How does an organization learn?
In 1995, Professors Nonaka & Takeuchi (at Hitotsubashi University, Tokyo) developed a four stage spiral model of organizational learning.
Tacit knowledge is personal, context specific, subjective knowledge, whereas explicit knowledge is codified, systematic, formal, and easy to communicate. The tacit knowledge of key personnel within an organization can be made explicit, codified in manuals, and incorporated into new systems and processes. This process is called "externalization".
The reverse process (from explicit to implicit) is called "internalization" because it involves employees internalizing an organization's formal rules, procedures, standards and other forms of explicit knowledge.
“Socialization" denotes the sharing of tacit knowledge and the term "combination" denotes the dissemination of codified knowledge.
According to Nonaka & Takeuchi, knowledge creation and organizational learning take a path of socialization, externalization, combination, internalization, socialization, externalization, combination . . . and so on, in an infinite spiral.