Knowledge Management: Absorptive Capacity, Double-loop Learning, and Tacit and Explicit Knowledge Explained.
Absorptive Capacity
Absorptive Capacity relates to an organisation’s ability to recognise the value of new information, embed it into an existing knowledge system, and apply it to achieve the intended business outcomes.
In short, it's the skill of learning new things. For instance, a business culture that values ongoing learning has greater absorptive capacity than one that doesn't support personal growth. This ability helps organisations handle volatility, uncertainty, complexity, and ambiguity (VUCA) effectively.
Double-loop Learning
Double-loop learning involves adjusting objectives or decision-making principles based on experience. The first loop employs these goals or rules, while the second loop allows for their alteration, thus termed "double-loop". This learning method is beneficial for organisational growth as it fosters creativity and innovation, helping not just to adapt to change, but also to foresee and stay ahead of it.
In essence, double-loop learning contrasts with single-loop learning. Single-loop learning involves repeatedly addressing the same problem using the same method without ever questioning the objective. Single-loop learning is characterised by acquiring knowledge and applying it without change—essentially a static process. Conversely, double-loop learning represents an evolution in understanding, transforming from simple and static to more comprehensive and dynamic. This method challenges whether the actions being taken are truly appropriate, e.g., are we doing the right thing?
For example, a single-loop learning thermostat turns on the heat when the temperature dips below 69°F. In comparison, a thermostat that questions this setting and considers if another temperature would be more efficient is using double-loop learning. Similarly, a store closing at 5 PM illustrates single-loop learning, while extending hours to 8 PM in order to respond to a change in peak shopping days shows double-loop learning.
Tacit and Explicit Knowledge
Tacit knowledge is rooted through experience and skills, and hard to transfer, express, codify, and assess. In contrast, explicit knowledge is easy to share, verbalise, codify, assess, and store, found in books, databases, and descriptions etc.,
One instance of converting tacit knowledge to explicit knowledge is when a technical specialist writes a knowledge article based on their expertise, making that knowledge accessible to others. Conversely, an example of transforming explicit knowledge into tacit knowledge occurs when a participant applies what they have learned from a training course to implement solutions within their organisation.
I hope this all makes sense.