Blog Assignment #4 (Due: Feb 16, 11:59 pm): Discuss how the knowledge spiral framework interpret the knowledge creation activities in Nucor Steel.

Nucor Steel - Knowledge Creation

Nucor Steel stands out as a business that harbors internal knowledge through the method of "socialization" model integration. Because Nucor only has a few layers of management before getting to the general population of employees, tacit knowledge is able to be easily distributed throughout the organization. Their business philosophy is thought to be very simplistic, which therefore makes their method of learning and management very effective. Along with learning, Nucor believes in fair treatment of their employees. This is backed by company surveys, meetings and social events.

When organizing a spiral model into a business, you can choose from multiple methods; learning and knowledge through guides and manuals, demonstration, or even new methods such as e-learning. Nucor has chosen the model that emphasizes learning from each other. In this environment, when learning from each other is key to productivity, employees tend to want to work more and learn with each other. Nucor wraps productivity and learning into their bonus pay structure. With this bonus structure, employees are paid based on a set amount of production. Also, if an employee misses a day during a regular work week, they will miss out on their entire bonus for that week.

Tacit knowledge is not something that is easily learned, or can be taught directly from a book. This type of knowledge is acquired through life experiences, relationships, and an understanding of the business you work in. This type of knowledge comes as "intuitions, hunches or insights". These types if intuitions come from being influenced and being a part of a business process for a long period of time. Nucor Steel creates an environment with their management and their employees that allows for the sharing of tacit knowledge to achieve the best performance possible. This knowledge comes in in two flavors: Technical and Cognitive: Technical tacit knowledge points to skills that someone has crafted through external and internal education. Cognitive comes from a life-long pursuit of personal feelings, values, ideals and other personal motivating factors. This formal tacit knowledge comes together and enables employees and management to work closely together to achieve greater results.

The management level monetary incentive is based heavily on their team's production. This keeps management responsible for their employees, which creates a spiral effect that encourages cooperation from the top-down. After reading a couple of articles about Nucor Steel, it is very obvious that their primary focus, which drives the company, is a passion for money. Their base salaries, across the board, are lower than most places, but their bonus structure is set up so that they have a potential to make more than they ever could at any other place. It is also known that if the employees prove themselves with production, that they will never have to worry about a job. This is backed up by the simple fact that they have not laid off an employee in over 25 years.

In closing, I believe that if you run a business with a pay structure and a simple step layer of management, that you will create an environment that will easily support the knowledge spiral framework of sharing tacit knowledge, creating concepts, justifying concepts, building an archetype and cross-leveling knowledge. These steps create the internalization of a combination of social (internal) and external skills and ideals that create a powerful synergy within a company.