Strategic Decision Making: The Influence of CEO Experience and Use of Tacit Knowledge

By Brockmann, Erich N.; Simmonds, Paul G. | Journal of Managerial Issues, Winter 1997 | Go to article overview

Strategic Decision Making: The Influence of CEO Experience and Use of Tacit Knowledge


Brockmann, Erich N., Simmonds, Paul G., Journal of Managerial Issues


At any given moment one is conscious of only a small section of what one knows. Intuition allows one to draw on that vast storehouse of unconscious knowledge that includes not only everything that one has experienced or learned either consciously or subliminally, but also the infinite reservoir of the collective or universal unconscious, in which individual separateness and ego boundaries are transcended.

Unlimited access to Vaughan's reservoir of knowledge would be akin to Nirvana for strategic planners. Accessing that information would be a strong basis for strategic planning and crucial to the long-term survival of any organization. Therefore, if strategic decision makers could tap only a portion of this incalculable knowledge resource during strategy formulation, better decisions should develop and ultimately result in improved organizational performance. Furthermore, as less formalized methods of decision making prove capable of accessing this knowledge inventory, they bear closer scrutiny. One potentially fruitful, albeit controversial, informal decision-making method relies on the use of tacit knowledge.

A manager's tacit knowledge inventory (TKI) (Sternberg et al., 1995) is analogous to Vaughan's (1979) reservoir of knowledge. Tacit knowledge is defined as work-related practical know-how that is learned informally on the job (Wagner and Sternberg, 1986); it is manifest by people knowing more than they can tell (Polanyi, 1966). It is sometimes associated with intuition, which is defined as choice made without formal analysis (Behling and Eckel, 1991), since intuition serves as a conduit for knowledge transfer (Anthony et al., 1993; Parikh et al., 1994).

Today's practitioners are continually plagued by a perceived inconsistency in their thought process. They sense an expectation for purely rational thought (Mintzberg et al., 1995), but have discovered through experience that their use of tacit, or hidden, knowledge is quite beneficial (Isenberg, 1984). Such benefits include a faster decision-making process (Eisenhardt, 1990), effective decisions (Agor, 1985a), and fewer pertinent factors necessary for a decision (Wagner, 1987).

Tacit knowledge is particularly germane to strategic decision making. Strategy is plagued by a stigma of unsystematic reasoning (Ansoff, 1988). incomplete searches for strategic alternatives, satisficing, and bounded rationality (Simon, 1960) influence this perception. In fact, instead of problems seeking a solution, an organization may draw from its "garbage can" of ready-made solutions and apply them to problems as they arise (Cohen et al., 1972). Perhaps more appropriately, these seemingly unsystematic decision methods may simply be applications of tacit knowledge. They are examples of what Mintzberg et al. (1976) refer to as managers trying to apply str-ucture to unstructured decisions as they attempt to identify whatever is familiar to them early in the decision process. That is, the use of tacit knowledge may be useful in explaining why many of the seemingly unsystematic decision are in fact logical.

The purpose of this study is not to condemn the traditional and analytical methods of making decisions. We agree with Herbert Simon that "The effective manager does not have the luxury of choosing between analytic and intuitive approaches to problems" (1987: 63). Each decision must be a balanced combination of both, much like the brain depends on both hemispheres for proper operation and orientation (Mintzberg, 1994). We seek to identify critical variables that affect the use of tacit knowledge. This study expands previous work linking the experience level of the decision makers with their use of tacit knowledge by focusing on the cognitive process of the key strategy maker. Specifically, this study examines the effect of experience and intuition on the use of tacit knowledge in the strategic decision-making process of Chief Executive Officers (CEOs). …

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

Strategic Decision Making: The Influence of CEO Experience and Use of Tacit Knowledge
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Full screen

matching results for page

Cited passage

Style
Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

"Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.