The Knowing Organisation

SSIT3 workshop, day 1: 24 April 2003
Professor Chun Wei Choo, University of Toronto

An organisation uses information in three arenas: to make sense of its environment, to create new knowledge, and to make decisions.

Sensemaking constructs the shared meanings that shape the organisation's purpose and frame the perception of problems or opportunities that the organisation needs to work on.

Working with problems and opportunities often become occasions for creating knowledge and making decisions. An organisation possesses three types of knowledge: tacit knowledge in the experience and expertise of individuals; explicit knowledge in the form of artifacts, rules and routines; and cultural knowledge embedded as assumptions, beliefs, and values. The creation of new knowledge involves the conversion, sharing, and combination of all three forms of knowledge. The results of knowledge creation are new innovations or capabilities.

Whereas new knowledge represents a potential for action, decision making transforms this potential into a commitment to act. Decision making is guided by preferences that are based on interpretations of the purpose and identity of the organisation. When new capabilities or innovations become available, they introduce new alternatives as well as new uncertainties. Decision making then selects courses of action that are expected to perform well given the understanding of goals and the conditions of uncertainty. Organisational learning and adaptation are thus the outcome of the interplay between organisational sensemaking, knowledge creating, and decision making

Background paper: Chapter 5: Sensemaking, Knowledge Creation, and Decision Making: Organizational Knowing as Emergent Strategy.

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