CREATING KNOWLEDGE IN PRACTICE PRESENTED BY: ZAAKIA CHAWLA BOOK NUMBER 4 ROLL # 18

THIS CHAPTER DISCUSSES THE.. Knowledge creation process in Matsushita Electric PART 1 Development of ‘Home Bakery’ Effect of that development throughout the co. PART 2 process of knowledge creation at a corporate level

MATSUSHITA :CORPORATE BACKGROUND  Focus: household appliances  Challenges:  Reached market maturity  Rivals from newly industrialized countries  Strong price competition  Strategy: ACTION 61 ’Beyond Household Appliances’

INTEGRATION OF THE THREE PROBLEM CHILDREN Cooking Appliances Division Rice- Cooker Division Heating Appliances Division Rotation Division

ENABLING CONDITIONS AT MATSUSHITA  Creative chaos  Autonomy  Requisite Variety  Redundancy of Information  Organizational Intention

THE 1 ST KNOWLEDGE CREATION SPIRAL-Home Bakery  Trend observation:  More working women  Increasingly simplified home cooking  Poorer diets  Conclusion: Cooking appliances must make meals ‘Easy & Rich’

THE 1 ST CYCLE OF THE HOME BAKERY SPIRAL Sharing tacit knowledge among pilot team members Creating a concept-product features (eg. The machine must knead,ferment & bake bread automatically once the ingredients are put into it) Justification against company intention of the experience being ‘easy and rich’ for the consumer Building a prototype of Home Bakery- overcooked outside, raw inside. To the 2 nd cycle

2 ND CYCLE OF THE HOME BAKERY SPIRAL (solving the kneading problem) Sharing tacit knowledge by apprenticing with the head baker The knowledge was externalized by creating the concept of ‘Twisting Stretch’ Justification against ‘Easy & Rich’ Building a prototype with special ribs in the dough case. To the 3 rd cycle

THE 3 RD CYCLE OF THE HOME BAKERY SPIRAL Sharing tacit knowledge among the commercialization team Externalizing knowledge by creating the concept of ‘Chumen’ Justification againt the organizational intention of cost and quality requirements Building the prototype of Home Bakery. To the cross leveling of knowledge

CROSS LEVELING OF KNOWLEDGE WITHIN DIVISION  The development of Home Bakery was a sharp break with past tradition  encouraged the development of other innovative products (e.g. automatic coffee brewer)  New knowledge spilled over beyond the product development team

CROSS LEVELING OF KNOWLEDGE BETWEEN DIVISIONS HOME BAKERY TEAM EASY & RICH DIVISION HUMAN ELECTRONICS (umbrella concept) COMPANY

2 ND KNOWLEDGE CREATION SPIRAL AT THE CORPORATE LEVEL  Focus: soft side of knowledge creation  Output: creation of new knowledge in terms of management systems, operational mechanisms or HRM systems  This output may also play an important role in gaining a sustainable competitive advantage.

THE 1 ST CYCLE OF THE CORPORATE SPIRAL Sharing tacit knowledge among the Human 200- people committee members Creating the concept of Voluntary Individuals Justification by the Human 21 Committee against doubt cast within the company To the second cycle

2 ND CYCLE OF THE CORPORATE SPIRAL Building an archetype of operational mechanisms as ‘concurrent engineering. Justification against ‘voluntary individuals’ Creating the concept of ‘Mind & Management Innovation’ Sharing tacit knowledge among the self- organizing team members To the next spiral of knowledge creation

ENHANCING ENABLING CONDITIONS FOR KNOWLEDGE CREATION  ‘Enabling conditions’ must be upgraded continuously for knowledge creation to continue  Creative chaos  Autonomy  Requisite variety  Redundancy of information  Organizational intention  Therefore, factors that facilitate these conditions must be improved continuously.

CONCLUSION.. Knowledge creation is a never ending process that requires continuous innovation-which is especially important for companies to survive in the competitive & volatile environment of today