Culture and Knowledge

Culture is one of the most used—and least understood—concepts in organisations.

It is often described as:

“The way we do things around here.”

This works because it is observable.

But it is incomplete.

It describes behaviour, not the mechanisms that produce behaviour.

Culture – A Structural Definition

From both research and practice, and aligned to the Knowledge Operating System:

Culture is the pattern of behaviours that emerges from shared mental models, shaped by purpose, identity, principles, and ethics, and reinforced through experience.

Shared mental models form when individuals develop sufficiently aligned expectations to coordinate action and anticipate the needs, behaviours, and responses of others. These models are not transferred mechanically through information exchange. They emerge through repeated interaction, dialogue, reflection, and shared experience.

This definition introduces four critical elements:

• Shared mental models → the knowledge layer.
• Purpose & identity → directional coherence.
• Ethics → boundary conditions.
• Experience → the testing ground (Gemba).

Knowledge and Practice — The Living Foundation

Socialisation (Tacit → Tacit)

Knowledge in organisations is not simply stored or transferred. It is formed, shared, and refined through practice. It is shared through the practice of Socialisation.

Practitioners draw on a combination of:

• Know-what — facts, structures, and information.
• Know-how — how work is performed in practice.
• Know-why — understanding of cause, effect, and consequence.

Much of this begins as tacit knowledge which is:

• experience-based,
• context-specific,
• and shaped through action, reflection, and interaction, including individual introspection.

It is not stored in systems. It lives in people, relationships, and practice.

Through experience and dialogue, aspects of this knowledge can be articulated.

Externalisation (Tacit → Explicit)

Externalisation is the process through which aspects of tacit knowledge become articulated and expressed in more explicit forms. This may include know-how, know-why, and know-what, although such expression is always partial and shaped by context.

Through externalisation:

• practices may be described,
• reasoning may be explained,
• and shared understanding may begin to emerge.

However, important dimensions of knowledge — including judgement, timing, intuition, and contextual awareness — often remain tacit and can only be developed through experience and practice.

This helps explain why documentation, systems, and training alone do not automatically create capability or shared understanding.

Combination (Explicit → Explicit)

Explicit knowledge, also known as Codified Knowledge, is gradually built up through processes that involve structuring, integrating, and systemising organisational understanding.

This involves:

• Organising knowledge into clear structures that establish a common language, stability, and consistent interpretation throughout the organisation.

• Integrating knowledge across various business capabilities, functions, and domains to make relationships, dependencies, and shared meanings more visible.
• and stabilising understanding through shared models, artefacts, processes, data structures, and systems that enable effective coordination, decision-making, and operational continuity.

These processes make explicit knowledge more accessible, transferable, and reusable within the wider organisational setting. This helps establish a more stable basis for communication, coordination, and collective efforts, especially in large or complex organisations where shared understanding cannot depend solely on informal interactions or individual memory.

This is where the Knowledge Base is formed (see below).

It provides:

• A common language.
• A shared reference point.
• The foundation for coordination and decision-making

👉 Often dominated by platforms and systems

Combination works in concert with Externalisation to stabilise codified knowledge.

Internalisation (Explicit → Tacit)

• Practice
  • Embodiment
  • Learning by doing
  👉 Occurs at Gemba

SECI	Learning Model	Knowledge Dynamic
Socialisation	Learning by Interacting	tacit ↔ tacit
Externalisation	Learning by Exchanging	tacit → explicit
Combination	Learning by Creating	explicit ↔ explicit
Internalisation	Learning by Doing	explicit → tacit

Adapted from Guzik et al.’s e-learning interpretation of SECI (Guzik, Lis, & Chodnicki, 2025).

🔁 Learning Loops

 

Figure 1: Learning Loops in SECI

 

The layers in Figure 1.

The Knowledge Layer (top)

• Externalisation + Combination
• builds the shared knowledge base.

The Learning Layer (bottom)

• Socialisation + Internalisation
• builds individual and collective capability.

The bridge between them:

• Articulation → Structuring (downward flow)
• Practice → Feedback → Refinement (upward flow)

The Knowledge Layer organises what is known.
The Learning Layer develops what can be done.

Shared Mental Models sit between the Learning Layer and coordinated organisational action.

They emerge through repeated SECI cycles and allow people to:

• anticipate each other’s needs,
• coordinate implicitly,
• anticipate the needs and responses of others,
• and adapt collectively under changing conditions.

Internalisation is the process by which knowledge becomes real capability.

It is not:

• reading,
• training,
• or exposure to information.

It is:

• repeated application in real work,
• under real constraints,
• with real consequences.

Through this process, explicit knowledge is transformed into tacit craft knowledge.

For a deeper understanding of the learning environment, see: Subject Area – The Learning Environment

Figure 2: The transformation of data to knowledge.

 

In the bottom half of the picture, data is transformed into contextualised information. The transformations of Craft Knowledge and Codified Knowledge can occur only within the SECI Learning and Validation Loops.

Craft Knowledge — The Outcome of Internalisation

Craft knowledge is the lived, embodied form of knowledge that develops through experience.

Craft knowledge develops primarily through:

• Learning by Interacting,
• and Learning by Doing.

It cannot be fully transferred through documents or instruction alone. It requires observation, participation, experimentation, reflection, and repeated exposure to real constraints at Gemba (Guzik et al., 2025).

It includes:

• Muscle memory — how work is physically performed.
• Sensory awareness — recognising subtle cues and patterns.
• Cognitive judgement — knowing what matters and what does not.
• Observational skill — seeing what others miss.
• Know-why in practice — understanding cause, consequence, and timing.

👉 This cannot be fully taught. It must be developed through experience.

Codified Knowledge – The Knowledge Base

The Knowledge Base is not a repository, nor does it reside solely within individuals.  The Knowledge Base is sustained through Communities of Practice (Grah, 2016) that create, interpret, apply, and renew organisational knowledge through ongoing participation in shared practice.

The Knowledge Base provides the stable explicit structures through which shared mental models can form and evolve.

The structures themselves are not the knowledge.

Knowledge emerges when people interact with those structures through dialogue, interpretation, experimentation, and practice (Gerlero, 2022).

It is a living structure of shared mental models, expressed through:

• Business Capability Models (what the business does)
• Common Data Models (what the business deals with)
• Their integration (how meaning is connected across the organisation)

👉 It is the stable foundation beneath changing processes, systems, and stakeholder perspectives

Figure 3: The Knowledge Base – built on a stable foundation.

AI systems can support the Externalisation and Combination phases by assisting articulation, structuring, synthesis, and feedback generation.

 

However, shared understanding still depends on human interaction, interpretation, and socially legitimate dialogue.

Value Through Use (Gemba)

Explicit knowledge only gains value when actively applied in organisational settings. While documentation, models, procedures, reports, and formal knowledge frameworks can stabilise understanding, their true relevance depends on ongoing practical use.

Knowledge becomes more valuable when it is employed in real tasks, evaluated against actual operations, and used to guide decisions, judgments, and actions. Using knowledge reveals the consequences of assumptions, refines ideas through feedback, and helps to better understand the real-world conditions faced by the organisation.

This process also enhances shared understanding across the organisation. As more individuals actively engage with knowledge, a broader range of experience accumulates. This leads to increased dialogue, clearer interpretations, and new chances for collective improvement, questioning, and learning. Over time, the ongoing interaction between explicit knowledge and real-world experience can deepen understanding, foster better alignment, and boost adaptive skills.

Importantly, using knowledge in practice also functions as an ongoing reality-testing mechanism. Applying knowledge in practice helps reveal:

• hidden assumptions,
• contextual limitations,
• unintended consequences,
• emerging changes,
• and areas where previous understanding may no longer still be valid.

Without ongoing cycles of use, feedback, reflection, and adjustment, explicit knowledge gradually loses meaning and relevance. If not applied regularly, knowledge tends to become more abstract and disconnected from actual organisational experience. Assumptions go untested, contextual understanding weakens, and confidence in current models may diminish over time.

Additionally, organisational coherence can decline as shared interpretations drift, memories fade, and diverse groups develop their own local understandings and workarounds. In this way, knowledge isn’t automatically valid just because it’s documented or stored; its ongoing relevance and vitality require continuous practice, feedback, and shared learning.

Entropy — The Silent Decay

All explicit knowledge is subject to entropy.

Without continual use and renewal:

• Definitions and shared understanding drift.
• Models lose alignment with reality as new factors come into play.
• Multiple versions of truth may emerge as group coherence begins to fade, and people begin to develop their own solutions in isolation to meet their own immediate needs.
• As a direct result of group fragmentation, siloed thinking becomes more prevalent, and systems become complex with an increasing loss of group coherence.

Knowledge does not remain valid by being stored. It becomes real only through use.

👉 It is not self-sustaining. It requires continuous engagement across the organisation.

 

Craft Knowledge

How Craft Knowledge Forms in the SECI Learning Cycle

Internalisation does not happen in isolation; it evolves through broader SECI learning dynamics and is strengthened by repeated practical experience.

 

During Socialisation, individuals learn by observing others, engaging in shared activities, and gaining tacit knowledge through experience, interaction, observation, imitation, and discussion. This process encompasses formal teaching as well as subtle contextual cues, judgments, behaviors, and situational awareness, which are often hard to articulate explicitly.

 

Through Externalisation and Combination, aspects of this tacit knowledge are progressively articulated, structured, discussed, integrated, and stabilised into more explicit forms. Practices, reasoning, models, processes, and shared interpretations become increasingly visible and available for broader organisational coordination and learning.

 

However, knowledge becomes true capability only through Internalisation. At Gemba — the place where work is done and results are felt — individuals use explicit knowledge in real-world situations, facing actual constraints. Through action, experimentation, feedback, reflection, adjustment, and repeated experience of outcomes, knowledge slowly transforms into tacit understanding and practical judgment.

 

This process is fundamentally iterative. Practice provides feedback, which guides refinement, leading to better future actions. Similarly, actions cause consequences, which prompt reflection, and this reflection guides adjustments. Over time, tacit understanding grows stronger through these repeated cycles of learning. It is through the continuous interaction of experience, articulation, practice, feedback, and reflection that craft knowledge slowly develops. This knowledge can’t be completely conveyed through documents or training alone; it is cultivated through direct involvement in real practice.

Critical Insight

Internalisation is where:

• knowledge becomes capability,
• capability becomes judgement,
• and judgement becomes adaptation.

Without internalisation:

• knowledge remains abstract,
• capability remains superficial,
• and learning is incomplete.

🧭 See Adapt, Survive and Flourish (KM Guideline) for the full SECI definition.

Culture is the emergent outcome of repeated SECI cycles across the organisation.

Where Social Capital Sits in SECI

Social capital should not be regarded as a peripheral or just “soft” organisational idea. Instead, it is a vital enabler of organisational learning and the successful functioning of SECI learning processes. Elements such as trust, relationships, shared norms, psychological safety, and relational cohesion significantly affect knowledge exchange among individuals and the progression of learning throughout the organisation.

Importantly, SECI does not operate flawlessly or fail entirely. Organisational learning occurs in degrees and varies in quality and effectiveness depending on the state of the surrounding social field.

When social capital is strong, people are generally more willing to:

• share experience openly,
• expose uncertainty,
• challenge assumptions constructively,
• give, receive, interpret, and integrate feedback through reflective dialogue,
• and take part in shared learning processes.

Under these conditions, SECI learning cycles become richer, more connected, and more adaptive.

As social capital diminishes, learning processes tend to become more limited. Trust decreases, communication turns more cautious, and knowledge sharing shifts toward transactional or politically secure exchanges. Social interactions may become superficial, externalisation more performative or incomplete, internalisation weaker, and the integration process increasingly reliant on systems and formal structures rather than genuine understanding.

In this sense, SECI does not abruptly cease functioning. Instead, the quality, depth, and coherence of organisational learning slowly decline. Learning becomes more fragmented, localised, and focused on compliance, while the organisation’s overall adaptive ability gradually diminishes over time.

 How degradation shows up

• With low trust or psychological safety
  → Socialisation becomes selective, guarded, or superficial.
  → Experience is not fully shared, knowledge may be withheld or filtered.

 

• With weak relationships
  → Externalisation becomes partial or performative.
  → Knowledge is expressed incompletely, shaped by context, capability, and perceived risk.

 

• With fragile or misaligned norms
  → Internalisation becomes inconsistent
  → knowledge is applied unevenly, or not at all.

What this means in practice

Organisations rarely have:

• zero social capital,
• or zero learning.

Instead, they operate with:

• Fragmented trust.
• Localised knowledge sharing.
• Uneven capability development.
• Higher levels of key person risk.

👉 This is why many organisations appear to function while gradually accumulating fragility.

Critical Insight

SECI is always operating.
The question is not whether learning occurs, but:

• what is being learned,
• how accurately reality is being interpreted,
• and how widely is that learning shared and applied?

As social capital degrades:

• Learning becomes local rather than shared.
• Knowledge becomes fragmented rather than broadly coherent.
• Behaviour shifts from adaptive → compliant.

👉 The system continues to work — but with increasing reliance on:

• workarounds,
• key individuals, where knowledge is held by a few.

Communities of Practice and Ba

Communities of Practice provide one of the primary social mechanisms through which organisational learning occurs.

While Ba describes the shared relational field within which people interact, Communities of Practice (Grah, 2016) describe the groups of practitioners who participate within that field and collectively develop knowledge through shared activity, dialogue, problem solving, and experience.

Communities of Practice emerge naturally around shared work, shared interests, shared challenges, and shared identities. They often cut across organisational structures, teams, functions, suppliers, customers, and formal reporting relationships. Membership is based less on organisational position and more on participation in a shared practice.

From a Knowledge Operating System perspective:

• Ba provides the field.
• Communities of Practice provide the social containers.
• SECI provides the learning dynamics.
• Shared Mental Models provide the emergent knowledge.
• The Knowledge Base provides the stabilised organisational memory.

Together, these elements explain how knowledge is continuously created, shared, interpreted, applied, and renewed.

Communities of Practice and the Knowledge Base

The Knowledge Base does not reside solely in repositories, models, procedures, platforms, or documentation.

Knowledge is also embedded within communities that collectively interpret, apply, and evolve those artefacts in practice. Wenger argues that knowledge is created, shared, organised, revised, and passed on within and among Communities of Practice, and that these communities effectively become the owners of knowledge in practice.

Business Capability Models, Common Data Models, policies, procedures, and other explicit structures provide important organisational anchors. However, their practical meaning is maintained through participation, interpretation, dialogue, experimentation, and use within Communities of Practice.

This helps explain why:

• knowledge often survives technology change while communities remain intact,
• documented knowledge frequently fails when disconnected from practice,
• and why tacit knowledge loss becomes significant when communities fragment or experienced practitioners leave.

Boundaries, Innovation, and Islands of Coherence

Communities of Practice not only create knowledge internally; they also create learning at their boundaries.

Interactions between:

• Communities of Practice,
• business capabilities,
• professions,
• organisations,
• customers,
• suppliers,
• and external networks

often become important sources of innovation and adaptive learning.

Wenger notes that radically new insights frequently emerge at the boundaries between communities rather than solely within them.

This observation aligns closely with the concepts of:

• Islands of Coherence,
• Knowledge Mycelium,
• inter-organisational learning,
• and collaborative innovation.

From an organisational ecology perspective, innovation often emerges where different communities, perspectives, experiences, and Shared Mental Models interact within a sufficiently healthy social field.

Warm Data & the Knowledge Operating System

The Knowledge Operating System depends not only on explicit information, but on the relational contexts through which meaning is created and interpreted.

Warm Data consists of the contextual and interconnected information that facilitates tacit knowledge, dialogue, trust, and shared understanding.

Without Warm Data:

• repositories grow,
• dashboards multiply,
• and reporting expands,

while adaptive learning capability quietly declines.

 

Mapping to the Knowledge Operating System and Organisational Ecology

Figure 4: Organisational Ecology

Purpose Layer

• Purpose defines direction.
• Ethics defines constraints.
• Capabilities define what the organisation can do in practice.

The Purpose Layer provides direction, constraint, and scope for the Knowledge Operating System.

It determines what is learned, how it is applied, and within what boundaries.

Ba / Social Field

• The relational space in which people interact.
• Trust, respect and open communication.
• Where people speak, listen, and engage with one another.

Note: See the Subject Area – The Learning Environment for an in-depth discussion here

👉 This is where knowledge flows between people in practice. It is where social capital is formed, maintained, and tested.

SECI Layer

• Knowledge creation, sharing, and operational use.
• Continuous learning loops between tacit and explicit knowledge, see figure 2.
• Understanding is formed individually and refined collectively through interaction.

Knowledge is not created in a single step.
It emerges through repeated cycles of:

• Sharing experience (Socialisation).
• Articulation and sensemaking (Externalisation).
• Structuring and integration (Combination).
• Application in practice (Internalisation).

👉 These cycles operate continuously, not sequentially

The quality of these cycles depends on:

• The strength of the social field (Ba).
• The levels of trust and mutual respect.
• The ability to evaluate knowledge in practice (Gemba).

👉 This is how knowledge evolves, becomes capability, and is sustained over time

Gemba

• Where work is done.
• Where people learn by doing.
• Where reality pushes back on assumptions.
• Where consequences are experienced.
• Where feedback cannot be ignored.

Models, plans, and beliefs are formed elsewhere. At Gemba, they are evaluated against reality.

👉 This is where assumptions live or die.

 

Culture (Emergent)

Culture develops through consistent patterns of interaction, learning, decision-making, and shared experiences over time. It manifests in daily behaviours, assumptions, prioritised decisions, and informal norms that influence how work is actually carried out throughout the organisation.

From this viewpoint, culture isn’t formed primarily by value statements, leadership slogans, branding efforts, or training sessions alone. Although these mechanisms can affect organisational goals or aspirations, they don’t necessarily influence actual behaviour.

Culture arises from what people consistently experience, reinforce, tolerate, reward, and learn collectively. It is moulded through continuous interaction within the organisational environment, including:

• how people communicate,
• how feedback is managed,
• how conflict and uncertainty are managed,
• what behaviours are rewarded or punished,
• how decisions are made,
• and whether learning is genuinely supported in practice.

Over time, consistent interaction patterns develop into shared expectations, routines, assumptions, and behavioural norms. Therefore, culture isn’t merely something an organisation states, it naturally emerges from its learning processes, relational dynamics, structures, and lived experiences.

Culture isn’t what we say we believe.

It’s what we repeatedly do—based on what we’ve learned together.

👉 Culture is not designed—it emerges from the conditions created by the system above and reinforces them over time.

The Integrated Model

• Purpose and ethics shape the field (Ba).
• The field enables SECI.
• SECI builds shared mental models.
• Shared mental models drive behaviour.
• Behaviour patterns become culture.

What Happens When the System Breaks

When social capital diminishes, organisational learning starts to break apart.

Trust drops, relationships turn more transactional, and individuals become more guarded about what they disclose, to whom, and under what circumstances.

Knowledge sharing tends to focus on operational needs rather than elements vital for collective learning and adaptation.

Consequently, understanding becomes confined to specific teams, functions, or individuals, and overall organisational coherence declines.

Simultaneously, the organisation becomes more susceptible to losing tacit knowledge. Experience-based judgment, contextual insights, and practical know-how are difficult to capture fully within systems or documentation. When experienced people leave, retire, disengage, or become overburdened, much of this unwritten expertise is lost. Over time, the quality of judgment may decrease, learning may slow, and the organisation increasingly relies on a dwindling few key individuals who hold vital knowledge and experience.

These conditions are often reinforced when organisations become overly dependent on systems, platforms, processes, and codified forms of knowledge. In SECI terms, Combination begins to dominate the broader learning ecology. Explicit knowledge becomes highly structured, standardised, and systematised, while the tacit dimensions of learning — observation, reflection, mentoring, dialogue, experimentation, and shared experience — receive progressively less attention. The organisation may appear highly controlled and information-rich, yet the deeper adaptive learning layer gradually weakens.

Over time, the overall effect is a gradual but significant cultural change. The organisation shifts from fostering adaptive learning to focusing on procedural compliance. Exploration is replaced by execution, reflection by reporting, and learning becomes more about performance than growth. Although the organisation may still work effectively, its ability to sense change, incorporate feedback, question assumptions, and adapt to uncertainty slowly diminishes. In this way, organisational fragility often develops gradually and unnoticed, long before any formal failure is visible.

Over time, the overall effect is a gradual but significant cultural shift.

The organisation moves:

• from adaptive learning toward procedural compliance,
• from exploration and reflection toward execution and reporting,
• from shared learning toward local optimisation and siloed thinking,
• from resilient adaptation toward increasing fragility and dependence on control,
• and from sensing reality toward protecting established assumptions.

Although the organisation may continue to function operationally, its capacity to:

• sense emerging change,
• give, receive, interpret, and integrate feedback from both people and the wider environment,
• challenge existing assumptions and mental models,
• share tacit knowledge through interaction and experience,
• and adapt under uncertainty gradually declines.

 

This reinforces the importance of feedback as a core adaptive capability. See Subject Area – Feedback for a deeper exploration of how organisations sense, interpret, internalise, and respond to signals from reality.

 

Organisational fragility, therefore, often develops slowly and invisibly, long before formal failure becomes apparent.

The Critical Pattern

Organisations often believe that knowledge can be supported solely through systems, processes, standardisation, and platforms. While these mechanisms are essential, they cannot entirely substitute for the social and experiential aspects of learning.

When organisations increasingly cut back on interpersonal interactions, overly standardise tasks, or rely too heavily on platforms and codified procedures, the fundamental relational conditions that foster learning could start to deteriorate.

Over time:

• social capital declines,
• tacit knowledge is shared less freely,
• reflective dialogue reduces,
• and opportunities for shared learning become increasingly constrained.

Under these circumstances, SECI learning cycles can still run, but their quality and depth gradually decline. Socialisation becomes shallower, externalisation turns more performative, combination becomes more system-focused, and internalisation weakens as learning becomes detached from real practice and feedback.

The organisation may still appear efficient, coordinated, and information rich.

However, beneath the surface, adaptive capability gradually erodes. As this pattern deepens:

• learning becomes narrower and more localised,
• behaviour becomes increasingly procedural and compliance-oriented,
• weak-signal sensing deteriorates,
• and shared mental models lose coherence.

As a result, culture becomes less flexible and more fixed. The organization depends more on control, formal procedures, and key personnel to uphold stability.

Over time, this can produce a gradual shift:

• from adaptive learning toward procedural compliance,
• from collective sensemaking toward execution,
• and from resilience toward fragility.

Importantly, this deterioration often occurs slowly and invisibly. Organisations may continue functioning for extended periods while their underlying adaptive capacity progressively weakens beneath the surface.

 

The package silo effect.

Large enterprise platforms can inadvertently lead to new forms of knowledge centralisation. As organisational meaning becomes more embedded in specialised system structures, authority may shift toward those who control system interpretation and platform knowledge. Research indicates that, under these conditions, knowledge tends to become socially concentrated rather than widely shared, increasing reliance on specialist groups and diminishing overall organisational understanding (Butler & Pyke, 2003). While platforms can enhance operational integration, they may also weaken relational learning and shared sensemaking if the social context around them is overlooked.

Critical Insight

Organisations often assume knowledge is shared when information is exchanged.

In practice, knowledge is only shared when shared mental models emerge through interaction, reflection, challenge, and coordinated experience.

Documentation may stabilise explicit knowledge.
But adaptive capability develops only when that knowledge becomes embodied through practice.

Knowledge becomes capability through use.

It remains valid through renewal.

It survives through shared practice.

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Gerlero, P. (2022). The SECI Knowledge Creation Model: A Look through Sociology. Paper presented at the ICAI Workshops.

Grah, B., Dimovski, V., C. Snow, C., & Peterlin, J. (2016). EXPANDING THE MODEL OF ORGANIZATIONAL LEARNING: SCOPE, CONTINGENCIES, AND DYNAMICS. ECONOMIC AND BUSINESS REVIEW, 18(2).

Guzik, A., Lis, A., & Chodnicki, M. (2025). Effective knowledge creation and transfer in e-learning using SECI model.

Guzik, A., Lis, A., & Chodnicki, M. (2025). Effective knowledge creation and transfer in e-learning using SECI model.

Nonaka, I., Toyama, R., & Konno, N. (2000). SECI, Ba and leadership: a unified model of dynamic knowledge creation. Long range planning, 33(1), 5-34.

Van den Bossche, P., Gijselaers, W., Segers, M., Woltjer, G., & Kirschner, P. (2011). Team learning: building shared mental models. Instructional science, 39(3), 283-301.