Organizational Knowledge Creation Theory and Its Implications for International Business Studies

This chapter outlines the Organizational Knowledge Creation Theory (OKCT) and considers its implications for studies on international business (IB). The presentation is dedicated to the originator of OKCT, the late Professor Emeritus Ikujiro Nonaka, who passed away on January 25, 2025, at age 89. It traces the roots and development of OKCT, highlighting the distinction between knowledge management and knowledge-based management. It explains how the spiraling process of the SECI model, the configuration of Ba, and the phronetic leadership capabilities are formed and replicated in geographically dispersed organizations. This shows how Nonaka’s emphasis on phenomenology broadens our understanding of knowledge as it emerges from the lived experiences of individuals in the environment with empathetic social interactions between collaborating human beings. As generative AI advances, we must redefine the roles and responsibilities of human beings in organizations. Generative AI can automate and accelerate certain knowledge processes, such as data syntheses, pattern identification, and content generation, but it cannot replicate the embodied insights and values-based judgments that remain unique to humans. Hence, the chapter links OKCT to broader questions of global sustainability and resilience among multinational corporations (MNCs) and the implications for IB research and practice. Given the scale and influence of MNCs, their leaders should be catalysts for sustainable and resilient transformation, promoting knowledge creation processes, fundamentally understanding that managing is a “way of life.” This philosophical perspective implicates a humanizing strategy focused on individual contributions as a key approach for MNCs to innovate and foster inclusive regenerative IB activities.