When a system behaves intelligently, we may want to discover where the intelligence is located. In smart technical systems, we may imagine that there is some clever lump of software somewhere doing the smart bits. In intelligent organizations, we may imagine that there must be some clever people pulling the strings. So we may wish to take the system apart to discover how the system works.
But I prefer to see intelligence as a holistic property of the whole system, emerging from the interaction between all the parts of the system, rather than something that can be specifically located in certain components or subsystems.
Let's consider any team sport - baseball, cricket, or any kind of football. The top teams are successful not just because they have the most talented (and expensive) players, but because they respond quickly and fluently to the tactics of the opposing side, which involves all of the elements of organizational intelligence.
The team may have a captain, but in many sports this is merely an honorary position for the oldest or wealthiest member of the team and there may be no visible difference in behaviour between the captain and the other players. The collective intelligence of a good team is not just the eleven men on the field but also the man on the touchline in the suit; not just the 90 minutes on the field but the whole training regime that enables them to perform at that level. When our team plays another team, where is the "memory" located of the other team's recent performance? It may not be the players themselves who watch and analyse the TV footage; it may be the coaches who feed this knowledge into the pre-match training.
So does that mean the knowledge is somehow "owned" by the coaches (on behalf of the team as a whole) and then "transferred" to the players before the match? But that is a gross simplification - it makes it seem as if the players were merely blank slates for the coaching staff to write upon. All we can accurately say about this kind of knowledge is that it is derived from observation and interpretation of TV footage, contained somewhere in the whole-system, and somehow influences the behaviour of the whole-system. It's not about transferring knowledge from one subsystem to another, but about communication and collaboration that results in the whole-system using the knowledge effectively.
Describing intelligence in this way allows us to focus on a series of critical questions - how does the team (as embodied whole-system) use knowledge intelligently, what kinds of signal does it pay attention to, how does it learn from past experience, how are new tactics and counter-tactics developed, and so on.
Those primary questions raise some secondary questions about the kinds of organizational structure and team culture in which this kind of intelligence may flourish, as well as the tools, platforms and other mechanisms that may be helpful, but we must always be wary of simplistic means-ends thinking - implement this regime and install these practices, and these outcomes will magically ensue.
for VPEC-T, see comments below