The Intersection of Knowledge Creation and User Identity in Network Businesses

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Aug 24, 20233 min read

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The Intersection of Knowledge Creation and User Identity in Network Businesses

Introduction:

In the world of business, there are two key considerations that Founders must make when building network businesses: the creation and conversion of knowledge, and the decision to tie user profiles to real identity. These seemingly unrelated concepts, when explored deeply, reveal common points that can contribute to the success or failure of a network business. In this article, we will explore the SECI Model of Knowledge Dimensions proposed by Ikujiro Nonaka and its connection to the importance of real identity in network businesses. We will uncover the impact of these factors on the growth, engagement, and longevity of networks, and provide actionable advice for entrepreneurs aiming to build successful network businesses.

The SECI Model of Knowledge Dimensions:

Ikujiro Nonaka's SECI Model suggests that knowledge is created through a conversion process between tacit and explicit knowledge, as well as between individuals and groups/organizations. The model consists of four stages: Socialization, Externalization, Combination, and Internalization. In the Socialization stage, tacit knowledge is transferred through practice, guidance, and observation. Externalization involves the codification of tacit knowledge into explicit knowledge, making it easier to share among members of an organization. Combination refers to the systematization of concepts into a knowledge system by combining existing sources. Finally, Internalization occurs when individuals learn from explicit documents and apply their knowledge through practice. This model highlights the importance of knowledge conversion in the growth and development of organizations.

The Impact of Real Identity in Network Businesses:

When it comes to network businesses, the decision to tie user profiles to real identity is a crucial one. Profiles can range from anonymous to real-names, and the choice has significant implications for the success of the network. While anonymous profiles may attract more users initially due to lower commitment requirements, networks that prioritize real identity tend to endure and become valuable businesses in the long run. The correlation between real identity and network success often goes unnoticed, but it plays a vital role in building stronger network effects.

The Role of Engagement and Network Effects:

Network effects occur when more users contribute to more value for existing users. However, the strength of these network effects depends on the level of engagement within the network. Networks with higher levels of activity, density, and commitment from users tend to outperform those with larger but less engaged user bases. This is why it is crucial for network businesses to focus on building a dense and highly active network, starting with a strong core and expanding from there. The success of network effects companies lies not only in having network effects but also in the strength of those effects, which stems from the size, density, and engagement of the network.

Actionable Advice for Entrepreneurs:

  • 1. Prioritize knowledge conversion: Implement the SECI Model in your organization by facilitating the transfer of tacit knowledge through socialization, externalizing it into explicit knowledge, combining existing sources to create new knowledge, and encouraging internalization through reading and application.
  • 2. Emphasize real identity: Consider tying user profiles to real identity, as it has been shown to increase user engagement and contribute to stronger network effects. Create a safe and controlled environment for users to share their real names, gradually expanding beyond niche markets.
  • 3. Focus on engagement: Build a highly active network with dense connections and committed users. Encourage users to invest emotionally in building and maintaining their online reputations, as this will contribute to the strength of your network effects and fend off competition.

Conclusion:

In conclusion, the SECI Model of Knowledge Dimensions and the decision to tie user profiles to real identity intersect in the realm of network businesses. The conversion of knowledge and the commitment to real identity play pivotal roles in the growth, engagement, and longevity of networks. By understanding and implementing the SECI Model and prioritizing real identity, entrepreneurs can build successful network businesses with powerful network effects.

Resource:

  1. "SECI Model (Nonaka & Takeuchi)", https://www.toolshero.com/quality-management/seci-model-nonaka-takeuchi/ (Glasp)
  2. "Does Real Identity Matter for Networks?", https://www.nfx.com/post/real-identity/ (Glasp)

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