Abstract
Over the last two decades, the Japanese notion of ba, introduced by Ikujiro Nonaka and his associates to the West, has come to play an important role in management theory. This notion, which has been roughly translated as ‘place’ or ‘topos,’ stresses the importance of processual spatial thinking for economics and management alike. As such, it echoes and amplifies recent voices in the business world, which argue that we must understand business strategy in terms of space, that is to say, as an expression of the dynamics of social interaction which involves such factors as connectivity, information flow, external versus tacit knowledge, etc. Despite many efforts, the barriers for fully integrating ba into the body of Western management literature will remain for as long as its underlying assumptions are defined by ontologically static categories. This article is an attempt to overcome this theoretical bottleneck, first by critiquing the sub optimal approach to processual problems generated by conventional Western business theories, which can neither recognise their hidden background assumptions about space nor transcend them, and second, by explaining, within the framework of comparative analysis, how ba leads to a new processual and dynamic account of business life. Our overall aim is to demonstrate how a new processual notion of space enables a deeper, more integrated understanding not only of the nature of the firm, but also of the role managers play within firms.
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References
Our research for this paper was generously supported with funds from the Fritz Thyssen Foundation, Cologne, Germany. We would like to thank Roger Gathman as well as to anonymous referees for making valuable comments on the manuscript.
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Compare Henri Lefebvre The Production of Space Oxford, Blackwell Publishers 1991. Also: E. Soja ‘Keeping Space Open’ Annals of the Association of American Geographers 89 no 2 (June 1999) pp 348–53. For a critical review compare Tim Unwin ‘A Waste of Space? Towards a Critique of the Social Production of Space’ Transactions of the Institute of British Geographers 25 no 1 (2000) pp 11–29)
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More precisely, we believe Coase’s implicit spatial concept to be exemplary for the cognitive framework of mainstream neoclassical economics (including the resource-based views of the firm), while we tentatively propose the spatial concept presupposed by Knight to represent management based on methodological individualism, including many knowledge-based theories of the firm. We also assume that the notion of ba favoured by organisational knowledge creation theory mirrors recent more processual understandings of the dynamic nature of the firm along with the creative role managers within it.
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Ibid p 203. In order to define “real change” proper, Knight distinguishes between natural changes and changes due to human action. In natural objects we usually only consider the unchanging property of changing in certain ways. Change here occurs only to known laws that do not change themselves; it is merely progressive in the sense that is does not carry unpredictability with it. Changes due to human action often involve, however, a change of the laws of change themselves and thus becomes utterly unpredictable. It is this kind of change that Knight refers to as “real.” Ibid pp 313–317
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Alfred Chandler The Visible Hand Cambridge (Mass), Harvard University Press 1977
“But a more important change is the tendency of the groups themselves to specialize, finding the individuals with the greatest managerial capacity of the requisite kinds and placing them in charge of the work of the group, submitting the activities of the other members to their direction and control. It need hardly be mentioned explicitly that the organization of industry depends on the fundamental fact that the intelligence of one person can be made to direct in a general way the routine manual and mental operations of others.” Frank H. Knight Risk, Uncertainty and Profit, III.IX.10
Ikujiro Nonaka and Hirotaka Takeuchi The Knowledge-Creating Company
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Theories of topological space have, of course, not only developed in Japan, though they seem to be far more popular with the Japanese than with Americans or Europeans. In order to make this point clear, we relate Nishida’s findings to the work of one of his Western contemporaries, namely Alfred North Whitehead. It might also be noted here that Nishida’s theory of topological space finds a distant analogue in Einstein’s theory of gravitational space and thus in modern physics, where space is not independent of the physical objects in it but rather is shaped by them. However, its concept of interactive creation allows for a dynamic understanding of human activity that exceeds any account of physics. Compare Robert J. Wargo The Logic of Nothingness: A Study of Nishida Kitarō Honolulu, University of Hawaii Press 2005
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A more detailed account of topological space and its role in economics in general is given in Graupe The Basho of Economics 2007 pp 175–205.
Ba refers to the first syllable or Japanese character (kanji) of the Japanese philosophical term Basho. The difference between the former and the latter can be explained as follows: The term basho is part and parcel of a very complicated, philosophical theory not only of space but also of consciousness developed by the Japanese philosophers Kitaro Nishida. With the notion of ba, only some important aspect of this theory are utilized, which can enhance and deepen our understanding of economic process in general and the dynamic and creative nature of firms in particular.
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In fact, the Japanese term can be read both in the singular and the plural. This is because Japanese language never distinguishes between the two forms. Uchi, for instance, can mean ‘the house’ or ‘houses’ depending on context.
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Georg von Krogh, Kazuo Ichijo and Ikujiro Enabling Knowledge Creation pp 45–68
A more detailed account such managerial implications can be found in: Ikujiro Nonaka, Ryoko Toyama and Toru Hirata Managing Flow pp 53–69. In the following we focus on an issue of more fundamental, methodological importance.
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Donald J. Boudreaux and Randall G. Holcombe, op cit
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Graupe, S., Nonaka, I. Ba: Introducing Processual Spatial Thinking into the Theory of the Firm and Management. Philos. of Manag. 9, 7–30 (2010). https://doi.org/10.5840/pom2010929
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DOI: https://doi.org/10.5840/pom2010929