Knowledge management-competitive-advantage
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  • There are two kinds of knowledge: tacit, which is hard to articulate, versus explicit knowledge, which can be written down and codified. How can we transfer tacit knowledge? Through mechanisms of socialization, mentorships, apprenticeships, face-to-face communication. Since knowledge may be an organization's only sustainable competitive advantage, it is very important to capture tacit knowledge. Intranets and e-mail help knowledge flow through an organization. Tacit knowledge often moves laterally through informal channels of communication (communities of practice). For example, those groups that hang around the coffee machine -- they are exchanging knowledge, just as the smokers huddled near the entrance to the building at break time. The information that is passed in this way is very important because it is useful for helping people to get their work done more effectively, in part, because nobody is willing to question or think about it very much. Communities of practice must have their place in a comprehensive knowledge management effort. Keep in mind that flows of knowledge are an organization's capacity to learn. They are all you really have.
  • Currently, governments around the world, multinational corporations, and a multitude of companies are interested, even concerned with the concept of knowledge management. Indeed, even individual Canadian provinces have an interest in understanding the flow of knowledge within their confines, trying to become more aware of the structures that exist within their hierarchies. For example, "Prince Edward Island has agreed to become the first world test site for KAM, a new 'Knowledge Assessment Methodology' devised by the U.S. National Research Council in Washington, and coordinated by the Institute of Island Studies. The KAM will assess the capacity of Prince Edward Island to compete to world standards in what pundits have dubbed 'The Knowledge Economy'. As computers shrink our world, distance begins to disappear; the distinction between center and periphery narrows to insignificance. For Prince Edward Island, where small population and a paucity of natural resources have traditionally been economic inhibitors, the Knowledge Economy provides the potential for significant, environmentally benign economic growth." To understand more about the whys of measuring the flow of knowledge in any institution, one must understand more about knowledge. The real change has come from the necessity for less information and more knowledge. There has been a shift from information to knowledge. Shift from bureaucracies to networks. The traditional hierarchical designs that served the industrial era are not flexible enough to harness an organization's full intellectual capability. Shift from training/development to learning. The role of education has become paramount in all organizations, public and private. Shift from local/national to transnational. Organizations can no longer rely purely upon national approaches to maintain their profitable growth. More and more, companies and industries of all types must globalize in order to maximize their profits.
  • Currently, governments around the world, multinational corporations, and a multitude of companies are interested, even concerned with the concept of knowledge management. Indeed, even individual Canadian provinces have an interest in understanding the flow of knowledge within their confines, trying to become more aware of the structures that exist within their hierarchies. For example, "Prince Edward Island has agreed to become the first world test site for KAM, a new 'Knowledge Assessment Methodology' devised by the U.S. National Research Council in Washington, and coordinated by the Institute of Island Studies. The KAM will assess the capacity of Prince Edward Island to compete to world standards in what pundits have dubbed 'The Knowledge Economy'. As computers shrink our world, distance begins to disappear; and the distinctions between center and periphery narrows to insignificance. For Prince Edward Island, where small population and a paucity of natural resources have traditionally been economic inhibitors, the Knowledge Economy provides the potential for significant, environmentally benign economic growth." The real change has come from the necessity for less information and more knowledge. There has been a shift from information to knowledge. Shift from bureaucracies to networks. The traditional hierarchical designs that served the industrial era are not flexible enough to harness an organization's full intellectual capability. Shift from training/development to learning. The role of education has become paramount in all organizations, public and private. Shift from local/national to transnational. Organizations can no longer rely purely upon national approaches to maintain their profitable growth. More and more, companies and industries of all types must globalize in order to maximize their profits.
  • Thomas Stewart, Board of Editors of Fortune: "1991 was the crossover year when capital spending by U.S. companies was greater on telecommunications, copying and computer equipment than on industrial, construction, mining, and farming equipment. We tend to think of the mid-1990s as the transition point, but we actually made this shift, from a macroeconomic perspective, around 1991."
  • An accepted definition of knowledge management does not yet exist, although perspectives on knowledge abound, but there are three important points to keep in mind: 1. Knowledge today is a necessary and sustainable source of competitive advantage. In an era characterized by rapid change and uncertainty, it is claimed that successful organizations are those that consistently create new knowledge, disseminate it through the organization, and embody it in technologies, products, and services. Indeed, several sectors - for example, the financial services, consulting, and software industries -- depend on knowledge as their principal way to create value. Thus knowledge is displacing capital, natural resources, and labor as the basic economic resource. Governments know this all too well. 2. There is general recognition that companies are not good at managing knowledge. They may undervalue the creation and capture of knowledge, they may lose or give away what they possess, they may deter or inhibit knowledge sharing, and they may under-invest in both using and reusing the knowledge they have. Above all, they often do not know what they know. This is probably true of explicit or articulated knowledge: that which can be expressed in words and numbers and can be easily communicated and shared in hard form, as scientific formulas, codified procedures, or universal principles. It is undoubtedly true of tacit or unarticulated knowledge: that which is more personal, experiential, context specific, and hard to formalize; is difficult to communicate or share with others; and is generally in the heads of individuals and teams. 3. Recognizing the potential of knowledge in value creation and the failure to fully exploit it, some corporations have embarked on knowledge management programs. These are explicit attempts to manage knowledge as a resource, in particular: Designing and installing techniques and processes to create, protect, and use known knowledge. Designing and creating environments and activities to discover and release knowledge that is not known. Articulating the purpose and nature of managing knowledge as a resource and embodying it in other initiatives and programs.
  • Increasingly, senior executives are recognizing that knowledge and learning represent the preeminent source of sustainable advantage in a fast-moving, highly competitive world. They know it is no longer enough to leave critical knowledge sitting passively in the minds of individual employees in a period of radical change. Workforce mobility, falling educational standards, and the rapid rate of business change mean that individuals can no longer be relied upon to provide consistent, comprehensive insight. Instead, the knowledge trapped within the employee base must be leveraged to the organizational level, where it can be accessed, synthesized, augmented, and deployed for the benefit of all. Organizations and individuals must learn rapidly and uniformly across different functions and levels of the organization. The best reason for an organization to develop a knowledge management system is to gain a competitive advantage in the marketplace: by turning intellectual assets into value through innovation. The real differentiator for those leading companies is knowing how to use innovation to create value and ongoing growth.
  • Partly as a reaction to downsizing, some organizations are now trying to use technology to capture the knowledge residing in the minds of their employees so it can be easily shared across the enterprise. No longer should companies have to worry that employees will walk out the door with valuable knowledge that it no longer has access to. Although many individuals may come and go, their learning is embedded for future use. Leveraging organizational knowledge is emerging as the solution to an increasingly fragmented and globally dispersed workplace. For many of these companies, knowledge management has become the next silver bullet-in effect, the successor to the reengineering and downsizing efforts that marked the last decade. Knowledge cultures are those in which formal attention is paid to what some academics have called the "knowledge grid." It has four categories: "what we know we know; what we know we don't know; what we don't know we know; and what we don't know we don't know." What is needed is a similar mindset about the collection of intellectual assets: it belongs to everyone employed in a particular place, and it has to be shared. This kind of policy saves money right across the board and allows something just as valuable as money to be saved: TIME. Saving time means more work can be generated because you don't have to reinvent the wheel every time a new project is taken on.
  • Organizational Knowledge: Why Is It Important? Because it makes money. And that is why it is important to have the knowledge process facilitated by a steady development of a knowledge culture, based on incentives, strong management leadership, that values, shares, and uses knowledge.
  • If your organization or department is serious about implementing a knowledge management program, then appointing a CKO is one way of initiating, and coordinating such a strategy. In this post-industrial, knowledge economy, no one can forget that knowledge is the most important resource; forgetting could be fatal. Knowledge, its creation, uses, and innovation is the only real competitive edge when governments are moving from industrial-based economies to knowledge-intensive ones. The best scenario would be that, like total quality management, knowledge management would become embedded in organizations, with knowledge a source of value. Of course, in the long-term the goal will see all members of the organization owning and driving the knowledge management system, and over time, seeing the need for CKOs decline. However, today's CKOs are discovering that knowledge management comprises a large agenda and that making substantial progress takes time. In the beginning, a leader or coordinator is imperative for initiating, keeping up the momentum, deciding on software and systems (with the IT staff), distilling, codifying, and helping others learn to share their unique or tacit knowledge so that an organization can raise its knowledge capabilities. Therefore, appointing a CKO is likely the best place to start when embarking on a knowledge management program, and even if an appointee does not have the title of Chief Knowledge Officer, he/she should have the requisite profile; perform activities that propel a knowledge management project forward; have access to the proper resources, and success factors that work.
  • There are two very different knowledge management strategies. In some companies, the strategy centers on the computer. Knowledge is carefully codified and stored in databases, where it can be accessed and used easily by anyone in the organization. This is called the codification strategy. In other organizations, knowledge is closely tied to the person who developed it and is shared mainly through direct person-to-person contacts. Emphasizing the wrong strategy or trying to pursue both at the same time can quickly undermine a business. Companies that follow a codification strategy rely on the "economics of reuse." By contrast, the personalization strategy relies on the logic of "expert economics." Companies that use knowledge effectively pursue one strategy predominantly and use the second strategy to support the first. Think of this as the 80-20 split: 80% of their knowledge sharing follows one strategy, 20% the other. It is tempting to think that the two knowledge management models can coexist in different business units within one corporation. Indeed, they can coexist, but only in corporations where business units operate like stand-alone companies. In a company like General Motors, where the car divisions have little to do with the credit and finance divisions, different models can in fact work in each business unit. Companies with tightly integrated business units, however, should either focus on only one of the strategies or spin off units that do not fit the mold. The issue is sometimes complicated by two additional concerns: the existence of multiple business units and the commoditization of knowledge over time.
  • Competency management -- one of the fastest growing areas of knowledge management is competency management, which focuses on displaying information in sophisticated ways to understand labor trends and compensation. Telecommunications giant L.M. Ericsson in Sweden has already embraced the idea of tracking skills and competencies throughout the organization. The company has used knowledge management to post consistent performance gains throughout the 1990s. Another type of KM that is attracting attention is knowledge sharing. A growing number of firms use Intranets and online forums to spread knowledge. Glance into the inner workings of Buckman Laboratories and you get an idea of how knowledge can flow in every direction and how each person can become a willing participant in the program. Competitive knowledge management -- yet another area of knowledge management blends competency management and knowledge sharing. Since Arthur Andersen's Atlanta-based business consulting division established an Intranet two years ago, consultants at the firm post knowledge workplans, methodologies, research, proposals and resumes, so that others in the organization can tap into high-level expertise on an as-needed basis. It's called: not reinventing the wheel logic!
  • Organizational Requirements for leveraging intellectual capital requires attention to what have been recognized as Knowledge Enablers: structures and attributes that must be in place for a successful knowledge management program. Leadership: it is absolutely critical to liberate the creativity of teams, and yet not have chaos. In a sustainable knowledge managed learning organization, leadership is often expressed as the self-confidence to navigate the unknown waters of the future. Culture: the workplace culture is paramount because while management may pay lip service to the value of cooperation and its ability to facilitate organizational knowledge, there is an underlying belief that performance is really driven by "corporate stars" and that internal competition must be in place to attract these superstars since only under-performers can be found in cooperative, team-oriented workplaces. Knowledge tools, controls, and new organizational structures will go far to create a new culture in which informed decision making is valued, but explicit efforts to cultivate that culture are still needed. Knowledge and skills can never substitute for the motivation only an effective organizational culture can provide. Access - Making sure available knowledge provides value and is not stored "just in case." The challenges are to facilitate access to the right content at the right time and place, be content rich and navigation lean, manage regulations and copyrights, and provide flexibility and ease of access. Technology - Deploying computing tools that link people enterprise-wide; support collaboration, including navigation and search engines and data storage technologies; and link people to the global resources of the organization. Embedding a learning attitude and placing value on competency development. Historically, more training expenditures have gone to developing cognitive skills than to developing motivated creativity. Those days are gone now. Currently, the goal is to see intelligent people using innovation to create knowledge out of information. To do so, there needs to be a corresponding culture that values organizational behaviors and supports an environment of trust and collaboration. Knowledge management programs need all enabling factors, and not just one or two, if there is to be any real success.
  • Buckman Laboratories' Koskiniemi reports: "Successful knowledge sharing is 90 percent cultural, 5 percent tools and 5 percent magic. All the technology and tools in the world won't make you a knowledge-based organization if you do not establish a culture that believes in sharing." To encourage knowledge sharing, some companies are creating central knowledge repositories. Organizations must offer a high level of psychological safety and capacity for openness. Rewards and incentives signal what behaviors and outcomes are most valued by management. It should not be surprising that knowledge accumulation and sharing are not valued. Management sends strong signals through its compensation policies: different roles are perceived of value according to their allocated compensation. So be careful about sending mixed signals, and keep in mind that culture is more than just compensation, and it is responsive to influences other than paychecks. Management sends signals about what is important through its recruiting priorities, promotions, and, possibly more than anything, through its own behavior. These deeply embedded cultural assumptions are significant.
  • Knowledge resides primarily in people whose experience, insights, skills, and competencies are the organization's most valuable resource. So, knowledge is a higher order commodity than technology, which simply provides tools to help the employees and the organization to develop and apply its management capital. "Technology allows people to collect, find, filter and distribute information far more rapidly than ever before. It is now possible to move large volumes of information quickly, and institutionalize what has always been an informal and haphazard process," explains Arthur Andersen's Michael Stone.
  • Not surprisingly, KM blurs the line between departments and operating divisions. Managers traditionally have kept a tight leash on their own department's data, and they have frequently interpreted it in narrow, rigid ways. Knowledge management collapses the boundaries. It allows people to use information across applications. [Do not isolate Knowledge Management: some CEOs have put knowledge management at the top of their agendas. Others have not given it the same attention as they have given cost cutting, restructuring, or international expansion. In companies where that is the case, knowledge management takes place - if at all - in functional departments such as HR or IT. But companies that isolate knowledge management risk losing its benefits, which are highest when it is coordinated with HR, IT, and competitive strategy.] I think the most interesting representation of what is going on in business is the quote from Paul Saffo at the Institute for the Future: "It is hardly news that the corporation as we know it is headed for the scrap heap of business history. Internal corporate structures are already mutating beyond recognition. Corporate boundaries are dissolving into commercial irrelevance as businesses explore entirely new modes of association and interaction." A knowledge management system cannot work through hierarchies. So the cultural side of it is very interesting, and means that while knowledge management doesn't have to be driven from the top, it does very much have to originate from the top. In order to justify financial investments in technology, CKOs must understand organization structure, motivation of people, and cross-boundary processes. Since it is a bottom-up and peer-to-peer tool that seeds an organization with intellectual capital, it is foreign ground for most organizations. While corporate directives to share information and create cross-functional teams can improve knowledge management efforts, real innovation and self-directed learning happen only at the individual and team level.
  • It is obvious that there is a significant tie between knowledge management systems and workplaces dedicated to learning. All organizations learn, but some are faster and more effective learners. And the faster you can learn, the more competitive you become. The key is to see learning as inseparable from everyday work. Training, by contrast, is typically episodic and detached from the context in which results are produced. This is especially important in Canada's case because it is moving from largely a natural resources-based economy to one in which knowledge will be expected to keep it competitive in the world's marketplace. To stay competitive, it will have to learn FAST.
  • Much of the interest in knowledge management comes from the problem of diffusing innovative practices within an organization. They go far beyond the failure of KM information systems. Improved diffusion of knowledge won't just happen because the CEO says it should, or because management buys new information technology. Effective organizational learning infrastructure will need to augment the natural workings of the informal communities of practice that already exist.
  • One of the major problems with governments, corporations, companies, organizations, and private citizens is that they have no concept of the future and never think about ramifications. Future studies must be figured into an organization's overall knowledge management system because to sustain a commitment over the course of months and years, people need to have awareness of the whole and understand the direction an organization is going. The challenge of organizational strategy and purpose is to revitalize and rethink the organization's business focus, and figure out where it is heading. To expect ongoing knowledge creation, it must have some relevance to the future you are creating. Therefore, a future element must be ever-present. Knowledge Management must somehow be connected to future studies for at least one significant reason and that is because to have a knowledge management system, it presupposes the ongoing creation of new knowledge. Peter Drucker's Theory of Business can also be brought into this analysis because he believed that there must be significant focus put on defining the environment, mission, and core competencies needed to accomplish that mission. "If the attitudes brought forth are genuinely heartfelt, if managers and especially top managers can increase their vulnerability by exposing their own deepest aspirations and assumptions, if people can feel part of a larger creative process shaping their industry and society, and if all this can be tied to people's commitment to creating a future about which they deeply care - then intellect and spirit align, and energy is not only released but focused." One thing is for certain: when questions, big questions (questions that matter to the future of an organization) are asked and explored, it can be a very powerful force because it is essential for co-evolving the futures we want, rather than the futures we get.
  • For a knowledge management effort to work, it must be understood that no progress is sustainable unless innovators learn to understand why the system is pushing back, and how their own attitudes and perceptions contribute to the "pushback." Until they see this, there will be no development of systematic strategies for sustaining profound change. (Once there is intellectual understanding there can be emotional engagement, leading to sustained action, all in a positive feedback loop.) "I believe that people do have passion to produce results says consultant and writer Fred Kofman, "but not business results. Sure, they care about business results, but they really have a passion for the quality of their own lives. Once they experience living their lives more closely to the way they really want to live, that passion will emerge." The enhancement of personal results is often the first source of reinforcing energy for sustaining deep change. And, it is inherently satisfying to work in a network of committed people. Given the choice, very few people would not want to become part of a network where there is excitement, perseverance, innovation, experimentation, and commitment. As Dr. W, Edwards Deming used to say, "People seek joy in work." In this day of bottom line focus, when employees often assume that personal needs are subservient to the organization's needs, it is truly liberating to discover that the two can be aligned rather than in opposition. For those who have gone from a run-of-the-mill organization to one, which literally supports learning and knowledge for everyone, feel transformed. They learn to understand just how much they are worth, and what they can give to the workplace. They become intellectually-stimulated, energized, and emotionally-engaged.
  • Communities of practice can be geared so that people continually learn to help each other. The diffusion of innovative practices needs informal networks through which new ideas can spread in and across organizations. Such informal networks are almost always superior to hierarchical channels for spreading new innovations because these informal networks already exist; experimenting with new ideas requires help and time to think in a safe context; and because there is a strong element of credibility with people whom we know. Without active internal communities of practice, an organization cannot expect profound and sustained change. Managers need to surrender control in order for learning capabilities to be enhanced. This will lead to greater business results by eliminating wasteful practices, and bring about the development of new business practices that lead to better results. The limits that block organizational learning initiatives have a great deal to do with the mental models embedded in the culture of an organization. For example: hoarders, hierarchies, and stars are the order of the day! For organizations to attain sustainability for their KM efforts, they must be prepared to develop new mental models for thinking about their workplaces and new ways to reach across internal and external boundaries. Mental Models must be managed because they do prevent new and powerful insights and organizational practices from becoming implemented. The process begins with self- reflection, unearthing deeply held belief structures and generalizations, and understanding how they dramatically influence the way we operate in our own lives. Until there is realization and a focus on openness, real change can never be implemented. This is hard work, particularly because the pull of sustainable development as an aspiration may bring diverse groups of people together in collaborations that require breaking down old boundaries and hierarchies. However, once employees are forced to let go of the existing conventional wisdom of the organization, they can be innovative and creative, designing new approaches and learning to learn faster.
  • Software Tools: Getting information that is locked inside a brain or disparate computer systems into a central repository is no simple task. "Ultimately, everyone must feed information in as they gain experience and expertise, and the information must be stored and routed so that people can use it. The design and thinking that go into the process are crucial. Success does not happen by accident," says Thomas Stewart.
  • Competitive success will be based less on how strategically physical and financial resources are allocated, and more on how strategically intellectual capital is managed - from capturing, coding and disseminating information, to acquiring new competencies through training and development, to re-engineering business processes. Ray Stata of Analog Devices has stated that "the rate at which individuals and organizations learn may be the only sustainable competitive advantage, especially in knowledge intensive industries." Further emphasizing this point, it has been said that "a firm's competitive advantage depends more than anything on its knowledge...what it knows -- how much it uses what it knows -- and how fast it can know something new" (Prusak 1997).
  • Much of the confusion and disappointment concerning KM comes from confusion between information and knowledge because even KM experts do not link knowledge to action. There is no clarity. People are investing in systems to capture, organize, and disseminate information, and then calling it "knowledge." But knowledge cannot, by definition, be converted into an object and "given" from one person to another. Knowledge only diffuses when there are learning processes whereby human beings develop new capacities for effective action. Information technology, while critical for enabling the spread of information, cannot capture and store knowledge. Only people can do that. An organization that encourages curiosity, innovation, collaboration, reflection, and mutuality across both internal and external boundaries and offers an effective learning infrastructure is one wherein learning is diffused and hierarchies are flattened. It should not matter where you sit in the hierarchy; everyone should be heard and allowed to participate in improving the overall learning infrastructure on a daily basis. "Through allowing deep personal reflection about one's own sense of purpose and deepest aspirations, and through cultivating individual and collective responsibility for the future, goes a long way to create an organization that has the creation if knowledge as an ongoing goal. When people bring their 'grand will' instead of their 'unfree will' to authentic inquiry into the questions of where are we going and what are we here for it can breathe life into an organization. It is the key to the future of strategy in an independent world."
  • Amidon, Debra M. The challenge of fifth generation R&D. Research Technology Management, Jul/Aug 1996, Vol. 39, No. 4, p.33. Bair, Jim. Knowledge management: The era of shared ideas. Forbes, September 22, 1997, Vol. 1, No. 1, p. 28. Bontis, Nick. There's a price on your head: Managing intellectual capital strategically. Ivey Business Quarterly, Summer 1996, Vol. 60, No. 4, p. 40. Cliffe, Sarah. Knowledge management: The well-connected business. Harvard Business Review, July/August 1998, Vol. 76, No. 4, p. 17. Cortada, James W. (1998) "Rise of the Knowledge Worker Resources for the Knowledge-Based Economy, Butterworth-Heinemann. Darling, Michele S. The knowledge organization: A journey worth taking. Vital Speeches of the Day, September 1, 1996, vol. 62, No. 22, p. 693. Donlon, J. P. Harnessing knowledge. Chief Executive, March 1999. Edvinsson, Leif and M. Malone (1997). Intellectual Capital: Realizing your company's true value by finding its hidden brainpower. New York: Harper Business. Greengard, Samuel. Storing, shaping and sharing collective wisdom. Workforce, October 1998, Vol. 77, No. 10. Haapaniemi, Peter. We've got too much information--and not enough knowledge. Chief Executive, 1998, Supplement: Technology and the CEO: Nightmares, Daydreams, Solutions, p. 26. Hansen, Morten T., Nitin Nohria, and Thomas Tierney. What's your strategy for managing knowledge? Harvard Business Review, March/April 1999, Vol. 77, No. 2, p. 106. Hiebeler, Robert J. Benchmarking: Knowledge management. Strategy & Leadership, March/April 1996, Vol. 24, No. 2, p. 22. Kim, W. Chan, and Renée Mauborgne. Fair Process: Managing in the Knowledge Economy, Harvard Business Review. Lapp, Ellen M. Knowledge management. Business and Economic Review, July/September 1998, Vol. 44, No. 4, p. 3. McCartney, Laton. Getting smart about knowledge management. Industry Week, May 4, 1998, Vol. 247, No. 9, p. 30. Mintzberg, Henry. That's not "turbulence", Chicken Little, it's really opportunity. Planning Review, Nov/Dec 1994, Vol. 22, No. 6, p. 7. Mullin, Rick. Knowledge management: A cultural evolution. The Journal of Business Strategy, September/October 1996, Vol. 17, No. 5, p. 56. Nadler, David A. 1998. Champions of Change. San Francisco: Jossey-Bass Publishers. Pemberton, J Michael. Chief knowledge officer: The climax to your career? ARMA Records Management Quarterly, April 1997, Vol. 31, No. 2, p. 66-69. Senge, Peter M. Creating learning communities. Executive Excellence, March 1997, Vol. 14, No. 3, p. 17. Senge, Peter M. Communities of leaders and learners. Harvard Business Review, September/October 1997, Vol. 75, No. 5, p. 30. Senge, Peter. Sharing knowledge. Executive Excellence, November 1997, Vol. 14, No. 11, p. 17. Senge, Peter. The knowledge era. Executive Excellence, January 1998, Vol. 15, No. 1, p. 15. Senge, Peter, Art Kleiner, Charlotte Roberts, Richard Ross, George Roth, and Bryan Smith. 1999. The Dance of Change: The Challenges to Sustaining Momentum in Learning Organizations. New York: Doubleday. Stewart, Thomas A. Why dumb things happen to smart companies. Fortune, June 23, 1997, Vol. 135, No. 12, p. 159. Stewart, Thomas A. Does anyone around here know...? Fortune, September 29, 1997, Vol. 136, No. 6, p. 279. Stewart, Thomas A. Knowledge, the appreciating commodity. Fortune, October 12, 1998, Vol. 138, No. 7, p. 199. Stewart, Thomas A. Knowledge, the appreciating commodity. Fortune, October 12, 1998, Vol. 138, No. 7, p. 199-200. Stewart, Thomas A. Packaging what you know. Fortune, November 9, 1998, Vol. 138, No. 9, p. 253-254. Truran, William R. Pathways for knowledge: How companies learn through people. Engineering Management Journal, December 1998, Vol. 10, No. 4, p. 15. Zerega, Blaise. Art of knowledge management. InfoWorld, July 27, 1998, Vol. 20, No. 30, p. 61.

Knowledge management-competitive-advantage Presentation Transcript

  • 1. Knowledge Management
  • 2. Knowledge Management• Definitions• Do you really need KM?• Do you need a CKO?• What’s the strategy?• Types of knowledge management systems• Organizational changes to expect• KM software tools
  • 3. Two Kinds of Knowledge Knowledge is intangible, dynamic, and difficult to measure, but without it no organization can survive.• Tacit: or unarticulated knowledge is more personal, experiential, context specific, and hard to formalize; is difficult to communicate or share with others; and is generally in the heads of individuals and teams.• Explicit: explicit knowledge can easily be written down and codified.
  • 4. Knowledge ManagementThe move from an industrially-basedeconomy to a knowledge or information-based one in the 21st Century demands atop-notch knowledge management systemto secure a competitive edge and a capacityfor learning.
  • 5. Knowledge Management• The new source of wealth is knowledge, and not labor, land, or financial capital. It is the intangible, intellectual assets that must be managed.• The key challenge of the knowledge-based economy is to foster innovation.
  • 6. The Knowledge EconomyThe move from an industrially-basedeconomy to a knowledge or information-based one in the 21st Century demands atop-notch knowledge management systemto secure a competitive edge and a capacityfor learning.
  • 7. The Knowledge Economy• The new source of wealth is knowledge, and not labor, land, or financial capital. It is the intangible, intellectual assets that must be managed.• The key challenge of the knowledge-based economy is to foster innovation.
  • 8. The Knowledge Economy For several decades the worlds best-known forecasters of societal change have predicted the emergence of a new economy in which brainpower, not machine power, is the critical resource. But the future has already turned into the present, and the era of knowledge has arrived.--"The Learning Organization," Economist Intelligence Unit
  • 9. The Knowledge Economy The knowledge economy rests on three pillars:• The role that knowledge plays in transactions: it is what is being bought and sold; both the raw materials and the finished goods• The concurrent rise in importance of knowledge assets, which transform and add value to knowledge products• The emergence of ways to manage these materials and assets, or KM
  • 10. Definitions• Designing and installing techniques and processes to create, protect, and use known knowledge.• Designing and creating environments and activities to discover and release knowledge that is not known, or tacit knowledge.• Articulating the purpose and nature of managing knowledge as a resource and embodying it in other initiatives and programs.
  • 11. Do You Really Need KM?• Competitive success will be based on how strategically intellectual capital is managed• Capturing the knowledge residing in the minds of employees so that it can be easily shared across the enterprise• Leveraging organizational knowledge is emerging as the solution to an increasingly fragmented and globally-dispersed workplace
  • 12. Do You Really Need KM?• If your department wants to stop constantly reengineering and downsizing: talented people are assets to be developed for a global 21st Century• If you are interested in the Knowledge Grid• If you understand that reuse of knowledge saves work, reduces communication costs, and allows a company to take on more projects
  • 13. Organizational Knowledge: Why Is It Important?• Knowledge can be embedded in processes, products, systems, and controls• Knowledge can be accessed as it is needed from sources inside or outside the firm• It is versatile and can be transferred formally, through training, or informally, by way of workplace socialization• It is the essence of the competitive edge!
  • 14. Does a KM System Need a Chief Knowledge Officer?• Only if your organization is serious about implementing a knowledge management program• Economic realities and and competitive edge factors play a large role
  • 15. What’s the Strategy? There are two very different knowledge management strategies:• Codification Strategy• Personalization Strategy
  • 16. Knowledge Management Types• Competency Management• Knowledge Sharing• Competitive Knowledge Management
  • 17. For Successful Managing of Knowledge Focus on five tasks:• Generating knowledge• Accessing knowledge• Representing and embedding knowledge• Facilitating knowledge• Transferring knowledge It is a process of instilling the culture and helping people find ways to share and utilize their collective knowledge.
  • 18. Knowledge Management Enablers• Leadership• Knowledge champions, such as CKOs• Culture• Access• Technology• Learning Culture
  • 19. More on the Importance of Corporate Culture• Changing the culture is imperative.• To create a climate in which employees volunteer their creativity and expertise, managers need to look beyond the traditional tools at their disposal: finding ways to build trust and develop fair process.• That means getting the gatekeepers to facilitate the flow of information rather than hoard it.• And offering rewards and incentives.
  • 20. The Technological Divide• Generating organizational knowledge invariably means converting the tacit knowledge of the individual into explicit knowledge accessible by all. Information technology is most effective when it enables this social process.• Companies must think through their technological systems.• Technology such as Intranets and advanced collaborative software have made Knowledge Management possible.
  • 21. Organizational Changes• Lines between departments and operating divisions blur• Knowledge management efforts can completely collapse boundaries• A knowledge management system cannot work through hierarchies• Individual and team learning processes must become the true driver of organizational learning
  • 22. Why KM? What’s the Big Deal?• By instituting a learning organization (KM- intensive), there is an increase in employee satisfaction due to greater personal development and empowerment.• Keeps your employees longer and thereby, reduces the loss of intellectual capital from people leaving the company.• Saves money by not reinventing the wheel for each new project.
  • 23. Why KM? What’s the Big Deal?• Reduces costs by decreasing and achieving economies of scale in obtaining information from external providers.• Increases productivity by making knowledge available more quickly and easily.• Provides workers with a more democratic place to work by allowing everyone access to knowledge.
  • 24. Why KM? What’s the Big Deal?• Learning faster with KM• Learning faster to stay competitive• KM software and technological infrastructures allow for global access to an organization’s knowledge, at a keystroke
  • 25. In Successful KM Programs• Information is widely disseminated throughout the organization. Wherever it is needed, it is accessible.• Accessible at a fast rate of speed.• Virtual communities of practice share what is known in a global fashion, independent of time zones and other geographic limitations.• Business boundaries are broad, and often virtual in nature.• Collaboration to support continuous innovation and new knowledge creation.
  • 26. Symptoms of KM Diffusion Challenges• No internal learning communities• Lack of psychological safety• Lack of workplace trust• Arrogance of people who believe they know everything, so why try?• Lack of communication within an organization made evident by continually reinventing the same wheel• Negativity and unrealistic expectations
  • 27. KM and Future Planning• Where are we going? What are we here for?• People need awareness of the whole: in what direction is the organization going?• To have a goal to reach in the future can provide great incentive for a KM initiative.• Effective leveraging lies within an organization’s capacity for rethinking and recreating. Scenario thinking can help us to see the blind spots, and help to create the future we want.
  • 28. Sustainability of a KM Endeavor There are three fundamental processes that sustain profound changes such as the introduction of a KM system:• developing networks of committed people• improving business results• enhancing personal results To achieve sustainability, there must be a focus on learning, and learning how to harness the learning capabilities that lead to innovation.
  • 29. Sustainability of a KM Endeavor• For significant change to lead to sustainability, hierarchical control must be put aside.• The emergence and development of informal networks must be supported so that people can share their tacit knowledge and help one another.• Managers need to surrender control.• And mental models need to be examined.
  • 30. KM Software Tools• Globalserve • Imagination• Knowcorp • Excalibur• Hyperknowledge Technologies• MicroStrategy • Imaging Solutions• The Molloy Group • Grapevine• KnowledgeX Inc. Technologies• • Intraspect Software WebFarming.com • Milagro: The Power• Softlab Enabling of Imagination Tools
  • 31. Knowledge Management?• The essence of knowledge management is understanding and valuing intangible assets over tangible• Understanding that human and intellectual capital are the greatest resources• Managing the skills and competencies that lie within an organization, and allowing them to blossom• Allowing people to be the best that they can be; optimizing performance
  • 32. CommentaryConfusion >>>>> Disappointment >>>> andConcern over Knowledge Management
  • 33. Acknowledgements• Peter Senge • David A. Nadler• Art Kleiner • Rick Mullin• Blaise Zerega • Ellen M. Lapp• Charlotte Roberts • Thomas Stewart• Richard Ross • Peter Feltham• George Roth • Howard Rheingold• Bryan Smith • Nick Bontis• James Brian Quinn • Morten T. Hansen• William Truran • Jim Bair• J Michael Pemberton • Henry Mintzberg• Sarah Cliffe • James Cortada