives.Talking about the knowledge spiral can also help them to understand the importance of turning tacit knowledge into an explicit form that everyone can use.
  5. Make Local Knowledge Available. Specialized knowledge often remains isolated in one part of the organization or with one person, which could cause real problems if he leaves. Make the knowledge you have in your team available to everyone, so that they have the information they need, when they need it.
  6. Codify Explicit Knowledge. People who want access to explicit knowledge have to know where to find it. So make sure that it is documented appropriately. For example, create documents, learning resources and L&D programs – and deliver on them.

Tip:

To help you gather knowledge from your team, learn How To Create a Wiki and set up a collaborative workspace.

To understand your organization as a whole and how that affects you, see our article, Deming's System of Organizational Knowledge. To make the most of your knowledge, see our article, Leverage.

Note:

Some experts have expressed concerns about this model. For example, Dr Stephen Gourlay, associate professor at the Kingston Business School in the U.K., argued that the distinction between tacit and explicit knowledge has some shortcomings. Management consultant Laird D. McLean suggested that the concept has limited practicality for creating knowledge, as he feels it does not explain in detail the mechanisms needed to do so.

Key Points

The Nonaka and Takeuchi Knowledge Spiral is a process of knowledge management that helps you to acquire, organize, share, and renew your team members' knowledge, to improve the performance of the entire organization.

Knowledge is either explicit, set out formally in manuals and documents, or tacit, the personal, informal knowledge that is learned through experience.

Knowledge is created, shared and transferred using a process called "SECI," an acronym that stands for socialization, externalization, combination, and internalization.

As a manager, you can encourage and support the creation of knowledge, by working out what tacit knowledge needs to be made explicit and by allowing people to share their knowledge. Try to include as many people as possible in the process, and make sure that specialized knowledge is not isolated in one part of your organization, but is made available to everyone.

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Comments (4)
  • Over a month ago Yolande wrote
    blueybeck, I had to smile when I read your comment. Not being a big Honda fan, I can relate to how you feel. But beauty is in the eye of the beholder, isn't it?
    The process remains interesting though.

    Cheers
    Yolandé
  • Over a month ago blueybeck wrote
    Once told proof is in the pudding. Might be good idea but the result of Honda doing this produced a ugly terrible looking car
  • Over a month ago BillT wrote
    Hello cookliz,

    Thank you so much for sharing that information.

    Bill
    Mind Tools Team
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