Tacit Knowledge Sharing in ERP System Implementation
- Dudi Rozental
- Jun 30, 2007
- 5 min read
ERP (Enterprise Resource Planning) is an organizational concept implemented through information technology. ERP systems consist of modules that operate in coordination with each other. The main concept is creating an integrated computer system, purchased as off-the-shelf software, requiring the organization to adapt itself to the processes embedded within it. The inherent advantage of this approach is the integration of all organizational functions into a single computer system. The organizational information exists in an integrative system, without data duplication, and is available to every function in the organization according to its needs and permissions.
Supporters of ERP claim there is an advantage to using off-the-shelf software because it incorporates "organizational intelligence" from the experience of many organizations worldwide. Such a system should also save costs on system interfaces and facilitate maintenance.
This approach also has opponents. The main arguments against implementing ERP in an organization are that such a system is cumbersome, requires extensive data entry and screens, and makes the organization dependent on a single vendor for its core technology.
ERP implementation serves as a basis for examining the phenomenon of tacit knowledge sharing. Employees from different and sometimes competing departments must unite to unify explicit and tacit knowledge related to organizational processes.
Sometimes, tacit knowledge has become part of daily work routines embedded in the work, making it difficult to identify and emphasize each component in the work process. The process itself is perceived as an integrated unit, and attempts to break it down into basic processes sometimes encounter difficulties because employees are not aware of the processes themselves and find it difficult to reconstruct the thinking process and break it down to the level of individual action components.
Knowledge sharing during ERP implementation is unique because ERP implementation redefines roles and blurs traditional intra-organizational boundaries. Therefore, transferring tacit knowledge is one of the key points in ERP implementation and an important component in its success; this is because reconstructing knowledge if it is lost is difficult.
Factors Influencing the Understanding and Construction of Tacit Knowledge
Based on your text, here are the key factors that influence the understanding and effective construction of tacit knowledge during ERP implementation:
Creation of Work Teams
Management assembles groups that accurately represent processes and employees, ensuring each team includes people who can analyze, document, and implement tacit knowledge effectively. This arrangement can create either positive or negative team dynamics. Positive dynamics built on trust enable openness and efficient knowledge sharing. Care should be taken to avoid repeatedly assigning the same fixed group of employees to permanent teams (organizational knowledge nodes).
Changing Organizational Work Methods
Shifting to process-based work methods instead of functional unit-based approaches provides a cross-sectional view of the organization, facilitating learning and understanding of tacit knowledge. This cross-section reveals how a single process affects different organizational units. However, process-oriented work methods may cause a loss of functional role definition within organizational units.
Pairing New Employees with Veterans
Combining new employees with experienced ones helps surface and share tacit knowledge. New employees receive better mentoring and handover; conversely, they bring fresh perspectives to organizational processes, potentially identifying failures overlooked by veterans—as the saying goes: "A visitor sees every flaw."
Organizational Employees Working with Implementation Teams
Through close collaboration, the implementation team absorbs tacit knowledge firsthand and transforms it into independent ERP processes. It's important to consider that organizational employees may be fixated on familiar working methods, making it difficult for them to accept new processes and ideas the implementation team proposes. This can cause delays and waste organizational time and resources.
Hierarchy in the Implementation Team
Since organizational structures are hierarchical and sometimes resistant to bottom-up suggestions, it is recommended that the implementation team create a parallel hierarchy that mirrors the existing organizational structure. This facilitates knowledge transfer across all levels between corresponding ranks.
Open Space
Creating a large, open hall without partitions where all teams can work together provides a comfortable platform for brainstorming, sharing ideas, and conducting discussions between multiple teams. In this structure, knowledge flows better, improving decision-making and contributing to the implementation process.
Additional Factors in Managing Tacit Knowledge During ERP Implementation
Open Space Challenges and Solutions
However, there's a thorny issue: discussions between multiple large teams consume significant time and create noise and commotion, resulting in confusion and a lack of concentration for other teams. Additionally, this platform may be too overwhelming for less dominant individuals whose voices might go unheard, preventing their contribution to the process. Therefore, if working in an Open Space environment, it's recommended to dedicate meeting rooms and create supporting mechanisms that ensure complete coverage of all stakeholders' opinions.
Listening to Ideas, Even When Undeveloped
Ideas should not be rejected because they are not fully formed or conceptually complete. This approach encourages employees to express opinions, share, and contribute to properly and effectively implementing tacit knowledge in the ERP system. Criticizing employees' ideas before they are analyzed will create resistance and reduce their future cooperation.
Support from Management
Management serves as a role model and supports employees' sharing of tacit knowledge. They present the implementation and sharing process as an important project rather than a "top-down directive" to convey the full importance of tacit knowledge sharing and motivate employees to actively participate.
Proper and Balanced Integration of Experts in Teams
Having too many experts in teams can lead to a lack of knowledge sharing if they don't know how to work as a team due to human limitations (since each is recognized externally as an expert). However, with proper planning and wise management, it's possible to create dynamics that lead to better decisions, innovative ideas, and more efficient implementation processes.
Every organization accumulates vast knowledge, including customer requirements, product improvement processes, or new services under development. To collect this wisdom, organizations invest millions of dollars in new knowledge management technologies based on advanced technology implementation, but most fail because they don't consider the human factor.
The Nature and Importance of Tacit Knowledge in Organizations
Tacit knowledge differs fundamentally from explicit knowledge. While most organizations have control over explicit knowledge that can be documented in manuals, books, training materials, or databases, it's important to remember: the most valuable knowledge in most organizations is tacit knowledge—the knowledge expressed through instincts, judgments, intuition, and people's experience. This is the central knowledge that organizations try to preserve. It is an organizational asset.
Effective knowledge sharing depends significantly on managers, who set the tone for organizational communication. An atmosphere of sharing and mutual respect contributes to understanding at all company levels that knowledge sharing leads to organizational growth and prosperity.
Advanced technology serves as a tool for organizing knowledge but shouldn't be relied upon as the sole solution. New information technologies like ERP systems support employees seeking information and sharing. Still, they don't generate the knowledge themselves or indicate that everyone with access to these systems possesses tacit knowledge.
People cannot be forced to volunteer knowledge, but it is possible to create a climate of mutual respect and trust to bring this knowledge to light.
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