Key words: knowledge creation, boundary management, cross and trans-cultural management, and Leadership

1. Critical Issues of Business/Managementin the Era of Knowledge Capitalism The Importance of Knowledge and Cultural Diversities 1 Cross border/cross-cultural Boundary Knowledge Management Key words: knowledge creation, boundary management, cross and trans-cultural management, and Leadership

2. Critical issues in the 21st Century In the 21 century, global political and economic integration will continue to progress. Negative Side • Cultural crash will further arise world wide. • To the extent that this collision is accompanied by any signs of close–minded ethnocentrism（自民族中心主義）, cultural superiority or cultural control over other cultures, fierce resistance can be expected to arise.

3. CommunicationGap Different Context ambiguity inaccuracy complexity Confusion Heightening of Distrust Occurrence of psychological stress Communication in the same culture lack of a sense of unity The negative side of the cultural diversity ＊ Disagreement in opinion＊ Difficulties in consensus building＊ Difficulties in united action & behavior Low productivityand little innovation effects

4. The 21st century will also have two essential dimensions. • First,this new era offers the opportunity for the creation of new international communities and cultures beyond existing national cultures. • Second, in the same era, scientific and technological knowledge production will be further dispersed on a global scale.

5. The percentage ratio of East Asian nationalitiesto which first authors belongedout of papers published in US., UK., and NL(INSPEC)： US E.A 2 E.A 1 Source: Made from INSPEC Search

6. Cultural diversities could become strategic resources as new competitive advantages for companies in the new historical era. • Multi-cultural Management Capabilities to leverage positive factors of cultural diversities as strategic resources. New competitive advantages of companies in the new historical era

7. The Main Source of New Sustained Competitive Advantages of Companies in the New Historical Era “Organizational Capability to produce Sustained Innovation based on Multicultural synergy effects”. Which is an essential factor to cope with the globally changing turbulent competitive environment.

8. Schematic Diagram of Ontological Difference of Context, Cultural Layers, and Cultural Diversities National Culture Regional Culture Social System Religion Historical & Economic Development Processes Generation Culture GenderCulture Industrial Culture Organizational Culture Sub System Culture Family Life Educational Background Person Personality Genes

9. Synergy effects by Muti-cultural Management to create knowledge [Diversity & Creativity] Various Point of Views Various InterpretationsDiverse Ideas Exact Issue Raising More Alternatives Effective Ways of Solution AppropriateDecision Making Cross & Trans Cultural Communication Cross & Trans Cultural Communication Cross & Trans Cultural Communication [Expansion of Options] Enhancement of Creativity Enhancement of Flexibility Expansion of Ways of Solutions Wider Perspective Better IdeasNew Concepts Mechanism of Surprise & Empathy High Creativity & Big Innovation Effects Source: Compiled from Adler,N.(1991), Hayashi,T & Hayashi Seminar(2006)

10. Organizational Capabilities to get the most out of capabilities of ＨＲ beyond nationalities and cultures. • To meet the purpose Multicultural Management Capability that transforms ideas created by “Synergy Effects of Cultural Diversity” into New Concepts.

11. New & Main Source of Competitive Advantagesin the 21st Century Organizational Capabilities to edit and synthesize ideas which are expressed by various members, and transform them into new products and new concepts of business methods. Sustained Competitive Advantage by Sustained Innovation Based on Synergy Effects by Multi-cultural Management

12. Brief Conclusion Cultural Diversity is the Key Concept in the world of 21st Century. The main source of the new sustained competitive advantage will be the multicultural management capabilities to maximize the positive side of the cultural diversity and to minimize the negative side. Multi-cultural Organization could survive in the Turbulent Competitive Environment, through creating the appropriate knowledge.

13. In these processes that make life cycles of products and business model shortened, innovative companies have steadily employed cross-disciplinary and cross functional new product development systems. New knowledge in these innovation processes seem to be created at the boundariesbetween disciplines and functions throughcross-cultural communicationsamong project members.

14. Radically new insights need requisite diverse domain specific knowledge (Engineering) Boundary of domain specific knowledge (Architecture) (MBA) (Industrial design) (Marketing) (Psychology) (Biology) (Linguistics) “Radically new insights and developments often arise at the boundaries between domains”. Source: T.Kelly(2001), ABC News “The Deep Dive”より作成

15. In this process, cross-trans cultural management leadership at the boundaries appears to be essential so as to inspire a variety of members to create and synthesize their ideas. • In the knowledge economy, therefore, the dynamic boundary management capability to create new knowledge and conceptual framework, by leveraging global open innovation networks, is becoming a “main source of sustained competitive advantages”.

16. Cross border/cross-cultural boundary knowledge management is sure to emerge as one of 'Critical issues of business management research in the 21st century’

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