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Organizational Knowledge Management
             as a precursor of Innovation




Original
Presentation in
Portuguese                              Jackson Pollock



Rio de Janeiro -20 de outubro de 2011   Apresentação
SEPRO SENAI/CETIQT                      Fernando Goldman
Disclaimer: The ideas presented here are those of
  the author and do not necessarily represent those
  of SENAI / CETIQT nor Eletrobras Furnas, the SBGC,
  the PPED / UFRJ or any institution with which he is
  or has been bound by ties of affiliation, services or
  hiring.



Rio de Janeiro -20 de outubro de 2011   Apresentação       2
SEPRO SENAI/CETIQT                      Fernando Goldman
Who is the speaker?

        Fernando L. Goldman – researcher of the Dynamics of
    Organizational Knowledge, Innovation and Competitiveness, a
    doctoral candidate in Public Policy, Strategies and Development at
    PPED / IE / UFRJ, Master in Production Engineering, UFF, MBA in
    Business Management from FGV and electrical engineer at UFRJ.
    Former Regional Director (Rio de Janeiro) of SBGC - Brazilian
    Society of Knowledge Management (2007-2011). Eletrobras
    Furnas Engineer




Rio de Janeiro -20 de outubro de 2011     Apresentação                   3
SEPRO SENAI/CETIQT                        Fernando Goldman
Our goal:
                    To arouse the discussion
        Let's talk about:
           the linear model of innovation;
           innovation in business models;
           a new vision of innovation;
           the theory of organizational knowledge
           creation;
           social tools and networks;
           Leadership in Innovative Firms.
Rio de Janeiro -20 de outubro de 2011   Apresentação       4
SEPRO SENAI/CETIQT                      Fernando Goldman
The Linear Model of Innovation

             Science, the Endless Frontier and Vannevar
             Bush – 1945;
             paradigm of science and technology
             policies, the end of 1950´s;

             the dynamics of innovation model adopted
             by most developed countries


Rio de Janeiro -20 de outubro de 2011   Apresentação       5
SEPRO SENAI/CETIQT                      Fernando Goldman
The Linear Model of Innovation


             This model dominated thinking about the
             S&T until recently;

             The problem is that this model is used up to
             today by many companies and some public
             policymakers.



Rio de Janeiro -20 de outubro de 2011   Apresentação        6
SEPRO SENAI/CETIQT                      Fernando Goldman
The Linear Model of Innovation



              In this model, innovation comes from
              scientific research and the strategic
              positioning of firm defines investments in
              R&D* for the creation of Organizational
              Knowledge.

         * Applied Research and Experimental Development .




Rio de Janeiro -20 de outubro de 2011                        Apresentação       7
SEPRO SENAI/CETIQT                                           Fernando Goldman
The Linear Model of Innovation…

           …neglects activities outside the R&D;
           …considers technological innovation as an
         act of production, instead of a continuous
         social process;

            The relationship between enterprise and
         innovation is complex, dynamic and multi-
         level .*
         *LAM, A. Organizational Inovation. In: FAGERBERG, J.; MOWERY, D. C.; NELSON, R. Oxford
         Handbook of Innovation. Oxford University Press, 2005.


Rio de Janeiro -20 de outubro de 2011                              Apresentação                   8
SEPRO SENAI/CETIQT                                                 Fernando Goldman
Innovation in business models


               People are realizing the need for firms to
               create innovative business models.

               It is not enough to create products and
               processes *


         *TEECE, D. J. Business Models, Business Strategy and Innovation. Long Range Planning 43, 2010.


Rio de Janeiro -20 de outubro de 2011                               Apresentação                          9
SEPRO SENAI/CETIQT                                                  Fernando Goldman
A new vision of Innovation


            The water analogy for knowledge simply does not
            work;

            the simple information processing - or its
            accumulation - does not lead to innovation;

            All processes of innovation come from exactly the
            subjective beliefs of people or of their images of
            the world;

            objectivity X subjectivity (Polanyi)

Rio de Janeiro -20 de outubro de 2011     Apresentação           10
SEPRO SENAI/CETIQT                        Fernando Goldman
A New Vision of Innovation


              Knowledge is inherently paradoxical: it is an
              individual construction and, at the same time, is the
              result of a social product (the product of a
              community) and can not be managed in the usual
              sense of the word 'management' .



Rio de Janeiro -20 de outubro de 2011    Apresentação             11
SEPRO SENAI/CETIQT                       Fernando Goldman
The KM * as multidisciplinary area:


             Increasingly, modern society perceives the
             current revolution around the use of knowledge
             and has sought ways to deal with this new
             reality.
             The traditional disciplines (engineering,
             administration, economics, etc..) have been
             consolidated in the use of classical factors of
             production;

          * KM – Organizational Knowledge Management

Rio de Janeiro -20 de outubro de 2011                  Apresentação       12
SEPRO SENAI/CETIQT                                     Fernando Goldman
The Organizational Knowledge
           After all, what knowledge are we talking about?

           To deal with Organizational Knowledge, capabilities
           are required to coordinate the creation
           (specialization) and use (integration) of different
           knowledge*

           Which is the relationship between Innovation and
           Knowledge Management?
         *DEMSETZ, H. The Theory of the Firm Revisited, v. 4 n. 1 Journal of Law, Economics, and
         Organization, p. 141-161, 1988.



Rio de Janeiro -20 de outubro de 2011                                Apresentação                  13
SEPRO SENAI/CETIQT                                                   Fernando Goldman
Contextualization

            Corporate Education             Organizational
                                        Knowledge Management


              Factor of Production        Factor of Production
                     Work                     Organizational
                                                Knowledge



        Intellectual Capabilities of    Dynamic Capabilities of
                individuals                     firm


Rio de Janeiro -20 de outubro de 2011     Apresentação            14
SEPRO SENAI/CETIQT                        Fernando Goldman
A new vision of Innovation

         The Knowledge-Creating Company - Ikujiro
         Nonaka and Hirotaka Takeuchi
         How Japanese Companies Create the
         Dynamics of Innovation (1995)




Rio de Janeiro -20 de outubro de 2011   Apresentação       15
SEPRO SENAI/CETIQT                      Fernando Goldman
A new vision of innovation


              The most quoted book on Knowledge
              Management is not about Knowledge
              Management.

              It talks about the dynamics of innovation




Rio de Janeiro -20 de outubro de 2011   Apresentação       16
SEPRO SENAI/CETIQT                      Fernando Goldman
A new vision of Innovation

        Like any milestone:
      - most often quoted than read, and
      - more read than understood




Rio de Janeiro -20 de outubro de 2011   Apresentação       17
SEPRO SENAI/CETIQT                      Fernando Goldman
A new vision of innovation

          ... it's just one of the many elements
          of a theory under construction


                 The Theory of Organizational
                      Knowledge Creation
                          (Nonaka)

Rio de Janeiro -20 de outubro de 2011   Apresentação       18
SEPRO SENAI/CETIQT                      Fernando Goldman
What does the TOKC say?



                Innovation is the result of the
                dynamic creation of
                Organizational Knowledge *

         *NONAKA, I.; TOYAMA, R.; KONNO, N. SECI, Ba and Leadership: a unified Model of Dynamic Knowledge
         Creation, Long Range Planning, v.33, p. 5-34, 2000




Rio de Janeiro -20 de outubro de 2011                            Apresentação                               19
SEPRO SENAI/CETIQT                                               Fernando Goldman
Knowledge Management ?

                              Different approaches to KM

               Mainstream                            New Approaches
               Approaches

          K is seen as static                         Dynamics of K


             unsustainables                           Firm's longevity




Rio de Janeiro -20 de outubro de 2011         Apresentação               20
SEPRO SENAI/CETIQT                            Fernando Goldman
What is the nature of the firm?


              Firms process information. (Simon)



              Firms create knowledge. (Nonaka)



Rio de Janeiro -20 de outubro de 2011   Apresentação       21
SEPRO SENAI/CETIQT                      Fernando Goldman
Organizational Knowledge Creation:


         Capability of a firm…:

                …to create knowledge,
                …to disseminate it and
                …to incorporate it into products,
                services and systems.

Rio de Janeiro -20 de outubro de 2011   Apresentação       22
SEPRO SENAI/CETIQT                      Fernando Goldman
Explicit and Tacit Knowledge
           Explicit knowledge is                        Tacit knowledge is
           objective, organized,                        subjective, being mainly
           structured, and can be                       based on experience. It
           made available in                            is embedded in people
           documents, databases,                        in the form of
           training videos and                          memories, mental
           other channels,                              models, views, practical
           traditional or not, of                       know-how etc.
           information sharing.
                                        www.kmgoldman.blogspot.com

           They are not two kinds of knowledge, they
           traditional, or not, of
           are two dimensions to the same knowledge.
           information sharing.

Rio de Janeiro -20 de outubro de 2011                          Apresentação        23
SEPRO SENAI/CETIQT                                             Fernando Goldman
How does innovation happen in TOKC?




Rio de Janeiro -20 de outubro de 2011   Apresentação       24
SEPRO SENAI/CETIQT                      Fernando Goldman
The paradox of Knowledge?


             Although individual, knowledge is a social product


          “People interacting in a certain historical and social context
          share information from which they construct social
          knowledge as a reality, which in turn influences their
          judgment, behavior, and attitude. (Berger; Luckmann, 1966)

             Organizational Knowledge is a complex and
             multidisciplinary theme

                                                                   25
Rio de Janeiro -20 de outubro de 2011       Apresentação                25
SEPRO SENAI/CETIQT                          Fernando Goldman
In TOKC, an innovative firm…:

              …creates knowledge continuously from the
              tacit knowledge of their individuals;
              …innovates by synthesis, a dialectical process,
              continuous and dynamic, which nurtures the
              paradoxes;
              …socially converts tacit knowledge into explicit
              and vice versa.

Rio de Janeiro -20 de outubro de 2011   Apresentação        26
SEPRO SENAI/CETIQT                      Fernando Goldman
What is Knowledge?


              The way you define knowledge defines how
              you manage it (Verna Allee)

              The correct differentiation between Data,
              Information and Knowledge

               DIKW is not functional for TOKC


                                                           27
Rio de Janeiro -20 de outubro de 2011   Apresentação            27
SEPRO SENAI/CETIQT                      Fernando Goldman
The knowledge in three properties




                                                           28
Rio de Janeiro -20 de outubro de 2011   Apresentação            28
SEPRO SENAI/CETIQT                      Fernando Goldman
The TOKC vision of Innovation


              Mental models of individuals are transformed in the
              informational process, setting new states of
              knowledge.



              Similarly, firms continually create knowledge, setting
              up new states of Organizational Knowledge .


Rio de Janeiro -20 de outubro de 2011     Apresentação             29
SEPRO SENAI/CETIQT                        Fernando Goldman
The Obsolescence of Knowledge
                           Obsolete Products,                        Fall in
                         Services and Processes                   Competitiveness

    Obsolete Organization
      Obsolete Groups
                                                                                   Decrease in
      Obsolete People                          Consequences of                  operational results
                                          obsolescence of Knowledge
                                               for Organizations
                                          Source: Adapted from Drucker (1995)

  Inability to innovate in the face
    of intra or extra information
                                                                                    Stakeholder
                                                                                     Pressures

                                                           Loss of investment in
         Loss of ability to retain existing                  renewal (people)
                 talents (people)

                                                                                              30
Rio de Janeiro -20 de outubro de 2011                      Apresentação                            30
SEPRO SENAI/CETIQT                                         Fernando Goldman
Social tools and networks


             knowledge creation, as a social phenomenon, is due
             to the constructive interaction between people in a
             community.

             Social tools enable the communication of
             information, accelerating the exchange and
             interaction. Everything living is organized in
             networks.



Rio de Janeiro -20 de outubro de 2011     Apresentação             31
SEPRO SENAI/CETIQT                        Fernando Goldman
Leadership in Innovative Firms
               Breaking with Taylorism (The Long Tail);
                Progress more than TQM;
                Skills to deal with intangibles;
                More research skills;
                But the manager is not an academic researcher;
                Researcher is looking for a Theory;
                Manager is looking for a method;
                Most important: There is no "magic formula".
Rio de Janeiro -20 de outubro de 2011        Apresentação       32   32
SEPRO SENAI/CETIQT                           Fernando Goldman
Questions?



         www.kmgoldman.blogspot.com
         http://www.slideshare.net/goldman



         Engº Fernando Goldman
         Email: fernandogoldman@yahoo.com.br




Rio de Janeiro -20 de outubro de 2011        Apresentação       33
SEPRO SENAI/CETIQT                           Fernando Goldman

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2011 10 20_senai_cetiqt_english

  • 1. Organizational Knowledge Management as a precursor of Innovation Original Presentation in Portuguese Jackson Pollock Rio de Janeiro -20 de outubro de 2011 Apresentação SEPRO SENAI/CETIQT Fernando Goldman
  • 2. Disclaimer: The ideas presented here are those of the author and do not necessarily represent those of SENAI / CETIQT nor Eletrobras Furnas, the SBGC, the PPED / UFRJ or any institution with which he is or has been bound by ties of affiliation, services or hiring. Rio de Janeiro -20 de outubro de 2011 Apresentação 2 SEPRO SENAI/CETIQT Fernando Goldman
  • 3. Who is the speaker? Fernando L. Goldman – researcher of the Dynamics of Organizational Knowledge, Innovation and Competitiveness, a doctoral candidate in Public Policy, Strategies and Development at PPED / IE / UFRJ, Master in Production Engineering, UFF, MBA in Business Management from FGV and electrical engineer at UFRJ. Former Regional Director (Rio de Janeiro) of SBGC - Brazilian Society of Knowledge Management (2007-2011). Eletrobras Furnas Engineer Rio de Janeiro -20 de outubro de 2011 Apresentação 3 SEPRO SENAI/CETIQT Fernando Goldman
  • 4. Our goal: To arouse the discussion Let's talk about: the linear model of innovation; innovation in business models; a new vision of innovation; the theory of organizational knowledge creation; social tools and networks; Leadership in Innovative Firms. Rio de Janeiro -20 de outubro de 2011 Apresentação 4 SEPRO SENAI/CETIQT Fernando Goldman
  • 5. The Linear Model of Innovation Science, the Endless Frontier and Vannevar Bush – 1945; paradigm of science and technology policies, the end of 1950´s; the dynamics of innovation model adopted by most developed countries Rio de Janeiro -20 de outubro de 2011 Apresentação 5 SEPRO SENAI/CETIQT Fernando Goldman
  • 6. The Linear Model of Innovation This model dominated thinking about the S&T until recently; The problem is that this model is used up to today by many companies and some public policymakers. Rio de Janeiro -20 de outubro de 2011 Apresentação 6 SEPRO SENAI/CETIQT Fernando Goldman
  • 7. The Linear Model of Innovation In this model, innovation comes from scientific research and the strategic positioning of firm defines investments in R&D* for the creation of Organizational Knowledge. * Applied Research and Experimental Development . Rio de Janeiro -20 de outubro de 2011 Apresentação 7 SEPRO SENAI/CETIQT Fernando Goldman
  • 8. The Linear Model of Innovation… …neglects activities outside the R&D; …considers technological innovation as an act of production, instead of a continuous social process; The relationship between enterprise and innovation is complex, dynamic and multi- level .* *LAM, A. Organizational Inovation. In: FAGERBERG, J.; MOWERY, D. C.; NELSON, R. Oxford Handbook of Innovation. Oxford University Press, 2005. Rio de Janeiro -20 de outubro de 2011 Apresentação 8 SEPRO SENAI/CETIQT Fernando Goldman
  • 9. Innovation in business models People are realizing the need for firms to create innovative business models. It is not enough to create products and processes * *TEECE, D. J. Business Models, Business Strategy and Innovation. Long Range Planning 43, 2010. Rio de Janeiro -20 de outubro de 2011 Apresentação 9 SEPRO SENAI/CETIQT Fernando Goldman
  • 10. A new vision of Innovation The water analogy for knowledge simply does not work; the simple information processing - or its accumulation - does not lead to innovation; All processes of innovation come from exactly the subjective beliefs of people or of their images of the world; objectivity X subjectivity (Polanyi) Rio de Janeiro -20 de outubro de 2011 Apresentação 10 SEPRO SENAI/CETIQT Fernando Goldman
  • 11. A New Vision of Innovation Knowledge is inherently paradoxical: it is an individual construction and, at the same time, is the result of a social product (the product of a community) and can not be managed in the usual sense of the word 'management' . Rio de Janeiro -20 de outubro de 2011 Apresentação 11 SEPRO SENAI/CETIQT Fernando Goldman
  • 12. The KM * as multidisciplinary area: Increasingly, modern society perceives the current revolution around the use of knowledge and has sought ways to deal with this new reality. The traditional disciplines (engineering, administration, economics, etc..) have been consolidated in the use of classical factors of production; * KM – Organizational Knowledge Management Rio de Janeiro -20 de outubro de 2011 Apresentação 12 SEPRO SENAI/CETIQT Fernando Goldman
  • 13. The Organizational Knowledge After all, what knowledge are we talking about? To deal with Organizational Knowledge, capabilities are required to coordinate the creation (specialization) and use (integration) of different knowledge* Which is the relationship between Innovation and Knowledge Management? *DEMSETZ, H. The Theory of the Firm Revisited, v. 4 n. 1 Journal of Law, Economics, and Organization, p. 141-161, 1988. Rio de Janeiro -20 de outubro de 2011 Apresentação 13 SEPRO SENAI/CETIQT Fernando Goldman
  • 14. Contextualization Corporate Education Organizational Knowledge Management Factor of Production Factor of Production Work Organizational Knowledge Intellectual Capabilities of Dynamic Capabilities of individuals firm Rio de Janeiro -20 de outubro de 2011 Apresentação 14 SEPRO SENAI/CETIQT Fernando Goldman
  • 15. A new vision of Innovation The Knowledge-Creating Company - Ikujiro Nonaka and Hirotaka Takeuchi How Japanese Companies Create the Dynamics of Innovation (1995) Rio de Janeiro -20 de outubro de 2011 Apresentação 15 SEPRO SENAI/CETIQT Fernando Goldman
  • 16. A new vision of innovation The most quoted book on Knowledge Management is not about Knowledge Management. It talks about the dynamics of innovation Rio de Janeiro -20 de outubro de 2011 Apresentação 16 SEPRO SENAI/CETIQT Fernando Goldman
  • 17. A new vision of Innovation Like any milestone: - most often quoted than read, and - more read than understood Rio de Janeiro -20 de outubro de 2011 Apresentação 17 SEPRO SENAI/CETIQT Fernando Goldman
  • 18. A new vision of innovation ... it's just one of the many elements of a theory under construction The Theory of Organizational Knowledge Creation (Nonaka) Rio de Janeiro -20 de outubro de 2011 Apresentação 18 SEPRO SENAI/CETIQT Fernando Goldman
  • 19. What does the TOKC say? Innovation is the result of the dynamic creation of Organizational Knowledge * *NONAKA, I.; TOYAMA, R.; KONNO, N. SECI, Ba and Leadership: a unified Model of Dynamic Knowledge Creation, Long Range Planning, v.33, p. 5-34, 2000 Rio de Janeiro -20 de outubro de 2011 Apresentação 19 SEPRO SENAI/CETIQT Fernando Goldman
  • 20. Knowledge Management ? Different approaches to KM Mainstream New Approaches Approaches K is seen as static Dynamics of K unsustainables Firm's longevity Rio de Janeiro -20 de outubro de 2011 Apresentação 20 SEPRO SENAI/CETIQT Fernando Goldman
  • 21. What is the nature of the firm? Firms process information. (Simon) Firms create knowledge. (Nonaka) Rio de Janeiro -20 de outubro de 2011 Apresentação 21 SEPRO SENAI/CETIQT Fernando Goldman
  • 22. Organizational Knowledge Creation: Capability of a firm…: …to create knowledge, …to disseminate it and …to incorporate it into products, services and systems. Rio de Janeiro -20 de outubro de 2011 Apresentação 22 SEPRO SENAI/CETIQT Fernando Goldman
  • 23. Explicit and Tacit Knowledge Explicit knowledge is Tacit knowledge is objective, organized, subjective, being mainly structured, and can be based on experience. It made available in is embedded in people documents, databases, in the form of training videos and memories, mental other channels, models, views, practical traditional or not, of know-how etc. information sharing. www.kmgoldman.blogspot.com They are not two kinds of knowledge, they traditional, or not, of are two dimensions to the same knowledge. information sharing. Rio de Janeiro -20 de outubro de 2011 Apresentação 23 SEPRO SENAI/CETIQT Fernando Goldman
  • 24. How does innovation happen in TOKC? Rio de Janeiro -20 de outubro de 2011 Apresentação 24 SEPRO SENAI/CETIQT Fernando Goldman
  • 25. The paradox of Knowledge? Although individual, knowledge is a social product “People interacting in a certain historical and social context share information from which they construct social knowledge as a reality, which in turn influences their judgment, behavior, and attitude. (Berger; Luckmann, 1966) Organizational Knowledge is a complex and multidisciplinary theme 25 Rio de Janeiro -20 de outubro de 2011 Apresentação 25 SEPRO SENAI/CETIQT Fernando Goldman
  • 26. In TOKC, an innovative firm…: …creates knowledge continuously from the tacit knowledge of their individuals; …innovates by synthesis, a dialectical process, continuous and dynamic, which nurtures the paradoxes; …socially converts tacit knowledge into explicit and vice versa. Rio de Janeiro -20 de outubro de 2011 Apresentação 26 SEPRO SENAI/CETIQT Fernando Goldman
  • 27. What is Knowledge? The way you define knowledge defines how you manage it (Verna Allee) The correct differentiation between Data, Information and Knowledge DIKW is not functional for TOKC 27 Rio de Janeiro -20 de outubro de 2011 Apresentação 27 SEPRO SENAI/CETIQT Fernando Goldman
  • 28. The knowledge in three properties 28 Rio de Janeiro -20 de outubro de 2011 Apresentação 28 SEPRO SENAI/CETIQT Fernando Goldman
  • 29. The TOKC vision of Innovation Mental models of individuals are transformed in the informational process, setting new states of knowledge. Similarly, firms continually create knowledge, setting up new states of Organizational Knowledge . Rio de Janeiro -20 de outubro de 2011 Apresentação 29 SEPRO SENAI/CETIQT Fernando Goldman
  • 30. The Obsolescence of Knowledge Obsolete Products, Fall in Services and Processes Competitiveness Obsolete Organization Obsolete Groups Decrease in Obsolete People Consequences of operational results obsolescence of Knowledge for Organizations Source: Adapted from Drucker (1995) Inability to innovate in the face of intra or extra information Stakeholder Pressures Loss of investment in Loss of ability to retain existing renewal (people) talents (people) 30 Rio de Janeiro -20 de outubro de 2011 Apresentação 30 SEPRO SENAI/CETIQT Fernando Goldman
  • 31. Social tools and networks knowledge creation, as a social phenomenon, is due to the constructive interaction between people in a community. Social tools enable the communication of information, accelerating the exchange and interaction. Everything living is organized in networks. Rio de Janeiro -20 de outubro de 2011 Apresentação 31 SEPRO SENAI/CETIQT Fernando Goldman
  • 32. Leadership in Innovative Firms Breaking with Taylorism (The Long Tail); Progress more than TQM; Skills to deal with intangibles; More research skills; But the manager is not an academic researcher; Researcher is looking for a Theory; Manager is looking for a method; Most important: There is no "magic formula". Rio de Janeiro -20 de outubro de 2011 Apresentação 32 32 SEPRO SENAI/CETIQT Fernando Goldman
  • 33. Questions? www.kmgoldman.blogspot.com http://www.slideshare.net/goldman Engº Fernando Goldman Email: fernandogoldman@yahoo.com.br Rio de Janeiro -20 de outubro de 2011 Apresentação 33 SEPRO SENAI/CETIQT Fernando Goldman