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The Two Valence Forms

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The Problem of Knowledge, and the Two Valence Forms


When framed as “the main cost, the main investment, the main product of the advanced economy” (Drucker, 1969, p. 264), it is quite understandable how knowledge became commodified—simultaneously a “natural” resource and a finished, economic good. In that sense, one could question whether, in the context of a so-called knowledge economy, the Knowledge valence should be distinct or included as a component of Economic valence, representing both a contemporary commodity and medium of value exchange. Individuals contribute their experience, education, skills, and capabilities to an organization, often in direct exchange for financial remuneration—your coin for what I know. For those framed as knowledge workers – including all of the participants in this research study – knowledge is their stock-in-trade, no different from the value provided by the bricklayer in constructing a wall, the lumberjack in felling trees, or the farmer in reaping the fruits of his/her harvest.


There is, of course, a fundamental difference in kind that the contemporary world, and especially the Drucker-inspired discourse of knowledge economy, has attempted to convert to a mere difference in extent. Reifying intangible, non-rivalrous, and intrinsically non-excludable knowledge into a near-tangible, tradable commodity is consistent with an industrially oriented mentality. In other words, Drucker’s original framing is problematic relative to a context that reads history as epochal transformations enabled by quantum innovations in the dominant mode of communication and interpersonal engagement. It attempts to characterize one of the dominant, transformative aspects of the contemporary world – the instantaneous, multi-way exchange of knowledge – in Industrial Age-cum-modernist terms. Knowledge as a commodified medium of value exchange is consistent with the prior epoch; Knowledge valence conflated with Economic valence is inherently a construct that reinforces the dominance of economic considerations over any other.


How else can we understand the nature of knowledge and the Knowledge valence? Nonaka Ikujiro, together with numerous collaborators, introduce Nishida’s concept of basho (expressed in its suffix form, ba) to describe the,


…shared context in motion in which knowledge is created, shared, and utilized (Nonaka, Toyama, and Konno, 2000). Ba is the context shared by those who interact with each other, a process through which the context itself evolves through a self-transcending process of knowledge creation. Knowledge emerges out of ba. (Nonaka, Toyama, & Scharmer, 2001)


According to Nonaka, the processes of knowledge socialization, externalization, combination, and internalization occur in the context created by ba (Nonaka & Konno, 1998; Nonaka, Toyama, and Konno, 2000; Nonaka, Toyama, & Scharmer, 2001) in a way that is neither transactional nor strictly instrumental. Rather, these processes represent a continual flow and transformation of knowledge through social, psychological, cognitive, and spiritual places in an organization. In his adaptation of Nishida’s philosophy, knowledge originates in, and mutually determines, ba, and the “firm is a constantly unfolding organic configuration of ba” (Nonaka, Toyama, & Scharmer, 2001, n.p.).


Although I do not agree that an organization is exclusively, or even primarily, determined by knowledge – a conceptual artefact of the knowledge economy discourse – Nonaka’s adaptation of Nishida’s philosophy provides useful guidance into the dual nature of knowledge, and specifically, the Knowledge-valence relationship. From Drucker, there is an instrumental, transactional, and tradable aspect to knowledge. This is knowledge as both resource and good, with a clear, economic connotation. On the other hand, from Nonaka, there is “a physical, a relational, and a spiritual dimension” (Nonaka, Toyama, & Scharmer, 2001, n.p.) to knowledge. This is knowledge that creates a common sensibility, a common understanding of place and contextual circumstances, and a common volition to action among organizational members. The former I call “fungible[1] Knowledge (f-Knowledge); the latter, Knowledge-ba.


Both forms can be seen among the empirical findings of this study. In Organization A, for example, Adam describes the importance of individuals’ Knowledge-valence connections to the organization in the aftermath of a merger: “What’s noticeable is that we have all sorts of folks that you weren’t aware of that they had particular association with certain things that suddenly claim to have that association” (Adam-1-48). This reaction among people whose jobs are suddenly placed in jeopardy can be understood as a survival response in the context of an organization that simultaneously claims to value f-Knowledge-valence relationships, and artificially imposes an arbitrary limit on the quantity of f-Knowledge-valence relationships that it will support, through its focus on “reducing redundancies.”


(Re-)creating knowledge as a rivalrous resource correspondingly creates a disruption in information flow that restricts the ability to get the job done, as Adam describes: “Information is not flowing, and for us that … becomes an issue, because information that’s needed to make decisions and recommendations and plans becomes fragmented, and becomes twisted by the interests of the supplier of the information” (Adam-1-52). Irrespective of one of Fayol’s (1949) basic principles of BAH management, that business concerns should take precedence over individual concerns, when fungible valence relationships are recreated as rivalrous and limited, personal concerns (like survival) far outweigh concerns of the enterprise.


In the case of f-Knowledge in Organization A, for example, information stops flowing at times when people see opportunity to either advance, survive, or protect territory. Information possession and control becomes a very valuable commodity and asset to be hoarded in times of uncertainty. Knowledge is not only power; in an interesting reversal, it can also become the governor that limits that which powers the organization. In the discursive context of the knowledge economy – within a relatively more BAH environment – Knowledge- and Economic-valence relationships may become conflated: f-Knowledge becomes a rivalrous resource when organization members perceive that Economic dominance is equivalent to exclusivity of f‑Knowledge.


In Inter Pares, the multiple venues in which knowledge is “socialized” are more than merely instrumental means through which information dissemination occurs. Regular program meetings and all-staff meetings – the two, primary governing bodies of the organization – create Knowledge-ba relationships among all members, and the organization itself. Instrumentally, “it makes the wheels turn easier, so you don’t have to come up with fifteen administrative checks and balances, and have somebody look over your shoulder as you’re trying to make every decision which, actually, is a waste of energy” (Jean-1-54). It also enables Inter Pares’s amazing ability to permit every member to commit the organization to a course of action with external constituencies. Each person shares the common context, a common sensibility, and a common volition to action. Simply put, Knowledge-ba creates a circumstance in which everyone just knows what to do.


Loreen expresses some of her perceived distinction between f-Knowledge and Knowledge-ba in describing Unit 7’s culture of inquiry, differentiating between checking-up and checking-in. She describes how an employee, hired for their expertise and knowledge may feel considerable discomfort in asking “content-related” questions. If one is paid to know – that is, compensated for their f-Knowledge – they had better know what they claim. If a senior member of the organization or a client questions that employee, it is often based in the employee being asked to either demonstrate their f-Knowledge (that is, their value to the organization), or justify the adequacy of their performance (checking-up). In a f-Knowledge organization, the space of inquiry is perceived as unsafe: “questions weren’t a comfortable place to live … it isn’t a natural place to want to be in terms of feeling confident” (Loreen-2-102).


However, in a Knowledge-ba environment, inquiry is the mechanism used to create that Knowledge-ba in the first place. Opening space for an “expert’s” own inquiry by inviting place for the not-yet-known is a path to creativity and innovation. Thus, the leader’s role shifts from directing work to encouraging appropriate inquiry and discovery, a role that both requires and creates Knowledge-ba, quite consistent with the contention of Nonaka, Toyama, and Konno (2000).


The question now arises: if there are both fungible and ba forms of the Knowledge-valence relationship, is there an equivalent duality for each of the other valences? The answer, as one might now expect, is unequivocally, yes. For each valence relationship, the fungible form is more instrumental and transactional. In all cases, the fungible-form valence relationships can be conflated with economic considerations, be it with respect to extrinsic motivation[2] (f-Socio-psychological), job titles (f-Identity), direct compensation (f-Economic), or externalizing waste products in pollution (f-Ecological).


Conversely, the ba-form valence relationships are environmental—they permeate the organization creating the types of commonality among members that manifest in Inter Pares’s collaborative management style, the tremendous success of Unit 7’s B-Roll Diabetes Initiative, and my department’s accomplishment of a remarkable number of projects for which no one supposedly had time. It is the source of intrinsic motivation (Socio-psychological-ba), constructing one’s sense of organizational self in referent[3] terms (Identity-ba), having a demonstrable sense of how one is valued by the organization (Economic-ba), and reflecting the organization’s collective engagement with public space and the physical environment (Ecological-ba).


As I will demonstrate in more detail in the next chapter, BAH organizations tend to emerge when fungible-form valence relationships predominate; UCaPP organizations emerge from ba-form relationships. As the ba-form relationships become more pervasive throughout an organization, and interact with more complexity among the members, a greater sense of collaborative community, with common sensibility, appreciation of context, and volition to action develops. This unity and coherence I describe as “organization-ba,” a pervasive, encompassing basho that is a crucial, if not determining, emergent property of UCaPP organizations. The connection to Adler and Heckscher’s description of collaborative community becomes clear if organization-ba is construed as Weber’s suggested “value rationality.” In this, an environment of organization-ba becomes the enabling cause that yields “contribution to the collective purpose, and contributions to the success of others” (Adler & Heckscher, 2006, p. 39).


In an earlier chapter, I described how Inter Pares creates its form of coalition with partner organizations worldwide:


Follow the relationships. So follow the place in the centre where both we feel that we can engage and we can contribute, and the people with whom we are building the relationship also feel that they can participate in this relationship, and they'll get something out of it, and it will be useful in the context in which they’re working. (Jean-1-3; emphasis added)


In Valence Theory terms, Jean’s formula describes participating in mutual exchange relationships that will connect Inter Pares with a potential coalition partner—in other words, creating various valence relationships. Additionally, she describes “the place in the centre” – basho – in which both will engage and find common context. Juxtaposing and connecting Inter Pares’s organizational context with that of the potential partner create a relationship that will be “useful in the context in which they’re working,” rather than, say, forcing the partner to adopt Inter Pares’s worldview and approaches. The two organizations come together to forge new valence relationship bonds, thereby creating a new, emergent organization in what otherwise might be called a meeting of minds. The unity and coherence that are simultaneously created is organization-ba—literally, the place (basho) of the new organization in the generative sense suggested in Nishida’s (1933/1970) original work.


The farther an organization is towards the UCaPP end of a hypothetical, BAH-UCaPP spectrum, the stronger is the corresponding sense of organization-ba. Members of UCaPP organizations are multiply interconnected and mutually engaged as a way of being. In contrast, we have seen that the more BAH an organization becomes, the more fragmented, separated, and instrumentally or transactionally connected are the members—even within themselves, as reported by all participants from Organization M. Drawing from this extreme, BAH case among the research participants, Organization M suggests that bureaucracy, administrative controls, and hierarchy may tend to ossify an organization by interfering with the complex interactions among valence relationships. Strong organization-ba indicates the degree to which valence relationships are able to interact with each other in complex ways within individuals, and how that complexity is expressed via the valence connections among organization members themselves[4].


Read on: Effective Theory

[1] The connotation of the word, fungible, is that it is tradable or negotiable in kind, or interchangeable for an equivalence of the same, or similar, commodity.

[2] These specifications of the f- and ba-forms of the valence relationships are meant to be examples only, and not exclusive and definitive.


[3] For example, as a referent leader.

[4] “Testing” this proposition among participants via my weblog (Federman, 2005-2010, post of June 11, 2008) resulted in responses suggesting the following: the siloed nature of one of the BAH organizations precluded interactions among f-Knowledge and other valences; Tayloristic specialization even within individuals, interfered with connections among  f-Economic, f-Socio-psychological, and f-Knowledge; and that “this concept explains why I feel so brutalized by work and school—I am simply not allowed to be my whole self in a BAH organization.”


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