Venture Knowledgist Quality Integration
TACIT KNOWLEDGE - THE ESSENSE OF QUALITY MANAGEMENT SYSTEMS
Organization's quality management system means quality of management
that is carried out in a systematic way and covers the whole organization.
Managerial levels include the whole organization (a corporation or
a business community as a whole), its business units or functions,
business processes, and individuals and teams. Leadership emphasizes
managers' personal and human aspects in conducting business resources
and actions. Leadership is based on managers' inherent understanding,
knowledge and behaviors. However, traditionally explicit business
information has been emphasized in realizing quality management. Now
the challenge is to combine explicit and tacit (implicit) knowledge
in all managerial business decisions in a professional way.
Also at the operational employee level tacit knowledge has a crucial
importance for the personal performance in carrying out the work.
In fact, nowadays all organizations are knowledge-based businesses,
and all workers are knowledge workers. It is a big challenge of a
quality management system to get knowledge moved from individuals
to the whole organization and between different actors, and from tacit
domain to explicit domain and also vice versa.
Modern ICT (Information and Communication Technology) solutions may
be also very useful in the area of tacit knowledge. Portal is an advanced
solution for knowledge-content businesses. Portals use Internet technology,
but basically a portal is very different from simple Internet or intranet
pages. A big quality related opportunity in portal solutions is to
get the use of business related knowledge and information appearing
in many forms and in different locations in the organization more
effective and efficient. Web-based group work environments promote
collaborative learning and innovation in organizations and networks.
These issues have become most significant factors in modern successful
quality management systems.
The essence of quality management is to manage organizational resources
and operations by relevant information and knowledge. The needs of
using information have been increased overwhelmingly within all kinds
of organizations, their management systems, business processes, and
relationships with the stakeholders or interested parties. However,
this has often taken place in terms of ICT solutions only. This has
induced to difficult situations in many business cases. Modern electronic
business solutions and ICT systems have become almost obligatory in
all kinds of businesses. However, typically they have only not made
the total situation easier because, in fact, they are much more than
only technological issues. One should also take into account thinking,
understanding, competences, skills, commitment, and feelings of the
users of the technological systems. These things are linked to the
tacit or implicit knowledge of people.
Quality experts and the application of recognized quality references,
especially ISO 9000 standards and performance excellence models, have
traditionally emphasized explicit information, e.g. documentation,
written descriptions and procedures, specifications, agreements, and
information records. Tacit knowledge has not been considered as consistently
and in the same details and deepness. However, the most voluminous
and important part of knowledge from the business point of view is
In general quality is understood as degree of fulfilling the needs
and expectations of all stakeholders or interested parties of an organization
effectively and efficiently through organization's products. In general
those products consist of goods and services, and they are realized
through business processes. Quality management is nothing else but
effective and efficient organization-wide business management and
it is primarily based on the beneficial use of business related data,
information, and knowledge. Therefore multifarious methodologies,
tools, and practices of managing knowledge should be used in the context
of professional quality applications, and even quality experts should
be aware and follow the general development of these aspects.
Business realities have changed
The world of business where organizations live and work today is
blurred and based on three major drivers:
- Speed: Every aspect of business and the connected organizations
operates and changes in real time.
- Connectivity: Everything is connected to everything else: processes,
products, people, businesses, companies, countries, etc.
- Intangibles: Every business connection has both tangible and intangible
value. The intangible is its real essence. Information and knowledge
issues (especially tacit knowledge) are emphasized.
Business foundations have changed from certainty and predictability
to uncertainty and ambiguity. That means emphasizing significance
of implicit business issues over the explicit ones. This especially
implies deep understanding of business situations, foundations, and
relations. This situation has remarkable effects in all management
structures and actions (including quality management), and the business
can't any more be managed by obsolescent means.
Due to competitiveness all organizations should strive towards excellence
of business performance. That is also the major intention of all modern
quality efforts. Business excellence can be achieved by deploying
appropriate approaches with superior effectiveness and efficiency
irrespective of the volatility of business environments. Particularly
innovations are emphasized. That requires development and implementation
of appropriate principles and practices also for quality management
and quality assurance.
Agility versus maturity is today's hot question in the field of quality
management. Agility means dynamic, context-specific, aggressively
change-embracing, and growth-oriented issues. The maturity school
is on the contrary appreciating established planning, documentation,
systems, etc., as relating e.g. to the traditional quality management.
World wide discussion is in a paradoxical situation due to the maturity
models and quality management standards, and on the other side the
manifesto for agile development. In fact, the both approaches are
needed simultaneously, but the big question is how. The maturity-agility
dilemma is, in fact, very related with the situation of explicit and
tacit knowledge. Flexible and agile systematic approach is seen possible
only when having a profound knowledge and deep understanding, and
using new modern principles for business process management, advanced
information technology, and management of knowledge.
Approaching from traditional to the
new quality management
Professional quality principles and methodology for quality management
has long roots and development around the world during decades since
1920s. Now the most important references of contemporary quality approaches
- ISO 9000 standards and their derivatives
- Quality awards criteria and business excellence models
These recognized and broadly used references may still be useful
and their guidelines still relevant in the new business circumstances
if only their substances are understood in new way, especially taking
seriously into account tacit knowledge issues (see figure 1). Some
examples that, however, are very central topics of quality management
are questioned here:
- What is the essence of real responsibility of a top manager?
- What is the role of "hidden" structure of a business organization?
- What are the weak signals anticipating changes in the business environments
and among the partners?
- How could one understand continual improvement as organizational
- How to manage immaterial parts of our products, especially services?
- What are the linkages between the explicit business processes and
their performances, and internal mental processes of the workers?
- How to manage with rational, non-rational (emotional), and irrational
(spiritual) intelligence in the business situations?
- How to achieve benefits from innovativeness of the personal?
- What does it mean and require when creating and strengthening confidence
among our stakeholders (i.e. achieving quality assurance happen in
Figure 1. The real quality management system is predominantly a mental
system and a common managerial thinking / behavior model or managerial
memory of an organization.
In these contexts conventional quality systems, quality manuals or
quality records, traditional work of quality managers, or third party
certifications have very little or no beneficial role for quality
management. In fact, they may even cause more harm than advantage.
Quality management system should be understood primarily as a mental
system (see figure 1) and as a general concept for a good systematic
management approach, and it should include appropriate methodology
for managing information and knowledge. For the same reason also texts
of the quality management standards and criteria of the quality awards
represent only a very minor part of the entireties those documents
imply in real practices in organizations. That is also reason why
there are so many different opinions about those documents. Deep tacit
knowledge gives us good bases also for understanding the standards
and business excellence models as the very same substance but only
seen in different perspectives.
One of the most common practices in organizational management is
planning. However, accomplished organizational activities often turn
out to be different from the plans that were formulated. A major reason
to this is that planning cannot reflect organizations' real dynamic
nature. Typically organizations pay too little attention to understanding
the present. It is often only about defining the vision for the future
or analyzing the past, so that one can make factual predictions. However,
we are always acting in the present. The present is actually the only
time in which one can ever do anything. The future is actually in
the present, in the form of expectations. But we are also always acting
in the present on the basis of our past. So the past is in the present,
in the form of the particular story we are telling ourselves as we
are doing what we are doing. Present time focus means that we should
try to understand what everyone is actually doing - and not doing
- and why this is happening. To clearly understand just what it is
that we are doing together in groups, or in organizations, that leads
to the emergent patterns that are our experience. These patterns of
behavior are just the core of an organization. They happen as a result
of all the things that people are thinking and feeling and doing.
Thus, the business reality is primarily something tacit in our minds.
Why then do we design various control systems - including formalized
quality management systems - and put together business plans? The
purpose seems to be that they are social defense against anxiety,
to find some kind of defense mechanism or procedure to avoid the anxiety.
The problem is that we seem to mindlessly design and install procedures
and systems that are based on taken-for-granted ways of thinking.
A lot of the systems that we put in place today actually make people
ill, if we don't understand and take into account the role of tacit
knowledge in our behaviors.
One may consider two more detailed examples characterizing the nature
of tacit knowledge in quality management: values (as mentioned e.g.
by the performance excellence models) and quality policy (as expressed
in the ISO 9000 standards).
Only human beings - never organizations - have values based on their
appreciations. One may see those values in actions of people, not
in any documents. Very often the concept "value" is not
used at all in practice. Thus values are tacit knowledge issues. Organizations
may have documented norms or value management. How one can see those
in practice and their effects? Again we are confronted with tacit
Quality policy means what are the overall intentions and direction
of an organization related to quality. Again the genuine quality policy
can be seen only in the actions of people, not in papers. Quality
policy document issued and signed by the top management of the organization
is only a tip of iceberg of the actual policy. It may, however, be
a useful managerial tool. In fact, it is not necessary to use concept
"quality policy" at all in practical business operations.
Knowledge focus in quality management
Quality management system means quality of the business management
carried out in a systematic way covering the whole organization. There
are management actions on several levels in an organization including
the whole organization, its business units or functions, business
processes, and individuals and teams. Both strategic management and
operational management are needed. Leadership emphasizes managers'
or superiors' personal and human aspects in conducting their business
actions (see figure 2).
Figure 2. Aiming at a world-class performance in leadership. A successful
business leader's primary quality feature is awareness.
Also at the operational employee level tacit knowledge has a crucial
importance for the personal performance in carrying out the work.
That is additionally emphasized by the fact that nowadays all organizations
are knowledge-based businesses, and all workers are knowledge workers
because the work is based typically on knowledge, competence, skills,
and even wisdom of the workers when they are handling different kinds
of data and information in their work, and doing interpretations,
judgments, and decisions for producing valuable outputs to the interested
parties. Requirements and conditions of the job have been changed
from old-fashioned "tailorism" to more human centered as
expressed e.g. by O'Toole (USA): "Work implies an activity that
produces something of value for other people" and Nishibori (Japan):
"Human work includes three elements: creativity (the joy of thinking),
physical activity (the joy of physical work), and sociality (the joy
of sharing pleasure and pain with colleagues)"
Business leaders are typically generalists and strongly acting individuals
with strong organizational positions. They know the right things but
are not necessarily interested in right methodologies. Therefore their
tacit knowledge is being highlighted in their managing actions. Their
strengths especially consist of awareness and self-management (see
The most well-known and recognized general model for management is
the P (Plan) - D (Do) - C (Check) - A (Act) model according to Deming
and Shewhart. This model is also an appreciated tool of quality management.
Traditionally PDCA model has been applied principally in the context
of explicit business information. Now however the challenge to the
business management is to combine explicit and tacit knowledge in
making business decisions in businesses (see figure 3).
Figure 3. Managerial actions based on facts from operations and combined
with the tacit knowledge of managers. "Ba" is a Japanese
concept expressing a collaboratively living environment promoting
change of knowledge.
There are different kinds of knowledge-based business operations
depending whether the work is done and information and data handled
individually or in teams, and whether the work is routine work or
requires interpretation / judgment. These different combinations lead
to different operational models with particular working models, processes,
challenges, and strategies:
- Transaction model or interaction model
- Expert model or collaboration model
Figure 4. Elements of the SECI process for knowledge transformation:
socialization - externalization - combination - internalization of
the knowledge. Managing a SECI process is a key issue in organizations
appreciating intellectual capital.
These situations relate both to explicit and tacit knowledge. It
is an important new area of a quality management system to leverage
knowledge moving (see figure 4) from individuals to the whole organization
and between different actors, and from tacit domain to explicit domain
and also vice versa. This tacit / explicit knowledge transformation
is described by so called SECI process.
Useful application of modern information
technology in the context of tacit knowledge
Although information systems were originally developed for the needs
of explicit data and information, the modern ICT solutions may, however,
be useful also in the area of tacit knowledge. That is based on the
fact that new technology makes possible effective cooperation and
collaboration between knowing individuals and collaborating groups
even around the world.
Portal is a modern solution for knowledge-content businesses. Portal
is a single, Web-based interface into the world of heterogeneous and
incompatible information and knowledge sources distributed across
the telecommunication network. The key quality management related
solution is an organizational portal with quality management applications:
"A cutting-edge gateway to quality-related business reality for
enhancing quality awareness, improved use of expertise, performance
management and interested party confidence." This kind of portal
provides automatic services for quality management to the members
of an organization as well as to its partners. Portals use Internet
technology, but basically a portal is very different from simple Internet
or intranet pages of organizations. Portal has general features that
are beneficial for all kinds of knowledge-based activities including:
- A consistent view of the relevant business community
- Information organizing and searching capabilities
- Direct access to knowledge and resources
- Direct links to relative data and knowledge experts
- Individual identity and personalized access to content
Figure 5. Challenging to enhance the effectiveness and efficiency
of the use of knowledge and information
An interesting topic is to enhance the effectiveness and efficiency
of the use of knowledge and information via a portal. The biggest
challenge for these solutions is the poor use of business related
knowledge and information that may appear in many forms (see figure
5). Important knowledge may be missing. It may be unused because the
needed knowledge is not available or accessible when needed or is
not in a useful form. It may be used but not appropriately or at opportune
time and place, or it may be misused. As one can see, a greater challenge
than to stretch the usefulness of explicit knowledge, information
and data to its extreme is to bring about a radical improvement of
utilization of tacit knowledge. Internet technology makes it possible
to create multifarious access interfaces to the business information
and knowledge, and related shared services. Especially information
security aspects should be emphasized when developing the quality
management of information and knowledge.
Modern Web-operated social networking applications based on simple
and cheap solutions of disruptive innovations have a wide variety
of quality management related uses such as personal management, collaborative
learning, carrying out cooperative projects, and supporting networked
communities. Their main strengths include customizable group systems
that allow many groups to work simultaneously on sharing individual
knowledge and to create new mutual knowledge. This may be done with
appropriate new tools for projects, calendar, tasks, forums, conferencing,
information / knowledge links, chat, reviews, voting, files, instant
messages, resource profiles, etc. Designed to ease problems solving
with group based working, the solutions make it possible to work in
groups, inside and outside the organization. This gives advantages
to organizations which have a lot of work groups that have to be in
contact with each other around the globe. E.g. a virtual network of
quality managers of a corporation or a larger business community may
be created on this basis.
Comprehensive development of quality
management through organizational learning
Organization's everyday business activities, "Domain of Action",
and achieved business performance results depend on the following
managerial corner-stones at the operational practical level (see figure
- understanding the issue, i.e. the ideas and principles directing
- innovativeness of the leadership system, and
- effectiveness and efficiency of management tools.
Figure 6: The overall business performance development framework of
an learning organization includes everyday operations, "Domain
of action" and strategic change management, "Domain of change"
Quality of management includes effective and efficient practices
of planning, control, and continual improvement. Business performance
is possible to enhance via two directions. Reactive development is
achieved through problem solving based on the facts from achieved
performance. More significant improvements are possible if the new
business opportunities are taken as the basis of performance development
and it is based on existing strengths and competitive advantages of
the organization. The reactive method in its backward-looking nature
is not effectively oriented to challenges. Real improvements utilize
innovations and may bring more added-value to customers and other
stakeholders. Creative improvements are possible to carry out through
the well established methods of learning organizations (see figure
6). In this way a broad basis of intellectual capital may be utilized.
A change in organizational performance is brought about by improving
the key factors of the existing "Domain of Action" (the
existing way to understand and run the business). This is arranged
through an organization-wide continual improvement and learning, a
"Domain of Change" which includes
- Increasing awareness of and sensitivity to new realities
- Changing attitudes and beliefs
- Developing skills and capabilities
The change in business activities is achieved through some kind of
"pump effect". These principles of a learning organization
are a challenging basis for the new age of quality management systems
and through them one may get realized e.g. ISO 9000 standards and
performance excellence models in a creative way.
Remarkable business opportunities and development always start at
the level of understanding and personal wills and dreams. Then afterwards
the use of practical tools and methodologies, and factual information
will be applied more effectively. Organizational development and management
are very deeply culture-dependent phenomena. In the western cultures
explicit facts-based management practices have been traditionally
emphasized. On the contrary in the eastern societies holistic understanding
and spiritualism have been prominent. Also western business developers
have many possibilities to learn from the eastern cultures.
New knowledge-based business conditions have enormous effects and
consequences to everything including the behavior of individuals,
groups, organizations, corporations, communities, and societies. Quality
management is a crucial issue for business competitiveness and may
be handled in a professional way also in these changed conditions.
One should only have clear and profound understanding of realities
of knowledge-issues and professional principles and methodology of
the modern quality approach. This is a challenge for quality professionals
who are developing business integrated quality solutions for knowledge-content
business environments. Agility and maturity are not any alternatives
but both are needed in the modern business environments. An advanced
business system including integrated knowledge-based quality management
system may create a strong foundation also for the business agility.
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