Cross-Cultural Perspectives on Knowledge Management (Libraries Unlimited Knowledge Management Series)

Cross-Cultural Perspectives on Knowledge Management

David J. Pauleen Editor

LIBRARIES UNLIMITED

CROSS-CULTURAL PERSPECTIVES ON KNOWLEDGE MANAGEMENT

Cross-Cultural Perspectives on Knowledge Management Edited by David J. Pauleen

Libraries Unlimited Knowledge Management Series Danny Wallace, Series Editor

Library of Congress Cataloging-in-Publication Data Cross-cultural perspectives on knowledge management / edited by David J. Pauleen. p. cm. — (Libraries Unlimited knowledge management series) Includes bibliographical references and index. ISBN 1–59158–331–4 (alk. paper) 1. Knowledge management. 2. Corporate culture. I. Pauleen, David, 1957– HD30.2.C78 2007 658.4 ʹ 038—dc22 2006028274 British Library Cataloguing in Publication Data is available. Copyright © 2007 by Libraries Unlimited All rights reserved. No portion of this book may be reproduced, by any process or technique, without the express written consent of the publisher. Library of Congress Catalog Card Number: 2006028274 ISBN: 1–59158–331–4 First published in 2007 Libraries Unlimited, 88 Post Road West, Westport, CT 06881 A Member of the Greenwood Publishing Group, Inc. www.lu.com Printed in the United States of America

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Contents

List of Figures

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List of Tables

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Foreword

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Acknowledgments Introduction SECTION 1: CONCEPTUAL APPROACHES TO CULTURE AND KNOWLEDGE MANAGEMENT

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Exploring the Relationship between National and Organizational Culture, and Knowledge Management

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David J. Pauleen, Ling-Ling Wu, and Sally Dexter 2

Culture: An Overlooked Key to Unlocking Organizational Knowledge

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Robert Mason 3

The Art of Systems: The Cognitive-Aesthetic Culture of Portal Cities and the Development of Meta-Cultural Advanced Knowledge Economies

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Peter Murphy SECTION 2: EFFECTS OF CULTURE ON KEY ASPECTS OF KNOWLEDGE MANAGEMENT

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Cultural Stretch: Knowledge Transfer and Disconcerting Resistance to Absorption and Application

Gerhard Fink and Nigel Holden

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Contents

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From Concept to Context: Toward Social-Cultural Awareness and Responsibility in the Organization of Knowledge

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Chern Li Liew 6

Managing Innovative Knowledge: Cultural Perspectives on Patenting

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Chad Saunders and Mike Chiasson 7

The Influence of National Culture on Knowledge Management in Virtual Teams

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Doug Vogel, Anne-Francoise Rutkowski, and Michiel van Genuchten 8

People’s Twist: The Cultural Standard of Loyalty and Performance in Former Socialist Economies

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Gerhard Fink and Maren Lehmann SECTION 3: RESEARCH AND CASES ON CULTURE AND KNOWLEDGE MANAGEMENT

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Institutional and Cultural Influences on Knowledge Sharing in Russia and China

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Kate Hutchings and Snejina Michailova 10

Asian Organizations Meet North American Management Theory: The Case of Singapore and Senge

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Kala S. Retna and Jane E. Bryson 11

The Peruvian Asparagus Cluster: Realizing Profitability from Social Capital and Shared Knowledge Management in a Traditionally Low-Trust Environment

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Luis S. Chang 12

Research and Development Knowledge Transfer across National Cultures

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Marjolyn S. W. Thiessen, Paul H. J. Hendriks, and Caroline Essers Afterword

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Index

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About the Editor and Contributors

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List of Figures

1.1 Culture, values, attitudes, and behaviors (Adler 2002)

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1.2 Extending Adler’s model to the level of organizations, groups, and teams

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1.3 KM model emphasizing the development of knowledge sharing behavior

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1.4 National culture, organizational culture, and KM

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5.1 Klemke’s context typology

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5.2 Structure of a cross-contextual knowledge organization system

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7.1 Significant attitude change between the pre-test and post-test on the item “Any kind of relationship had to be structured hierarchically to obtain harmony” on a 5-point scale (From –2 = Strongly Disagree to +2 = Strongly Agree) 121

7.2 Convergence between the pre-test and post-test on the item “How much is the presence of a leader in the group required?” on a 10-point scale, from 1 = not at all, to 10 = very much

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11.1 The Road to Frío Aéreo

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12.1 Knowledge transfer model

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12.2 Indicators of the impact of national culture on knowledge transfer

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12.3 National cultures of the Netherlands, the United States, and India

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List of Tables

5.1 Selected definitions of knowledge

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7.1 Synchronous versus asynchronous communication activities

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7.2 Experience of HK and Dutch respondents

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7.3 Expected and encountered problems

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7.4 Pre- and post-test characterization rankings

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7.5 Between and within nationality comparisons on the item “leadership”

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11.1 Culture and progress

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12.1 The knowledge transfer cultures at Akzo Nobel Car Refinishes R&D units

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12.2 Assessment of cultural differences and their impact on cross-cultural R&D knowledge transfer at Akzo Nobel Car Refinishes

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Foreword

What is knowledge management? To keep it simple, we could say “making sure you know what you need to,” where you refers to some group or organization that manages knowledge. Usually it is a company, but it could be a scientific community, or any other social entity, so let us use the word organization for now. In order to manage knowledge, the organization needs two things: a memory and means of communicating the knowledge. Knowledge management has been used as a synonym for information management. In this case it usually revolves around the use of technology, both “memory” and communication technologies. For others, knowledge management means the management of practices—and, by extension, people—in the organization. This means that learning, rather than technology, takes centre stage. The emphasis rests on managing organizational practice in such a way that people can learn what they need to know from one another. According to either school, communication between people is a crucial aspect of knowledge management. In its emphasis on communication, knowledge management is similar to culture, if we define culture as the set of implicit rules for the social game. Culture in this sense would refer to the management of the tacit knowledge of a group of people. This is the knowledge that specifies, for instance, when to see others as friends, competitors, enemies, or potential loved ones, and how to treat them accordingly. Groups that have culture in this sense range from teams to societies. Very few people have explicit knowledge of their culture; they take it for granted. This can happen even to those who are aware that faraway people have different cultures. To accept that we are culturally embedded ourselves can be even more difficult than to accept that others are. If we accept that the notions of culture and knowledge management are similar in their focus on communication, there is no escaping the idea that knowledge management as a conscious activity must build on the sort of implicit rules of the game set by culture. This book addresses a number of issues that come to the fore when one considers

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Foreword knowledge management as a culturally contingent activity. For instance, the very idea that knowledge can be managed as an asset separate from relationships between people is alien to most cultures in the world. Knowledge is always related to a person you have a relationship with, and any other knowledge is simply not relevant. As a consequence, to anybody who wishes to be socially visible, knowing people is still far more important than knowing the sort of things that are usually called “knowledge.” “Making sure you know what you need to” is dependent on culture in many ways. In most countries, some knowledge that might be very relevant is not managed because nobody could profit by doing so, or because powerful groups might take offence. In some cases the state itself acts as a censor. There may be limited communication between groups or between hierarchical levels. Organizations all over the world have a tendency to inherit the knowledge management mechanisms that prevail in other institutions of their society, such as the family and the state. Did you learn that it was wise to keep your mouth shut in front of your father? This is a lesson about hierarchy. You will probably do the same later, with your boss—despite knowledge sharing programs. Knowledge management is often formally undertaken in order to support innovation. But it is by no means a precondition for innovation that all members of the organization be engaged in knowledge management. Asian tiger countries have achieved tremendous growth and innovation while maintaining very authoritarian business models. When one looks at knowledge management across cultures, it turns out that one size does not fit all. This volume brings together a very readable collection of chapters that tackle the connections between culture and knowledge management from various perspectives. They are very different. Some I found creative, others thorough, most of them insightful; but every one was well worth reading. Together, they include many parts of the world and illustrate what I have just put forward—that knowledge management in its many facets is intimately connected to culture. I am pleased to be able to invite you, the reader, to enjoy this timely and important volume. Professor Gert Jan Hofstede Associate professor of Information Management in International Chains Social Science Group Wageningen University

Acknowledgments

David J. Pauleen would like to acknowledge the help of all those involved in the collection and review process of this book, without whose support the project could not have been successfully completed. These include, first and foremost, the authors, but also his colleagues at Victoria University of Wellington—in particular, Professor Gary Gorman. Special thanks to Jackie Bell, who was instrumental in helping to prepare the manuscript. A further note of thanks goes to the staff at Libraries Unlimited, which has made the publication of this book possible.

Introduction

Companies, educational institutions, nongovernmental organizations, governments and, of course, individuals work globally these days, and generally the modus operandi of each is the gathering, synthesis, sharing and storage (in no particular order) of data, information, and knowledge. In this global economy, knowledge is a critical resource (Drucker 1995), and organizations are striving to capitalize on their knowledge assets through effective knowledge management strategies and practices. Organizational knowledge can be in the form of patents and processes (manufacturing, etc.), but perhaps more importantly it is in the skills, knowledge, and experience in employees’ minds and the ability of individuals and organizations to learn and adapt to new situations. Most knowledge management is understood, and written about, from the perspective of the West and in particular the United States. This perspective tends to be scientific—that is, objective, quantifiable, analytical. There is nothing wrong with this as far as it goes, but it is limited and represents a form of cultural bias (Pauleen and Murphy 2005; Pauleen et al. 2006). And when we step outside a Western frame of reference, we discover that knowledge is a global phenomenon, which may be managed differently in different cultural contexts. To survive in a global age, we must understand this critical point. The manifestation of global knowledge occurs in many forms: from how foreign markets and financial systems operate, to why foreign people think and interact in particular ways that we cannot always understand or predict. It is clear that seeing others from our own limited perspective will lead to inadequate understanding and imperfect knowledge, lessening individual and organizational effectiveness. How, then, can we learn to both expand our knowledge assets and effectively manage knowledge in a global age? The answer lies partly in perspective taking—the ability to understand other worldviews and to relate this understanding to knowledge management. Worldviews underpin the insight and knowledge generated by a particular community. As much of the world’s knowledge is local in nature, we must learn to develop the ability to understand what knowledge is from as many perspectives as possible. With perspective taking as

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Introduction our foundation, we can then begin to develop more effective ways of managing knowledge across multiple functional perspectives: engineering, psychology, management, philosophy, religion, and many more. This book looks at knowledge and knowledge management from a cultural perspective. We argue that culture fundamentally influences how entities—from individuals to countries—understand and interact with information and knowledge. Culture has been defined as a “collective programming of the mind that distinguishes the members of one group from another” (Hofstede 1984, 21). This programming determines how people think, what they count as knowledge, how they solve problems—indeed, how they know and interact with the world. Such programming is rarely explored; yet it is deeply embedded in all of us. As they say, “You can take the boy out of the country, but you can’t take the country out of the boy.” However, understanding the impact of culture on our daily lives requires significant effort, and for this reason the study of culture is problematic in many areas of research and practice. As mentioned previously, culture operates at our deepest individual and societal levels and is generally not recognized in either researchers’ or practitioners’ worldviews. Some may be aware of the impact of cultural influences but place it in the “too hard” basket, perhaps at best paying it lip service with some off-the-shelf program or some basic cultural training, possibly in order to meet a prescribed regulation. Even for the few who are cognizant of the underlying and often overwhelming influence of culture on so much of what we do as individuals and organizations, it is a genuine challenge to recognize and learn the lessons of culture and apply them in even-handed and effective ways. This, then, is the challenge of this book: to introduce knowledge and knowledge management perspectives from different cultures, in different contexts, using different processes for different purposes. The authors, who come from many different countries and cultures, as well as a variety of backgrounds, have done a commendable job. Since the iterations of culture and knowledge are nearly limitless, all we can do here is begin the journey to increase awareness among those individuals and organizations wishing to learn from and share with others. In the final analysis, it is for the reader to have a mind open to the challenges and opportunities of culture.

THE STRUCTURE OF THE BOOK The book is divided into three sections: Conceptual Approaches to Culture and Knowledge Management, Effects of Culture on Key Aspects of Knowledge Management, and Research and Cases on Culture and Knowledge Management. The reader will soon discover that many of the issues raised in each of the chapters relate to and build upon each other, like parts in a complex but challenging puzzle.

CHAPTER SUMMARIES Chapter 1, “Exploring the Relationship between National and Organizational Culture, and Knowledge Management,” discusses and links the concepts of national culture, organizational culture, and leadership. The authors suggest that not only is culture a critical factor in the understanding of knowledge management, but that complex

Introduction relationships exist between the different cultural contexts of national, regional/ethnic, and organizational culture. These relationships affect knowledge management strategies and processes at both national and organizational levels. They model these relationships and discuss their implication for research and practice. In Chapter 2, “Culture: An Overlooked Key to Unlocking Organizational Knowledge,” the author argues that the multiple cultures of the people who comprise global organizations represent a potential knowledge asset that should be managed like any other organizational asset. He maintains that this can be done by understanding the cultural basis of learning and knowledge. This chapter outlines the recursive relationship between learning and knowledge, reviews recent research on the cultural foundations of learning and knowledge, and proposes a model of boundary spanning that can help global organizations meet the challenge of unlocking the knowledge represented by their diverse membership. Chapter 3, “The Art of Systems: The Cognitive-Aesthetic Culture of Portal Cities and the Development of Meta-Cultural Advanced Knowledge Economies” is an essay that leaps past current views of culture, suggesting new ways to understand the knowledge dynamics of successful local economies. The article discusses the role of pattern thinking, aesthetics, and design in the rise and sustenance of economically powerful portal cities, where knowledgeable people—regardless of culture—congregate and form part of a greater whole. Section 2 begins with a look at cultural factors in global knowledge transfer. Chapter 4, “Cultural Stretch: Knowledge Transfer and Disconcerting Resistance to Absorption and Application” summarizes the findings of a number of case studies to determine that time constraints and communication problems caused by cultural differences have a negative impact on initially positive expectations between international partners. The authors suggest it can take between two and seven years—or even longer—to achieve a smooth transfer and acceptance of knowledge from one party to another, if ‘the right people’ are deployed in the ‘right situation’. The right people are individuals who are locally sourced and equipped with appropriate personality characteristics; the right situation is a society which is open to the application of the knowledge being made available. Chapter 5, “From Concept to Context: Toward Social-Cultural Awareness and Responsibility in the Organization of Knowledge” argues that human language—and by extension information and knowledge—is highly context based. As such, it is detrimental to cross-cultural information retrieval and knowledge discovery systems if diverse contexts are forced into a single representational system, as they currently tend to be. The author argues that a hermeneutic approach could provide a promising avenue for developing a more productive framework that would support free and open dialog across competing heterogeneous contexts in the knowledge discovery environment. Chapter 6, “Managing Innovative Knowledge: Cultural Perspectives on Patenting” takes a cross-cultural perspective on patenting to explore differences and similarities in the management of innovative knowledge over time. Patents operate at the nexus of individual, legal, political, organizational, and societal interests and as such provide a useful vantage point for exploring cultural perspectives in the management of knowledge. The authors explore several interesting and critical tensions in the management of knowledge across cultures in the global environment, including the ownership of

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Introduction knowledge, effects on innovation and knowledge flows, and global enforcement, particularly in the area of the patentability of new innovations such as computer software, genes, and so on. Chapter 7, “The Influence of National Culture on Knowledge Management in Virtual Teams” contends that knowledge management is now clearly a critical factor in both organizational and academic settings in distributed contexts that increasingly engage multiple national cultures. This chapter explores aspects of national culture with respect to knowledge management in virtual teams based on the HKNET project, which involved participants from three continents and continued for seven years. Using their findings, the authors develop and present a model of the interaction dynamics associated with national culture, technology choice, and knowledge management processes and outcomes. In Chapter 8, “People’s Twist: The Cultural Standard of Loyalty and Performance in Former Socialist Economies,” the authors use knowledge management as a lens to focus on cultural standards, particularly with regard to issues of loyalty and performance in the former socialist economies of Eastern Europe. They explain how people—in order to survive—developed personal and internal knowledge management approaches in the face of external and hierarchical state controls. One result was the concealment and shift of knowledge from the state into private networks, thus establishing a form of market rationality within the planning rationality of a socialist economy. Section 3, “Research and Cases on Culture and Knowledge Management,” begins with Chapter 9, “Institutional and Cultural Influences on Knowledge Sharing in Russia and China.” This chapter, following up on the general topic of knowledge transfer introduced in Chapter 4, takes an in-depth look at the challenges inherent in transferring knowledge between western industrialized economies and the transition economies of (former) communist nations such as Russia and China, particularly in the context of home nation and subsidiary operations. Using interviews conducted with western and local managers in Russia and China between 1996 and 2003, the chapter specifically addresses the cultural and institutional factors that impede and facilitate knowledge sharing in Russia and China. Chapter 10, “Asian Organizations Meet North American Management Theory: The Case of Singapore and Senge,” reviews the connection between knowledge management and the learning organization, and argues that both concepts rely on culturally embedded theories and practices. The authors present a case study of the use of Senge’s learning organization concepts in one large Singaporean organization and reveal the cultural challenges that emerged in the process of applying essentially Euro-American management theories within an Asian culture. The chapter includes a discussion of the practical implications of these cross-cultural challenges for Singaporean organizations, multinational organizations, and transnational consulting. Chapter 11, “The Peruvian Asparagus Cluster: Realizing Profitability from Social Capital and Shared Knowledge Management in a Traditionally Low-Trust Environment” tells the story of the Peruvian asparagus cluster and how it became the world’s top exporter of fresh asparagus. The case focuses on how collective action and a shared knowledge management program tackled the problems of a complex asparagus logistic chain in spite of the historical low levels of trust and social capital in Peru. The author uses a three-pronged analysis to provide the background to understanding the basis for

Introduction cooperation in traditionally noncooperative populations and signals hope for trust and cooperation building in other clusters and possibly Peruvian society as a whole. Finally, Chapter 12, “Research and Development Knowledge Transfer across National Cultures” offers another look at the important topic of knowledge transfer, this time focusing on the area of multinational corporations’ dispersal of research and development activities across countries. The authors contend that the integration of the dispersed research and development (R&D) knowledge via knowledge transfer across cultural borders is essential for managing multinationals. The research confirms that cross-cultural knowledge is very often problematic, but it also provides a more positive outlook by showing that cultural differences are not just barriers to knowledge transfer; rather, they can also provide a stimulus to learn from and with others from different cultures. Interestingly, the research also shows that cultural differences tend to increase the difficulties of transferring explicit knowledge more than that of tacit knowledge.

REFERENCES Drucker, P. 1995. Managing in a time of great change. New York: Truman Talley Books/Plume. Hofstede, G. 1984. Culture’s consequences: International differences in work related values. Beverly Hills, CA: Sage. Pauleen, D., and Murphy, P. 2005. In praise of cultural bias. Sloan Management Review 46(2): 21–22. Pauleen, D., Everisto, R., Davison, R., Ang, S., Alanis, M. and Klein, S. (2006). Cultural Bias in IS Research and Practice: Are you coming from the same place I am?. Communications of the Association of Information Systems 17(17): 354–72.

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SECTION 1 Conceptual Approaches to Culture and Knowledge Management

1 Exploring the Relationship between National and Organizational Culture, and Knowledge Management David J. Pauleen, Ling-Ling Wu, and Sally Dexter

ABSTRACT Globalization and ICT have opened up opportunities for organizational knowledge to be shared across national and cultural boundaries both intra- and interorganizationally. In this context, an understanding of national (societal) culture and its relationship to knowledge management (KM) has become an essential requirement. In this chapter we discuss the concepts of national culture, organizational culture, and leadership and suggest that not only should culture be an element in the understanding of KM, but that there are complex relationships between the different cultural contexts (national, regional/ethnic, and organizational) and the way in which they relate and interrelate to affect KM strategies and processes at both a national and an organizational level. We then develop a conceptual model that shows the interrelationship of national culture and organizational culture and their mutual influence on organizational KM. We conclude with a discussion of implications for research and practice.

INTRODUCTION The rise of the global knowledge economy has been greatly driven by rapidly advancing information and communication technologies (ICT). These technologies have served to reduce traditional business boundaries and increase opportunities to participate in networks far beyond immediate physical locations (Barker 2000). In this new economy, knowledge has become an extremely valuable resource (Drucker 1995; Nonaka 1994), and organizations are striving to capitalize on their knowledge assets through effective knowledge management (KM) strategies and practices. Initial KM strategies relied heavily on ICT-based solutions to store and retrieve explicit organizational knowledge. However, these ICT-based strategies often failed to deliver meaningful results (Ambrosio 2000). Although technology is still a key component, this

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Cross-Cultural Perspectives on Knowledge Management single focus has been eclipsed by an increasing awareness of the importance of the organizational and social aspects of KM. To date, much of the KM literature has focused on corporate and organizational culture, with relatively little attention paid to the implications of national culture. However, KM, which is context embedded, is a particularly culturally dependent process (Glisby and Holden 2003; Nonaka and Toyama 2003). Effective KM practices developed by and for one culture may not necessarily be successfully used by other cultures (Pauleen and Murphy 2005). This is an important point as cross-cultural knowledge sharing has become more prevalent through the forces of globalization, advances in communications technology, and increasingly culturally diverse workforces (Cox 1991; Nemetz and Christensen 1996), as well as through international mergers and acquisitions, Internetbased e-commerce, and an increasing trend to global outsourcing. Meanwhile, dominant Western cultural assumptions about knowledge and KM influence KM research and development. Given these factors, an understanding of the influence of national culture is now, arguably, a critical requirement in understanding and implementing successful KM in organizations. Although it has been suggested that globalization will act as an antecedent to cultural homogeneity (Levitt 1983) and that cultural distinctiveness will be lost as global strategies displace strategies that revolve around national, regional, and cultural differences, a quick look at current world events may cause one to doubt the validity of this view, at least for the present. Within the international management area in general, as well as within the KM arena, this implicit culture-free assumption has been seriously challenged (Adler 2002; Glisby and Holden 2003; Holden 2002), and it is argued that cultural context is an important KM dynamic. This chapter expands on this argument by examining the relationship between national culture, organizational culture, and KM. We suggest not only that national culture is a significant factor in the understanding and practice of KM, but that complex relationships between the different cultural contexts (national, regional/ethnic, and organizational) and the way in which they relate and interrelate to affect KM strategies and processes must also be considered. The role of leadership is also explored, and we maintain that leaders who embody organizational culture and context may act as mediators in the relationship between national culture and KM.

DEFINING CULTURE There is a seemingly inexhaustible array of definitions of culture, with more than 160 definitions identified more than 50 years ago (Kroeber and Kluckhohn 1963). Although this range of definitions could be interpreted as representative of the complex nature of culture, in fact, the notion of culture is so deeply ingrained that it has become almost synonymous with our identity to the extent that everyone believes they understand culture (Westrup et al. 2002). Culture can be categorized in terms of three main elements: content, construction, and sustainability. In terms of content, culture has been defined as “a system of ideas” (Namenwirth and Weber, 1987, 8), “a distinctive, enduring pattern of behavior and personality characteristics” (Clark 1990, 66), and “collective programming of the mind that distinguishes the members of one group from another” (Hofstede 1984, 21). In essence,

National and Organizational Culture, and Knowledge Management the content of culture consists of a set of underlying norms and values of behavior, shared by a group of people tied together by powerful affiliations or bonds. The construction of culture, according to Schein (1985), results from the interaction of people and their environment. In particular, Schein emphasized the aspect of problem solving in culture, which is considered to be a valid way of thinking in order to respond to the surrounding environment. That is, culture is a set of valid knowledge, created and shared by a group of people, to solve the problems they face in their environment. In terms of sustainability, culture is transmitted by symbols, rituals, and stories, passed on from one generation to another (Kroeber and Kluckhohn 1963). The implicit (or even tacit) part, as well as the explicit part of cultural knowledge is sustained and transferred through information expressed in various ways. In this vein, Hall and Hall (1990) view culture as a system for creating, sending, storing, and processing information. However, Barham and Heimer (1998) point out that the standard anthropologically derived concepts of culture are out of touch with the connectivities and networks of the modern global economy. Recent research highlights the active role of people and the emergent, contested, and ongoing nature of culture, and people’s reaction to dynamic contexts (Giddens 1984, 1990; Myers and Tan 2002; Walsham 2002). Holden (2001, 162) calls for “a paradigmatic shift in the way culture is viewed and suggests that researchers reframe culture as infinitely overlapping and perpetually redistributable habitats of common knowledge and shared meanings.”

NATIONAL CULTURE There are a number of theories and models that have informed cross-cultural research, both methodologically and philosophically. Many of these are centered on the concept of national culture and are based on dichotomies or continuums of values, such as individualism/collectivism (Hofstede 1984); high and low context (Hall 1976); and monochronic/polychronic (Lewis 1996). These value-based models predict individual and group attitudes and behaviors based on national culture. However, Corbitt and colleagues (2004) suggest that such widely accepted structural frameworks may be too reliant on categorical descriptions that ignore differentiation within cultures, as well as the individual exceptions likely to be found to any general rule. Several studies have identified national culture in terms of work-related attitudes and values, to distinguish groups of people from other groups (Hofstede, 1984; Ronen and Shenkar 1985; Smith et al. 1996). Hofstede (1984, 1988) proposed five dimensions of national culture: individualism/collectivism, masculinity/femininity, power distance, uncertainty avoidance, and long-term versus short-term orientation. Some researchers have used this model to account for KM processes and found that the cultural dimensions of the Hofstede model might play a role in the KM processes (Ford and Chan 2003; Rossen 2003). The legitimacy of the concept of national culture, however, remains in question, as evidenced by the continuing debate in the literature. Scholars argue that globalization has enabled the emergence of the multicultural society, in which members of different regional and ethnic groups live and work in the same shared environment. Therefore, an identity based upon the notion of a nation-state does little to reflect regional and ethnic differences (Holden 2001; Myers and Tan 2002; Westrup et al. 2002). Indeed, McCrone

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Cross-Cultural Perspectives on Knowledge Management (1998) asserts that the quest for regional identities and decentralization reflects the need for the idea of national cultural identities to be challenged and usurped. The concept of national sovereignty has been linked to the notion of a national cultural identity, and it has been suggested that as globalization and economic, political, and cultural pressures further negate the importance of national sovereignty, this will affect the idea of a national cultural identity (Castells 1996, 1997; Featherstone 1990; Waters 2001). Hall (1992) contends that instead of thinking of national cultures as unified, they should rather be regarded as a discursive device representing difference as unity or identity. Most authors agree that nations may contain different cultures or subcultures within national borders, and that national borders do not necessarily represent culturally homogeneous populations (Groeschl and Doherty 2000). Rather than emphasize single national cultural identities, the challenge is developing theory that furthers understanding of heterogeneous cultures (Mercer 1992). Doney, Cannon, and Mullen (1998) stress their view that national culture is not a characteristic of individuals or nation-states but of a large number of people conditioned by similar background, education, and life experiences. Weisinger and Trauth (2002), through a combination of theoretical argument and practical research suggest that culture is, in fact, locally situated, behavioral, and embedded in everyday social negotiated work practices—a view also subscribed to by Holden (2001). Based on the social construction of reality theory (Berger and Luckman 1967), Corbitt and colleagues (2004) argue that national culture can be more accurately understood by seeking out the dominant social codes that frame a society’s values, attitudes, and behaviors. The debate between proponents of national cultural models and those who favor a more discrete or localized understanding of culture is unlikely to be resolved soon. National culture models certainly help to simplify cross-cultural research, whereas a more localized view of culture will more likely reflect the culture under study. An example of a local description of culture is the fascinating analysis of the factors that shape Taiwan’s character (as a people) by Yu and ChiangLin (2002). Based on personal observation, a review of secondary sources (e.g., educational statistics), and reflection, Yu and ChiangLin described five life experiences that together constitute a unique Taiwan experience: motorcycling, a belief in higher education, crisis consciousness, compulsory military service, and studying abroad and returning welleducated. Together, these life experiences heavily influence individual mental attitudes and behavior and society as a whole. For example, Yu and ChiangLin (2002, 354) argue that the overwhelming use of motorcycles in Taiwan, which—though often causing congestion and chaotic traffic conditions—shapes motorcycle riders’ personalities and skills (including young children riding with their parents) and the greater society in the following ways1 by training riders: • • • • •

to move accurately and swiftly with clear, specific goals to look for opportunities almost anywhere and anytime to be adaptive and flexible to be tough and take risks to act individually, with a small scale of vision

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not to strictly obey laws and regulations

Yu and ChiangLin’s five life experiences, although not proven in an experimental sense, nevertheless resonate with Taiwan residents and actually do go a long way

National and Organizational Culture, and Knowledge Management to providing an understanding of the local culture, one that is much more accurate and relevant than Hofstede’s descriptions, which in the case of Taiwan may no longer be accurate. Two of the life experiences—belief in higher education and studying abroad—point to a culture supportive of knowledge and knowledge acquisition from other countries.2

National Culture and Knowledge Drawing from psychology and cultural history, Nisbett and colleagues (2001) argue that the considerable social differences that exist among cultures affect, among other things, tacit epistemologies (theories of knowledge, including what counts as knowledge and degrees of certainly about knowledge) and the nature of cognitive processes (the ways by which people know the world). Comparing Eastern and Western traditions, Nisbett and colleagues (2001) group the cognitive differences between ancient Chinese and Greeks under the headings of holistic versus analytical thought. Holistic thought involves an orientation to the “context or field as a whole, including in particular the relationship between a focal object and the field and a preference for explaining and predicting events based on the existing relationships” (Nisbett et al. 2001, 293). They define analytic thought as detaching the object from its context, a tendency to focus on attributes of the object, to assign it to categories, and a preference for using rules about the categories to explain and predict the objects behaviour” (2001, 293). Nonaka and Toyama (2003) and Glisby and Holden (2003) state that Eastern people tend to think about their work in terms of the whole picture, whereas Western people tend to think of their work from their own individual vantage point. These cognitive biases are a major component of knowledge sharing and knowledge creation processes (Pauleen and Murphy 2005). According to Chia (2003), it has been a Western tradition to regard a knowledgeable person not as someone who has the ability to perform a task, but as one who can understand and render articulate and explicit—particularly in writing—the underlying causes of events. In contrast, in traditional Chinese culture learning and knowing came through direct, sustained, experimental practice. Chia (2003, 959) goes on to suggest that “the current preoccupation with explicit knowledge creation and management may need to be tempered by an equally important emphasis on direct experimental action as a valuable source of meaning, innovation, productivity and enhanced performance.” All that has been discussed here converges to support the major contention that national culture deeply affects how people process information in their environment and strongly suggests that this effect should be taken into serious account during the development and implementation of KM initiatives, especially in global contexts.

Culture, Values, Attitudes, and Behaviors Adler (2002) developed the model in Figure 1.1 to show how national culture influences the values of a culture and subsequently its attitudes and the behaviors of its members. An example of this is the Japanese culture: it values social harmony, which in turn creates an attitude of cooperation and subsequent behavior in which disagreements are rarely openly expressed. In this model, national culture appears fully fledged and hence

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Figure 1.1 Culture, values, attitudes, and behaviors (Adler 2002).

appears at the top, with values, attitudes, and behaviors following on from it. However, it is clear from the model that culture is influenced by the other factors and can change over time. This is illustrated when, for example, youth (as a subculture) behaviors change and slowly exert change on the overriding national culture. Globalization and the increasing pervasiveness of ICT tend to hasten cultural change in at least two ways: through direct exposure to other cultures and by facilitating networks and relationships, which allow new—and often transitory—cultural forms to emerge.

The Relationship between National and Organizational Culture Prior to 1980, organizational culture was largely considered to be independent of national culture (Ford and Chan 2003). This was epitomized by multinational companies, which managed national branch offices using expatriate managers and head office management techniques. Since this time, many studies have compared national and organizational culture, with the majority of the research focused on the link between organizational and national culture and the extent to which one influences the other (Clark and Mueller 1996; Morden 1995; Smith 1992). Earlier writers argue that the influence of national culture on organizational culture will decline over time (Evan 1975), whereas later researchers suggest that the collective “mental maps” of national culture seem to resist the convergence effects of international business practice (Clark and Mueller 1996; Laurent 1983). Others, in particular, Straub and colleagues (2002) use Social Identity Theory to explain how different cultures—including professional, ethnic, organizational, and national cultures—can coexist, and have different saliency with individuals at different times. The focus on culture as a mechanism to produce “relationship to self’” amongst members of an organization, suggests that its deployment as a governance technique is closely bound up with questions of identity (Hall and du Gay 1996). Beulens, Kreitner, and Kinicki (2002) contend that organizational culture is, in effect, a by-product of national or societal culture. They assert that culture influences organizational behavior in two ways: Employees bring their individual societal cultures in the form of customs and language, and organizational culture in turn affects the values/ethics, attitudes, assumptions, and expectations of an individual. Here it is suggested that Adler’s model can apply equally to organizations. Within organizations, the interplay of culture, values, attitudes, and behaviors is seen to be occurring in a more time-compressed process. Organizational cultures exert a powerful influence on an organization’s values, attitudes, and behaviors, as well as the values,

National and Organizational Culture, and Knowledge Management Figure 1.2 Extending Adler’s model to the level of organizations, groups, and teams.

attitudes, and especially behavior of its employees. In organizations that have been around for a very long time, it might appear that the organizational culture has also appeared fully fledged. However, it is obvious when we look at organizational histories that individuals, often in the form of founders and powerful leaders, have by the force of their personalities influenced the organizational culture through their own behaviors, attitude, and values. An example of this is how Konosuke Matsushita’s personality and earlier life experiences greatly influenced the organizational culture (values, attitudes, and behaviors) of the Matsushita company (Holden 2002). It is worth remembering in this case, however, that a great deal of K. Matsushita’s values and attitudes derived from the larger Japanese culture of which he was a part. (We will shortly return to the importance of this interplay of culture, values, attitudes, and behaviors, and individual actors.) Likewise, in the same way that Adler’s model applies to organizations, it can be further extended to groups, such as organizational functions (e.g., finance, sales), communities of practice, and even to teams if they exist long enough to form a team culture. In these cases, the time compression is further evident and it can be more clearly seen how individual actors can have an ever-greater influence on the culture of the group or team and its values, attitudes, and behavior. Finally, with regard to Adler’s model, the relationship between national culture and organizational culture, as seen in the case of Matsushita, is evident: a relationship that extends to the cultures of groups and teams, and ultimately, individuals themselves. This notion is captured in Figure 1.2.

National Culture and the Influence of Leadership in Organizations As alluded to in the case of Konosuke Matsushita and his eponymous company, the norms and values in national culture not only affect organizational culture, but

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Cross-Cultural Perspectives on Knowledge Management can also influence leadership and leadership processes in organizations (Ayman, Chemers, and Fiedler 1995; Bass and Avolio 1993; Hofstede, 1984, 1993; Hunt, Boal, and Sorensen 1990; Nikandrou, Apospori, and Papalexandris 2003; Triandis 1993). For instance, clusters of European countries that share similar cultural values also share similar leadership (Brodbeck and Frese 2000; Smith 1997). The leaders in Chinese organizations tend to use patriarchal leadership, as distinct from the productionoriented leadership or people-oriented leadership found in Western society. Brase (2001) has shown that management behaviors have a direct effect on workplace respect and cooperation. National culture influences organizational leadership through its impacts on the values and beliefs of both leaders and followers. Leaders are more likely to be affected and behave in the way that is accepted in their culture. Similarly, different expectations toward how a leader should behave could be potentially rooted in cultural beliefs. That is, followers hold common implicit expectations toward their leaders, which further shape their perception, valuations of the leaders, and hence influence the behavior of the leaders in that culture. For instance, people in cultures with high power distance are more likely to accept and even expect that leaders have an autocratic leadership style than others in cultures with low power distance. Moreover, business leaders in cultures of higher uncertainty avoidance are more concerned about control than creativity and innovation, and thus might be more likely to become transactional leaders instead of transformational leaders, when compared with leaders in cultures with lower uncertainty avoidance (Politis 2001). Wiig (2004, 115) argues that leaders, and other influential people, wield enormous influence in organizations by creating powerful reference models that “directly affect the attitudes, mentalities, and culture within their organizations.” Employees look to leaders as role models, often emulating their behavior. The mental models that these leaders operate from are often unconscious, a result of deep-seated cultural values and life experiences. In an empirical study of character traits of American and Taiwanese chief executive officers (CEOs), Judge (2001, 63) found “robust differences between these two sets of CEOs offering support for the ‘culture bound’ nature of leadership.” Character traits are strongly linked to leadership credibility, which has an equally strong impact on organizational trust and culture (Judge 2001). Evidently national culture can have a significant effect on leadership, and leaders can have a significant effect on attitudes and behavior throughout the organization (Trompenaars 1993).

Knowledge Management, the Organization, and Culture Knowledge management is the systematic and explicit management of knowledgerelated activities, practices, programs and policies within the enterprise (Wiig 2000) to effectively apply an organization’s knowledge to create new knowledge to achieve and maintain competitive advantage (Alavi and Leidner 2001). Sveiby (2001) identifies two broad approaches to KM. One focuses on the “hard” aspects such as the deployment and use of appropriate technology; the other focuses on the “soft” aspect: the capture and transformation of knowledge into a corporate asset. This second approach includes the management of people and processes.

National and Organizational Culture, and Knowledge Management The first categorization of KM is the management of information (Sveiby 2001). This approach views knowledge as objects that can be handled by information management systems. The key goal of this approach is to increase access to information through enhanced methods of access and reuse of documents through, for example, hypertext linking, databases, and full-text search. Networking technology in general (especially intranets), and groupware in particular, are key solutions. This approach is based on the idea that technology harnessed to a great volume of information will make KM work. The second categorization is the capture and transformation of knowledge into a corporate asset through the management of people (Sveiby 2001). This approach views knowledge as a process: a complex set of dynamic skills and know-how that is constantly changing. Commonly viewed as a management issue, approaches tend to focus more on innovation and creativity, in the style of the “learning organization,” as advocated by Senge (1999), where organizational behaviors and culture also need to be changed. To make this approach work, a holistic view is required, and often theories of behavior of large-scale systems are invoked. The aim here is to get people to share what they know. Processes are more important here than technology. Wiig (2004, 218) argues that a new generation KM (NGKM) is needed that provides guidance “to govern knowledgerelated investments, activities, and support systems that are people-focused and peoplefriendly and frequently supported by IT.” It is clear that KM is not simply a matter of managing information; it is essentially a deeply social process, which must take into account human and social factors (Clarke and Rollo 2001; McDermott 1999; Thomas, Kellogg, and Erickson 2001), as well as cultural issues. Thomas, Kellogg, and Erickson (2001) argue that a successful KM system is one that includes a knowledge community, where people can interact in the discovery, use, and manipulation of knowledge. Fundamental to the notion of community in KM is the understanding that community involves identifying and engaging in the social practices and relationships that are operating in a particular context (Rooney 2005). Nonaka and Toyama (2003) argue that the “knowledge process” occurs at the interconnection between (organizational) structure and agents, and is dynamic and interlinked from an individual-to-societal level. With regard to organizational KM, Nonaka and Toyama (2003) dispute the notion of the organization as a machine that solves problems, arguing rather that that the organization is an entity that creates knowledge through action and interaction within the organization and with its wider environment. They go on to say that in “knowledge creation, one cannot be free from one’s own context” (2003, 3), which we understand to mean culture in its widest sense. In terms of cross-cultural research, there are still relatively few studies that examine the relationship between national culture and KM (a major exception are the case studies found in Holden 2002), even though the importance of national culture on KM has recently been recognized. In Mason’s study of published reports of KM systems (2003), he found that national culture and ethnic background of users are rarely mentioned with only one case directly discussing the importance of national culture. Mason contrasts this with the attention given to culture in other information science studies (Walsham 2002) and suggests that KM designers may be implicitly adopting the “culture-free” hypothesis as a basis for design. This hypothesis is based on the fundamental premise that organizations are micro-social entities that exist without reference to the

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Cross-Cultural Perspectives on Knowledge Management Figure 1.3 KM model emphasizing the development of knowledge sharing behavior.

immediate societal environment, and in contrast to the idea that organizations match their structures to fit their societal environment. Of existing KM models, the most widely referenced is Nonaka’s SECI model (Nonaka 1994), which has been almost universally acclaimed and used by many organizations worldwide as a starting point for KM practices and which deals with both tacit and explicit knowledge. This model assumes that knowledge can be transferred through processes of socialization. However, Glisby and Holden (2003) assert that the Japan-specific cultural factors tacitly embedded in the model mean that it is not possible for it to be successfully transferred to Western nations in its totality. They claim that in order for the model to work in a Western setting, it might be necessary to first introduce Japanese values and management techniques, which would embed the required cultural conditions necessary for success of the model. Other KM models, including those of Boisot (1987) and Chase (1997), are also bereft of any consideration of cultural issues. Here it is suggested that the fundamental goal of organizational KM should be the development of the individual employee who is willing and able to share knowledge. Sharing behavior is what makes knowledge available to other individuals and the organization as a whole. With this mind, KM can be divided into two parts, which can be referenced in current business parlance as the upstream and downstream of knowledgesharing behavior (Figure 1.3). The upstream management of knowledge can also be thought of as nurturing knowledge sharing. It includes commonly accepted prerequisites and processes of KM such as developing social capital. This includes an organizational culture that encourages risk-taking and transparency, allows mistakes, sets up appropriate rewards and motivations that encourage knowledge sharing, and provides the time and space necessary for knowledge sharing, and where leaders champion KM and managers lead by example (e.g., Cohen and Prusak 2001; Davenport and Prusak

National and Organizational Culture, and Knowledge Management 1998; Horwitz et al. 2003; Mason and Pauleen 2003; Senge 1999; Thomas, Kellogg, and Erickson 2001; Wiig 2004). The downstream management of knowledge can be thought of as the harvesting of knowledge sharing. From a cultural perspective, this again includes the time and space for individuals to share knowledge, as well as the information and communication technologies that facilitate knowledge sharing behaviors and allow organizations to capture, hold, and disseminate knowledge (e.g., Alavi and Leidner 2001; Sveiby 2001). In this chapter, the concern is not so much with the downstream management of knowledge, but rather with the development of an organizational culture, which provides upstream KM values, attitudes, and behaviors that support and encourage knowledge sharing behavior in individuals.

Model of National Culture, Organizational Culture, and Knowledge Management A model is proposed here to explain the influence of national culture on organizational KM processes, and in particular knowledge sharing behavior (Figure 1.4). The model proposes that national culture affects organizational KM processes both directly and indirectly. It is based on the literature presented earlier and acknowledges the mutual influence of organizational culture and individual actors, including leaders and managers. The main propositions of this model state the following: •

•

•

•

National culture will directly affect knowledge-sharing behavior in individuals through its influence on the values and attitudes of individuals. The influence of national culture will be seen in how individuals perceive their roles and responsibilities with regard to knowledge sharing as they interact in organizations, groups, teams, and dyads. Organizational culture may mediate the effects of national culture on knowledgesharing behavior in individuals through its influence on the values and attitudes of individuals. Leadership and management values, attitudes, and behaviors with regard to knowledgesharing behaviors may have a particularly strong influence on both organizational culture and individual knowledge sharing behaviors. Purposeful organizational KM may influence both organizational culture and individual knowledge sharing behavior.

Figure 1.4 National culture, organizational culture, and KM.

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CONCLUSIONS AND IMPLICATIONS The notion of collective mental maps (Clark and Mueller 1996; Laurent 1983) and the assertion of culturally determined biases regarding KM practices (Chia 2003; Pauleen and Murphy 2005) are based on deep underlying metaphysical assumptions. Knowledge and its relationship to decision making and action point to a critical link between shared cultural values and attitudes toward knowledge and KM processes and the development of successful organizational KM processes. This link signals the need to develop “alternative conceptualizations and practical understandings of the strategic priorities, decisional imperatives, and modes of management operating in diverse geographical locations throughout the world (Chia 2003, 957). These alternative conceptualizations may be reflected in differing organizational attitudes toward education, cooperation, innovation, and creativity as well as specific practices in learning, training, and teamwork. There is little doubt that cross-cultural research is gaining increasing importance in the business arena. This derives from two main trends: diverse organizational workforces and globalization. More recently, globalization and the increased capacity of ICTs have heralded the arrival of the new knowledge economy where knowledge is the new rate of currency. However, despite an increasing international focus on KM and the importance of cross-cultural considerations in the transfer of knowledge (Wensley 2002a, 2002b, 2002c), there has been relatively little research on KM and cross-cultural issues.

Implications for Culture, Practice, and Research The debate on national culture, summarized in this chapter, begins to indicate just how problematic it can be to define culture and its boundaries when factoring in the cultural impact on a research or managerial problem. Although it is reasonable to conclude that culture will have some impact on how people understand and communicate knowledge, and therefore on how knowledge may be effectively managed in any given culture, the challenge to management and researcher alike is how to define culture and to determine what measures to use. We believe that cultural boundaries between nations are often indistinct and that different sub-cultures can exist within a single nation (Fukuyama 1995). Thus, similar to the concept of national culture defined by Doney, Cannon, and Mullen (1998), we do not necessarily equate national culture with the geographical boundaries of a nation. We do not assert that all groups in the population of a nation share the same set of values, attitudes, and behavior. We believe that in broad terms culture is transmitted from one generation to another by learning the information embedded in symbols, rituals, and stories; however, given the reality of the ever increasing interconnectedness of organizations and individuals, we agree with the view that organizations and individuals can be quite fluid and adaptable in creating effective ‘working’ cultures to suit localized, situated contexts. Knowledge management is acknowledged as a complex field that cannot be conducted with technology alone. Rather, integrated approaches that feature organizational, social, and technological emphases have become the trend for organizations who seek to create, use, and share knowledge to gain competitive advantage as well as foster creativity and innovation. Most research to date has been predominantly focused on the organization as the level of analysis in KM studies. The importance of national culture and its impact

National and Organizational Culture, and Knowledge Management on KM strategies and process is gathering momentum and some researchers are questioning the culture-free assumption that has long been accepted within KM (Glisby and Holden 2003). Furthermore, national culture can be seen to have important implications in concepts closely linked to KM success, including topics such as social capital, innovation, and creativity. Despite recognition of the importance of national culture, there remains a dearth of research in the area of KM, and almost none that has been carried out at a grassroots level. In this chapter we have developed an argument that national culture can directly influence organizational culture and KM processes. We contend that organizational culture can mediate the influences of national culture on KM processes. We also suggest that actors, such as leaders, also play a part in mediating and changing the structures of national and organizational culture. We developed a model that illustrates both the direct and indirect relationships between national culture, organizational culture, and knowledge sharing behaviors. It is up to researchers and practitioners to seek to understand and implement effective KM strategies that incorporate national cultural influences into organizational settings.

NOTES 1. Motorcycle riding in Taipei, as in many other large—particularly Asian—cities, is a phenomenon not easily explained; it needs to be experienced. The authors have had the experience and can attest to its personality shaping potential. 2. Yu and ChiangLin’s analysis provides an excellent description of a country that has experienced significant cultural change in a relatively short span of time. While still retaining many traditional cultural values, Taiwan has been willing to incorporate many institutions associated with other cultures, such as democracy, a globally integrated economy, and so on.

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Cross-Cultural Perspectives on Knowledge Management Beulens, M., R. Kreitner, and A. Kinicki. 2002. International OB: Managing across cultures from organizational behavior. New York: McGraw Hill Education. Castells, M. 1996. The rise of the network society. The information age: Economy, society and culture, Volume 1. Oxford: Blackwell. ———. 1997. The power of identity. . The information age: Economy, society and culture, Volume 2. Oxford: Blackwell. Chase, R. 1997. The knowledge-based organization: An international survey. Journal of Knowledge Management 1 (1): 38–49. Chia, R. 2003. From knowledge-creation to the perfecting of action: Tao, Basho and pure experience as the ultimate ground of knowing. Human Relations 56 (8): 953–81. Clark, P., and F. Mueller 1996. Organizations and nations: From universalism to institutionalism? British Journal of Management, 7, 125–39. Clark, T. 1990. International marketing and national character: A review and proposal for an integrative theory. Journal of Marketing 54 (4): 66–79. Clarke, T., and C. Rollo 2001. Corporate initiatives in knowledge management. Education and Training 43 (4/5): 206–14. Cohen, D., and L. Prusak 2001. In good company: How social capital makes organizations work. Cambridge: Harvard Business Press. Corbitt, B, K. Peszynski, S. Intranond, T. Thanasankit, T., and B. Hill 2004. Culture, information and code systems. Journal of Global Information Management 12 (3): 65–85. Cox, T. 1991. The multicultural organization, Executive 5 (2): 34–37. Davenport, T.H., and L. Prusak 1998. Working knowledge: How organizations manage what they know. Boston: Harvard Business School Press. Doney, P.M., J. P. Cannon, and M. R. Mullen 1998. Understanding the influence of national culture on the development of trust. The Academy of Management Review 23 (3): 601–21. Drucker, P. 1995. Managing in a time of great change. New York: Truman Talley Books/ Plume. Evan, W. 1975. Measuring the impact of culture on organizations. International Studies of Management and Organizations 5, 91–113. Featherstone, M. ed. 1990. Global culture: Nationalism, globalisation and modernity. London: Sage. Ford, D. P., and Y. E. Chan. 2003. Knowledge sharing in a multi-cultural setting: A case study. Knowledge Management Research and Practice 1, 11–27. Fukuyama, F. 1995. Trust: The social virtues and the creation of prosperity. New York: Free Press. Giddens, A. 1984. The constitution society: Outline of a theory of structuration. Cambridge: Polity Press. ———. 1990. The consequences of modernity. Cambridge: Polity Press. Glisby, M., and N. Holden 2003. Contextual constraints in knowledge management theory: The cultural embeddedness of Nonaka’s knowledge-creation company. Knowledge and Process Management 10 (1): 29–36. Groeschl, G., and L. Doherty 2000. Conceptualising culture. Cross-Cultural Management 7 (4): 12–17. Hall, E. T. 1976. Beyond culture. New York: Doubleday. Hall, E. T., and M. R. Hall 1990. Understanding cultural differences. Yarmouth, ME: Intercultural Press. Hall, S. 1992. The Question of Cultural Identity. In Modernity and its futures, ed. S. Hall, D. Held and A. McGrew, 273–325. London: Polity Press. Hall, S., and P. du Gay 1996. Questions of cultural identity. London: Sage.

National and Organizational Culture, and Knowledge Management Hofstede, G. 1984. Culture’s consequences: International differences in work related values. Beverly Hills: Sage. ———. 1988. Confucius and economic growth: New trends in culture’s consequences. Organizational Dynamics 16 (4): 4–21. ———. 1993. Cultural constraints in management theories. Academy of Management Executive 7 (1): 81–94. Holden, N. 2001. Knowledge management: Raising the spectre of the cross-cultural dimension. Knowledge and Process Management 8 (3): 155–63. ———. 2002. Cross-cultural management: A knowledge management perspective. Upper Saddle River, NJ: Pearson Education. Horwitz, F., T. H. Chan, and A. Quazi 2003. Finders, keepers? Attracting, motivating and retaining knowledge workers. Human Resource Management Journal 13 (4): 23–44. Hunt, J. G., K. B. Boal, and R. L. Sorensen 1990. Top management leadership: Inside the black box. The Leadership Quarterly 1, 41–65. Judge, W. Q. 2001. Is a leader’s character culture-bound or culture-free? An empirical comparison of the character traits of American and Taiwanese CEOs. The Journal of Leadership Studies 8 (2): 63–78. Kroeber, A. L., and C. Kluckhohn 1963. Culture: A critical review of concepts and definitions. New York: Vintage Books. Laurent, A. 1983. The cultural diversity of western conceptions of management. International Studies of Management and Organization 13, 75–96. ———. 1986. The cross-cultural puzzle of international human resource management. Journal of Human Resource Management Spring, 91–102. Levitt, T. 1983. The globalization of markets. Harvard Business Review (May–June), 1–11. Lewis, R. D. 1996. When cultures collide. London: Nicholas Brealey. Mason, D., and D. Pauleen 2003. Perceptions of knowledge management: A qualitative analysis. Journal of Knowledge Management 7 (4): 38–48. Mason, R. 2003. Culture-free or culture-bound? A boundary spanning perspective on learning in knowledge management systems. Journal of Global Information Management 11 (4): 20–37. McCrone, D. 1998. The sociology of nationalism. London: Routledge. McDermott, R. 1999. Why information technology inspired but cannot deliver knowledge management. California Management Review 41 (4): 103–17. Mercer, N. 1992. Culture, context and the construction of classroom knowledge. In Context and cognition , ed. P. Light and G. Butterworth, 28–46. Hemel Hempstead, UK: HarvesterWheatsheaf. Morden, T. 1995. National culture and the culture of the organization. Cross-Cultural Management: An International Journal 2 (2): 3–12. Myers, M., and F. Tan 2002. Beyond models of national culture in information systems research. Journal of Global Information Management 10 (1): 24–32. Namenwirth, J. Z., and R. B. Weber 1987. Dynamics of culture. Boston: Allen and Unwin. Nemetz, P. L., and S. L. Christensen 1996. The challenge of cultural diversity: Harnessing a diversity of views to understand multiculturalism. Academy of Management Journal 21, 434–62. Nikandrou, I., E. Apospori, and N. Papalexandris 2003. Cultural and leadership similarities and variations in the southern part of the European Union. Journal of Leadership and Organizational Studies 9 (3): 61–84. Nisbett, R., K. Peng, I. Choi, and A. Norenzayan 2001. Culture and systems of thought: Holistic vs. analytic cognition. Psychological Review 108, 291–310.

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Cross-Cultural Perspectives on Knowledge Management Nonaka, I. 1994. A dynamic theory of knowledge creation. Organizational Science 5 (1): 14–37. Nonaka, I., and H. Takeuchi 1995. The knowledge-creating company. New York: Oxford University Press. Nonaka, I., and R. Toyama 2003. The knowledge-creating theory revisited: Knowledge creations as a synthesizing process. Knowledge Management Research and Practice 1, 2–10. Pauleen, D., and Murphy, P. 2005. In praise of cultural bias. Sloan Management Review 46 (2): 21–22. Politis, J. D. 2001. The relationship of various leadership styles to knowledge management. The Leadership and Organizational Development Journal 22 (8): 354–64. Ronen, S., and O. Shenkar 1985. Clustering countries on attitudinal dimensions: A review and synthesis. Academy of Management Review 10 (3): 435–54. Rooney, D. 2005. Knowledge, economy, technology and society: The politics of discourse. Telematics and Informatics, 22, 405–422. Rossen, E. 2003. Cross-cultural inequality in IS: A preliminary exploration of Scandinavia and France. Cross-cultural workshop at ICIS 2003, Seattle. Schein, E. H. 1985. Organizational culture and leadership. , San Francisco: Jossey-Bass. Senge, P. 1999. The dance of change. New York: Doubleday. Smith, P. 1992. Organizational behaviour and national cultures. British Journal of Management 3: 39–51. Smith, P. B. 1997. Leadership in Europe: Euro-management or the footprint of history? European Journal of Work and Organizational Psychology 6: 375–86. Smith, P. B., S. Dugan, and F. Trompenaars 1996. National culture and the values of organizational employees. Journal of Cross-Cultural Psychology 27 (2): 231–63. Straub, D., K. Loch, R. Evaristo, E. Karahanna, and M. Srite 2002. Toward a theory-based measurement of culture. Journal of Global Information Management 10 (1): 13–23. Sveiby, K. 2001. What is knowledge management? http://www.sveiby.com/articles/KnowledgeManagement.html. Thomas, C, W. A. Kellogg, and T. Erickson 2001. The knowledge management puzzle: Human and social factors in knowledge management. IBM Systems Journal 40 (4): 863– 84. Triandis, H. C. 1993. The contingency model in cross-cultural perspective. In Leadership theory and research: Perspectives and directions , ed. M. M. Chemers and R. Ayman, 167–88. San Diego: Academic Press. Trompenaars, F. 1993. Riding the waves of culture: Understanding cultural diversity in business. New York: McGraw Hill. Walsham, G. 2002. Cross-cultural software production and use: A structurational analysis. MIS Quarterly 26 (4): 359–80. Waters, M. 2001. Globalisation. 3rd ed. London: Routledge. Weisinger, J. Y., and E. M. Trauth 2002. Situating culture in the global information sector. Information Technology and People 15 (4): 306–20. Wensley, A. 2002a. Plato’s philosopher kings and knowledge management. Knowledge and Process Management 9 (4): 203–4. Wensley, A. 2002b. Book review of Cultural management: A knowledge management perspective by N. Holden. Knowledge and Process Management 9 (2): 129. Wensley, A. 2002c. Book review of The social life of information by J. S. Brown and P. Duguid. Knowledge and Process Management 9 (4): 264. Westrup, C., S. Al Jaghoub, H. El Sayed, and W. Liu 2003. Taking culture seriously: ICTS, cultures and development. In The Digital Challenge: Information Technology in the Development Context, ed. S. Krishna and S. Madon, 13–27. Aldershot, UK: Ashgate.

National and Organizational Culture, and Knowledge Management Wiig, K. 2000. Knowledge management: An emerging discipline rooted in a long history. In Knowledge Horizons ed. C. Dupres and D. Chauvel, 3–26. Boston: Butterworth-Heinemann. ——— 2004. People-focused knowledge management. Burlington, MA: Elsevier ButterworthHeinemann. Yu, P. L,. and C. Y. ChiangLin 2002. Five experiences that shape Taiwan’s character. In Made in Taiwan: Booming in the Information Technology Era ed. C. H. Chang and P. L. Yu, 347–77. Singapore: World Scientific Publishing.

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2 Culture: An Overlooked Key to Unlocking Organizational Knowledge Robert Mason

ABSTRACT In the knowledge-based view of the firm, knowledge is a potentially strategic asset and should be managed as any other asset. A global organization comprising members from multiple cultures and ethnic groups has a potential asset in the knowledge of these different members, yet prior knowledge management approaches have ignored the cultural dimension of knowledge. Unlocking the asset represented by the cultural differences in an organization requires an understanding of the cultural basis of learning and knowledge. Recent research on the early development of the brain suggests a strong connection between how one learns and one’s early cultural environment, suggesting the need for rethinking the knowledge management effort. This chapter outlines the recursive relationship between learning and knowledge, reviews recent research on the cultural foundations of learning and knowledge, and proposes a model of boundary spanning that can help global organizations meet the challenge of unlocking the knowledge represented by the different cultural and ethnic backgrounds of their members. “Once people have learned to learn in a given way it is extremely difficult to learn in any other way. … Culture reflects the way one learns” (Hall 1990, 47).

BACKGROUND This chapter addresses the issue of culture and ethnic background as dimensions of knowledge management and the learning organization. The discussion that follows stipulates that the twenty-first century business and economic environment

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Cross-Cultural Perspectives on Knowledge Management is increasingly global and that an organization’s knowledge has become a strategic asset (Grant 1996). Learning, if not the only sustainable competitive advantage (Stata 1989), as a minimum can be considered to be one of the most important factors in competitiveness. Consequently, organizations have considerable motivation to manage their knowledge asset effectively and to use this asset as the basis for further learning. Toward this goal, many organizations have established systems of knowledge management. The interest in knowledge management, as indicated by the number of research articles on the subject, does not seem to follow the kind of increase, peak, and decrease pattern that has been observed in other management fads (Ponzi and Koenig 2002). Most knowledge management systems (KMSs) have the explicit or implicit goal of enabling the organization to have access to all relevant available knowledge (Alavi and Leidner 2001). However, a review of published reports of KMSs indicates that organizational members’ cultural and ethnic backgrounds are not considered in the design and operation of most KMSs, which take a Western (and mostly North American) approach (Mason 2003). This means that KMSs as currently envisioned and designed have a significant cultural gap that can lead to underutilizing some of the organization’s knowledge assets—those assets represented and embedded in the persons who are not from mainstream Western cultures. The systems as currently designed may unwittingly place barriers to knowledge access by those from non-Western cultures, and the knowledge of organizational members who are not from Western cultures may not be captured or communicated by the KMS. For example, as organizations become more global and comprise members who have distinct national and ethnic backgrounds, the organization could use these members’ knowledge to help tailor the organization’s sales and marketing efforts to meet the preferences of the distinct groups from which these members came. Bridging this cultural gap in KMS design requires an understanding of the recursive relationship between learning and knowledge, the significance of the tacit dimension of knowledge in this relationship and in knowledge transfer, and how differences in cultural and ethnic backgrounds affect knowledge and learning. To develop this understanding, the chapter posits the following: • • • •

Individual learning is a necessary (but possibly not sufficient) process for organizational learning and knowledge retention. The relationship between knowledge and learning is recursive; each affects the other. In this learning–knowledge relationship, the tacit dimension of knowledge performs a critical role. The early cultural environment of an individual affects how the individual learns; if one is to learn in a different way after childhood, external intervention may be required.

These propositions provide a foundation on which we might develop a set of principles that can guide the design of a culture-sensitive KMS. The following discussion summarizes the principles as postulates, which can be further examined through a model of boundary spanning at the syntactic, semantic, and pragmatic levels. The paper concludes with a discussion of the implications of the postulates and a model for the design of KMSs that might enable learning across and among multiple cultures.

Culture

DATA, INFORMATION, KNOWLEDGE, AND LEARNING This section develops the previously mentioned propositions in more detail and provides the foundation for the model of boundary spanning outlined in the subsequent section. Although the following discussion may discuss individual and social aspects of learning and knowledge separately, the integration of both perspectives is necessary for a full understanding of the interrelationships among knowledge, learning, and culture.

Individual and Organizational Learning and Knowledge Learning occurs when an entity has interpreted information in a way that enables the entity to change the range of behaviors that it may consider (Huber 1991). Note that in this viewpoint, learning can either enlarge the range of options (the entity sees new possibilities) or narrow the range of options (the entity can eliminate some actions from further consideration). Some researchers have argued that when an individual in an organization learns, the organization itself has learned (Huber 1991). Although one might debate this strong statement, as it equates individual learning with organizational learning without considering the need either for applying the individual’s learning or for communicating this learning to others, this position does emphasize that an individual—not an organization—is central to the process of learning. Organizational learning occurs as individuals in that organization make sense of data and information and apply their interpretation to the vision, strategy, standards, procedures, and operational activities that are communicated and implemented throughout the organization. As a consequence, we posit that individual learning is necessary for an organization to learn, but this may be an insufficient condition: The individual may need to act on this learning through communication with others, design and implementation of strategies or tactics, or the implementation principles that embed the new knowledge into organizational procedures. The communication of individual learning to others in the organization is also necessary for the organization to mobilize around its goals and strategy for pursuing these goals. Such communication is perhaps more challenging for Western organizations than Japanese or other Eastern organizations. In the latter, learning experiences and the sharing of knowledge are more integrated into the organizational routine (Nonaka and Takeuchi 1995).

The Nature of Data, Information, Knowledge, and Learning The conceptualization of knowledge, long discussed by philosophers, has enjoyed renewed interest since researchers have taken seriously the resource-based view of the firm (Barney 1996; Barney, Wright, and Ketchen 2001; Penrose 1959;) and have recently proposed that knowledge is a key resource for the firm (Grant 1996). The traditional view of knowledge is that it fits into a hierarchical model: Knowledge is at the top of a pyramid whose middle layer is information and whose lowest level is comprised of data. In this model, knowledge is an accumulation of interpreted and organized information (Davenport and Prusak 1998), and information comes from data within a context. One generally imagines a flow to this hierarchy, with “raw” data that are arranged in ways

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Cross-Cultural Perspectives on Knowledge Management that are meaningful in order to produce information, and then this information is consolidated into coherent frameworks to form knowledge. In this view, generally taken as typical (Alavi and Leidner 2001), data are precursors, or building blocks, of information and information is the source for knowledge. In this model, learning is the process by which the entity increases its awareness of context, creates meaning, and thereby is able to transform new information and experiences into knowledge. This model is consistent with the notion that a KMS is intended to support four steps of knowledge management: knowledge creation, knowledge storage and access, knowledge transfer, and knowledge application (Alavi and Leidner 2001). This model has been recognized as limiting and incomplete. Without some prior knowledge—knowledge that enables one to direct one’s attention to what is salient—it is difficult to distinguish data from noise. This suggests a reverse hierarchy, one in which knowledge is required to interpret data and create information (Tuomi 1999). Such a reverse hierarchical model emphasizes that an entity does not simply begin with an empty store of knowledge and build up a knowledge base, but rather it starts with a foundation of prior knowledge. Perhaps the most meaningful conceptual framework within which to view the relationships among learning, knowledge, information, and data is to visualize a hermeneutic, recursive process in which each is enriched and made meaningful by a consideration of the others. Discerning data from noise necessitates a prior knowledge framework that anticipates possible signals. Given such a framework, data can be interpreted to create meaning and resolve questions (information) and thus the entity learns. Information is the basis of communication between and among entities that can agree on interpretations and abstract concepts that can be the basis for new knowledge, which in turn can help recognize and interpret new data. At the same time, multiple schemata may be applied to develop alternative interpretations of data, providing for the construction of different meanings. One learns by using prior experience to continually select and sort signals from the environment, interpreting these signals (data) so that the new information can be incorporated in a way that enables the entity to make sense of both prior knowledge and new information. In considering this recursive model, the purposes of an organizational KMS have been articulated as contributing to three critical organizational processes (Choo 1998): 1. Sense making (understanding and interpreting data about the environment) 2. New knowledge creation (thus improving all organizational processes) 3. Decision making (applying the knowledge to affect the environment).

Systems of knowledge management for a particular organization may focus on one or more of these goals. However, the recursive nature of data, information, and knowledge demonstrates the inadequacy of simple models that would create knowledge from information and information from data. This recursive aspect also suggests multiple roles for a KMS and suggests that an effective KMS enables both individual and organizational learning through the creation of meaning and significance from the interactions of (prior) knowledge schema, (new) data, and (flows of) information. This viewpoint emphasizes the internal processes of organizational sense making and knowledge creation. In addition to the internal processes, the organization is engaged in a recursive information exchange with its environment. This exchange also affects the

Culture organization’s sense making, particularly helping the organization to understand the external values within which it is operating. This discussion suggests that knowledge can be viewed in two ways, and neither is adequate by itself. Knowledge can be viewed as a store of accumulated and interpreted information, but it also can be viewed as a social process by which individuals and organizations continually apprehend and make sense of information based on prior knowledge. The recursive aspect of knowledge and learning means that the stored knowledge affects how the individual (entity) screens and interprets flows of information. Learning—the process of understanding, interpreting, and representing new information and new experiences so that this stored knowledge can be changed or reinforced—is thus affected by the existing knowledge. This suggests an initial postulate on which we might build a framework for a culturally sensitive KMS: P1: An effective KMS not only enables an organization to store knowledge, it enables flows of data and information among its members and supports them in interpreting and representing these data and information and thus enables them to create new knowledge by considering multiple interpretations of new data using alternative schema.

Dimensions of Knowledge: Explicit and Tacit Today, the concepts of tacit and explicit have been explored in much of the writing about knowledge management and knowledge creation. Discussing and communicating about the explicit dimension is straightforward, and there is little controversy about it. The explicit dimension of knowledge is expressed in words and can be communicated to others using language, diagrams, or other tangible artifacts. Consequently, the information technology infrastructure of a KMS will typically have a knowledge base containing text, tables, models, and other information that can be expressed explicitly. However, much of what has been written with respect to the tacit dimension has misunderstood and misinterpreted Polanyi’s phrase, “we know more than we can tell” (Polanyi 1967, 4). Particularly, many have interpreted this to mean that knowledge is of two types: tacit and explicit. In taking this approach, some of the more popular writers on knowledge management have suggested transformations from one type to another (Nonaka and Takeuchi 1995; von Krogh, Ichijo, and Nonaka 2000). However, Polanyi was clear in his view that all knowledge comprises a tacit dimension; he does not discuss a tacit type of knowledge, only a dimension of knowledge that one is unable to articulate. Nonetheless, the notion of two types of knowledge is widespread and underlies much of the literature on knowledge management. A recent review of several dozen papers indicates that about 90 percent of them refer to two types of knowledge (Keane and Mason 2006). This emphasis on types rather than dimensions means that the holistic and integrated aspect of knowledge has not been studied sufficiently. It is no surprise that those who construct KMSs, without a research foundation on which to build, have inadequately accounted for the tacit dimension in their designs. The tacit dimension may represent physical skills, such as riding a bicycle, but it also reflects concepts of values and facts that are commonly known (sometimes referred

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Cross-Cultural Perspectives on Knowledge Management to as common sense) to a society or group. These commonly known values and facts are socially constructed and transmitted, as through apprenticeships (learning from a few masters) and through the broader cultural environment. The cultural environment, whether national or ethnic, contributes to an individual’s tacit dimension of knowledge and aspects of this dimension and may be difficult to change (Hall 1990). If one considers that one objective of a KMS is to enable individuals to have access to the widest range of available knowledge, it should provide for access to the tacit as well as the explicit dimension of knowledge. This leads to our next postulate: P2: For a KMS to be effective across multiple cultures, it should recognize both dimensions of knowledge and enable access and transfer of the entirety of knowledge held by the organization’s members.

CULTURE AND LEARNING Culture has been defined as “the system of shared beliefs, values, customs, behaviors, and artifacts that the members of society use to cope with their world and with one another, and that are transmitted from generation to generation through learning” (Bates and Plog 1990, 7). Culture is both individual (it is manifested as individual traits that are learned) and collective (it emerges over time from the shaping of behavior and practices through the combined efforts of a society). The importance of culture to learning can hardly be overstated. This chapter opens with the quote from Hall (1990, 47) on the relationship between learning and culture. Vygotsky, Rieber, and Carton (1987) proposed that learning can best be understood by taking an explicit culture-centered approach. Others have agreed with this perspective and developed the culture-centered approach further (Forman, Minick, and Stone 1993; Kozulin 1998). This perspective posits that culture (the collective) is a source of differences in cognition as (individual) cognitive processes are formed through sociocultural activities. Cole (1971) and others developed a contextual theory of cognitive functions, which posits that different cultures have different systems of mediated learning experiences (MLEs). Such systems and the resulting MLEs are important to cognitive development, thus leading to differences that become evident when a learner makes a transition from one system to another. A recent book focuses on the different cognitive processes between Asian thought and Western thought (Nisbett 2003). The book is filled with examples of how Asians and Westerners think differently. For example, when asked about themselves, Asians see themselves as part of a group and Westerners see themselves as individuals. Similarly, when viewing a picture of an object in the physical environment, Asians see the object in context and in relationship to the environment; Westerners perceive it more as a separate object and do not refer to the context in describing it. Nisbett outlines a conceptual model of how meaning is constructed by someone who has grown up in a particular culture. In this model, social structure (e.g., family and family relationships) is an antecedent to attention processes, metaphysics (including “folk metaphysics)” and epistemology (2003, 33). In other words, according to this model, the social structure in which one grows up affects (or effects) how one makes sense of the world and how one knows what one knows. It is significant that the differences

Culture Nisbett notes are not simply differences in a factual knowledge base but are differences in cognitive structure and, more basically, how these structures are formed: In other words, there are differences in how an individual learns and makes sense of new experiences. The evidence for a cultural difference in perception and cognition has been raised before by comparative linguists. The Sapir-Whorf hypothesis posits that language is associated with how people perceive the world. Although individuals can find a word in their native language that will correspond to each object they perceive in the physical world, their language directs attention to different aspects of the physical world and enables them to perceive (and communicate) relationships between and among these physical objects. The perceived relationships differ depending on the language (Whorf and Carroll 1956). This language-directed attention, which begins very early in a child’s life (Kuhl 2001), shapes how the child learns and consequentially affects learning later in life. In his study of young adults, Kozulin (1998) found that individuals who grew up in one culture and were engaged in learning tasks in another culture had specific learning difficulties. The difficulties were associated with coding schemata, concepts, and graphic and symbolic devices used in communication of ideas (e.g., tables, ordering, plans, maps). The difficulties extended to cognitive activities such as the ability to identify or define problems (the ability to apply already acquired knowledge to a set of data and infer the implicit question or issue that needed to be resolved) and the ability to work with multiple sources of information. In short, because of the cultural environment (and the accompanying learning that was associated with this environment), the young adults were missing cognitive antecedents that would enable them to excel in their new environment. Kozulin concluded, “Cross-cultural differences in cognition are most probably related to learning practices characteristic of different cultures and subcultures,” and “two major determinants of cognitive prerequisites are conceptual literacy and facility with other symbolic psychological tools, and a mediated learning experience responsible for the integration of these tools into the cognitive system of the student” (1998, 129). Kozulin’s research went further and showed that intervention could help the learners develop the basic skills and concepts that would enable them to learn effectively in the new environment. There is a neurological basis for these differences in epistemology and in how these differences evolve. Some of the most relevant research on this topic is interdisciplinary, work that engages neuroscientists, cultural anthropologists, language psychologists, and learning theorists (Kuhl 2001), and this work continues to contribute to our understanding of how the mind develops. At the time of birth, a baby has roughly the same number of neurons (brain cells) in its brain as an adult—about 100 billion. However, there are only about 50 trillion synapses, or connections among these neurons. In the first three years, the number of synapses grows twentyfold, to one quadrillion. Synapses are potential learning pathways, so this explosion of connectivity within the brain in the early years equips the child to learn from the range of new stimuli that the child experiences in these early years. The “brain as sponge” metaphor has been used; others describe “the scientist in the crib” (Gopnik, Meltzoff, and Kuhl 2001) because of the child’s exploration of the world and the discovery of new facts.

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Cross-Cultural Perspectives on Knowledge Management Even before the maximum number of synapses is reached around age three, the child is observing the surrounding environment and beginning to selectively sort out different stimuli. Studies of infants show that at about 7 months, children give equal attention to changes in sound regardless of the language. However, by the age of 11 months, the infants already are beginning to be selective about which sounds are different and interesting. For example, at the age of 7 months, Japanese and American infants are equally perceptive of the differences between the sounds of /ra/ and /la/, sounds that are easily distinguished in English but more difficult for Japanese speakers. At 11 months, the infants in an English learning environment have improved their perception of the difference between the sounds, but the infants in a Japanese learning environment have lost some of their ability to perceive the difference in sounds. A similar study with American and Taiwanese infants, using sounds in Mandarin, showed a similar tendency, with the Taiwanese infants improving their ability to distinguish the Chinese sound and the American infants decreasing in their ability to make the distinction. In summary, in both cases, infants demonstrated a significant increase in native-language phonetic perception and a decrease in foreign-language phonetic perception over this short period of time (Kuhl 2001). These infant studies suggest the importance of early cultural environment to learning. Learning begins by making distinctions, seeing differences in the environment, and using these differences to interpret and remember experiences. The explosive period of synapse growth provides the infant with many opportunities to learn—everything from how to walk and interact with the physical environment to communicating with others in the environment. However, the growth of synapses slows quickly, and the number of synapses remains about the same from age three until the child is about eight years old. At this point, the number begins to be “pruned” in order for the remaining paths to be reinforced and become more efficient. From birth to the age of eight, the brain is being programmed to learn—in a computer analogy, the brain is being “wired” to learn in a particular way (Kuhl 2001, 2002). This programming determines fundamental perceptual and cognitive frames or schemata that are used thereafter to interpret and learn from experience, and these schemata have substantial staying power. As noted in an online encyclopedia of religion, “the Jesuit maxim, ‘Give us a child until [s]he’s seven, and [s]he’s ours forever,’ has been quoted until it is a cliché, but that is because experience seems to suggest it is true” (Bailey 1998). This early development of learning abilities shapes the perception and interpretation of experiences throughout a person’s life. It has been acknowledged for some time that knowledge and its acquisition is path dependent (Hayek 1952; Kelly 1955), but the recent advances in neurobiology are providing a better look at how this path dependency arises. The relationship between and among culture, learning, and personal knowledge suggests that knowledge management techniques that are appropriate in one culture may not be effective for organizations that comprise members from multiple cultures or organizations that seek to serve multiple cultures. A global organization that seeks to tap into the knowledge of all its members would benefit from understanding that the knowledge embedded in members from different cultures may have different structures (schemata), and individuals who can benefit from having access to this knowledge may

Culture have difficulty in accessing this knowledge without intervention. This suggests two other propositions: P3: For a KMS to encompass knowledge by individuals from different cultures, it should provide for multiple schemata by which the knowledge can be organized and structured in the individuals’ native formats. P4: If a KMS is to be effective for learning by individuals with different cultural backgrounds, it should either (a) have culturally sensitive access mechanisms or (b) provide for skillbuilding that enables acquisition of knowledge classified and structured in non-native formats.

The preceding discussion shows the limitations of KMSs for global organizations, and the propositions provide guidance for the characteristics that a more culturally encompassing KMS might exhibit. What appears to be required is a different way of thinking about knowledge management in an organization that seeks to combine different cultures. The following discussion proposes one such approach: thinking of the knowledge management task as one of boundary spanning across cultures. The discussion draws on earlier articles that discuss this approach to thinking about designs for KMSs and digital libraries that seek to serve multiple cultures (Mason 2003, 2005).

A BOUNDARY SPANNING MODEL FOR KNOWLEDGE MANAGEMENT IN MULTICULTURAL ORGANIZATIONS Boundary spanning has been recognized as a necessary component in processes that require coordination and translations among diverse groups (Star and Greisemer 1989) and different functional groups, or “thought worlds” (Dougherty 1992). Carlile’s (2002) study of boundary spanning objects in a new product development (NPD) process suggests a useful framework for examining the functions of KMSs. Carlile’s ethnographic study of teams performing four primary functions in the creation of a new product (sales/marketing, design engineering, manufacturing engineering, and production) identified the difficulties of communication and coordination of the different knowledge and value systems represented by the team members. He examined how the teams worked together and how the team dealt with the specialized knowledge of each area. Each of the four functional areas had localized and embedded knowledge, structured in a way that made sense to that area, much as we envision the localized and embedded knowledge of a culture. This knowledge specialization presented a barrier to the effective operation of the NPD team—the team found it difficult to exchange and synthesize knowledge as necessary for the successful development of a new product. Carlile observed that the team overcame this barrier by using boundary spanning objects that operated at three different levels: syntactic, semantic, and pragmatic. At the syntactic level, shared repositories enabled communication of facts and agreedupon tasks and actions. At the semantic level, standardized forms and methods enabled not only communication of facts but also provided a way for the different groups to clarify differences in meaning. The objects at this semantic level (standard forms and methods) enabled the team to translate the localized knowledge embedded in one group into forms that other groups could understand. At the pragmatic level, objectives, maps,

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Cross-Cultural Perspectives on Knowledge Management and models enabled each group to transform embedded knowledge into knowledge that the entire team (and others not in the group) could understand. In earlier studies of communities, Brown and Duguid (1998) pointed out the roles of boundary spanning activities and noted particularly the need for translators between communities. In commenting on Carlile’s model, Brown (2002) suggests that Carlile’s three levels correspond to three different levels of knowledge ambiguity among communities of practice. At each level, different types of boundary objects are necessary for communication, knowledge transfer, and learning. At the syntactic level, the differences across the boundaries are explicit, clear, and stable. A shared syntax is a necessary (but not necessarily sufficient) condition for sharing knowledge under these conditions. Taxonomies and classification (e.g., shared databases) provide this syntax and enable the sharing and transfer of knowledge among groups that have a clear understanding of their differences and understand that these differences are relatively stable. For a multicultural organization, this condition might be represented by an organization that has been relatively stable over time, so that the different cultures within the organization have a clear understanding of their differences. Under these conditions of explicit and clear differences, this syntactic level is a necessary condition for knowledge sharing in a multicultural organization. Agreements on syntax are required for data to be exchanged between cultures and communities. As a minimum, agreements at this syntactic level deal with technical standards and data architecture. Although data can be shared at this level, as Carlile and Brown both note, the sharing of data is insufficient for the exchange of knowledge and learning. At the semantic level, the differences across the boundaries may be neither clear nor stable (Brown 2002). The solution to spanning the boundary at this level requires a method of translating meanings across boundaries. At this level, Carlile (2002) observed the use of standardized forms and methods as boundary objects. For a KMS in an organization that comprises, or seeks to serve, multiple cultures, this semantic level is an additional necessary, but insufficient, prerequisite for knowledge sharing. For groups that have similar cultures, in which concepts are similarly named and relationships among concepts are similar, relatively simple translations that involve mapping of concepts from one language or mental model to another may be sufficient. In some cases, the models may need to be dynamic and agile. For example, if the technology for exchanging information between groups is critical to an exchange (e.g., as in a technology transfer), or if technology is the focus for exchanging knowledge, the dynamic nature of technology may require the models employed in the exchange to be agile and to enable interpretation of flexible and evolving concepts. Even more difficulty may be expected if the different cultures are experiencing different rates of progress. In such situations—and any situation in which the differences are neither clear nor stable—frequent communication between the groups may be necessary to assure currency in meaning and to assure that new concepts are absorbed by both groups. At the semantic level, if there has been agreement at the syntactic level, and there is the basis for a shared communication language, metaphors may be a useful approach to communicating new ideas (Lakoff and Johnson 1980), if such metaphors can be apprehended by both cultures. For groups that have more distinct cultures, with few shared concepts, such translations or mappings may not be feasible without additional explorations at the pragmatic level. Indeed, even the metaphorical concept of a library, widely used in most Western cultures, may not be shared across some cultural boundaries (Duncker 2002).

Culture The pragmatic level provides a level for exploring other differences across boundaries. However, explorations at this level require some degree of agreement at the other two levels. In his discussion of this model, Brown (2002) notes that the knowledge of one group is not neutral to the knowledge of another group or community. Different communities may have different values and/or power relationships, and this level of difference requires boundary objects that provide additional capability beyond the first two levels. At the pragmatic level, the groups must transform their knowledge and create new (shared) knowledge rather than simply exchanging or transferring knowledge. Resolution of group differences requires objects such as models and maps, objects that enable the surfacing of assumptions, tacit knowledge, and values. At this level, shared syntax and meaning must be sufficient to permit the sharing of methods of thinking and the development of a shared basis for understanding each group’s values and mental schemata. It is at this stage that intervention, perhaps by someone who has experience with both cultures, may be necessary. In this model of boundary spanning, the lower two levels are necessary but insufficient for complete sharing of knowledge and the development of mutual understandings that would enable the creation of new knowledge. The mutual understandings and the associated trust that comes from these understandings may be necessary if a KMS is to support an organization comprising users from multiple cultures. This suggests a fifth proposition: P5: For a KMS to be effective in a multicultural organization, it should provide boundary spanning mechanisms and processes at the syntactic, semantic, and pragmatic levels.

Mechanisms and processes at the syntactic and semantic levels of this model are readily apparent in observations of commercially based KMSs implemented at individual organizations, but corresponding processes at the pragmatic level are rare. The few cases in which such pragmatic level processes were reported noted the use of face-to-face meetings and structured forums in which distinct groups discussed values and differences. Some incentives and standards, designed to transform the executive level goals and values (e.g., the use of the KMS) into practice at the operational level of the firm, were judged to be pragmatic boundary spanning activities in which the boundary was hierarchical rather than a national, cultural, or ethnic (Mason 2003). Access to all the knowledge available within an organization is constrained when a KMS does not explicitly plan for the inclusion of multiple cultures in the creation, storage, and transfer of knowledge. A KMS designed by and for a particular organizational culture by its nature restricts the range of schemata by which knowledge is classified and stored, and thus the creation of new knowledge is limited to discussions within the meta framework provided by the collective combination of these schema.

CONCLUSION AND DISCUSSION Prior work in KMSs has not been sensitive to either the value of knowledge that may be embedded and localized in different cultural groups or to ways in which this knowledge might be made accessible. This lack of sensitivity means that global organizations, organizations that seek to make use of the knowledge of all their members and that seek to serve multiple external clients, are inadequately prepared to do so with current models and implementations of KMSs. The theoretical goals of KMSs—to enable access to the

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Cross-Cultural Perspectives on Knowledge Management widest range of knowledge and to provide the capability to create new knowledge from existing knowledge—are not being realized in today’s global organizations. Recent interdisciplinary research involving neuroscientists, cultural anthropologists, language psychologists, and learning theorists has contributed to our understanding of how the mind develops. This work has provided evidence for the opening quote from Hall that emphasizes the cultural dimension of learning and knowledge creation. The early cultural environment affects the wiring of the brain so that later learning is shaped and guided by these native cultural experiences. If organizations are to benefit from the recent understanding of brain development and are to create KMSs that support global efforts and enable knowledge creation and exchange among multiple cultures within the organization, new approaches are required. One approach is to consider distinct cultures as different learning communities and to think of a KMS as a boundary-spanning process. This chapter suggests that the three-level boundary-spanning model proposed by Carlile can help guide the development of mechanisms for incorporating different cultures in an organizational KMS. Each level presents different challenges. The syntactic and semantic levels are more easily amenable to the application of current information technologies. However, these are simply necessary levels and are not sufficient for a multicultural KMS. Completing the model requires these levels to be used to work at the third (pragmatic) level of the model. It is at this level that the culturally specific tacit dimension of knowledge may be reflected, and it is at this level that the organization that seeks to encompass multiple cultures must provide social mechanisms by which the issues of different values can power can be negotiated. Only then can a global organization unlock the knowledge embedded in its culturally diverse members and realize the original vision of a KMS that enables ready access to the full range of knowledge within the organization’s boundaries.

REFERENCES Alavi, M., and D. E. Leidner. 2001. Review: Knowledge management and knowledge management systems: Conceptual foundations and research issues. MIS Quarterly 25 (1): 107–36. Bailey, E. I. 1998. Religious education. In Encyclopedia of religion and society, ed. J. W. H. Swatos. Walnut Creek, CA: AltaMira Press, http://hirr.hartsem.edu/ency/ReligiousE.htm. Barney, J. B. 1996. The resource-based theory of the firm. Organization Science 7 (5): 469. Barney, J., M. Wright, and D. J. Ketchen Jr. 2001. The resource-based view of the firm: Ten years after 1991. Journal of Management 27 (6): 625–41. Bates, D. G., and F. Plog. 1990. Cultural anthropology . New York: McGraw-Hill. Brown, J. S. 2002. An epistemological perspective on organizations and innovations. Paper presented at the Organizational Knowledge and Learning Conference, Athens, Greece. Brown, J. S., and P. Duguid. 1998. Organizing knowledge. California Management Review 40 (1): 90–111. Carlile, P. R. 2002. A pragmatic view of knowledge and boundaries: Boundary objects in new product development. Organization Science 13 (4): 442–55. Choo, C. W. 1998. The knowing organization. New York: Oxford University Press. Cole, M. 1971. The cultural context of learning and thinking: An exploration in experimental anthropology. New York: Basic Books. Davenport, T. H., and L. Prusak 1998. Working knowledge: How organizations manage what they know. Boston: Harvard Business School Press.

Culture Dougherty, D. 1992. Interpretive barriers to successful product innovation in large firms. Organization Science 3 (2): 179–202. Duncker, E. 2002. Cross-cultural usability of the library metaphor. International Conference on Digital Libraries archive. Proceedings of the 2nd ACM/IEEE-CS Joint Conference on Digital Libraries Portland, 233–40. New York: ACM Press. Forman, E. A., N. Minick, and C. A. Stone. 1993. Contexts for learning: Sociocultural dynamics in children’s development. New York: Oxford University Press. Gopnik, A., A. N. Meltzoff, and P. K. Kuhl. 2001. The scientist in the crib: What early learning tells us about the mind. New York: Perennial. Grant, R. M. 1996. Toward a knowledge-based theory of the firm. Strategic Management Journal 17 (Winter): 109–22. Hall, E. T. 1990. The silent language. New York: Anchor Books/Doubleday. Hayek, F. A. v. 1952. The sensory order: An inquiry into the foundations of theoretical psychology. Chicago: University of Chicago Press. Huber, G. 1991. Organizational learning: The contributing processes and literatures. Organization Science 2 (1): 88–115. Keane, B. T., and R. M. Mason 2006. On the nature of knowledge: Rethinking popular assumptions. Hawaii International Conference on System Sciences, Kauai, Hawaii. CD-ROM. Los Alamitos, CA: Computer Society Press of the IEEE. Kelly, G. A. 1955. The psychology of personal constructs. New York: Norton. Kozulin, A. 1998. Psychological tools: A sociocultural approach to education. Cambridge, MA: Harvard University Press. Kuhl, P. K. 2002. Born to learn: Language, reading, and the brain of the child. Early Learning Summit for the Northwest Region, Boise, Idaho, http://www.ed.gov/teachers/how/early/ earlylearnsummit02/kuhl.doc. Kuhl, P. K., F. M. Tsao, H. M. Liu, Y. Zhang, and B. De Boer. 2001. Language/culture/mind/brain: Progress at the margins between disciplines. Annals of the New York Academy of Science 935: 136–74. Lakoff, G., and M. Johnson 1980. Metaphors we live by. Chicago: University of Chicago Press. Mason, R. M. 2003. Culture-free or culture-bound? A boundary spanning perspective on learning in knowledge management systems. Journal of Global Information Management 11 (4): 20–36. ———. 2005. The critical role of librarian/information officer as boundary spanner across cultures: Humans as essential components in global digital libraries. World Library and Information Congress: 71st IFLA General Conference and Council, Oslo. The Hague: International Federation of Library Associations, http://www.ifla.org/IV/ifla71/papers/013e-Mason. pdf. Nisbett, R. E. 2003. The geography of thought: How Asians and Westerners think differently—and why. New York: Free Press. Nonaka, I., and H. Takeuchi 1995. The knowledge-creating company. New York: Oxford University Press. Penrose, E. T. 1959. The theory of the growth of the firm. Oxford: Blackwell. Polanyi, M. 1967. The tacit dimension. Garden City, NY: Anchor Books. Ponzi, L, and Koenig, M. 2002. Knowledge management: another management fad? Information Research 8 (1), paper no. 145, http://InformationR.net/ir/8–1/paper145.html. Star, S. L., and J. R. Greisemer 1989. Institutional ecology, “translations” and boundary objects: Amateurs and professionals in Berkeley’s Museum of Vertebrate Zoology, 1907–39. Social Studies in Science 19: 387–420. Stata, R. 1989. Organizational learning: The key to management innovation. Sloan Management Review 30 (3): 63–74.

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Cross-Cultural Perspectives on Knowledge Management Tuomi, I. 1999. Data is more than knowledge: Implications of the reversed knowledge hierarchy for knowledge management and organizational memory. Journal of Management Information Systems 16 (3): 103. von Krogh, G., K. Ichijo, and I. Nonaka. 2000. Enabling knowledge creation. New York: Oxford University Press. Vygotsky, L. S., R. W. Rieber, and A. Carton. 1987. The collected works of L.S. Vygotsky. New York: Plenum Press. Whorf, B. L., and J. B. Carroll. 1956. Language, thought, and reality: Selected writings. Cambridge, MA: Technology Press of Massachusetts Institute of Technology.

3 The Art of Systems: The CognitiveAesthetic Culture of Portal Cities and the Development of Meta-Cultural Advanced Knowledge Economies Peter Murphy

ABSTRACT Knowledge economies are the most powerful economies in the world. What makes them possible? This article discusses the origin of knowledge in pattern thinking and the source of pattern thinking in aesthetic forms. In addition, the author notes the concentration of knowledge economies in specific geographic zones—in portal city regions. These various phenomena are confluent. The art cultures of portal cities, and their intense concentrations of designing intelligence, contribute to the long-term accumulation of knowledge in these places. There is a strong parallelism between aesthetic culture and the demands of long-distance portal economies. Aesthetic form lends itself to the management of uncertainty—it facilitates the discovery of pattern in the midst of chaos. At the same time, powerful economies arise out of the same kind of ability to manage high levels of contingency and risk. The city is the most potent point of intersection of these various capacities. Arts-and-science cities, also normally portal cities, self-organize through mimetic aesthetic forms to meet these challenges. Portal cities, characterized by high levels of import and export, are among the most proficient users of pattern forms to manage data flows. Firms and organizations, where the management of knowledge occurs, mirror this. Successful firms and organizations deal with the continuous influx of information generated by contingency. They use pattern thinking and designing intelligence to make sense of those information flows and to obviate the risks inherent in operating in environments that are characterized by high levels of uncertainty and rapid shifts in direction.

INTRODUCTION There are two ideas of culture. One is romantic (Murphy and Roberts 2004): Culture in the romantic sense is a function of nations. Nations are defined by territory, language,

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Cross-Cultural Perspectives on Knowledge Management and social norms. Nations possess incommensurable characteristics—different ways of doing things and creating things, and different mind-sets, that provide advantages in global economic and social competition. In particular, the “genius” of a nation produces innovation. A second, and older, idea of culture equates culture with the civilization of cities. This idea precedes the modern romantic idea of nationhood. Culture as a function of the civilization of cities is less the expression of incommensurable qualities and habits and is more the consequence of the universals of shape, pattern, and form. These are universals in the sense of their reach. They can be understood irrespective of nationality, and acquired and stored as knowledge, they can be widely imitated and are applicable in many domains. A little like nations, however, this kind of pattern knowledge does not emerge just anywhere. Nor is it most potently applied just anywhere. Its natural ecology is the city, especially as we indicate subsequently, the porous environment of great portal cities. Portal cites combine busy ports (sea, land, and rail ports) with large metropolises. They are characterized by intensive import and export of goods, money, people, and information. Despite the importance of modern rail, road, and air transport, most successful portal cities are still located on coasts and rivers. The emergence of pattern knowledge is closely associated with the aesthetics of these littoral cities and the high-quality design cultures that such cities invariably produce. In the second model of culture, then, it is the art, design, power, and beauty of cities that produces innovation. Japan exemplifies the two meanings of culture. It has a strong, easy-to-recognize set of national characteristics. The Japanese way of doing things is often used to explain the wealth of Japan’s economy. But, long before Europe, archipelagic Japan was a highly urbanized society that had a refined aesthetic culture and that relied on the intensive importation of knowledge even when, from a national perspective, Japan was “closed” to the world. Today the 41 universities of Kyoto, and its huge industrial research park infrastructure, owe considerably more to the urban culture of art and knowledge than they do to the national difference of Japan. This is especially so at the sociocultural level of fundamental far-reaching innovation. National culture has a significant role in the identity formation of linguistic or territorial groups. Yet, as an innovation driver—a shaper of technological, economic, and social forms with a high propensity for export— national difference is much less significant. The largest part of human innovation has for the longest time been tied to the culture of cities.

THE ART OF SYSTEMS The particular significance of all of this is that, although the human species has always on some level innovated, in the past 200 years, innovation has become a core economic and social force. What we have come more recently to call the knowledge economy is simply a reflex of this. Knowledge, it must be emphasized, is not per se innovative. Mostly knowledge is something that is secondhand: It passes from one person to another. Yet, sometimes, the act of knowledge produces something new—something unheard of or something unprecedented. Newness is not such an important quality in itself. Where it is important is where knowledge that is new produces something that gives shape to the world. This kind of knowledge patterns what we make and how we manage, what we say and how we feel, what we do and how we behave in the world. Let

The Art of Systems us call this formative knowledge or pattern knowledge. The amount and the influence of this kind of knowledge have grown sharply in the past 200 years. Usually, it begins obscurely enough and normally in some domain of art or science. What is impressive is how quickly pattern knowledge now moves from the quieter corridors of the arts and sciences into the bustling thoroughfares of the wider society. One of the reasons for this is that a large number of modern institutions—ranging from corporations to governments—routinely absorb and apply, utilize and spread, promote and develop new knowledge (Heller 1985). Another reason is the growth of self-organizing systems in the modern world. Observing and mimicking patterns is a human trait. The mimetic power of social systems and information systems in the modern world has expanded significantly. Since the Industrial Revolution, economy activity based on applied science and applied art has grown at an enormous rate. Governance based on the social sciences and cultural industries based on the humanities have expanded in tandem. Modern institutions—ranging from manufacturing corporations to government departments to film studios—have become adept at modeling and restructuring using pattern knowledge. Despite this, our “knowledge of knowledge” remains elusive. It is a far trickier question to explain how pattern knowledge emerges than to describe its impact on economic behavior and social organization. The classic philosopher’s paradox—that knowledge is ignorance—indicates just how difficult it can be to precisely answer the question “What is knowledge?” One of the oldest confusions is to equate knowledge with opinion. We still do this, and we do it alongside all of the newer idols of knowledge we have invented, not least the idea that the accumulation of information is the same as knowing things. The fallacy of equating knowledge and information is illustrated by a very simple example. Stock investors who ignore the financial news and who pay attention solely to profit and loss results make better investment decisions (Surowiecki 2004). The opinions of pundits and the 24/7 flow of information get in the way of making good financial judgments. So often, in the case of knowledge, less is more. Knowledge is always economical. There is a good reason why this is so. Knowledge—as opposed to opinion, expression, or information— fixes on the form or shape of things. Knowledge is a function of system or architectonic arrangement. Knowledge is intimately connected to the art of systems, the art of how things are systematically arranged so as to be most pleasing, useful, efficient, economical, just, inspiring, or moving. Knowledge is the comprehension of form. Information, opinion, and expression are often superfluous to the essentials of form. They just get in the way. Considered as a unified field, then, knowledge is aesthetic. Knowledge, in the strongest sense, is the aesthetic or art of systems. Self-reflexive accounts of high-level knowledge creation tend to conclude on a very repetitive note: Knowledge begins with an image. It starts with the intuition of an image, a shape—a sketch of something in the mind. The aesthetic quality or art of systems cuts across economy and emotions, work and entertainment, politics and imagination. It is common across all of the compartments and spheres of human action and cognition. Thus, to know something is also to know how to arrange something or how something is arranged. Aesthetic qualities, we must always remember, are not simply social phenomena. The art of systems plays its role in the formation of societies and economies. But systemic aesthetic qualities are also pervasive in the physical and biological domain as well. Characteristics like symmetry are built into the fabric of the universe (Greene 2004). It is unsurprising, then,

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Cross-Cultural Perspectives on Knowledge Management that knowledge economies are functions of both the arts and the sciences. Beauty is to be found in self, society, and nature. Knowledge, in the sense of the art of systems, is knowledge of the commons. It is, at its root, the mind’s grasp of the common forms or common morphologies of self, society, and nature. The aesthetic or art of systems may be explicit or tacit. We can explain “what” we know, but more often we rely on inarticulate assumptions of knowing “how” to do something. Knowledge breakthroughs usually make what is inexplicit explicit. We give an account of what we know. But most knowledge remains implicit in the structures or systems we build or that we discover around us. In the most advanced economies and societies, we are surrounded by ever-deepening layers of knowledge embedded in complex systems. Yet we do not very often read a manual to make sense of a software system, any more than we read a travel guide to make sense of a city. We buy these code books for reassurance, but in practice our deepest knowledge comes through reconnaissance and navigation of these systems as we identify their aesthetic or systemic properties, and match them with our intuitions of the same. Knowledge in the sense of the aesthetic ordering or art of systems is not, and has never been, equally distributed across the face of the earth. There are knowledge clusters: there are knowledge-rich societies and knowledge-poor societies. Some economies interpolate high levels of systems knowledge; others exist literally hand-to-mouth. The explanation of why this is so is, at least partially, a function of place. In certain definable places, knowledge concentrates, which also means that in these places high-level aesthetic regimes emerge. The chief nodal points in which knowledge concentrates are portal cities and sea regions. The powerhouse examples of portal societies or portal regions in history are to be found around the Mediterranean (e.g., ancient Greece, Renaissance Florence and Venice), the North Sea (e.g., the Low Countries, southern England since the Renaissance, and the Scottish Lowlands in the eighteenth and nineteenth centuries), the seaboards and Great Lakes of North America since the sixteenth century, and the China Seas in the nineteenth and twentieth centuries. Adding to these maritime regions the inland peninsulas of Europe—especially the Île-de-France and the triangular regions bounded by the Elbe and Salle Rivers, the Maas and Rhine Rivers, and the Rhine and Danube Rivers—we find that these societies, in their golden epochs, are responsible for most of the human species’ towering artistic, literary, political, economic, scientific, and technological inventiveness. In the cases of post-1400 Europe and post-1800 North America, this intellectual geography is vividly mapped by Murray (2003, 301–6). Unsurprisingly, then, portal regions have also emerged as the principal incubators of modern kinds of intellectual capital (Murphy 2005a). Advanced economies over the past 150 years have put great effort into transforming tacit knowledge into explicit knowledge and turning explicit knowledge into forms of intellectual property, especially patents and copyrights (Howkins 2001). Intellectual property, like generic knowledge, clusters in littoral, insular, peninsula, and riverine zones, regions, and states. This recent history echoes deeper patterns in the distribution of knowledge. Scattered step-like across the past 2,500 years of human history, there have appeared a series of geographical regions distinguished by exceptionally high levels of intellectual innovation and the ability to use this groundbreaking capacity to generate economic wealth, social prosperity, and geopolitical influence. Each of these regions has been characterized by two or more ‘world cities’ that mirror each other, a maritime or riverine geography, and

The Art of Systems a precocious ability to trade, communicate, and project themselves over long distances. Each region has developed a portal character; that is to say, each is an intensive importer and exporter of one or more of the following: goods, money, people, or information. A condition of this is that each develops porous systems that complement more conventional social systems based on rules and hierarchies.

PORTAL SOCIETIES Porous systems, especially those with global reach, emerge where a society is good at encouraging designing intelligence. Portal societies are characterized by powerful cultures of design that are proficient in deploying the morphological resources of the commons. Beautiful, elegant, fair, efficient, and economic structures and processes are created by acts of design. Design represents a distinctive mode of economic and social production, distribution, and interaction. Designing intelligence finds its epitome in high-level arts and sciences. The pursuit of aesthetic beauty and mathematical elegance mirrors the pursuit of lucid laws and social fairness. A recurring characteristic of portal city regions is the creation of order by design. Order by design, a key part of the art of systems, facilitates the long-distance, cross-cultural reach of portals. To do this, it reduces the grip of rules and hierarchies in social organization in favor of aesthetic self-organization. The latter is crucial. For aesthetic self-organization stimulates tacit and explicit innovation. Beauty and its many synonyms (e.g., mathematical elegance, social symmetry) are key drivers of social reform, systems development, product creation, machine efficiency, and so on. (For a discussion of beauty’s role in machine and product development, see Gelertner 1998.)The same thing that animates social and economic creativity propels great art and science, and creates great urban centers. Here we see the underlying symmetry between designing intelligence, the historic concentration of world-class arts and sciences in portal regions, and the economic wealth and aesthetic order of their cities. Common to all is the power of beauty. Portal zones include historic cases like the fifth-century b.c.e. Aegean and Black Seas (Athens), the Renaissance Mediterranean (Venice), and the seventeenth- and eighteenth-century North Sea (London, Amsterdam, and Edinburgh). The modern age saw the development of powerful maritime city-regions in the New World, notably the pseudo-sea regions (the East Coast, Great Lakes-Hudson region, and the California coast) and littoral cities (Boston, Chicago, Detroit, Toronto, New York, and San Francisco) of North America, the urban coastal cities and “beach civilization” of Australia, and the islands of New Zealand (on the Australian case, see Murphy, 2006). The nineteenth and twentieth centuries saw the rise of the China Seas region, and the emergence there of a series of insular and peninsula societies—Japan and more recently Singapore, South Korea, and Taiwan—that have accumulated high levels of intellectual capital and have developed impressive technocratic cities. Like all other species of society and economy, portal regions include interesting cases of failure, and also of triumph over failure, such as the following: • •

The dashing of Thomas Jefferson’s hopes that the Mississippi–Gulf of Mexico–New Orleans region would become an economic powerhouse in the nineteenth century. The faltering attempts to reenergize the Mediterranean in the same century as the territorial power of the Russians and Ottomans broke the tissue of connection between

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•

•

•

the Mediterranean and Black Seas, and oceanic power finished off the Mediterranean city-states. The swallowing of the riverine city-states and principalities of Europe by French and German territorial power in the nineteenth century, and the splitting of Baltic and maritime East Asian economies by Soviet and Chinese Communist territorial power in the twentieth century. The reemergence of older portal regions—the Mediterranean (Northern Italy and Israel) after 1945; the renaissance of Black Sea and Caspian Sea zones and the reunification of the Baltic after the end of the Soviet Union, reorientating historically intellectual capital–rich coastal societies (e.g., Lithuania and Estonia) to their littoral near-neighbors (e.g., Finland); and the reemergence of the south coast of China as a powerhouse with complex relations to its insular twin, Taiwan, following the partial retreat of state socialism in China. The latter-day resurrection of the Gulf of Mexico as a major portal region structured around the Houston-Miami littoral arc, its oil-sea industries, and high-tech space industries.

The ups and downs of these long-term, large-scale processes are well-illustrated by the case of the rise and fall of the large mainland-dominated Communist states in the Soviet Union and China. The resulting capitalist-communist geopolitical bipolarity disrupted historical patterns of sea ecumenes in the Black Sea, the Mediterranean, the Caspian Sea, the Baltic Sea, and the China Seas. Since the end of the Cold War, older and arguably more powerful patterns have come back into play. Studies measuring innovative capacity (measured by expenditure on research and development and production of patents) indicate that the emergent cohort of economic innovators (those that have appeared in the period since the late 1980s) are all littoral entities bordering these old sea regions. Porter and Stern (2001) point to major gains in innovative capacity made by Denmark, Finland, Singapore, Taiwan, South Korea, and Israel. They predicted then that Ireland was in the process of joining this littoral group. It is also notable that three of the four countries (Japan, Sweden, Finland, and Germany) that have lifted their patentable level of innovative capacity consistently over the past quarter of a century are littoral states on the bounds of the Baltic or China Seas. Sharp observers have noted how with the demise of the Soviet Union “a new Hanseatic League” began to develop. This is “an emerging regional commercial trading zone, stretching as far as Hamburg and Copenhagen to the west, Oslo and Stockholm to the north.” The eastern anchor of this zone is the twin cities of Helsinki and Tallinn, located a ferry ride across the Baltic Sea (McGuire, Conant, and Theil 2002). Such twinning or mirror cities are very typical of these powerhouse sea region groupings. As in the case of Israel, Finland, and other budding innovators, at the end of the twentieth century information technologies and telecommunications have played a leading role in the reemergent zones. However, one should be careful not to overidentify formative power with any particular technology, system, or process. In all of the cases, deeper structural forces are at play. In all portal regions characterized by persistent and high levels of innovation, procedural rules and social hierarchies are (partly) displaced by aesthetic structures or tacit self-organizing forms of order. This is conditioned by the fact that portal societies are all involved in long-haul trade. Sea or riverine carriage, and long-distance trade, shapes the nature of portal regions by virtue of one telling condition: The greater the distance is, the less effective are hierarchies and rules in ordering human transactions. One of the results of this is that knowledge in the strong

The Art of Systems sense of the aesthetic or art of systems has an incipient tendency to replace hierarchies and rules under portal conditions. This has important spin-offs, one of the chief being that portal city regions are excellent milieus in which the arts and sciences develop. This helps to explain the role of the arts and sciences in the political economy of portals, and the high level of creativity often characteristic of them. A classic case of this is historic Königsburg, on the far eastern side of the Baltic. This old port and university town not only produced Immanuel Kant but also Hermann Minkowski (the geometer who provided the mathematical basis for Einstein’s theory of “spacetime”), Theodr Kaluza (whose geometry laid the foundation for string theory in physics), and Hannah Arendt (one of the two or three great political philosophers of the twentieth century). Copernicus came from the nearby port town of Frombork. Think also of cases such as fifth-century b.c.e. Athens or twentieth-century New York City. Why do these places have such a high incidence of creativity? The phenomenon can be explained in part by the dense, unsocial, and mobile nature of portal cities and their populations of strangers who lack thick social ties. Aesthetic ordering, key to creative acts, is favored under such conditions. Political context also has implications for the power of aesthetic ordering. The most crucial factor is that city-regions are not nations. To do what they do, they must operate at least to some extent outside of national-territorial procedural institutions and network systems, and equally also outside of the bureaucratic hierarchies of patrimonial states. Hong Kong’s special administrative status vis-à-vis the People’s Republic of China is a classic example of the latter. The Pearl River delta today produces 10 percent of China’s gross domestic product and 40 percent of its goods for export. This is directly a function of Hong Kong’s special—that is, “odd”—status. Portal city regions flourish where the states or legal systems that they are embedded in are odd, at least in contrast with conventional nation-states and patrimonies. Often these are states that are federations, commonwealths, or unions of states. Examples range from the seventeenth-century Dutch Republic and the United States to United Arab Emirates and its mercurial portal of Dubai. Such states are based on devolved power, divided power, or separated power. In other cases, the power of portal states is enigmatic. They rely on tacit unwritten constitutions (like Great Britain) or on a pervading sense of anonymous power (like Japan)—or else they are states that are cities (historic Venice, Singapore); states that have been divided in half (South Korea); or states that are claimed as provinces of another state (Taiwan). In some cases, portal city regions, like Japan’s KobeOsaka-Yokohama-Tokyo conurbanation, dominate the surrounding nation-state. In short, powerful portals are different. They obey the law of the state yet have a life that is quasi-independent of it. Portals, though, do not just replace one kind of law for another. What makes portals truly different is their capacity to replace social rules and hierarchies with an intuitive aesthetic order. This has enormous consequences, not least because the resulting morphology of portal city-regions typically embodies an emphatic sense of form, and this in turn encourages visual, intuitive, and pattern-style cognition that is essential for high-level creative action. Let us examine how such aesthetic order emerges.

EMERGENT FORMS When a portal city begins to act as an intermediary between its manufacturers and foreign cities or between its countryside and foreign cities, or simply between foreign cities,

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Cross-Cultural Perspectives on Knowledge Management it becomes a foreign commerce city. People bring their goods to the intermediary—to the portal—rather than trading directly because of the concentration of intelligence in the portal city. A classic example is the cotton trade in the American South before the Civil War. By 1830, 40 percent of the receipts of that trade flowed to New York City for freight, insurance, commissions, and interest (Miller 1968). This is a consequence of the fact that in any production or distribution system, organizational capacity, logistics, and inventiveness over time acquire a progressively greater role in contrast to land, labor, energy, and physical capital. Portals concentrate such capacities. Intelligence in the most general sense means the capacity to make better-than-chance choices. Portal cities are intelligence centers. Portals function as intelligence centers in a number of different ways, ranging from the simple to the complex. Let us consider briefly these four levels or stages. At the first stage, portals collect and disseminate information about prices, environmental conditions, availability of transport, assessments of political risks, maps, stories of expeditions, warnings of invasions, and so on. Such information is a response to uncertainty. The more uncertain the world, the greater is the demand and the need for information. Uncertainty creates contingency—possible or alternative ways of acting are projected in order to meet uncertain conditions. Intelligence at the second stage is the ability to think effectively about contingencies and to evaluate possibilities (what might be done), without fear or panic or irrational exuberance. Limited intelligence, typical of societies with thick cultures, assumes a more or less fixed number of alternatives. Expansive intelligence, typical of societies with thin cultures but high cognitive thresholds, encourages unconventional conceptions of what might be done. The third stage of intelligence rests on the capacity to be able to locate events, contingencies, and choices in the context of large-scale and long-range patterns and structures. Contextualization relies on pattern recognition. This requires theoria—the ability to be able to step back and think theoretically about events and contingencies, which means being able to intuit the deeper structural forces and morphologies that shape surface events and contingent situations. The fourth stage of intelligence is innovation/creation. This kind of intelligence is not to be confused with reflexive projection and evaluation of contingencies. Future thinking, involved in puzzling about contingencies, underpins adaptability to contextual change. But changing actions or the rules of action to master contingencies is not the same as fundamental creation/innovation. Fundamental creation/innovation is a function of emergent forms. The highest stage of intelligence is the capacity to give form. This is the most difficult and the most mysterious kind of intelligence. It is very powerful but rarely in evidence. It is the kind of intelligence that is called upon when social systems are threatened with chaos. This kind of intelligence creates new scientific, technological, economic, social, organizational, intellectual, and cultural forms. The creation of new forms is rare but extraordinarily important (Castoriadis 1997). Where do such forms come from? That is a difficult question to answer. But one thing is clear: portals have played an exceptional role in the history of creation. In antiquity, the Mediterranean ecumene was a generator of a remarkable array of forms. The Silk Roads–Caspian Sea ecumene was the incubator of the most vital developments in Arab

The Art of Systems and Islamic thought. The China Seas ecumene today produces the most enterprising of Asian social forms. The Baltic Sea was a driving force of commercial innovation during the European Middle Ages (Parker 2004). The Mediterranean revisited its massive formative power during the Renaissance and early modern era. The North Sea–Baltic Sea ecumene became the crucible of European and global modernity from the sixteenth through seventeenth, eighteenth, and nineteenth centuries. The greatest form-generating powerhouse in the nineteenth century was the Great Lakes–Hudson ecumene that linked Chicago and New York City. In the second half of the twentieth century, this leading role gravitated to the coastal ecumene that linked San Francisco’s Bay Area with Los Angeles and San Diego. Much of the enduring strength of the United States derives from its unprecedented command of not one or even two but of multiple portal city regions ranging from the Baltimore–Boston seaboard through the Great Lakes–Hudson region, the Californian coast, and the crossborder Seattle–Vancouver ecumene to the liquid arteries of the vast Mississippi–Gulf of Mexico–Floridian Peninsula zone. Notably, whenever one of these regions declines, another rises in its place. As the power of the post-1945 postindustrial economies of the California Coast and Puget Sound dipped around 2000, the slack was already being taken up by Florida and Texas, as flows of population and investment accelerated toward the inverted Y centered on Houston and Miami. In 2000–2005, the largest seaports in the United States were New Orleans (“South Louisiana”) and Houston. These were ranked fourth and sixth internationally—competing with Rotterdam (first), Singapore (second), Shanghai (third), and Hong Kong (fifth) (see Geohive n.d.). The election of Texas Governor George W. Bush as U.S. President in 2000 was driven by population growth in Florida and Texas. This population growth was matched by a flow of businesses from California, the dominant economy of the 1990s. (For a discussion of the export of business and people from California to Florida, see Kotkin 2005.) The signature of this shift was the growth of intellectual capital concentrations in the southern U.S. littoral relative to California or the North-East. The dynamic of portal cities is well exemplified by Chicago, on the Great Lakes (Miller 1996). In the nineteenth and early twentieth centuries, Chicago created a startling array of new economic, social, and intellectual forms, including futures trading in commodities, the modern office (based on a combination of telegraph, filing cabinet, and typewriter), the assembly line packing plant, the iron-frame skyscraper and the modern vertical city, the balloon frame for domestic housing, the mail-order business,1 modern marketing techniques (the introduction of the sale and the bargain, and active stimulation of customer trust and loyalty), the idea of the city as a conference center, and the first truly great school of American sociology (the Chicago School). Chicago also cocreated the only species of indigenous American philosophy (Pragmatism). In the twentieth century its premier university, the University of Chicago, was domicile to more than 70 Nobel Laureates, mainly in physics, chemistry, medicine, and the economic sciences. The movement from information through contingency, order, and innovation can be thought of as the life cycle of intelligence in the portal. Two additional conditions, however, are prerequisites for the concentration of intelligence in the portal, both spatial in nature. The first is topography. Portal cities typically arise in locations that are poor for agriculture or do not have sufficient raw materials for self-sufficient manufactures.

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Cross-Cultural Perspectives on Knowledge Management These are cities built on thin strips between coast and hills, on deltas, drained marshes, or on islands. They arise in topographically difficult places. The development of collective intelligence is a compensation—and substitution—for the lack of conventional resources or factors of production. The portal creates advantage out of disadvantage. The second ulterior condition of the concentration of intelligence in the portal is that such cities have a strong sense of the sculptural. The denizen of the portal city is inclined to see the world as a plastic place. Portals are characterized by a distinctive combination of lightweight media and of plastic media. The life cycle of information, contingency, order, and innovation is driven by a response to the human condition of uncertainty. Let us call this the cybernetic cycle. Much of this process unfolds through the kind of lightweight media whose creations are portable and ephemeral—as one might expect where the driving force of the process is uncertainty. However, toward the higher end of the life cycle, as order and structure become more central to outcomes, plasticity and sculptural qualities become increasingly important drivers of collective intelligence. At this point, the civic and architectonic qualities of the portal emerge as a central feature of the cybernetic cycle.

INFORMATION AND UNCERTAINTY Information is a response to uncertainty. Human beings seek out information when they are uncertain. (This is not to say that they necessarily seek out challenging information; indeed, probably most often they look for information that is reassuring or comforting in the light of uncertainty.) Thus, a traditional village has a relatively low need for information. Its members typically never travel outside a radius of 15 or 20 miles, and their lives are ruled by the local forces of custom and the seasons. Of course, from time to time such societies will be subject to unpredictable events like wars and invasions, about which they will want to gather reports. But in the traditional agrarian society of this kind, such contingent events are exceptional, whereas in the case of a long-distance mercantile society, the need to respond to such events is an everyday occurrence. On a spectrum of societal types—from the agrarian to the industrial to the long-distance trading society—the last has the highest demand for information simply because it experiences higher levels of doubt on a regular basis and must master the resulting ambiguities and contingent choices. The wider the habitual scope of the transactions and traffic of a society, the greater is the experience of uncertainty and contingency. A society that conducts a high proportion of its transactions and traffic over long distances—either on a regional or global scale—multiplies its exposure to sources of uncertainty. Not all or even a majority of these uncertainties will be negative. However, simply by virtue of being uncertainties, they produce information needs. If stock markets plummet, war is declared, there is a virus outbreak, or some business teeters on the brink of bankruptcy, such events generate uncertainty. Demand for the production and transmission of information follows such events. Information is an attempt to answer the question “How can I orientate myself in this situation?” This kind of question has a high cognitive weighting. In contrast, in the village society, uncertainty generates questions with a high affective content. Uncertainty, in other words, triggers both affects (fear, alarm, and panic) and cognitive emotions (curiosity, interest, and attention). In traditional settings, uncertainty is ultimately

The Art of Systems resolved by the assertion of hierarchical order (often in the form of patrimonial structures). In modern societies, uncertainty generates demand for procedural guarantees— rules governing how we proceed. The model of such rules or methods emerges from the regulation of movement or procession across space. Thought anticipates (plans for) events. It constantly seeks information so it can make plans. Plans are possible because events can be correlated—on the X and Y axes of a Cartesian graph: “If X happens, then we can do Y to compensate.” Uncertainty in this case is resolved by being able to think about the paths of things through space as they cross and cause events in time. Methods, like the railway network timetable or the television network schedule, emerge to regularize these crossings. Procedural institutions, from government departments to commercial corporations, take shape around these methods. In the case of portals, uncertainty tends to be resolved in part through methodical network correlations, but also sometimes by the very opposite of the methodical approach—that is to say, uncertainty is resolved by paradox instead. Paradoxes are a path through complex or ambiguous situations in which the ambiguity of tension-filled contingencies is resolved into the ambidexterity of living with opposites. Paradox is a meta-cultural way of dealing with contingency. Thinking by paradox means that emphasis is placed less on if-then rules and methods—and more on the conceptual union of opposites. Immanuel Kant, in the conclusion of his Groundwork of the Metaphysics of Morals (1964), observed that the most demanding kinds of thought end in paradox. More specifically, he was arguing that there was no ultimate distinction between freedom and necessity. This is the mentality of the portal—for what it imports, it exports. Its thought is revolutionary—circular like a paradox. We begin with freedom and end with necessity that leads us back to freedom. Information is raw material for such Tao-like path making. The question of where the next concentration of intellectual capital might emerge was raised in Pauleen and Murphy (2005). The legacy of Taoism, especially its feeling for paradox and its geographical footprint, gives some hints about the cognitive mapping of the future. This theme is taken up in Murphy (2005c) and in Murphy and Hogan (2005). The greater the scope of human action is, the greater is the demand for information. Demand for information is a response to the uncertainty caused by enlarging the ambit of action. Information can be produced and transmitted in a vast array of genres—letters, documents, news reports, memoranda, analytic reports, commentary, official reviews, legally prescribed reports, and so on. Such information can also be produced and transmitted by electronic means. Electronic means of transmission have existed since the invention of the telegraph in the middle of the nineteenth century. Wireless media (broadcast radio, television, and mobile devices) and wired media (the Internet) in the twentieth century expanded the scope of instantaneous transmission, but not its fundamental nature. (Think of the innovative combination of telegraph, filing cabinet, and typewriter in the emergent form of the modern office in Chicago in the 1870s and 1880s: the office computer of the 1990s was only a fusing of these three functions into one machine combining digital transmission, electronic filing, and the keyboard.) Alternatively, information can be transmitted physically like any other commodity. Books are shipped, hard copies of documents are couriered, letters are carried by the postal system, and government reports are warehoused. The carriage and storage of information creates an economy. The foundation of this economy is uncertainty. Thus, much—perhaps most—of what is produced and

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Cross-Cultural Perspectives on Knowledge Management disseminated by this economy has little lasting value, and indeed much is redundant before it is ever stored or transmitted. Information is created and carried in response to an event, or a series of events. After an event is reported or analyzed, it is rare that anyone at a later time returns to the report or the analysis. Indeed, often the real value of information lies not with any particular item of information but rather in the way that the process of its production and distribution satisfies the demand for information and does so independently even of the content of the information. The board of a company in financial crisis will commission a strategic review, or a government faced with failing military power will commission an inquiry. But little beyond the executive summary of these documents will ever be read, and even those abstracts will not necessarily or even normally be acted on. In such cases, the process of creation and distribution of information satisfies demand for information without anyone ever caring what the report or document says. Looked at from this perspective, information is an index or measure of uncertainty in social situations. It is a bellwether of social anxiety and social curiosity. The demand for information is a response to the unknown or the unpredictable. To produce a statement that it will not rain tomorrow in the desert is a statement that has little or no information value. We already know that there is little risk of this happening anyway. Rain is an event that can and does occur occasionally in a desert. But such an event occurs within a known probability distribution. It is possible, but the probability is low that it will rain in the desert tomorrow. In contrast, if someone reports that tomorrow it is likely to rain in the desert, then that is a statement that deals with an event. Such a statement has some value, albeit of an ephemeral nature. The more the world is surprising or unpredictable, and the more it is filled with irregular events, the greater the demand for information. A world in which deserts are swamped with rain, the tropics are parched, temperate zones are frozen, and the icecaps are melting is a world starting to border on chaos. Such a world would be filled with the maximum amount of information, but this is not a world we would want to live in. Yes, artists from time to time play with the idea of the chaosmos, but this is a thought experiment. Those facing uncertainty demand information in the expectation of reducing uncertainty and with it the prospect of chaos.

CONTINGENCY AND ORDER How does information, generated by uncertainty, reduce uncertainty? It does so by helping to establish what has happened (report), and what has caused what has happened (analysis). Information conveys something not already known. Information does not always in itself alleviate the feeling that the world is chaotic. Reports of the free-fall of a stock market may induce a strong perception that the world is disordered. But information does nonetheless provide the raw material for the production of orientative knowledge—knowledge for devising a pathway around an unexpected event, and subsequently for understanding the causality of events and the way in which most events (that about which we are uncertain) are not purely random but have structural causes. To understand the structural causes of events, we must understand structures. We need to be able to show how events and actions take on recognizable patterns, shapes, and figures. Let us consider the first aspect of orientative knowledge—that of finding strategic pathways through and around events. It may surprise us to find out that it is raining in

The Art of Systems the desert. Possessing this item of information does not change the surprising nature of the event, but it does prompt us to formulate yes/no responses to the situation—to treat the event as something that poses contingencies that we have to decide between. Physical events, market events, and political events cause us to reorientate the course of our actions. If we hear reports of rain, we might have to decide whether to continue our planned journey into the desert until the event is over. Information—as the apprehension of uncertainty—presses us toward the formulation of contingencies. It does this because information is always an answer to an implied or actual question (query). An answer to a question carries information to the extent that it reduces the questioner’s uncertainty. A report that it is raining carries an implied question: viz., when will the event—the departure from regularity—be over (“When will the rain finish?”). When we pose that question to ourselves, we also pose the question of contingency: “Either we will stay put or we will continue with our trip.” Contingencies are alternatives, or choices, that we must decide upon. We can plan for contingencies. (“It might rain even in the desert—what do we do if it does rain??). But the “what if?” question—entertaining as that question is—rarely anticipates actual events. So we are left with surprises in light of which we must formulate new or adaptive courses of action. Portal societies are faced with contingent choices all of the time. In a metaphorical sense, any society that interacts with temperate, tropic, desert, and arctic zones at a distance is bombarded with surprises to the point where surprises are no long surprising. In such societies, orientating quickly and devising pathways that reduce both uncertainty and the flow of incoming information that results from uncertainty is at a premium. If uncertainty is not reduced, chaos results, both at the level of social and economic action and at the level of information (too much information creates its own uncertainty, viz. “Which item do I choose to read first when I have limited time?” and “Which items shall I ignore?”). As important as the ability to make contingent choices in response to uncertain situations is, there is still a yet more important operation that must accompany this at a higher level: the capacity for pattern recognition. Pattern recognition allows us to determine whether events belong to an underlying pattern. In performing this operation, we answer questions such as “Is rain in the desert an anomaly, or is it consistent with known probabilities, or is it indicative of a long-term change in climatic patterns?” What pattern recognition supposes is that physical, social-historical, and even divine events have an underlying order—that is, they are organized into systems. This does not preclude asystemic behaviors. Unpredictable physical events occur, political events remain surprising from time to time, markets on occasions rise and fall erratically, and fate can be arbitrary. However, the human capacity for pattern recognition is built on the natural fact that surprise is the exception rather than the rule and that the world is fundamentally orderly. More perplexing is the fact that the world may be orderly even when it does not appear to be so. The sudden death by suicide of a loved one may be a shocking event that “makes no sense,” but the joyless science of sociology nonetheless may well tell us that the person who has taken their life was a member of an at-risk group characterized by high levels of suicidal behavior. (Contemporary methods of data mining do exactly the same: They can predict that a customer who has a certain financial and credit history, and a particular social profile, and who buys a certain garment at a particular time in the cycle of the financial year, has a high probability of defaulting on

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Cross-Cultural Perspectives on Knowledge Management their credit payments.) Identifying a deceased person as belonging to a high-risk group may be little comfort to those who have lost a loved one, but it nonetheless underlines the fact that even events to which the labels “surprise” and “shock” are attached often belong to probabilistic or normative orders that are actually quite deterministic. The world has its stochastic and existential moments, and possibly even its miraculous moments, but we do not live in a stochastic world. Such a world would be chaotic and ultimately entropic. We cope well with, and even do interesting things with, occasional stochastic events. Some theories of artistic and personal freedom rate stochastic behaviors very high. But in reality it is the human capacity for perceiving order and producing emergent forms that is the real foundation of human freedom and creativity. To experience the world as chaotic is ultimately not a liberating or productive experience, except in small doses or at historically decisive junctures. Significant continuing levels of disorder generate entropy and decreasing levels of social and physical energy. In short, disorder is exhausting. Structures, in contrast, are energizing—though of course many so-called structures are nothing of the kind and are in fact chaos in the making. But where there is real order, which is characterized by beautiful, elegant, and economic forms or systems, brilliant things can be produced. Order should not be confused with rules or norms, protocols or procedures, customs or rituals—any more than knowledge can be equated with information. Rituals and rules at some level are generated or shaped by the forms that give us structure and order. They are the secondary or tertiary phenomenon of this order. Order can be best understood as an abstract figure or design, as a pattern. Order is the shape around which social structure and organization is built up.

SOCIAL GEOMETRIES From a social-historical point of view, order allows us to act in the world, to anticipate how we will act, and to understand retrospectively how we have acted. Referring strictly to the social-historical domain, here I distinguish between three fundamental kinds of order—order based on hierarchies, networks, and navigations. (See also Murphy 2003: this schema extends the typology of hierarchical, dynamic, and civic orders developed in Murphy 2001a.) These orders reflect different degrees of extension. Navigational orders extend the greatest distance, networks less far, and hierarchies least far. (For a discussion of the ethics of navigational orders, see Murphy 1999.) Hierarchy is a one-dimensional order. We can sketch a hierarchy by penciling a series of vertical dots and connecting the lines between them, and then branching further dots and lines (nodes and paths) from the initial set. We can build up a complex social and organizational structure around that diagram. In the social-historical domain, traditional, customary, and patrimonial orders are species of hierarchical order. We all recognize such social forms, even in their adaptive modern versions, where organizational hierarchies have largely though not completely replaced personal and traditional kinds of hierarchies. From the consensus-producing hierarchies of the Japanese company to the party bureaucracies of Mainland China, from the patron–client hierarchies of most of the world’s poorer states to the Fordist hierarchies of the modern procedurally driven departmentalized corporation, most societies still order many, and in some cases most, of their activities in an up and down manner.

The Art of Systems Yet, hierarchy is not the only kind of order. In the modern age, two-dimensional social geometrical forms have partially overtaken one-dimensional forms. Imagine that we take lines (paths) connecting dots (nodes), and we connect together those lines. We thereby create two-dimensional plane figures, representing things such as fields, windows, and tables. Field, window, and tabular images are central to the modern imaginary. (Correspondingly, many of the radical critiques of modernity end up being restatements of the logic of plane surfaces; see, for instance, Deleuze and Guattari 1987.) The pervasive late twentieth-century metaphor of windows, which accompanied the spread of information technologies, is an apotheosis of this kind of order. That is to say, not tree hierarchies but plane figures are the most common way that moderns have of both ordering and representing figuratively the world around them. Windows, mirrors, frames, maps, and facades dominate the modern social geometrical imagination. They do so because they embody the equality of the plane surface. They are structured, not up and down, like the levels of a hierarchy, but from side to side, as if on the plane surface of a billiard table. One of the early historical examples of the planar type of order was the ethos of the seventeenth-century English levelers. This was followed in the eighteenth century by the imagining of the world in two-dimensional longitudinal and latitudinal terms. The introduction of new worldviews is always a slow process. For example, convincing English royal science of the day of the validity of the planar representation of space proved quite difficult—because it conflicted with the hierarchical impulse to want to look upward to the stars (the heavens). Navigators liked the idea of longitude, but science preferred an implicit hierarchical order of steering by the stars. In this case, the planar conception eventually won out over the stargazers. But hierarchy never disappeared as a fundamental ordering principle. It merely took on new appearances. Hierarchies imply tight connections with powerful forces. The type of connection over plane surfaces is less intense. Plane surfaces are conducive to network connections. As things move across a plane surface in different directions, they cross paths, eventually composing a net-like pattern across the plane. In social action, such interactions on a field are organized by rules or plans for proceeding. This is what modern law does; it is also what democratic and organizational procedure does. They allow for orderly interaction on a field. They establish coordinate relations across planar surfaces. These relations mirror the equality of the planar surface as opposed to the hierarchy of an ascending-descending chain of being. The methods of flat organization, “one vote, one value,” and “one law for all” are all expressions of such planar equality. These images of order permeate the world. Take technology as an example. The desktop of a contemporary computer is without rank order, whereas the hard disk of a computer is normally organized around arboreal tree structures and nested hierarchies, as are the information architectures of institutional local area networks. Yet if we take a step beyond this level, and look at the technologies of inter-networked computing, we discover a different kind of order—the order of reconnaissance or navigation—where one cannot move using hierarchic cues or planar directions because of the scale of internetworked worlds. Navigational order as a consequence dominates the world of internetworked technologies. The nature of this order is to encourage movement in and around. Its key technologies are search technologies. Its organization is neither linear nor planar. It has a kind of plastic character—or at least, in the informational realm,

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Cross-Cultural Perspectives on Knowledge Management the virtual equivalent of three-dimensional plasticity (Murphy 2005b). To understand this, imagine if we take a number of plane surfaces and bolt them together. In doing so, we create stereometrical objects (three-dimensional objects) that bodies (other threedimensional objects) move around. We also create three-dimensional spaces that bodies move through. This is the essence of a navigational order. Hierarchical orders operate most effectively at high intensity over short distances. Network orders operate most effectively, at lesser intensity, over medium distances— such as within the borders of a nation-state. Navigational orders operate with minimum force over long distances. We can think of this in geopolitical terms. Hierarchies are most effective over localities. Correspondingly, big-scale hierarchies often have difficulty administering what is most distant from the root of the hierarchical structure. (The classic examples are the collapse of premodern empires into feudal hierarchies or else into competing warlord ruled territories.) Networks seem best disposed to national or continental scales. If we think of modern network building—the railroad and telegraph, and later telephone and broadcasting networks—their natural scope seems to be medium-scale territorial space. Hierarchies generate strong, but limited, connections, often of a personal kind and often regulated by ritual, custom, or loyalty, as well as by command. Network orders generate wider but less stringent connectivity. Network orders cluster human beings into associations rather than communities. Associations put human beings together in a lateral rather than vertical manner. They rely less on ritual, custom, and command than hierarchies do, and more on legal rules, procedures, and indicative guidance (i.e., policy). Modern organizations are frequently a hybrid of hierarchy and association. Modern organizations appear once systems have to be managed over national scale distances. Before that, family or patrician or party hierarchies could effectively coordinate actions. As and when these failed to translate satisfactorily to national or global scale, bureaucratic hybrids emerged. Modern bureaucratic hierarchy is a compromise between hierarchical and network forms. (Professional worlds are a similar hybrid: They encourage lateral transactions—for example, the national conference—but jealously guard tacit hierarchies of authority in the guise of reputable sources, journals, speakers, and the like.) Such hybrids allow action at a distance to be combined with smaller scaled features such as personal affiliation to bosses. Employees remain governed by local hierarchical structures while operating at large through contractual, contact, professional, peer, cross-departmental, interorganizational, and strategic-coalition networks. The network society is not a recent development. This is contrary to the view of Castells (2000) who regards the network society as a product of the explosion of information technology in the latter part of the twentieth century. The fact, though, is that this explosion piggybacked on existing network technologies (the U.S. and British phone networks in the first instance) which themselves descended from nineteenth-century American and British models of communication and municipal utility networks. Modern oceanic empires (the Dutch and the British) were effective in part because of their ability to develop functioning networks across the face of the globe. The purest example of the network society developed in the United States (Murphy 2004). This society has a strong lateral, associational dimension underpinned by legal and procedural norms. The network society is also a legalitarian society with strong planar characteristics. We see this inscribed in Thomas Jefferson’s legal device to subdivide all U.S. territory into

The Art of Systems a gridiron pattern. This checkerboard geometry with its network of intersecting lines was infinitely expandable across two-dimensional space—the type of space of the U.S. Geological Survey mapmakers for example. Underlying this was a simple equation: Law plus grid equals a dynamic society. As Jefferson anticipated, American power expanded from coast to coast, across the continent, and then beyond. It did so via networks. One of the greatest of these was the riverine network opened up by Jefferson’s purchase of the Louisiana Territory from the French. This enabled a commercial web that extended along the Mississippi River eventually from New Orleans to the Great Lakes, upward to the Gulf of St. Lawrence and downward along the Hudson River to New York City. Land networks (the railroad and the telegraph) followed. Eventually, these networks began to expand across the oceans via civil communications (first cable, later wireless and satellite) and by the strategic dotting of U.S. military bases across the globe. Networks are effective for coordinating action over the medium scale. Their effectiveness declines on the larger scale. A union of 50 states may constitute an effective federal network over a continental scale—but a union of 500 states over a global scale is inconceivable. It would simply be entropic. Even with its strategic networks and its networked alliances, U.S. military intervention worldwide can be effective only intermittently and for short- or medium-term durations. Similarly, think of the example of the original networking of computers in the ARPANET project of the 1960s. The U.S. Defense Department’s Advanced Research Projects Agency (ARPA) funded projects in the 1960s to network university computer labs. The principal figures in this research were J.C.R. Licklider and Larry Roberts. They worked out how to connect machines over a telephone network, solving especially the routing problems involved because of the large number of connections opened up by even a simple network. Paul Baran from the RAND corporation and British telecom engineer Donald Davies worked out the idea of sending messages around these networks not via continuous analog channels but via discrete, reroutable, noncontinuous packages of digital information. That was a very powerful extension of network geometry to computing. However, in the era of inter-networking, when networked computing was extended (through the amalgamation of networks) beyond a continental scope, a new logic overtook that of networking—the logic of navigation, in which searching and reconnaissance began to supersede the practice of strict networking. In the 1970s, Vinton Cerf and Robert Kahn devised the Transport Control Protocols (TCP) for networking different networks. Navigational logic is not primarily a logic of status (“here is my place”) or one of reasoning (“if X, then Y”) but rather one of morphology. It is an aesthetic logic. Successful searching through a google-sized quantum of data requires being able to recognize patterns. In a parallel sense, human creation (and quite probably natural creation as well) take forms (aesthetic patterns) and transforms them (Thompson 1961). A word of caution: There is nothing new about navigational order. It is as old as port cities. If we think of a society as a vertical branching line that converges on a root, or a network as grid, or lattice, or hatching of lines spread over a plane surface, a navigational order, in contrast, has a third dimension—that of depth. Navigational space is full of bays. It is convex/concave space. It is plastic space—space that is moved through and around. It is space that is entered and exited. It is recursive space in the sense that it is rotated through. It is the space of eternal return (Murphy 2001b).

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Cross-Cultural Perspectives on Knowledge Management Navigational orders are so called because of the load that they place on cognitive orientational competencies and emotions. In a hierarchical or network order, it is relatively easy to find one’s place. The symptom of the breakdown of an order is the systemic inability of agents to find their place. Hierarchies have lines running through connecting nodes from top to bottom. Webs, lattices, grids, and other network structures have high levels (redundant levels) of connectivity. Navigational orders happily employ elements of hierarchical and network forms. But they do not rely as heavily on connectivity as the other two do.2 To orientate and to structure movement, they use devices that are more abstract in a plastic sense. Navigational orders use high-level design features to structure movement and orientation, such as scale, proportion, contrast, symmetry, rhythm, and balance. These are pattern-forming geometric properties that the human brain readily recognizes even when it cannot necessarily describe the geometric properties underlying the forms. Knowledge of these features is usually tacit rather than explicit, but no less powerful for that. Scale, proportion, contrast, symmetry, rhythm, and balance apply to all aspects of the world—linguistic, visual, auditory, tactile, olfactory; aesthetic, intellectual, social, economic, political; organizational, associational, and customary. These pattern-forming properties play a role in hierarchical and network orders. Hierarchies can be structured to branch symmetrically; the grid is an example of the highly (almost inertly) symmetrical organization of a web. But it is under conditions of three-dimensional order that pattern-forming geometric properties take on an emphatic role. Think of the everyday act of walking down the street. We move through (navigate) a world that is filled with solid geometrical objects. We may know we are walking along a grid because we are used to looking at maps of gridiron streets, but we actually orientate ourselves by observing around us the literally thousands of patterns created out of scale, proportion, contrast, symmetry, rhythm, and balance (and the calculated departures from these).

RECURSIVE OR CIRCULAR KNOWLEDGE Exactly the same thing applies to knowledge. When we take the simplest of data and start to structure it, we create objects that we must navigate. Taped voice messages, video clips, letters, reports—indeed any information-carrying entity—must be navigable if it is to have any force. Its force is its navigability, and its navigability is the effect of its lucidity, the power of the patterns from which it is composed. Take the example of one informational object—the document. The document is the basis of modern governance. We can build tree hierarchies of documents, and we can link documents into web-like patterns. This was the motivating schema of Tim Berners-Lee (1999) in the early 1990s, when he devised his URL, HTTP, and HTML protocols for linking documents stored on networked computers. However, when we move around the object itself, these types of orderings are helpful only in a limited way. To navigate the object, we need other cues, such as visual symmetry, scale, and proportionality. All information objects, from the microscopic to the macroscopic level, can be organized in such patterns. The letters on a page are made up of contrasting dots against blank space organized in regular ratios. Text on a page is organized symmetrically, or with deliberate departures from symmetry. The size of headings, subheadings, and text on a page is scaled—large, medium, and small size. More complex page layouts utilize the same tacit geometries. Space is divided

The Art of Systems into scales, ratios, and rhythms allowing the eye to easily navigate the page. All of this is conditioned by the fact that the space between the reader’s eye and the surface of the page is three-dimensional space. Exactly the same applies to larger intellectual, organizational, and social systems. Systems can be formed on the basis of properties that allow movement and orientation through space without strong connections. In hierarchies and network models, when connections break, systems fail. To ensure connectivity, systems need sanctions or the enforcement of some kind of law or policy or protocol or law-like agreement. Peer, coalition, contractual, and other network relations are underpinned by rules and protocols. At the same time, the transactions possible for any one node in a network depend on the connection strengths and activity of its correspondents. When correspondents are too close, personal qualities (trust, loyalty, and preverbal understandings) are much more effective than networked association. However, beyond a median point, the greater the distance a system must cover, the more connection strengths will be strained. Thus, for action outside of the middle ground, a paradox presents itself: How can we have interaction without connection? Interaction without connection was the basis of the first markets—I am assuming here Karl Polanyi’s (1977) distinction between local exchange and market exchange, which is carried on over a distance and outside of a given society—when unaffiliated tribes began to trade without actually meeting one another. Fearful of strangers, but wanting goods available outside their kin structure, the first market traders would leave goods at their tribes’ boundaries; these would be collected anonymously and other goods left in their place (Brown 1990). Hermes was the god of this silent trade in archaic Greece. This kind of trade was known in many societies. (For archaic examples of silent trade, see Grierson 1903.) It was probably the first actual instance of global trade in the modern era. As the Portuguese began to pioneer oceanic trade routes, the trade carried on between the Portuguese and populations on the African west coast was conducted initially by silent trade techniques. According to Herodotus (Histories, Book 5), the Carthaginians used similar techniques when they were trading with “a race of men who live in a part of Libya beyond the Pillars of Heracles.” The asynchronous and anonymous nature of the exchange seemed to generate very good outcomes: “There is perfect honesty on both sides; the Carthaginians never touch the gold until it equals in value what they have offered for sale, and the natives never touch the goods until the gold has been taken away.” It is actually possible that some of the tensions of loyalty and network transactions are simply avoided by this system. Hermes was the god of the boundary-crossers (those engaged in various kinds of silent trade) in societies that had strong near-toclosed boundaries. Silent trade began out of the fear of strangers. Ironically, the spaces where it was conducted—at boundaries and crossroads—eventually became hubs filled with strangers conducting silent trade. Eventually these strangers would create their own society—the portal society. Silent trade has taken on many forms through the history of mercantile and cultural traffic. Consider the impact of electronic means of communication in the late twentieth century. The electronic linking of documents stored on networked computers enhanced the degree of lateral access to documents. This was a conventional effect of networking. But electronic linking also expanded the potential for silent trade both in a commercial and intellectual sense. It created asynchronous transactional structures that

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Cross-Cultural Perspectives on Knowledge Management enabled agents to act and react on the basis of information, while machines mediated their transactions. This created a form where agents could act and react not just on the basis of information that they provided each other, but also on the basis of knowledge they acquired of the collective patterns of action and reaction of people involved in these transactions. Data logged as a result of machine-to-machine transactions made it possible to analyze the characteristics of anonymous agents and mine for statistical correlations indicating behavioral patterns—for example, “people who read document X who also read document Y” or “people who purchase commodity N also purchase commodity P,” and so forth. What the aggregation of such data establishes is not the boundaries of a community (of trust) or an association (of peers) but the existence of anonymous collectives of usage, transaction and type. This offers self-reflexive and selfmonitoring understandings of silent trade based on interaction without connection. Decision markets (Surowiecki 2004) are yet another contemporary example of silent trade. These are markets where individuals are required to make a judgment independently of each other. This might be to decide “How many jelly beans are in a jar?” “Who will win the next election?” or “Which stock will perform best?” The mean of these judgments is uncanny in predicting the right answer. Well-run stock markets and elections have a similar propensity to “get it right.” One of the reasons this is so is that decision markets mobilize knowledge without this knowledge being distorted by persuasion. The earliest theories of knowledge, developed by the ancient Greeks, harbored the suspicion that persuasion, far from enhancing collective decision-making, often degraded it. It was sophistic. Arbitrary factors—such as who speaks first or who speaks loudest, as well as the desire to be liked by others or the fear of offending others—deform discursive reasoning. Bad judgments, as well as good ones, communicate well. There are always good reasons for doing bad things. The best, collective decisions occur where decision makers have the greatest independence of each other. The mean of a set of independent judgments is more likely to “hit the mark” than the communicative consensus of experts, pundits, or committees. Decision markets—such as betting on an election or institutions structurally akin to them, such as voting in an election—may occur against a discursive background, but the market itself is silent. Such decision markets in practice are much more accurate in predicting outcomes, and probably a lot better at securing outcomes, than any consensus of experts is. The strength of decision markets lies in the paradox of interaction without connection. Interaction without connection has always been of particular interest to small states, especially city-states based on portal trade, and to economic regions that occupy extraterritorial space (particularly sea space) between large states. Unless they acted imperially, portals and city-states traditionally lacked the ability to administer or control the trade networks that they were dependent on. Some city-states, such as Venice, were forced into empire building to protect and augment their networks. Antiquity was a model for this. The Attic, Hellenistic, and Roman Empires all married hierarchic command structures with lateral networks. The Romans, for example, were brilliant road builders; and they put in place a very effective postal system that carried mail long distance across sea and land. But to control networks, protect them from enemies, and drive their extension, the Romans turned to imperial techniques. This did not mean that Rome lost the capacity for lateral organization. It just combined that capacity with hierarchical structures. But even when city-states were forced into empire-building,

The Art of Systems they also relied on their capacity for interaction without connection. To do so, they had to create transport, trading, and other systems that were self-steering. Self-steering supposes that a system acts in response to information. The result of this action generates new information that in turn generates a new response and new action. Information comes from external and internal sources. As these kinds of self-steering loops become more sophisticated, information is archived, and that (accumulated, objectified) information becomes part of the way of generating new or modified behaviors. The most effective looping of information and action occurs under conditions in which information is treated as patterns. Stories, documents, protocols, and news reports each have their own generic structural patterns. Beneath their literary surfaces they all suppose some patterned relationship between events. The greatest city-states and portals have been those that excel at theoria—at high-level pattern recognition and production. Self-steering is a type of autonomy. City-states and city regions are interested in autonomy because, more often than not, if they are not able to self-steer (interact without connection), they will be assimilated into some larger hierarchical structure or spatial network. A condition of their existence is to be very good at self-steering. This means to be able to act in response to external conditions and contingencies without their actions being set in motion by either the “unmoved mover” (the root node) of a hierarchy, or by the correlation of forces produced by distributed networks. One of the reasons why the ancient Greek city-states resisted federalism (even though they invented the idea) was likely that it subtly impinged on their self-steering capabilities. Self-steering systems internalize causation. This was the basic point of Norbert Wiener’s (1948) theory of cybernetics, which was a play on the Greek word for steersman. When a steersman of a boat moved a rudder, the craft changed its course. If a steersman detected that the previous change of course had overshot the mark, the rudder was moved again to correct the boat’s drift. Self-steering systems do not rely on the teleology (the final cause) of the unmoved mover, or on the convergence of multiple efficient causes of network agents, to drive them. Instead they loop, which is simply another way of saying that they are autonomous or self-regulating. Causation is enacted in time. Causation creates or regulates a succession of events or actions in time. To say that a social action “is caused” is simply to say that social movement or action occurs in time in a manner that belies a discernable underlying pattern. In a hierarchical order, causation functions to drive movement up and down branching lines—from the top to the bottom, and from the bottom to the top. Everything is set in motion by the root node. In a planar order, causation generates movement across a plane, from side to side—from coast to coast for example. Intersection between nodes, or the convergence of efficient causes, drives this kind of movement. In a navigational or portal order, in contrast, causation is primarily formal: It relies heavily on pattern recognition and production. Formal properties are the preeminent cues for steering, which is the fundamental act of navigation. Steering drives movement in and out, around and about. The typical pattern of motion is the circular movement of opening and closing, arriving and departing, through and around. This type of causality is almost acausal. In a circular or rotational pattern, the strict difference between cause and effect is blurred or obliterated. The navigator is constantly taking on board tiny bits of pattern-information and adapting actions accordingly.

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Cross-Cultural Perspectives on Knowledge Management Pattern production is the highest stage of intelligence. To create forms is the most demanding and the most difficult of all intelligent functions. The historical incidence of formative power is not evenly distributed. A relative handful of times and places are responsible for the largest quantum of form-creation. As has already been noted, sea regions and portal cities are in turn responsible for the largest portion of this quantum. The classic cases are the ancient Greek and Roman Mediterranean–Black Sea region; the medieval Silk Road–Caspian Sea ecumene; the Renaissance Mediterranean; the early modern Baltic Sea–North Sea; the modern China Seas; and the nineteenth-century Great Lakes–Hudson ecumene. Athens–Piraeus, Rome–Ostia, Alexandria, Constantinople, Bukhara, Venice, Florence, Amsterdam, London, Stockholm, Shanghai, Chicago, and New York City have all played a vastly disproportionate role in form-creation—in artistic, scientific, economic, and social creation. One possible reason for the coincidence of form-creation and portal activity is that the portal city and the sea region are navigators’ domains. This is meant not just in the obvious sense that these places are mariners’ domains, but also in the more complex sense that these are by their nature places for the organization of long-distance traffic and logistics, and mercantile and cultural interaction. Such things, of course, can be and are organized by bureaucratic hierarchies and network organizations. Yet, the effectiveness of these stands in an inverse relation to the distance over which they operate. The further away we move, the less compelling is the power of contractual or peer networks. Under these conditions, the silent trade of interaction without connection becomes more important. Portals provide sophisticated versions of this because they are “cities of turnover.” The churn of these cities is conducive to interactions without connectivity. These are interactions that are supported not by hierarchic connections or networked associations but by abstraction. Portals, of course, have hierarchies and networks in abundance, but they have something additional—plastic milieus through which is it easy for itinerants and strangers to move, and that are crucibles for the emergence of material, technological, and intercultural forms. Aristotle proposed that ideally a city-state should be self-sufficient. To modern ears, that idea sounds like a proposal for a closed society. It sounds like China in the 1960s or Burma in the 1990s. But that was not what Aristotle had in mind. Sparta was not his idea of a normal city. Rather, self-sufficiency meant something like self-steering. In fact, kybernetes, the steersman, was a common Greek metaphor for the state. Self-steering was paradoxical. The city of Aristotle’s acquaintance had extensive contact with the world, but it arranged its affairs such that it was not beholden to the world. This is a difficult balancing act. It is only possible because portal societies are intensely interested in the world but without being suborned to hierarchic loyalties and planar networks. Knowledge plays a special role in the portal city’s adaptation to the exigencies of the world. The more closed a society is (the Spartan model), the more tight-knit it is, the more it relies on local affinities of loyalty and trust, and the more suspicious it can be, as well as the more hostile to aliens and strangers. The Chicago School sociologist W. I. Thomas made the observation about how the ties and feelings of locality, or what he called the “primary group,” are projected onto larger-scale organizations and spaces: The Polish peasant uses a word, okolica, ‘the neighborhood round about,’ ‘as far as the report of a man reaches,’ and this may be taken as the natural external limit of the size of the primary group—as far as the report of a member reaches—so long as men have

The Art of Systems only primary means of communication. But with militancy, conquest and the formation of a great state we have a systematic attempt to preserve in the whole population the solidarity of feeling characterizing the primary population. The great state cannot preserve this solidarity in all respects—there is the formation of a series of primary groups within the state—but it develops authoritative definitions of ‘patriotism,’ ‘treason,’ etc., and the appropriate emotional attitudes in this respect, so that in time of crisis, of war, where there is a fight of the whole nation against death, we witness, as at this moment, the temporary reconstitution of the attitude of the primary group.” (Thomas 1966, 169–70)

An open society (a liberal network society like the United States), in contrast, does not function at all like a primary group, except in moments of crisis. Network relations are thin, not thick. Contract trumps community, and institutional procedure is more powerful than moral solidarity. The cost of entry to a network is low. An open society depreciates local affinities for networks that are infinitely extensible. These, though, have diminishing power or efficacy beyond the medium scale. The portal, by contrast with this, is paradoxical. It has a strong capacity to create boundaries—to demarcate itself from its environment—and yet it is porous: Goods, people, or information freely flow in and out of it. Great portal cities, for instance, engender strong civic identification and patriotism (“a strong sense of place”) but, at the same time, attract large numbers of outsiders to settle there and still larger numbers to pass through. To be both open and bounded is a powerful condition. Its power arises from its paradox. Cities of turnover that encourage and attract those who act and see the world not in terms of personal affiliation or networked association but as structure, form, and pattern have a subtle advantage. Such persons can engage in the quid pro quo of trade and traffic without the transactions being dependent on mutual consent or on face-to-face attachment. A place where large numbers of such people congregate is likely to be capable of producing emergent forms. That people do congregate in such places is a function of the need of portals to organize action at a distance. Such organization is optimally achievable when systems are self-organized through forms rather than via networks of coefficient causality or by the directing action of the unmoved mover of a hierarchy.

MANAGEMENT OF KNOWLEDGE The largest companies in the world, almost without exception, are headquartered in portal cities. As the maps in Slater (2004) indicate, most of the headquarters of Fortune 500 companies are located (in Asia) in the Japan archipelago and the South Korean peninsula; (in the United States) in the East Coast, Great Lakes, Mississippi, California coast, and Gulf of Mexico zones; and (in Europe) in southeast England, the Île de France, and the Rhine–Danube zone. To indicate just how difficult it is to escape this logic, two or three Fortune 500 companies are headquartered in territorial Beijing, but Taipei, the capital of the island of Taiwan, has the same number. The dominance of portals is because these cities (1) maximize access to information (and most especially information summarized in prices); (2) constitute nodes in the most important distributive networks in the world; and (3) excel at generating forms and accumulating knowledge of forms. Of all of the many functions of the firm, the generation of productive forms, in the long run, is the most important. Firms compete on price. They also accumulate market power (market share) through supply chains and

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Cross-Cultural Perspectives on Knowledge Management distributive networks. But the most successful firms are art firms or science firms; they compete on the design of products and systems. They compete on quality. All firms and institutions have scarce resources. The better the use of these resources is, the more viable the company or organization will be. It is here that aesthetic knowledge comes into play. For, ultimately, efficiency and economy are a species of beauty. If a technologist figures out how to reduce the power consumption of a refrigerator by a factor of ten (which is what technologists achieved during the 1990s), this will be a more marketable fridge than one that is simply cheap. From the science angle, the technologist who does this is always finding more elegant solutions to technical problems, just as the commercial designer who finds the most elegant touch pad arrangement to work the device does so from the art angle. The same applies to economies. When looked at closely, the economy of Mainland China in the 2000s appears much less like the nirvana of growth that journalists routinely tout and much more like a nightmare of gross inefficiency. When we observe China use seven times the energy of Japan, six times the energy of the United States, and three times the energy of India to produce the same unit of output, the overriding importance of technical design becomes clear. Design plays an ever-growing role in consumption as well as production. Indeed, the most sophisticated consumers make purchasing decisions based on aesthetics not price. These may be the aesthetics of the product or of the shopping center where it is purchased. But aesthetics is not just wrapping. It is implicated in the very heart of creative production, and this has enormous implications for wealth generation. Simply put, a company that develops a new pharmaceutical is better placed than one that produces existing drugs more cheaply. This is essentially what a knowledge economy is. It is an aesthetic economy. It is propelled by firms that compete through design—be it the design of a tin can, a drug, a piece of software, a highway, or a book. The implicit idea behind a design always belongs to the human commons. But the work of teasing out what is implicit, and making it explicit, can be turned into property. Increasingly much of what makes the most valuable firms valuable is such intellectual property. Portal city regions have long been social laboratories of design. Venice built its economy on the design of better boats. Portals like Venice also invest heavily in the design of the built environment. This is not a matter of luxurious ornamentation or conspicuous consumption. Rather, beautiful cities provide the most intensive exposure of their denizens to form. They thereby inspire and encourage designing intelligence of all kinds. There is strong evidence that human neurology is open-ended. Neurological structures are not a genetic inheritance but are formed through the interaction of the human mind with its environment by creating its own artificial environment. The built environment of the city has long been a key to nurturing the architectonic structures of human intelligence (Allen 2004). Unsurprisingly then, high-quality arts and sciences have had an historic propensity to concentrate in portal cities that have invested massive wealth in the building of city squares, churches, museums, and campuses. From London and Edinburgh to New York and Hong Kong, from Athens to San Francisco, Rome to Chicago, this has been true. All of this has implications for the management of knowledge. First, the management of knowledge occurs on macro, meso, and micro levels. Great firms take an interest in their city regions—they invest in them through their building and sponsorship programs, just as the Renaissance guilds did in Venice and Florence.

The Art of Systems The macro and meso levels of city region and firm cannot be entirely separated. The commons of the city is the necessary complement of the private domain of the firm. One produces ideas, the other produces intellectual property. There is not a firewall between. Common wealth and private wealth are mutually implicated. One advances or retreats with the other. Striking the balance between them is difficult, but achieving it is enormously productive. Second, knowledge that has it roots in the commons should not be confused either with information about contingency or with the protocols of connectivity that typify distributed networks. Rather, the core of knowledge management is concerned with enhancing the art and science of an organization. For sure, such management is invariably conditioned by the imperatives of contingency and connection. When the old Soviet Union triggered an explosion of American space science—with the news of its Sputnik flight—this set off the accelerated development of the high-tech Gulf of Mexico–Floridian Coast space economy. But a certain sign that knowledge is more than a response to contingency, and more than a function of the proliferation of connections, is illustrated by the first great organization of the space economy, the National Aeronautics and Space Administration (NASA). NASA developed as a typical Fordist organization. It combined bureaucratic hierarchy with a national network artfully distributed across politically powerful states (with headquarters in Washington, DC, and Centers in California, Ohio, Maryland, Texas, Florida, Virginia, Alabama, and Mississippi State). It had great successes and great failures. Its greatest failure, the Space Shuttle Columbia disaster, encapsulates the limits of knowledge management in such organizations. The day before the shuttle’s breakup, NASA’s engineers were to be found busy debating hypothetical contingency scenarios of “what would happen if’ the Shuttle’s heat-shield tiles failed.”3 Such prescience was spooky. Good engineering can be tested by if-then reasoning. But, in the end, such testing cannot overcome bad design, and this was the shuttle’s problem. Fundamentally from the beginning, it was a poor design. Information cannot substitute for good design. Another way of putting this is that the logic of knowledge is different from the logic of contingency, or for that matter from the logic of networks. Contingency generates lots of reporting—on risks and possible responses. Networks require a large amount of time to maintain linkages—relations between different offices and campuses. Most of this activity, though, is secondary to the art or science of design. If-then reasoning, and its endless demand for information, has decidedly fewer beneficial effects in the world than might be supposed. This is not just because, as economists have long known, information in the real world is imperfect but simply because good design (read beautiful form) in the first place is often a better way of obviating risk than incessant planning for it. Intelligence failure is inherent in projecting scenarios of highly uncertain environments (e.g., warfare, space voyage). What is important is not so much that bad things occur, but that good system design allows recovery when the unpredictable but inevitable dire event happens. When we understand the limits of contingency management, we also understand why it is that so many firms and organizations rely so much on branding. A brand is a simple visual abstraction (an iconic design) that binds individuals and agencies across distance irrespective of location. A brand is a visual form that communicates silently. This is also what knowledge, albeit in a much more complex sense, does. Knowledge, understood as the art of systems, creates effects without relying on bureaucratic hierarchy or procedural

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Cross-Cultural Perspectives on Knowledge Management negotiation. Knowledge spreads without time-consuming transactions between agents. This is because it is shape-like. In our imagination, the virtual realm par excellence, we can “see,” “hear,” and “touch” the shapes of knowledge. Think for example of DNA—it is a double helix. Grasping the shape was the key to unlocking the knowledge of the genome. Knowledge acquisition in organizations is similar. Its most powerful media are morphological. This is true, ironically enough, of the knowledge of hierarchy and networks as much as anything else. Before we describe them or enact them, we “see” them. But hierarchies and networks are not necessarily the most interesting or even the most robust of cognitive-aesthetic structures. Structures like symmetry, balance, rhythm, and proportionality—and shapes like those of skeletons, sponges, interfaces, tiles, and cells—abound in art and science. The challenge of knowledge management is to help create contexts in which reasoning and imagining about these are not overwhelmed or overdetermined by the imaginary of hierarchies and networks. A related challenge, then, is to turn the management of knowledge into the knowledge of management. In the simple sense, this means to find ways of using the art of systems to redefine management away from the overworked imaginary of hierarchy and network to one that begins to explore a larger morphological universe filled with other reliable structures like skeletons, sponges, and interfaces. Endless instructions down the hierarchy, and repeated negotiations across networks, are not the sign of successful firms or organizations. Knowledge in the strong sense, in contrast, is a deep repository of cognitive-aesthetic forms.

CONCLUSION Cognitive-aesthetic knowledge is found everywhere. But, in its most developed forms, it clusters. Notably, as has been observed, it clusters in portals. Most people are shocked when they first meet New Yorkers on the street. They are rude—their address is bluff, gruff, and short. The stories told about Venetians in the old days, or about denizens of Shanghai today, are pretty much the same. This is not surprising. Portals, by their nature, are ecumenical. They harbor a multitude of languages, nationalities, faiths, and customs, and they put them together in one, usually tiny, place. In such places, communication works best when it is aesthetic. Irrespective of language, nationality, and faith, people understand beauty. Beauty is silent. Beauty is the essence of a good system. Beauty is the paradigm of economy and efficiency. From Venice to New York, Shanghai to San Francisco, portals have developed aesthetic form as the complement of, and sometimes substitute for, rules and hierarchies. In this world, the art of systems flourishes as the medium of silent trade and of interaction without connection over distance. Thus we end where we began, with a singular proposition: The most interesting and most efficacious kind of culture from the perspective of fundamental innovation is the meta-culture of the city. Cities, in this department at least, trump nations. The artknowledge of the city is the acme of human knowledge. No matter how much human beings mobilize religious or national norms in economic life or organizational behaviors, it is art-knowledge, or pattern knowledge, that shapes the most important breakthroughs in production and distribution, organization and governance. Irrespective of whether it is the engineers in Houston’s space administration or the designers of assembly-line robots for a Japanese car manufacturer based in Tokyo, the same basic fund of pattern

The Art of Systems knowledge is drawn on. It is to this kind of knowledge, and its concentration in great cities, that we owe the most far-reaching experiments in economy making and organizational development. For this reason, the capacity to manage pattern knowledge, to understand its dynamics and its mimetic distribution, is essential.

NOTES 1. This invention possessed virtually all of the structural features of electronic commerce that appeared a little more than a century later. These features included purchase at a distance based on selections from distributed catalogs, the central warehousing of commodities, placement of orders via a communications network (the post office in the nineteenth-century case), distribution of goods via post offices, reliance on customer trust to purchase goods “sight unseen,” and asynchronicity between payment and delivery of goods. 2. A parallel can be drawn here with debates about the functioning of the human brain. Connectionist models of the brain explain cognitive functioning in terms of neural networks. Hebb’s 1949 rule states that learning is dependent on changes in the brain caused by correlated activity between neurons. When two neurons are active together, their connection is strengthened; when not, the connection is weakened. Intelligence is located in the connections between neurons. In response, Fodor and Pylyshyn (1988) identify a feature of human intelligence that they call systematicity. Systematicity is something that connectionists cannot account for. The systematicity of language refers to the pattern nature of language behavior. It accounts for the fact that the ability to produce or understand some sentences is tied to the ability to produce or understand others of related structure. 3. E-mails show that National Aeronautics and Space Administration (NASA) engineers predicted the Columbia disaster. The Associated Press (2/27/03 Washington) indicated that newly disclosed e-mails inside NASA showed senior engineers worried a day before the Columbia disaster that the shuttle’s left wing might burn off and cause the deaths of the crew, a scenario remarkably similar to the one investigators believe actually occurred. The dozens of pages of e-mails describe a broader, internal debate than previously acknowledged about the seriousness of potential damage to Columbia from a liftoff collision with foam debris from its central fuel tank. Engineers never sent their warnings to NASA’s leadership. Engineers in Texas and Virginia fretted about the shuttle’s safety during its final three days in orbit. One speculated whether officials were “just relegated to crossing their fingers,” and another questioned why such dire issues had been raised so late. “Why are we talking about this on the day before landing and not the day after launch?” wrote William C. Anderson, an employee for the United Space Alliance LLC, a NASA contractor, less than 24 hours before the shuttle broke apart February 1 while returning to Earth. NASA said those messages—including the few that were hauntingly prescient—were part of a what-if exercise by engineers convinced the shuttle would land safely despite possible damage from foam that struck insulating tiles on the spacecraft’s left wing at liftoff. “It was a surprise to us when the ‘what-if’ scenario played out,” said Robert Doremus, head of the mechanical systems group in Mission Control. “We were not expecting that.”

REFERENCES Allen, B. 2004. Knowledge and civilization. Boulder, CO: Westview Press. Associated Press 2003. E-mails show NASA engineers predicted Columbia disaster. http:// abclocal.go.com/ktrk/news/22703_nat_shuttleemail.html Berners-Lee, T. 1999. Weaving the Web. London: Orion.

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Cross-Cultural Perspectives on Knowledge Management Brown, N. 1990/1947. Hermes the thief: The evolution of a myth. Great Barrington, MA: Lindisfarne Press. Castells, M. 2000. The rise of the network society. Volume 1, 2nd ed. Oxford: Blackwell. Castoriadis, C. 1997. World in fragments: Writings on politics, society, psychoanalysis, and the imagination. Stanford, CA: Stanford University Press. Deleuze, G., and F. Guattari 1987. A thousand plateaus: Capitalism and schizophrenia. Minneapolis: University of Minnesota Press. Fodor, J., and Z. Pylyshyn 1988. Connectionism and cognitive architecture: A critical analysis. Cognition 28:3–71. Gelertner, D. 1998. Machine beauty: Elegance and the heart of technology. New York: Basic Books. Geohive n.d. Largest seaports in the world. http://www.geohive.com/charts/charts.php?xml=ec_ seaport&xsl=ec_seaport Greene, B. 2004. The fabric of the cosmos: Space, time and the texture of reality. London: Penguin. Grierson, P. J. H. 1903. The silent trade: A contribution to the early history of human intercourse. Edinburgh: W. Green. Heller, A. 1985. The power of shame: A rational perspective. London: Routledge and Kegan Paul. Howkins, J. 2001. The creative economy. London: Penguin. Kant, I. 1964. Groundwork of the metaphysics of morals. New York: Harper and Row. Kotkin, J. 2005. American cities of aspiration. Weekly Standard 10:21. McGuire, S., E. Conant, and S. Theil 2002. A new Hanseatic league. Newsweek International, 11 March: 14. Miller, D. 1996. City of the century: The epic of Chicago and the making of America. New York: Simon and Schuster. Miller, W. 1968. A new history of the United States. London: Granada. Murphy, P. 1999. The existential stoic. Thesis Eleven: Critical Theory and Historical Sociology 60: 87–94. ———. 2001a. Civic justice: From Greek antiquity to the modern world. Amherst, NY: Humanity Books. ———. 2001b. Marine reason. Thesis Eleven: Critical Theory and Historical Sociology, 67:11–38. ———. 2003. Trust, rationality and virtual teams. In Virtual Teams: Projects, Protocols and Processes, ed. D. Pauleen, 316–42. Hershey, PA: Idea Group. ———. 2004. Portal empire: Plastic power and thalassic imagination. New Zealand Sociology 19 (1): 4–27. ———. 2005a. Knowledge capitalism. Thesis Eleven: Critical Theory and Historical Sociology 81:36–62. ———. 2005b. The n-dimensional geometry and kinesthetic space of the Internet. In Encyclopedia of Multimedia Technology and Networking Volume 2, ed. M. Pagani, 742–47. Hershey, PA: Idea Group. ———. 2005c. Unsocial sociability: The paradoxes of intellectual capital formation and social capital networks. In The Third International Conference on Politics and Information Systems Technologies and Applications Proceedings, eds. J. Carrasquero, F. Welsch, A. Oropeza, T. Flueler, and N. Callaos, 405–10. Orlando, FL: PISTA. ———. 2006. Sealanes. In Sociology—Place, time and division, eds. P. Beilharz and T. Hogan, 38– 44. Melbourne: Oxford University Press. Murphy, P. and T. Hogan. 2005. Creative cities and intellectual capital: Megapolis, technopolis and the China Seas region: The economics of paradox. Paper presented at the Eighth Asian Urbanization Conference, The University of Marketing and Distribution Sciences, Kobe, Japan.

The Art of Systems Murphy, P. and D. Roberts. 2004. Dialectic of romanticism. London: Continuum. Murray, C. 2003. Human accomplishment: The pursuit of excellence in the arts and sciences 800 B.C to 1950. New York: HarperCollins. Parker, G. 2004. Sovereign city: The city-state through history. London: Reaktion. Pauleen, D. and P. Murphy 2005. In praise of cultural bias. MIT Sloan Management Review 46(2): 21–22. Polanyi, K. 1977. The livelyhood of man. New York: Academic Press. Porter, M. E. and S. Stern 2001. Innovation: Location matters. MIT Sloan Management Review 42(4): 28–36. Slater, E. 2004. The flickering global city. Journal of World-Systems Research 10(3): 591–608. Surowiecki, J. 2004. The wisdom of crowds. New York: Doubleday. Thomas, W. I. 1966. Analytical types: Philistine, bohemian and creative man. In On social organization and social personality: Selected papers, ed. M. Janowitz, 169–70. Chicago: University of Chicago Press. Thompson, D. 1961/1917. On growth and forms. Cambridge: Cambridge University Press. Wiener, N. 1948. Cybernetics, or control and communication in the animal and the machine. New York: Wiley.

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SECTION 2 Effects of Culture on Key Aspects of Knowledge Management

4 Cultural Stretch: Knowledge Transfer and Disconcerting Resistance to Absorption and Application Gerhard Fink and Nigel Holden

ABSTRACT International knowledge transfer does not follow a straightforward scheme. There is ample evidence that, even if senders and receivers of management knowledge are initially cooperative, expectations of both sides cannot be met, and within a relatively short period of time, conflicts unavoidably emerge caused by communication problems due to cultural differences. It can take 18 months or two years to overcome that period of disappointment and resistance. These effects can only be overcome if senders and receivers of knowledge socialize, develop, and maintain contacts both in the business and also in the private sphere. Furthermore, even if the transfer of explicit knowledge (written, codified) is complemented by transfer of tacit knowledge, it may take seven years or longer to achieve a smooth transfer and acceptance of knowledge. It is also crucially important to deploy the right people—that is, individuals who are locally sourced and with appropriate personality characteristics. Finally, successful knowledge transfer must operate in a society that is open to the application of the management knowledge being made available. When a best practice migrates, its quality and perceived usefulness and applicability change. It becomes something different.…

INTRODUCTION The importance of knowledge management (KM) as a core aspect of the international activities of corporations is beyond dispute. This conviction is unambiguously articulated by Heinrich von Pierer, the chief executive officer of Siemens, whose company is featured in the one of the contributions to the Academy of Management Executive Special Issue on global transfer of management knowledge (Fink and Holden 2005a).

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Cross-Cultural Perspectives on Knowledge Management He is quoted as saying, “Between 60 and 80% of the value added we generate is linked directly to knowledge—and that proportion is growing.” But exactly how this global, multiplex transfer of management knowledge is most effectively accomplished is a matter of contention. This chapter aims to throw useful light on that key issue by means of (1) presenting an up-to-date overview of state-of-the-art academic knowledge about the global transfer of management knowledge and (2) underpinning this overview with a perceptive commentary. During 2004 and 2005 Fink and Holden (2005a, 2005b) prepared special issues of two academic journals—the Academy of Management Executive (AME) and the Journal of Managerial Psychology (JMP)—about the challenge of transferring management knowledge in the context of the modern global economy. The theme of the AME special issue, which appeared in May 2005, addressed the general question of the global transfer of management knowledge from a management perspective. For the time being at least this special issue is without question a leading guide to the state of the art in what is emerging as a critical management function. The special issue of JMP, published in late 2005, goes beyond the managerial issues and focuses consciously more on what one might call the human side of cross-cultural knowledge transfer interactions. But why are the editors confident of having access to state-of-the-art knowledge? For both special issues some 40 contributions were received from the United States, Europe, and Asia, which were anonymously reviewed by more than 80 scholars around the world. No other academic journals have ever devoted themselves to the issue of global transfer of management knowledge. Hence, one of the aims was to gather potentially important contributions and let them stand together in order to reveal the breadth and complexity of the subject matter. This subject matter was extremely diverse, ranging from crosscultural training interventions to knowledge orientation in Russian enterprises, from theoretical models of knowledge transfer to management education in Australia. What was evident from all these contributions is that there is a general recognition of the importance of effective knowledge transfer, its highly problematical nature in practice, and the lack of unifying concepts to guide methodologically based investigation. The AME and JMP special issues comprise 13 cases, which combine conceptual insight lodged in practical experience in locales as diverse as China, Russia, Poland, Vietnam, and Africa. The selected cases represent the most valuable source of up-todate academic endeavor in the field of the global transfer of knowledge with a strong focus on the nature of interorganizational and interpersonal interactions and their consequences. The editors attempted in their respective introductions to synthesize the insights as practical challenges to management and as pointers to rich research topics. This chapter reflects those motivations.

ANTICIPATION IN SUCCESSFUL KNOWLEDGE TRANSFER Of 13 cases published in the two special issues, 6 have been selected for this chapter in order to illustrate both a major insight as well as a major management challenge. The main criteria for selection of the six cases were as follows: (1) There should have been obvious interest on the supplying and receiving ends to have up-to-date management knowledge transferred; (2) Taken together the cases should overlap as to the time range of efforts and together provide a “full cycle picture”; (3) The cases should cover

Cultural Stretch experiences from different regions of the world; and (4) The cases should reflect failure and success. This refers to the fact that, when headquarters attempt to impose their knowledge on other cultures in an overtly tutorial manner, there is a very strong probability of encountering resistance at the receiving end, also due to a conflict of interest. The six cases reveal that resistance is often unanticipated by the providers of knowledge. Success is achieved only if providers of knowledge are willing to modify their attitude and approaches and engage constructively with local counterparts. The passage of 18–24 months seems to be significant. If there is one clear message that emerges from the cases discussed (albeit briefly) in this chapter it is that the successful transfer of knowledge as an international activity requires of managers a competence that is rarely mentioned, certainly not a topic in management education, yet crucial when knowledge moves into new cultural contexts. This precious competence is anticipation, and the cases show that a failure to anticipate often catches management off its guard and can knock strategies off course for years. Of particular concern then to the KM community and the wider community of management scholarship is to account for the impact of cultural factors on knowledge transfer activities. The fact that the JMP authors were required to discuss knowledge transfer from the point of view of both application and absorption meant that they were able to highlight subtleties and nuances that appear to be disconcerting in practice, yet were considered to be of minor significance to KM researchers. One such issue concerns the language barrier, a habitually undervalued and misunderstood influence on cross-cultural knowledge transfer in specialist literature shaped by authors whose native language is, unhelpfully, English. To place the core message of the contents of these journals in context, this chapter will begin with some general considerations about approaches to cross-cultural KM.

CROSS-CULTURAL KNOWLEDGE MANAGEMENT MODELS AND SCHEMES At risk of oversimplification it can be said that the KM literature is dominated by two approaches, which treat the topic in theory and practice from strongly contrasting positions. For Japanese scholars Nonaka and Takeuchi (1995), the key issue is knowledge creation, whereby firms convert tacit knowledge into explicit knowledge and vice versa through interaction processes, which are briefly discussed subsequently. Despite the considerable influence of the work of Nonaka and Takeuchi, which embodies a specifically Japanese but more generally an oriental approach to KM, the Western (i.e., North American and European) contributions emphasize knowledge transfer as a more consciously explicit process. Nonaka and Takeuchi state the distinction as follows: The realization that knowledge is the new competitive resource has hit the West like lightning. But all this talk about the importance of knowledge—for both companies and countries—does little to help us understand how knowledge gets created. Despite all the attention by leading observers of business and society, none of them has really examined the mechanisms and processes by which knowledge is created. This distinction is what separates the Japanese approach from theirs. More important, it is for this reason that the Japanese experience is especially interesting and useful.

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Cross-Cultural Perspectives on Knowledge Management There is a reason why Western observers tend not to address the issue of organizational knowledge creation. They take for granted a view of the organization as a machine for ‘information processing’. This view is deeply ingrained in the traditions of Western management, from Frederick Taylor to Herbert Simon. And is it a view of knowledge as necessarily “explicit”—something formal and systematic. Explicit knowledge can be expressed in words and numbers, and easily communicated and shared in the form of hard data, scientific formulae, codified procedures, or universal principles. Thus knowledge is viewed synonymously with a computer code, a chemical formula, or a set of general rules. (Nonaka and Takeuchi (1997, 7–8)

Nonaka and Takeuchi (1995) based their theory of knowledge creation on the general distinction between tacit knowledge (hidden, implicit, embedded, and not codified) and explicit knowledge (codified, explicitly expressed, outspoken, written text). They assumed that the most important knowledge in a firm is tacit knowledge, because tacit knowledge is unique to the firm and difficult to transfer—hence in the sense of the resource-based view also difficult to copy (Barney 1991, 1997). To create new knowledge tacit knowledge has to be made explicit, transferred, combined with other available knowledge, and reconverted (internalized) into new tacit knowledge. They suggested in their famous model four stages in a sort of circular (or spiral) process of knowledge creation: • • • •

Tacit—tacit transfer (Socialization) Tacit—explicit conversion and transfer (Externalization) Explicit—explicit transfer (Combination), and Explicit—tacit transfer and conversion (Internalization).

At the end of these four stages, the process begins again at the socialization stage. However, as Glisby and Holden (2002) have argued, all four modes are culturedependent, each reflecting well-documented aspects of Japanese organizational behavior. Their critique reflects a conviction that the cultural context variously influences what is understood by tacit or explicit knowledge, and how either mode of knowledge can be communicated, perceived, and absorbed. What for Americans or West Europeans may be clear and explicit is not necessarily so for East Europeans or Asian people, who need (1) additional tacit information in order to accept or understand the explicit component, or (2) explicit explanations to understand the tacit. By stressing the Japaneseness of the Nonaka/Takeuchi model, Glisby and Holden (2002) remind us that their conception cannot be used indiscriminately to throw light on cross-cultural knowledge creation behavior involving non-Japanese protagonists. The typology of Gupta and Govindarajan (2000) helps us to combat this limitation. It shows us that the effectiveness of knowledge transfer within each of Nonaka and Takeuchi’s four modes is conditioned to a greater or lesser extent by five factors: • • • • •

The perceived value of knowledge The motivation to share knowledge The richness of communication channels The motivation to learn and adopt new knowledge The ability to recognize the value of new knowledge.

These five factors are regarded as representing essential preconditions for the successful transfer of management knowledge and especially in cross-cultural contexts. It is, however, important to grasp that the quality of each of the five factors is in practice

Cultural Stretch determined by the context of the interaction. As is made evident in the following text, the selected cases make it abundantly clear that perceptions of knowledge and the motivations to share or adopt it were powerfully influenced by contextual factors such as resistance to accepting knowledge from outside one’s own ambience and lack of appreciation of the role of tacit knowledge as a catalyst for facilitating the transfer of explicit knowledge. It is important not to see the Gupta/Govindarajan typology as an alternative to the Nonaka/Takeuchi model. Rather, the two schemes are complementary. The Nonaka/ Takeuchi model emphasizes the need of conversion of tacit knowledge into explicit and after transformation back into tacit knowledge. In that sense tacit and explicit knowledge are complementary. The model also stresses the importance of human relationships in organizational settings and, through amply referring to practices in Japan, selective elements of the model became rather culture dependent. The Gupta/Govindarajan typology is concerned with knowledge transfer at the strategic level. It is culture-neutral and strongly emphasizes motivational aspects, but it lacks recognition of the importance of tacit knowledge to complement explicit knowledge. All six cases selected embrace aspects of the Gupta/Govindarajan model and highlight the importance of tacit knowledge; however, they also indicate the importance of an atmosphere conducive to establish rich communication channels (Holden 2002). All this reinforces the conviction that the mere possession of knowledge and the capacity, thanks to modern communication technologies, to transmit it to multiple users does not by itself ensure genuine transfer. For his part, Holden (2002) has demonstrated that a psychological and emotional component, which he calls atmosphere, is a vital factor in energizing the flow of knowledge across individuals. He defines atmosphere as “a pervasive feeling, which is derived from experience and serves as a determinant of expectations concerning future cooperation, about a business relationship or group activity such as collaborative learning or knowledge sharing” (Holden 2002, 315).

KNOWLEDGE TRANSFER IS NEVER LINEAR The six cases selected reveal the value of the Gupta/Govindarajan model as well as the concept of atmosphere, whose significance for the study of knowledge transfer in crosscultural situations is not yet fully appreciated. The cases make it plain that knowledge transfer activities—no matter how systematically planned—do not follow a linear logic. This is an extremely troublesome issue, as it highlights a major challenge in the global transfer of management knowledge: namely, the very precariousness of the activity as a management practice, involving weaknesses in (1) planning and co-coordinating cross-cultural knowledge exchanges, and (2) anticipating the manifold causes of forms of knowledge distortion and the nature of their impact on operations. The latter point is extremely important. In complex ways cultural differences can impede the straightforward cross-cultural transfer of management knowledge, but it is folly to attribute to culture, as popularly understood, some inherently pernicious features that willy-nilly undermine corporate endeavor. The argument being advanced here is that the management failure to anticipate in what ways cross-cultural business interactions may evolve contrary to plans and assumptions is a prime cause of stress and strain in the global transfer of management knowledge.

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Cross-Cultural Perspectives on Knowledge Management Although top managers of large corporations often claim that they are reducing complexity within their firm, it would be naïve to assume that managers can make cultural difference disappear. We conclude that complexity cannot be eliminated; it only can be shifted. Thus managers who find it burdensome or tiresome dealing with cultural diversity often transfer this task to local managers in firms’ networks. This practice can be called cultural stretch, referring to the challenge whereby individuals or groups of people adjust their behavior to suit the demands of working simultaneously with various sets of cultural values and norms in order to meet organizational goals. This calls for alignment with the headquarters’ requirements alongside the norms and values embedded in manifold stakeholder cultures.

KNOWLEDGE TRANSFER AND RESISTANCE TO ABSORPTION For this chapter, six cases have been selected to provide other key learning points, which were derived from the specific context of investigation yet which may have applicability in completely different knowledge sharing scenarios. These cases also suggest that the available theories briefly sketched above could have served as guideposts for effective knowledge transfer and that setbacks could have been avoided with appropriate preparation. As a communality, the cases make clear that knowledge transfer processes will take years rather than weeks or months, encountering many forms of unanticipated resistance, and that the transfer process cannot be hurried. The antidote appears to be trust, but in cross-cultural environments, that too takes time. Trust seems to be established only when people at the receiving end are given voice as equal partners. May, Puffer, and McCarthy (2005) were engaged in establishing Western-style management training in Russia, a country that is still in awkward transition to market economy. Initially equipped with enthusiasm and the best intentions the U.S. trainers soon had to face the fact that what they considered to be important knowledge was not wanted by the Russian managers, who initially were eager to gain superior U.S. management knowledge but could not cope with what was offered to them. Not long after the collapse of the initial training program, another attempt was started, in which strong emphasis was put on identifying the “right people”: those young, ambitious, but mostly inexperienced managers who were able and willing to learn from scratch and were not burdened with previously important knowledge. Here the Gupta/Govindarajan (2000) typology can be usefully invoked. It helps to explain why American trainers found themselves confronted with an unexpected demotivation on the part of the Russians about the way in which the knowledge was being imparted, and about its value and relevance for Russia. The clash was so sharp that the U.S. attempts to train Russian managers came to an abrupt halt.

CONTEXTUAL KNOWLEDGE IS NOT GAINED OVERNIGHT The authors who report their own experience had to learn that for the delivery of management know-how to non-Western countries, it is of paramount importance to (1) adapt a given set of tools to fit for a specific subset of people of the other national culture and (2) be able to transfer these tools to preidentified people who are equipped with the required personality traits and consequently could be successfully selected as course

Cultural Stretch participants. Their case emphasizes the importance of designing appropriate strategies for selecting people from transitional economies as potential receivers of the knowledge that the Americans could offer. A further prominent factor is that the educators should be not only context-sensitive but also fully conversant with the cultural and institutional background, and that is a type of knowledge not gained overnight. The truth of that observation is amply supported in the contribution of Javidan and his coauthors (2005), who describe rapidly deteriorating interactions involving a North European business school and a large South Asian corporation. The Asian Bank commissioned the business school to design and run a major executive program, but scarcely had this started when bitter recriminations blocked the knowledge transfer. After a short while, Asian participants and their supervisors found out that that the knowledge about leadership management provided by the Nordic scholars would not fit into the local corporate culture settings. Thus, their motivation to learn subsided. Instead of seeking clarification in communication about the emerging issues, the Nordic scholars also quickly lost their motivation to share their knowledge with the Asian bank staff. Guided by the Gupta/Govindarajan (2000) model, one may say that both sides—the Nordic Europeans and the top management of the Asian Bank—did not even think about establishing rich communication channels between them. This paper also alerts us to the importance of Holden’s (2002) approach, which recommends creating at the outset an atmosphere conducive to cross-cultural knowledge sharing and of the need to see the associated transfer processes as learning opportunities for suppliers and prospective recipients of knowledge.

TRANSFERRING MEANINGLESS MANAGEMENT KNOW-HOW Kuznetsov and Yakavenka (2005) report about large-scale attempts to make available British and other modern Western management textbooks to university teachers in Belarus. They expose a rarely considered aspect of the transfer of Western management know-how to former socialist countries. What emerges is a picture in which Western management texts are perfectly translated into Russian and transferred to the Belarusian context without much adaptation of content to local conditions prevailing in the Belarus economy. As Kuznetsov and Yakavenka report, 40 percent of their sample of Belarus professors are unhappy with the overall style of the texts or question the validity of the translations. Even if they understand every word, they cannot give a meaning to the texts. The authors make it clear that this attempt to transfer management knowledge to Belarus was based on a Western assumption that sufficient absorptive capacity was available to make the process efficient. The reality is rather different, as the case study shows that even after 15 years, the massive sums of money from European and other international sources to support the transition from communism to the market economy in the more easterly lying socialist countries of Europe have only partially succeeded as an exercise in international knowledge transfer. The professors had not the slightest idea about the functioning of Western market economies. Thus, they could not attribute any meaning to texts that reflect a different economic and political reality than that prevailing in Belarus. The conclusion to be drawn is that there would need to be some transfer of tacit knowledge going along with the explicit knowledge provided in the textbooks (cf. Holden and Kortzfleisch 2004).

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Cross-Cultural Perspectives on Knowledge Management In practical terms, this means that the contents of textbooks must be adapted. It cannot be taken for granted that professors and students are familiar with Western business practices, the related concepts, and the societal values that underpin them. It may not be feasible to modify textbooks to fully reflect the reality of one particular former Soviet republic, but authors and their local collaborators ought to be able to find ways to make the contents suit a country experiencing the transition to the market-economy system by referring to other countries in analogous situations. The issue at stake is that explicit knowledge provided with books and author’s guides cannot be grasped without also being complemented by tacit knowledge. This means that publishers can produce textbooks that, through achieving a certain common cognitive ground with readers in countries like Belarus, have a greater chance of being useful. That would fit in with the Gupta/Govindarajan (2000) scheme and the Nonaka/Takeuchi (1995) model. Without socializing among professors from the West and Belarus, there is hardly a chance to get the management knowledge across.

UNDERSTANDING FOREIGN EMPLOYEES AS CULTURAL RESOURCES The issue concerning the gap between expatriates and the local business community is taken a stage further by Vance and Paik (2005, 590), who shift the focus from expatriate managers to “foreign employees being managed at host country operations.” In their case study of “forms of host country national learning for enhanced [multinational corporation (MNC)] absorptive capacity,” they build on the well-established finding that “past research … [generally has failed] … to identify important contributions that can be made by host country nationals to promote the effective transfer of knowledge throughout the multinational organization.” On the basis of an empirical investigation involving 51 managers as informants in 49 different MNC foreign subsidiaries with home bases in France, Japan, Germany, Korea, the United States and the United Kingdom, the authors identify 12 categories of learning needs among host country nationals. The investigation suggests a picture of top management detachment and aloofness vis-à-vis their host country employees and a reluctance to consult and trust these colleagues. Vance and Paik argue that, unless these employees are empowered to receive expatriate knowledge and know-how, their absorptive capacity remains underused and that MNCs need to consider forms of in-house training to align the strategy of the company with the potential of those employees. Companies should not only train their potential expatriates to cope with assignments abroad, but also their local counterparts to be prepared for the cultural gaps with the incoming expatriates. Glisby and Holden (2005) show how a Danish giftware firm achieved a remarkable breakthrough by dispensing with market intermediaries and directly exchanging tacit knowledge between corporate headquarters in Copenhagen and business partners in Japan’s retail sector. The Danish firm seems to have implemented exactly what Vance and Paik (2005) recommend: to have Japanese nationals trained and employed at the corporate headquarters and to serve as intermediaries between the Danish corporate culture and the Japanese local culture. They did this by going to Japan not on a permanent basis, but rather on a temporary basis to contact local firms, to socialize with local

Cultural Stretch counterparts, and to help them understand the tacit and explicit knowledge on which the particular sales strategy of the Danish firm is based. This case is an extremely interesting example of the applicability of the Nonaka-Takeuchi (1005) model to interactions also involving non-Japanese protagonists. The existence of a gulf between detached and aloof headquarters’ managers and expatriates, on the one hand, and their respective host country counterparts, on the other, stresses the need for a conversationalist disposition amongst managers and the need to articulate “rational” and “non-rational” elements in their active discourse. This experience is to be seen in contrast to a traditional sender-receiver model, such as that of Gupta and Govindarajan (2000), which considers KM as a set of objective messages. The intrinsic merits of these messages and the characteristics of the potential adopters are considered to be the sole contributors to the success of knowledge transfer. Such a perception would support the view that strategic implementation of management concepts through power relations is dependent on the capability of key managers to persuade their subordinates to accept a management tool without a mutual understanding of its merits.

CREATING THE ATMOSPHERE FOR TRUST That trust and a positive atmosphere be achieved neither straightforwardly nor within a short period of time is impressively demonstrated by Nancy Napier (2005) on the basis of her 10-year experience with management knowledge transfer to Vietnam. At first she and other Western scholars enjoyed a very brief period of smooth and unchallenged flow of explicit and simple textbook knowledge from foreign experts to Vietnamese professors. Then the process came to an abrupt halt, as the Vietnamese started to claim that “Vietnam was a special case,” resisting the foreigners’ lofty view of their own management knowledge. For the foreigners this shift of behavior was tough to accept. Note that this is the third occasion cited in which there has been an abrupt halt in an attempt to transfer Western management knowledge. Time passed, and committed foreigners became familiar with the internal constraints of the Vietnamese system. Only then could they build trust and began to learn from the Vietnamese. As a result both sides could open up to each other again. The foreigners were no longer just mentors, but actually became colleagues. Intriguingly, the actual turning point was marked by an open confrontation between the Vietnamese and their foreign colleagues. This confrontation became possible only after the foreigners had become perceived as partners who were prepared to operate within the constraints of Vietnamese culture. Extending on her earlier writings and that of Holden (2002), Gupta and Govindarajan (2000) and others, Napier identifies four core elements as a framework of analysis: (1) the stages of the relationship; (2) participative competence—to be applied to senders and receivers alike about their ability, motivation, and understanding of knowledge; (3) organizational atmosphere—between and within organizations on both sides; and (4) conduit conditions that facilitate the ease or difficulty of knowledge flows. It is worth highlighting a notable feature of Napier’s paper: its description of how radical system change in Vietnam induced a collective culture shock (Fink and Feichtinger 1998; Fink and Holden 2002), which expressed itself in learned helplessness

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Cross-Cultural Perspectives on Knowledge Management (Garber and Seligman 1980) and skepticism about rewards to be given for personal efforts and achievements. It was frequently observed that it took 18–24 months before the Vietnamese were willing and able to make their own decisions.

REDUCING AND INCREASING ABSORPTIVE CAPACITY The six cases highlighted in this chapter cover experiences across three continents. It is striking how the six sets of authors point to a failure on the part of “knowledge deliverers”—whether the West as a source of management know-how or a corporation handling relationships with its subsidiaries—to take account of attitudes, feelings, and specific features at the receiving end. In the context of the selected cases such features range from the intelligibility and perceived value of Western management texts to a sense of affront in host country subsidiaries at not being trusted by top management in a remote head office. Either way, the transfer of knowledge is rendered difficult. Self-esteem is damaged; absorptive capacity lies dormant. As it happens, all authors of the six cases contend that patience, training, and human resource development methods are called for. This is, of course, easier said than done. The scope and specialization of such interventions go far beyond what is customarily available in cross-cultural management education. While that particular challenge goes unmet and possibly unrecognized, it must be expected given that we live in a world in which knowledge sharing remains a great buzzword but is habitually compromised by a heavy-handed and frequently power-based approach. As already noted, the transfer of management knowledge takes time—often years. The more detailed and thorough the preparation was, the less likely the emergence of intractable problems. Part of the preparation involves the nature of the knowledge and recognition that the transfer process itself is part of the knowledge received. Thus, the design of the transfer process to suit recipients and potential beneficiaries is of vital importance. Here, it is important to recognize that every explicit knowledge transfer needs to be complemented by a tacit component, and vice versa. Otherwise, even if texts are perfectly translated and retranslated, prospective recipients of the explicit messages may understand every word in either language but still have problems making sense of the communicated management knowledge, because the context from which the knowledge is derived remains unknown. The transfer of management know-how is heavily dependent on how the values, attitudes, competences, and personality traits enmesh with each other. Finding or developing the appropriate people can be very difficult—sometimes an impossibility. If people are involved who are inappropriately qualified to handle the related cross-cultural issues, any attempt to transfer management know-how is counterproductive. If the transfer of management know-how involves uniform procedures, local or regional management is likely to establish its own informal subsystems and routines. This occurs not as an act of defiance, but as an attempt to modify those procedures so that they are better received at the local end. If headquarters cannot supply solutions that serve the needs of subsidiaries, the management role of headquarters has to be questioned. The absorptive capacity of local managers can be greatly enhanced if they—as prospective recipients of new management knowledge provided by headquarters—are given a chance to gain insights into and understanding of the cultures from which that

Cultural Stretch knowledge emerges. Expatriates sent to distant subsidiaries can successfully serve as knowledge mediators if they do not separate themselves from the local business community and socialize with local people—in other words, showing interest in and respect for the local culture, and investing in building relationships and trust with local managers. Cultural stretch—the reaching out across boundaries of language and culture—can be left to the local managers, but can also be the responsibility of headquarters. Cultural stretch is a key component of the accommodating approach mentioned previously. The following is a synopsis of the key learning points to emerge from the cases under consideration: • •

•

•

•

Major knowledge transfer processes across different nations or cultures may take seven years to come to fruition. Initial optimism may be high, but there is a strong probability of confrontation and resistance if senders and prospective receivers of knowledge do not conscientiously strive to establish rich communication channels between each other. Resistance may be the result of cross-cultural miscommunication or clashes of interest. Either way, it may take 18 months or longer to overcome standoffs. In such cases socialization of senders and receivers of knowledge seems to be indispensable, because tacit and explicit knowledge are complementary and tacit knowledge can only be transferred by socialization. Socialization, as stressed in the Nonaka/Takeuchi model (1995), and motivation, as specified in the Gupta/Govindarajan typology (2000), play a key role. Both are significant factors in the creation of an atmosphere conducive to interchange between senders and receivers (Holden 2002). Transfer of purely explicit knowledge across cultures is bound to fail if the prospective receivers are not able or willing to fully understand the context whence this knowledge is derived—that is, they already have tacit knowledge about the sender’s context and culture. The sending culture may have to be prepared to learn from the receiving culture (Napier 2005).

DISCUSSION The cases described here have given some insights into some important questions for cross-cultural KM practice. These include the following: • • • •

Why context/culture specific management knowledge is changing its meaning when traveling Why teachers of management knowledge, which come from another culture, need to find the “right people” for what they teach Why corporations, which want to harmonize their management practices and reduce complexity, need to find the right people for redesigned tasks, and Why transfer of a successful management practice embedded in production technology is bound to fail if the right people cannot be found within the required time span or simply do not exist in a given society.

It is clear that neither the models of Nonaka and Takeuchi, on the one hand, nor of Gupta and Govindarajan, on the other, can embrace these factors, much less suggest practical solutions to problems which these very models anticipate. No model is capable of subsuming all key factors in a simplified format. All this presents KM theorists with a very tricky challenge because, according to the nature of the context, some factors may

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Cross-Cultural Perspectives on Knowledge Management acquire a disproportionate significance and sometimes a disproportionate insignificance. To take a simple yet very familiar example: the capability to operate in languages other than other English is largely insignificant to the businesspeople of English-speaking countries, but to businesspeople whose native language is not English, foreign language knowledge is not only significant, it is a sine qua non of their operational effectiveness. The unilateral transfer of management knowledge (i.e., the imposition of new management knowledge on staff and local managers in another culture) has the effect of seriously depleting valuable knowledge—much of it of the valuable tacit kind—acquired by managers and staff at the local level. These personnel become recipients of knowledge, which is judged by headquarters to be highly context-relevant, but the acts of absorbing it may mean abandoning previously held ways of perceiving, thinking, judging, and acting that were considered normal and self-evident, even obligatory. This proves to be a painful and demotivating experience, presenting individuals with various challenges: • • • • •

To learn the new management rules and to comply with those rules To behave differently as the still valid values of their society would imply To adjust their personality profiles to fit with the prevailing values of the society and the new value profiles of the firm To cope with the changes within the organization, and what they imply for the social groups they belong to and for their private life To redefine their own personality and their notion of privacy

It would be utterly naïve to expect that these changes can take place within a short period. Imposing completely new management practices on people may largely destroy what so far has given orientation to people and what used to be the foundation of their personal identity inside and outside the organization. It has been emphasized several times in this chapter the importance of establishing a conducive atmosphere for creating trust as a prerequisite of cooperative knowledge sharing. Insofar as this observation enshrines a truth, it was noticeable how Western knowledge deliverers tended to ignore it. Indeed, they ignored it so comprehensively in some cases that cross-cultural interactions came to a complete halt. Such eventualities were not anticipated, just as it was seldom anticipated how less blatant forms of resistance could undermine business strategies. It is worth noting that strategies, in the way in which they are formulated and discussed, have a strongly explicit character. What unsettles them in the domain of knowledge transfer is the impact of the tacit in the form of contextually influenced indifference, resistance, and occasionally even outrage. These by no means uncommon reactions take management—especially management at headquarters—by surprise. There is no known antidote to this condition as long as corporate management surveys the world from headquarters and not from multiplicities of local standpoints.

CONCLUDING REMARKS There is no straightforward transfer of management knowledge. On the one hand, successful transfer is subject to numerous preconditions as to the perceived value of the knowledge, the motivation of the knowledge providers, the esteem that the provided knowledge enjoys, and the capabilities of recipients to understand and absorb the offered knowledge. On the other hand, the transfer of management knowledge may cut

Cultural Stretch deeply into the existing structures of values and norms of behavior, which are valid in the recipient societies. The adoption of the new management practices has severe consequences for the identity of the affected people. New definitions are required of social values, of norms of behavior, and of what privacy means to people. Major changes in management practice may therefore bring into the public domain what hitherto had been held to belong to the private sphere. Out of this springs a further observation, which may have positive implications for our understanding of good practice. The way in which good practice is mediated by communication between headquarters and local management and staff and training of local people across languages and cultures is an intrinsic part of the practice as far as recipients are concerned. The case discussed by May, Puffer, and McCarthy (2005) suggests that learning depends on prior unlearning on the side of the trainers and the trainees. Trainers must adapt their training techniques and know-how by considering the local absorptive capacities and by finding ways and means to identify those local people who fit the qualifications and personality profiles required by the new management know-how. One of the great challenges imposed on staff and managers by cross border management knowledge transfer is the necessity of “unfreezing elements in their backgrounds inhibiting their receptivity to learning market-oriented practices” (May, Puffer, and McCarthy 2005, 25). This is by no means the first reference in the KM literature to the importance of unlearning practices and skills for which there is no longer any call. But it is always the others—our colleagues in Moscow or Beijing or Lusaka—who are expected to unfreeze elements in their background. Yet we must learn to unfreeze the equivalent elements in ourselves too (Glisby and Holden 2005; Napier 2005). Otherwise, those all too misplaced ethnocentric assumptions about the superiority of Western methods are merely replicated to our own detriment. In other words, to impose exclusively the good practices of other cultures’ headquarters is tantamount to renouncing local or regional knowledge. Thus, knowledge is reduced to what can be applied across many nations. Although this may reduce complexity within a large firm and will enhance headquarters’ control, it has the effect of increasing the psychic distance between the whole organization and its markets located in culturally diverse socioeconomic environments. In the long run, this constraint on knowledge leveraging will give room to newly emerging competitors that can better deal with local requirements. Cross-culturally, then, from the cases here it seems likely that there is no such thing as a universal best practice; it is relative to those involved in transferring, receiving, and implementing. As has been shown, when a best practice migrates, its quality and perceived usefulness and applicability change. It becomes something different from what was originally conceived. In utterly contrasting ways, this reality was recognized by all the authors mentioned. There is no firm that stands as an unequivocal benchmark for other corporations; as with all other forms of communication there are countervailing influences, whose provenance, Promethean forms, and effects including economic consequences continually take managers by surprise. In fact, if there is one factor that links most of the contributions principally discussed in this chapter, it is that the cultural impacts on cross-cultural knowledge sharing activities repeatedly also catch managers—often at senior levels—off guard and, in some cases, throw corporate strategies off course for years.

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