CHAPTER one

Communities of Practice and Their Value to Organizations

IN 1988, WHEN JAPANESE COMPETITION WAS THREATening to put the Chrysler Corporation out of business, no one suspected that the resurgence of the company (now the Chrysler unit of DaimlerChrysler) would depend in part on the creation of an innovative knowledge system based on communities of practice. While some of its competitors took as little as three years to get a new vehicle to market, a typical new-product development cycle at Chrysler easily ran five years. This was no way to compete. The first order of the day was to achieve a dramatic reduction in this product-development cycle.

The story is well known, though the role that communities of practice played is less widely ...

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