As companies grow more skilled at knowledge creation, Nonaka sees them drawing customers, suppliers, competitors, education partners, and communities into these processes. At the same time, corporate leaders must decide how much autonomy to grant employees, balancing the need for flexibility with the need for control. Carroll Creech, former CEO of Snap-on Tools Japan, a division of the U.S. global manufacturer Snap-on Inc., understands this paradoxical challenge. “Nonaka-Sensei,” he says, “does not look at the constituent parts of an organization or the issues it faces as separate things. He sees an organization as a set of relationships that work together in ways that affect the whole. Having enough patience to not cut things short and say, ‘What’s the bottom line here?’ is essential if you want to compete in a global economy that demands constant innovation.”
Of course, not every company in Japan is a paragon of knowledge creation, as that country’s perennially troubled financial sector makes clear. But the examples Nonaka uses in Managing Flow and The Knowledge-Creating Company demonstrate what the Japanese are doing right. It’s as if his original desire for revenge on the West has been fulfilled, but in a way he could never have anticipated. Japan has become a sort of management conscience to the rest of the world, and through its best companies, an exemplar of superior achievement.
There’s a parallel here to the role information technology has played over the last four decades. IT began as an innovative paragon, became a flawed workhorse always falling short of its potential, and emerged as a strategic partner transforming the role of enterprise in the world. This history, like that of Japanese management practice, makes clear that the full measure of humanity must become manifest in the machine if knowledge is to be created; treating humans as interchangeable parts will always lead to a creative dead end. Nonaka’s great contribution has been to offer a vision for channeling creativity into innovation and a method for bringing it forth. In the end, the phronetic manager capable of integrating the analytical power of episteme with the poetry and technique of techne can achieve extraordinary results while helping to make the organization whole.
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Sally Helgesen is an author and leadership development consultant. Her books include The Web of Inclusion: A New Architecture for Building Great Organizations (Currency/Doubleday, 1995) and Thriving in 24/7: Six Strategies for Taming the New World of Work (Free Press, 2001). Her Web site is www.sallyhelgesen.com.