Agent Based Modeling for Creation of Knowledge Exchange in a Company

Aftab Z. Khan

Abstract

The paper proposes a model of organizational learning through the means of balancing between two opposed forces – exploration and exploitation in a dynamic environment. Overall this is an experimental study, where a series of simulations were used to examine the influence of external complexity on the balance between exploration and exploitation within organizations. The methodology used is agent-based modeling and Kauffman’s NK model. The agent-based modelling approach is being used to simulate the dynamics of knowledge creation in organizations. Furthermore, the model enhances Kaufman’s fitness landscape concept in order to represent the complexity of any organization as a learning space where both the organization and its employees are constantly exchanging ideas. Environmental complexity has a destructive impact on the performance of overall organization and its members, and, by default, a negative effect on an organization’s knowledge accumulation/learning. Another result is that a maximized organizational knowledge is reached when an organizational repository is quickly and constantly updated with individual knowledge and there is a slow socialization rate among the organizational members.This paper brings a methodological contribution to the organizational learning literature by representing the “learning space” as a rugged landscape formed by individuals and an “organizational memory” in their attempt to evolve and to retain needful knowledge. Second, it analyses the agents’ interactions in their quest to develop knowledge and to evolve in time along with environmental changes.

Keywords

organizational learning, complexity, NK fitness landscape, exploration-exploitation trade-off, knowledge creation, agent-based modelling;