KM Most-Cited Reading Packet 10-12

1. KM Most-Cited Reading Packet 10-12 By Manny Martinez & Yi-Hsuan Lee

2. Agenda • The Firm As A Distributed Knowledge System: A Constructionist Approach • Organizational Memory: Review of Concepts and Recommendations for Management • Exploring Internal Stickiness: Impediments to the Transfer of Best Practice within the Firm

3. The Firm As A Distributed Knowledge System: A Constructionist Approach Author: Haridimos Tsoukas, 1996 Agenda: Introduction Recent Developments Structure of Social Practices Industry Recipes Conclusion

4. Introduction • Two key questions regarding traditional management research • 1. In what direction should the firm channel its activities? • 2. How should a firm be organized? • Assumptions underlying these questions • rationality • propositional reasoning • sufficient knowledge

5. Introduction • The traditional approach does not account for particular circumstances of time and space • Full knowledge and access to that knowledge is assumed, but this is clearly not the case • “A firm’s knowledge cannot be surveyed as a whole; it is not self contained…”(p13)

6. Recent Developments • The author argues that firms draw upon existing knowledge and it’s ‘collective knowledge’ - just as Stein (19) argued • Instead of employees as cogs reacting to given scenarios, individuals interact with their past experiences and create their surroundings • Those following this idea either: create taxonomies or create analogies between the mind and the organization

7. Recent Developments • Taxonomists create types of organizational knowledge and draw out their implications • tacit vs. explicit • Opposition to Nonaka and Takeuchi relating to the inter-connectivity between tacit and explicit • Analogies between the organization and the mind • the necessary knowledge is distributed • the collective mind is created as individuals interact

8. Recent Developments • Human understanding is based on a unique and unarticulated background, thus rendering the ‘rationalist’ view lacking • This background is then applied by an individual to a target, thus resulting in understanding the target • The background is a result of socialization

9. Structure of Social Practices • Three dimensions of social practices • 1. Normative expectations are associated with a particular role • 2. An individual brings past socializations to particular situations • 3. Interactive-situational dimension-the context of an activity activates expectations • The absence of predictable rationality results in a dispersed environment

10. Structure of Social Practices • “Human agency is ‘always and at every moment confronted with specific conditions and choices…’” (p19) • The human decision is always grounded in local, socialized, and personal experiences • The infinite number of resulting possibilities is managed through institutional context

11. Industry Recipes • “Through a process of socialization, managers internalize industry-specific distinctions” (p20) • A recipe “consists of a set of background distinctions tied to a particular field of experiences” (p20) • Recipes represent tacit knowledge

12. Conclusion • Resources are not given or discovered but created…..through human interaction • Firms rely on knowledge that is dispersed throughout the individuals • Thus the firm is a distributed knowledge system • The firm’s knowledge is in a broad context • Normative and actual situations are in tension, resulting from the localness of individuals

13. Conclusion • Management is therefore not a rule-making endeavor, but should be the process of allowing individuals to interact • This interaction allows employees to create knowledge • Assumptions not stated by the author • requires experts, education, and motivation • Compare the role of managers to that given by Drucker

14. Organizational Memory: Review of Concepts and Recommendations for Management Author: Eric Stein, 1995 Agenda: Introduction Defining Organizational Memory Processes of Organizational Memory Recommendations

15. Introduction • Working definition: Organizational memory is the means by which knowledge from the past is brought to bear on present activities, thus resulting in higher or lower levels of organizational effectiveness (p22) • Involves the coding of information via suitable representations, which later have an effect on the organization in light of current conditions

16. Introduction • Organizational memory as a capability • means to transmit information from past to future members • Three types of organizational memory • metaphor allowing insight into organizational life • embedded in management theory • relevant to management practice

17. Introduction • Organizational memory as a metaphor • Three types of information can be stored as a memory to “steer” an organization • 1. Outside information • 2. Information from the past • 3. Information about the organization itself • What is the importance here?

18. Introduction • Organizational memory as related to management theory • learning vs. unlearning • flexibility vs. stability • human resources vs. information resources • Necessary for planning and decision making in organizations

19. Introduction • Organizational memory as related to management practice • Capturing the lessons of experts and other personnel to reduce loss of knowledge during turnover • Capturing knowledge over time will result in a competitive advantage

20. Defining Organizational Memory • How to use organizational memory to enhance effectiveness - provides a useful framework • Guarding against inflexibility and lowered effectiveness • Look at types of memories • encoded but not sent immediately • time in transmission is critical • extended duration following transmission

21. Recommendations • Recommendations • 1. Identify the types of memories • What is the usefulness? • 2. Look at coupling between senders and receivers • 3. Consider the role of short/long term memories • 4. Inventory and classify memory

22. Recommendations • Recommendation 4 is the most useful and doable • 1. Knowledge-base in crucial for effectiveness • 2. Knowledge supports effective strategic decision making, resulting in a strategic advantage: • suggestive • predictive • decisive • systemic

23. Processes of Organizational Memory • Consist of acquisition, retention, maintenance, retrieval • Provide the means by which knowledge from the past is brought to bear on present activities

24. Processes of Organizational Memory • Acquiring organizational memories • Mostly focuses on learning • The receipt of a sensory signal is the most basic form of learning • Individual learning cycles are completed when new knowledge is accepted and encoded into individual minds • Organizational learning is not complete until individual learning is embedded in the organization • Organizational memory is essential to organizational learning, while learning is a necessary condition for memory

25. Processes of Organizational Memory • Acquiring organizational memories • Organizational memories may also produce barriers to learning, especially double-loop learning • Double-loop learning occurs when members detect conflicting requirements and try to resolve those conflicts by changing prevailing norms and values • Since individuals must change their shared theories-in-use and images of organization, unlearning might take place

26. Processes of Organizational Memory • Retaining organizational memories • Retention is the most important and widely recognized feature of organizational memory • Three categories to retain organizational information • Schemas: • A schema is an individual cognitive structure that helps people organize and process information efficiently • Scripts: • Scripts describe the appropriate sequencing of events in conventional or familiar situations • Systems: • Memories may be retained in the social fabric of organizations, in their physical structures, and in explicitly designed information systems

27. Processes of Organizational Memory • Three major categories of means to retain organizational memories

28. Processes of Organizational Memory • Maintenance and loss of organizational memories • Departing members leave 'holes' in existing knowledge networks • The average experience of those who leave may be more important than the absolute number of those who leave • Firms that fail to reinforce social structures may experience a loss of knowledge as relationships atrophy • Organizational memories also can be maintained through recurrent patterns of interaction

29. Processes of Organizational Memory • Retrieving organizational memories • Organizational memories can be recalled to support decision making and problem solving • An inquirer is motivated to retrieve information if: • the inquirer values what has been done in previous contexts • the desired information exists and the inquirer is aware of the information • the inquirer has the ability to search, locate, and decode the desired information • the cost to locate the information is less than re-computing the solution from scratch • An organization that maintains but does not use its knowledge-base is dysfunctional

30. Recommendations • Recommendations • 5. Explore the impact of both individual and organizational learning • 6. Examine the retentive capacities of personal and shared schema • 7. Examine the retentive capacities of personal and organizational scripts • 8. Examine the retentive capacities of the social and physical structures associated with organizations • 9. Leverage advanced information technologies to support the processes and products of organizational memory

31. Recommendations • Recommendations • 10. Assess the loss of knowledge experienced by organizations due to turnover and organizational restructuring • 11. Assess the means by which organizations maintain different types of knowledge through communication processes, repetition, sanctification, and validation • 12. Examine the degree to which organizations support the retrieval of knowledge from the past and the impact of that knowledge on organizational effectiveness

32. Conclusion • An improved organization memory can benefit the organization in several ways: • Helps managers maintain strategic direction over time • Helps the organization avoid the nightmare of cycling through old solutions to new problems • Gives new meaning to the work of individuals if such efforts are retained • Facilitate organizational learning • Strengthen the identity of the organization • Provide newcomers with access to the expertise

33. Discussion • Does this article really provide management tools? • Can managers actually identify the memories?

34. Exploring Internal Stickiness: Impediments to the Transfer of Best Practice within the Firm Author: Gabriel Szulanski, 1996 Agenda: Stages in the Transfer Process Origins of Internal Stickiness Research Results and Suggestions

35. Stages in the Transfer Process • Initiation • This stage comprises all events that lead to the decision to transfer • A transfer begins when both a need and the knowledge to meet that need coexist within the organization • Implementation • During this stage, resources flow between the recipient and the source • Related activities cease or diminish after the recipient begins using the transferred knowledge

36. Stages in the Transfer Process • Ramp-up • The recipient use the new knowledge ineffectively at first, but gradually improves performance, ramping up toward a satisfactory level • Integration • Use of the transferred knowledge gradually becomes routinized in every recurring pattern • A shared history of jointly utilizing the transferred knowledge is built up in the recipient

37. Origins of Internal Stickiness • Four sets of factors are likely to influence the difficulty of knowledge transfer: • Characteristics of the source of knowledge • Characteristics of the recipient of knowledge • Characteristics of the context • Characteristics of the knowledge transferred

38. Origins of Internal Stickiness • Characteristics of the source of knowledge • Lack of motivation • A knowledge source may be reluctant to share knowledge for fear of losing ownership or a position of privilege • Not perceived as reliable • When a source unit is not perceived as reliable, initiating a transfer from that source will be more difficult

39. Origins of Internal Stickiness • Characteristics of the recipient of knowledge • Lack of motivation • Some recipients may be reluctant to accept knowledge from the outside • Lack of absorptive capacity • Recipients might be unable to take advantage of outside source of knowledge • Lack of retentive capacity • The ability of a recipient to institutionalize the utilization of new knowledge reflects the retentive capacity • Without such ability, initial difficulties may become an excuse for discontinuing its use and reverting to the previous status

40. Origins of Internal Stickiness • Characteristics of the context • Barren organizational context • Intrafirm exchanges of knowledge are embedded in a organizational context • A context that stops the gestation and evolution of transfers is said to be barren • Arduous relationship • A transfer of knowledge may require numerous individual exchanges • An arduous (i.e., distant) relationship might create additional difficulties in the transfer

41. Origins of Internal Stickiness • Characteristics of the knowledge transferred • Causal ambiguity • When the precise reasons for success or failure cannot be determined, causal ambiguity is present • Unprovenness • A proven record of past usefulness helps in the process of selecting knowledge for transfer Which factor will mostly affect the difficulty of knowledge transfer?

42. Research Results and Suggestions • The correlation between the two sets of constructs is very high • The three most important barriers are: • The lack of absorptive capacity of the recipient • Causal ambiguity • The arduous relationship between the source and the recipient

43. Research Results and Suggestions • These results contrast to conventional wisdom • Conventional wisdom attributes stickiness almost exclusively to motivational factors • Knowledge-related barriers dominate rather than motivation-related barriers • Why organizations do not know what they know? • It may be less because organizations do not want to learn but rather because they do not know how to

44. Research Results and Suggestions • Using only incentive systems to mitigate internal stickiness is inadequate or misled • It might be profitable to devote scarce resources and managerial attention to: • Develop the learning capacities of organizational units • Foster closer relationships between organizational units • Systematically understand and communicate practices

45. Discussion • Are there any other barriers to the transfer? • Are these results suitable to the companies from other countries?

46. Appendix • Research samples are from 8 companies: • AMP, AT&T Paradyne, British Petroleum, Burmah Castrol, Chevron Corporation, EDS, Kaiser Permanente, Rank Xerox • 2 sets of constructs: • Dependent variables: stickiness in stages in the transfer process • Independent variables: Origins of Internal Stickiness • The data set • 271 observations of 122 best-practice transfers in 8 companies