Innovation Based Community
1. Abstract
Innovation based community study is the concept based on Nonaka’s Knowledge-Creating Company theory and Porter’s competitiveness diamond model. The first theory demonstrated the organization changes from continuous of innovation, new knowledge creation and the dissemination of them across the entire organization started from the initiative of the individual and the group interaction which transpire into the commitment of the organization. While the second theory pointed out the requirement of change at the nation and the firm level must create the synchronize strategies to be more effective and innovative to utilize their human, capital, and natural resources. By capture the interacting of between these two theories in the implementation of cluster development i.e. hotel the charm in Changmai, and many implementation of cluster development projects under ministry of finance, we hope that we can derive the knowledge capture model that we can use to later on build the better the sustainability communities of practice in systematically manner.
2. Definitions
knowledge:
The information in action which transformed into capability for effective action that described what we know and what we can do. A use of information derived from a personal ability to perform a certain task, experience, intuition and judgment. Knowledge is the capacity that enables person to perform a particular task and it is obtained with the aid of information. The overwhelmingly important productive resource in terms of its contribution to value added and its strategic significance. The primary production and crucial factors provided organizations with lasting competitive advantage, a product of information, experience, skills and attitude.
knowledge management:
Planning for and organizing, leading and controlling the knowledge workers within an organization and the ongoing set of tasks and activities they perform, the knowledge work.
A tactical method can be used to help managers achieve the organizational goals. The art of transforming intellectual assets and information into enduring value for an organization’s customers and people. Creating, maintaining and exploiting knowledge infrastructures and organizational knowledge cultures and making knowledge pay-off. A framework or methodology includes techniques and tool to facilitate knowledge workers in learning, use and creating knowledge. Managing knowledge which is stored in the heads of the people or otherwise, for example in Databases.
Clusters:
A geographically proximate group of interconnected companies and associated institutions in a particular field linked by commonalities and complementarities. Clusters encompass an array of linked industries and other entities important to competition including governmental and other institutions – such as universities, standard setting agencies, think tanks, vocational training providers and trade associations.
3. Knowledge Management Theories
In this study, we will primarily base on Nonaka’s knowledge-creating company in conjunction with the consideration of the people’s motivation to collaborate.
Knowledge Management Theories in use for the study
Knowledge-Creating Company
Nonaka’s Knowledge-Creating Company is a dynamic set of organizational management theories which enable the continuous innovation, create new knowledge and disseminate them across the entire organization. It also demonstrates that organization’s knowledge is based on the initiative of the individual and the group interaction which transpire into the commitment of the organization. Individual’s tacit knowledge must be transformed into explicit knowledge which is formal and systematic and easy to communicate and share.
There are five Enabling Conditions for Organizational Knowledge Creation: Intention, Autonomy, Fluctuation and Creative Chaos, Redundancy, and Requisite Variety.
1. Intention
The organization's aspiration to meet its goals. It is expressed the visions that justify the created knowledge and fosters employee commitment by top and middle managers.
2. Autonomy
The condition allows individuals to discover new knowledge, creative ideas and self-directed actions.
3. Fluctuation and Creative Chaos
The rapid changes i.e. new markets needs, new technology change, etc which even intentionally induced b to evoke a sense of crisis for the organization to meet the new challenging goals. The increased tension helps organization to discover the new innovative ideas and solutions.
4. Redundancy
Redundancy and overlap information on business activities, management responsibilities and etc. making the interchange between hierarchy and non hierarchy more effective. It leads to tacit knowledge, speeding up the knowledge creation process, enabling others to understand and learn as well as facilitate different points of view.
5. Requisite Variety
The constructing of the diversity of necessary information for the entire organization to handle multifaceted knowledge.
There are four types of interactions in the organization knowledge: socialization, combination, externalization, and internalization.
‘Ontology’ explains how the organization knowledge spirally evolved with the individuals sharing knowledge with others across organizational boundaries.
The Five Conditions for the Knowledge Spiral: Sharing tacit knowledge, Creating Concepts, Justifying Concepts, Building an Archetype, Cross-Level
1. Individuals share tacit knowledge which amplified through social interaction.
2. Tacit knowledge shared through team work transforms into explicit and formulate to the new concepts (similar to externalization).
3. The Justification the values of the new knowledge through the organization and society process. This helps to create the criteria and standards for judging truthfulness.
4. Building an archetype can either be a process for developing a (product) prototype, a new corporate value, managerial system or new organizational structure and etc.
5. Cross-level knowledge moves explicit knowledge beyond the initial boundaries. It continues to affect the external i.e. consumers, affiliated organizations and etc.
The middle up model
The middle-up-down approach is suggested to be the most fitted management model to facilitate the dynamic interactions and spirally movement of the organizational knowledge. First, it encourages socialization and externalization and the secondly it also brings about combination and internalization.
Implementation of Organizational Knowledge Creation
· Create a knowledge vision and communicate it by providing a mental image of the knowledge we wish to create, accumulate, and disseminate.
· Develop a knowledge crew from the committed individuals. They are identified as knowledge practitioners, engineers and officers.
· Build a high-density of interaction, opportunities for social interactions which encourage the continuous exchange of tacit and explicit knowledge, the dynamic exchange of ideas, intuitions, perceptions, mental models, and experiences that convert into explicit knowledge.
· Take advantage on new product development process that create adaptive and flexible approaches.
· Adopt middle-up-down management model where the top executive articulate their vision while the front line managers pursue the realistic issues with middle management mediating between the two.
· Switch to a hypertext organization which allows the entire organization to switch between the various context of knowledge creation using information technology that storing and interpreting both tacit and explicit knowledge from the knowledge base layer which embedded in corporate vision and organizational culture.
4. Problem Specification
Thailand has been blessed by the economic growth and attracted substantial foreign investment in the recent years. However, the sustain growth and productivities of the nation posts very awakening issues for Thailand.
From Dr. Michael Porter’s preliminary findings report in May 2003 for examples, “Thailand generates less revenue per tourist than leading competitors, for example Indonesia. Thailand has not been able to increase the revenue per tourists over time. Even after the 1997 devaluation, revenues in terms of Thai Baht only remained stable, while tourists reduced their spending in terms of US Dollar. Low labor cost allow Thai assembly plants to be cost competitive despite a much lower level of automation. Thai-based producers have low incentives to adopt world-class technology to improve productivity, but this perpetuates low wages”
Therefore, it is necessity for Thailand to be more competitive by building upon the sustainable productivity in which a nation uses human, capital, and natural resources more effectively and innovatively. To drive the competitiveness of Thailand, it is also necessary to align Thailand strategy as well as the firm level strategy onto the same directions (macroeconomic and microeconomic levels in parallel) to cope with the dynamism of global business competition both at the national level as well as the firm level. Porter’s “diamond model” demonstrates the competitiveness of the nation as a relationship and the interaction of the strategy at the national level and the firm level in to four driving factors as follows:
1. Factor conditions (input)
The consideration of fundamental factors as natural resource, geography; capital and factors which include knowledge and skill of people, and infrastructure.
2. Context for firm strategy and rivalry
The conditions and rules of business and government (international and local) regulations/promotion, especially the ones that relate to productivity and competitive advantage improvement.
3. Related and supporting industries
The structure of the industry, knowing how each business entity works together with others in the industries in the value chain which including supporting industries.
4. Demand conditions
The understanding of the customers demand, and how to respond to satisfy the customer needs.
Hence, the innovation productivities clustering remains the key success factors of Competitiveness of the nation.
5. The Problem and KM
The Collaborative Competitiveness Development
Competitive Advantage of Nations has globally accepted by the work has been done from
Dr. Michael Porter in 1990. His famous “diamond model” demonstrated the important of each factor, the relationship and the interaction between different factors. He also highlighted that there are multiple factors beyond the firm’s internal to improve the competitive edge. He also pointed out the need of the aligned parallel strategy development on both macro and micro economic to drive up the dynamism of the competitive edge of the country. With, additional studies, i.e. Enright (1992,1993), indicated the impact of regional and geographical locations competitiveness which clearly indicate the effect on the internal and external focus of the parallel development of the firms and the industry. In other words, the collaborative development is also required internally and externally. At the cluster level, cluster’s members are working to collaborate and mutually support each other to enhance the cluster competitive edge by i.e. “learning-by-doing” and etc. The learning from the experience of exchange, demonstrate and sharing knowledge and innovation ideas among individual in the close proximity areas in which underling by innovative ideas from knowledge workers under the new knowledge based economy. As pointed out by Nonaka and Takeuchi (1995) in Knowledge-Creating Company, the innovation and knowledge creation are the social engaging process which individuals exchange tacit and explicit knowledge. The Creation of Knowledge begins with the alignment of individual as the basis collaboration. And, then it will expand into the trust-based relationships and social capital the fuse the value chain of cluster and create innovative base society both at individuals and across organization. Innovation and learning can not be undertaken in isolation. The richer the links between different value-creating activities and organization within, the greater the exchange of information, knowledge and innovation will be.
6. Ideas and Strategy to Solve the Problem
Cross organization collaborations can provide a powerful competitive positioning. While management the risk of sharing intellectual properties i.e. innovation ideas among different organization posted significant draw back. Considering the challenge of collaboration and sharing in cluster development, collaborations and sharing are usually started from the motivations in which initially drive individuals and organizations to explore the possibility of working together for a set of the certain explicit goals. It is vitally important that parties have clearly understanding their own motivations so that the relationships can be formed accordingly to the expectation. On one hand, the motivation is simply humanitarian just helping who is in need for the well-being of society. On the other hand, it is more on the issues of the limited risk arrangement or the creation of competitive advantages. It is more on the basic businesses relationship which is to generate economic returns for the collaborative undertaken. In either case, the collaborations continue to evolve as long as the motivation and objectives continue to meet especially the business arrangement. It is worthwhile to systematically consider the motivation and the benefits expected to gain from collaboration engagement. To think about motivations systematically, it is helpful to create a strategy framework which map the motivation knowledge model derived from Nonaka’s Knowledge-Creating Company the ideas that driven people within the organization to share their tacit and explicit knowledge across the sub-organization boundaries.
This model shall be used in to capture the motivation of the cluster developments in Thailand i.e. Hotel De charm cluster development in tourism industry and various cluster development projects under Ministry of Finance projects during the fiscal year of 2005.
7. Conclusion
Knowledge Management is the essential development mechanism to help the organization focus more on their internal process. When we can transpire this process into the basic of cluster development across the value chain, it helps the new innovation and knowledge move across the organization boundaries more effectively. Therefore knowledge capture model on both implementation of the knowledge management and competitiveness development is the important step to facilitate that cluster development in systematically approach.
8. References
o Nonaka, I.; Takeuchi, H., (1995), The Knowledge Creating Company, Oxford University Press.
o Porter, M. E. (1990), The competitive advantage of nations, The Free Press, New York.
o Solvell, O.; Lindqvist, G.; Ketels, C. (2003). The Cluster Initiation Greenbook. Ivory Tower Ab.
o Business for development: implications for export strategy-makers, Thailand, Competitiveness, and “e”. ITC/WTO discussion forum. (2003) Cancun, Mexico.
o Kemp, J.; Pudlatz, M.; Perez, P.; Ortega, A. M.;(2002).KM Terminology and Approaches. The European KM Forum Consortium.