Tacit knowledge as a promoter of project success Presented by Poj Paniangvait Yingrudi Khankaew

Agenda Context Objective Technical idea Perspective Conclusions Point of view: enhancement perspectives Future Recommendation

Context Author: Kaj U. Koskinen Key Problem: Tacit knowledge can be key success factor in the delivery of automation systems by using 2 cases study in the metallurgical industry

Case Studies Case1: Automation project for a steel plant Case 2: Automation project on a concentrator plant

Objectives To describe the presence and effects of tacit knowledge in the delivery of automation systems To show how the tacit knowledge of the project personnel can have a noticeable effect on the success of the project

Technical Ideas Theoretical Framework Research context Research methodology

Theoretical Framework Explicit VS Tacit knowledge Importance of experience Mental models Intuition Commitment Interaction as a reinforcing factors Metaphor Summary: tacit knowledge is practical know-how

Theoretical Framework Type of Knowledge Explicit knowledge (Nonaka and Takeuchi,1995) type of knowledge which can be articulated in formal language Tacit knowledge (Polanyi,1996; Johnson-Laird,1987; Nonaka and Takeuchi,1995) Beliefs, value, viewpoints, uncodified routines, etc. intuition and commitment

Theoretical Framework Importance of experience Bardaracco (1991) human being can take advantage of information if earlier social software connected to information Cohen and Levinthal absorptive capacity man's capability of utilizing new information in the solution relies on his earlier knowledge Ross, 1989 Knowledge and know-how based on experience can be utilized in engineering supported by cognitive psychological research Lyles and Schwenk,1992 The capability to solve a problem is dependent on the richness of the existing knowledge structure Multi-faceted experience

Theoretical Framework Mental Model Kim, 1994 mental models represent a person's view of the world, including both explicit and implicit knowledge Argyris, 1989 Although people do not always behave congruently with what they say Mental model provides a context in which to view and interpret the new experience.

Intuition Just do it this way. It will work. Senge,1990;Nystorm,1993 they are not figure out complex problems entirely rationally, relying instead on hunches, recognising patterns, and drawing intuitive analogies and parallels to other seemingly disparate situations

Theoretical Framework Interaction as a reinforcing factor Daft and Huber, 1987 The richness of a medium can be analyzed in terms of two underlying dimensions: the variety of cues to the medium convey and the rapid of the feedback the medium can provide. Berger and Luckman, 1966 Face-to-face social relations Here-and-now interactions Meaning are created and negotiated through communication and interaction between people.

Theoretical Framework Metaphors Nonaka and Takeuchi, 1995 Metaphor is highly effective in fostering direct connection with the creative process in the early stages of knowledge. Metaphor merges two different distant ideas into single.

Research context 2 Main context approaches: A sale project(explicit) document an offer an order A delivery project(required tacit) engineering installation commissioning Sales Project - Offer - Order Delivery Project - Engineering - Installation - Commissioning

Knowledge Creation Process Delivery Project Same Task Same Partner Other Partner Intuition Commitment Text Books Contacts Plans etc. Knowledge Conversion Explicit Knowledge Know-Why Richness of Interaction as a Reinforcing Factor Experience Tacit Knowledge Know-Why Knowledge creation process in delivery project. (The “figure is based on the principle of the ‘Knowledge Conversion' model by Nonaka and Takeuchi, 1995).

Research Methodology Using a “knowledge intensive quantity” empirical part using “action research method” to gather information

Case study and perspective

Case 1: Automation project for a steel plant Supplier is Finnish enterprise manufacturing automation systems Customer is A Finnish steel mill

Case 1: Working stages : Initial stage the suppliers had no tacit knowledge on rolling mill experience. (Table 1) Planning stage Several meetings and trainings between customer and supplier mostly explcit knowledge exchange involve telephone and telefax communication no common language and different mental models increase bad feeling within the project decrease commitment During the project no common social events between supplier's and customer's project group no activities increased openess and mutual confidence(tacit knowledge During installation and commissioning Character of a rolling mill process(tacit knowledge) begin to be clear to supplier's project group unprofitable for the supplier because of the delayed project

Table 1 Experience-based tacit knowledge of the personnel at the beginning of the coarse rolling mill project Supplier's experience: No rolling mill experience No problem solving skills based on intuition Difficult to understand customer views Expert on automation Customer's experience: Expert on rolling mill Some automation experience Coarse rolling mill in Finland The supplier and customer had some earlier co-operation - Little understanding of the other party's uncodified routines

Perspective and conclusions case1 The lack of tacit knowledge was an obvious reason for the poor economic performance of the project Unprofitable to supplier due to the significant delay of the project

Enhancement perspective and learning At the end of the project the tacit knowledge of both the supplier and of the consumer relating to rolling mill automation has increased significantly. (table 2) Tacit learned enhance: common language, communication way- metaphor, better co-operation and mutual understanding

Table 2 Experience-based tacit knowledge of the personnel at the end of the coarse rolling mill project Supplier's experience: Much rolling mill experience Intuition Based problem solving skills improved Better able to see the customer’s views and understanding their ‘language’ Expert on automation Customer's experience: Expert on rolling mill More automation experience : More understanding about automation viewpoints and attitudes (for example work discipline) Coarse rolling mill in Finland The supplier and customer now had much experience of co-operation - Better understanding of the other party's uncodified routines

Case 2: Automation project for a concentrator plant Supplier is the engineering department of Finnish multi-metal enterprise Customer is a large South African Mining company

Working case of Delivery process The delivery consisted of an automation system, which was designed at the supplier’s plant and installed and commissioned at the steel factory’s rolling mill.

Case 2 Working stages Initial stage planning meeting held at the customer's premises initial data of customer as explicit knowledge planning stage Two customer tailored coursed in Finland. tacit knowledge are speciied in some degree installation and commissioning stage common language similar mental models no delay more commitment experience and mutual trust common spirit feeling of security between groups

Table 3 Experience-based tacit knowledge of personnel in the beginning of the concentrator project Supplier's experience: Much experience in concentration Plant Intuition Based problem solving skills Easy to understand the customer’s views and problems High task commitment Expert on automation Customer's experience: Expert on concentrator Plant Quite a lot of experience with automation Easy to supply initial data to the supplier A concentrator plant in the Republic of South Africa The supplier and customer had no previous co-operation - However, quite a good understanding of the other party's uncodified routines

Perspective and conclusions case 2 Tacit knowledge gained from experience may be expected to help significantly in the success of delivery projects. The level of communication, not only explicit but tacit, within a project is significant key to its success.

Table 4 Experience-based tacit knowledge of personnel at the end of the concentrator project Supplier's experience: Much experience in concentrator Plant Intuition Based problem solving skills Easy to understand the customer’s views and problems High share task commitment Expert on automation Customer's experience: Expert on concentrator Plant Much experience on automation A concentrator plant in the Republic of South Africa The supplier and customer had now much experience of co-operation - Good understanding of the other party's uncodified routines - Supplier's comfort at working in strange environments increased

Point of View  Tacit knowledge has not received much attention.  A great deal of know-how required in the delivery is tied to knowledge that is not written.  Tacit knowledge is difficult to express and define  The research problem in the action research method is holistic and diffiicult to separate into parts using analysis.  The author of this paper participated as a designer and project manager in both of the projects, which are the basis of the empirical part of the study  Optimization:Enhancement and extensible application for development stages is important  To Increase efficiency, effectiveness and innovativeness

Point of view At extensible and enhancing level in the future, the company can be knowledge creating company by the followings: 1. Socialization: collective data by dialogue and interview from knowledge worker 2. Externalization: analysis of tacit knowledge and link to explicit knowledge by using knowledge mapping model or common KADs 3. Combination: create best practice, learning by doing and combining previous knowledge and new knowledge 4. Internalization: distribute best practice model and make it more applicable and effective in different scenario in field building

Four modes of knowledge conversion and spiral model To From Nonaka´s theory of knowledge creation

Knowledge Creation Processes at 5 phases 1.Discovery phase: Share Tacit knowledge Knowledge capture meeting: knowledge mapping and commonKADs Template 2.Capture phase: Create concept and common language CommonKADs knowledge model/map 3.Sharing phase: Justify concept Share Best Practice scenarios 4. Build Archetype phase: Directions and routines Application Facilitating and mentoring 5. Development phase: Cross leveling knowledge Sharing/Networking and Continuing development

KM Practices Middle-up-down management CKO COPs Knowledge Engineering Team KMS support CKO=Chief knowledge Officer COPs=Community of Practice: Knowledge Engineering Team (Middle Management) as facilitator and mentor KMS support team

Balance Scorecard as KPI Key Drivers Financial perspective Customer perspective Internal business process Learning and Growth Total Quality Management CRM program Activity Based Costing Knowledge Management

Future Recommendation…. Establishing an enterprise knowledge culture Developing and deliver knowledge-based product and services Maximizing the value of enterprise’s intellectual capital Creating an environment of knowledge sharing Establishing a culture of continuous learning Managing customer’s knowledge to increase their loyalty and the value added

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