MIT Sloan Management Review

Leadership and Organizational Studies

 

Knowledge Management’s Social Dimension: Lessons From Nucor Steel

By Anil K. Gupta and Vijay Govindarajan

October 15, 2000

To sustain competitive advantage, a company must give people incentives to transfer their knowledge. A look at the innovative steel company Nucor and others suggests how to build a knowledge-sharing environment.

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A gap exists between the rhetoric of knowledge management and how knowledge is actually managed in organizations. There is widespread awareness of the economic value that creating and mobilizing intellectual capital can unleash. Yet, for most companies, the reality rarely matches the potential. As the CEO of a commercial-services company lamented in an interview, “We provide pretty much the same services in every location. But my regional managers would rather die than learn from each other.” Our research suggests the CEO’s experience is not an isolated one. In fact, too often, actual knowledge sharing doesn’t just fall below executives’ expectations; it doesn’t even match their perceptions about the extent to which knowledge is being shared within their organizations. (See “The Potential vs. the Reality of Knowledge Sharing: Survey Results from Three Large Global Corporations.”)

Building an effective social ecology — that is, the social environment within which people operate — is a crucial requirement for effective knowledge management. Nucor Corp., the world’s most innovative and fastest-growing steel company for the past three decades, is a case in point. The company’s phenomenal success cannot be explained without examining the exemplary social ecology that Nucor has created for accumulating and mobilizing knowledge. By adopting a similar framework, any company can convert itself into an effective knowledge... To read the complete article, login or sign-up using the form below.

 
 

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