Impact of Social Media on Organizations

NANYANG TECHNOLOGICAL UNIVERSITY K6213 Knowledge Management Technologies Term PaperIMPACT OF SOCIAL MEDIA ON KNOWLEDGE MANAGEMENT IN ORGANIZATIONS ANTONY PRAKASH SRINIVASAGAM PRIYA LAKSHMI 1

ContentsABSTRACT ......................................................................................................................... 3INTRODUCTION ................................................................................................................ 3EVOLUTION OF KM SYSTEMS ........................................................................................ 3APPLICATION & IMPACT OF KM TECHNOLGIES ........................................................ 5 INFORMATION TECHNOLOGY FOR KNOWLEDGE MANAGEMENT ..................... 6 CORPORATE MEMORIES ............................................................................................. 7IMPACT OF SOCIAL MEDIA ON KNOWLEDGE MANAGEMENT INORGANIZATIONS .............................................................................................................. 8EFFECT OF SOCIAL NETWORKING PHENOMENON IN LEADERSHIP ...................... 8EMERGENCE OF SOCIAL MEDIA.................................................................................... 9SOCIAL MEDIA AND KNOWLEDGE MANAGEMENT ................................................ 10BENEFITS OF SOCIAL NETWORKING IN ORGANIZATIONS .................................... 12 SOCIAL NETWORKING IMPROVES EMPLOYEE EXCELLENCE ........................... 12 INCREASES EMPLOYEE MOBILITY ......................................................................... 13 CORPORATE DIRECTORIES AND INTRANET WILL BE REVAMPED ................... 13 INCREASE REVENUES ................................................................................................ 13 ORGANIZATIONS CHANGE THE WAY THEY COMMUNICATE ........................... 14 ORGANIZATIONS CHANGE THEIR VISION ............................................................. 14CHALLENGES FACED IN IMPLEMENTING SOCIAL MEDIA IN ORGANIZATIONS 14FUTURE OF KNOWLEDGE MANAGEMENT TECHNOLOGIES .................................. 15CONCLUSION ................................................................................................................... 16REFERENCES ................................................................................................................... 17 2

ABSTRACT This paper describes the evolution of KM systems, the applications of KM inorganization and its impact on business. The focus is on the impact of social media inorganizations from a knowledge management perspective.INTRODUCTION In a knowledge‐based economy, knowledge creation processes are viewed asfundamental drivers of economic development. Continuous knowledge creation is needed tomaintain the competitiveness of organizations, regions and industrial clusters (Canals, Boisot,& MacMillan, 2005). Knowledge Management is a relatively new field which has generateda lot of interest since the 90’s. It was started with the expectation of improving businessefficiency with the help of information technology (Weisbord, 1987). Knowledge management is the next logical step in a sequence of societaldevelopments that has already been going on for a very long time. Systematic managementof knowledge takes on new importance with the current economic reality where knowledgeis a differentiating competitive factor for individuals, corporations, and nations. This realityis the driving force behind broad adoption and continued development of powerful methodsand tools to manage knowledge (WIIG, 1997).EVOLUTION OF KM SYSTEMS Evolution is important for the development and use of KM systems as the contextand information changes with time. It was initially assumed that Knowledge can be managedlike other commodities. However, it became clear that knowledge resides in the individualsand it benefits strongly from the interaction with others. The interaction had an effect on the 3

efficiency and thinking of individuals. Knowledge was acknowledged to have a volatilecharacter and it continuously evolved through interactions between people. A lot ofconcepts that were available for knowledge sharing were not efficient which led to theevolution of KM to adapt to the changing needs (Weisbord, 1987).Example: At Guide, Oslo, in order to identify consultants with appropriate competencies fora project, Competence description, a form of word documents were created in 1996 to givedetails about a consultant’s competencies as the business is focused on finding the rightperson for an assignment. When the organization grew, it required a more sophisticatedsystem to identify individuals with certain competencies. To overcome this issue, theAvailable-consultants system was developed which consisted of an excel sheet with detailsabout competence, availability for a project, etc. When the first intranet was launched in1996, HTML based competence descriptions were automatically generated with informationabout competencies and profiles from the Available-consultants system. In 1998, the secondintranet was launched with consultant profile information and importance was given forpersonal details. The Job-assignment system based on Lotus Notes developed andimplemented in 1998 contained information about consultant competencies and used tomatch a project to a consultant with the desired profile. It partially replaced the Available-consultants system. The Competence-marketplace system developed at Guide in Oslo wasdesigned to have KM system for mapping experts’ competencies within organizations, andfinding consultants for projects. The Developers-guild system was developed in 1999. It wasan online community meant for co-operation, knowledge sharing and information retrievaland it also included online articles, discussion lists, collaborative writing tools, and news(Lindgren, Hardless, Hardless, Nuldén, & Institute, 2002). 4

The KM systems evolve continuously as the needs of the organization changes. Thesystem should be able to serve the organization to improve its knowledge base and efficiency.Adding too much complexity to the system might result in its failure. KM systems evolutionneeds to look into the organizational goal in the long run and managed to keep in sync withthe needs of the organization (Lindgren, et al., 2002).APPLICATION & IMPACT OF KM TECHNOLGIES Organizations realise the potential of knowledge and rely heavily on the competenceof individual organizational members. Information systems play an important role insupporting knowledge management initiatives to achieve competitive advantage and a lot ofmoney is going into Knowledge Management. Industry watchers tell us that perhaps 80% ofbusinesses now have explicit KM projects. Several new trade journals serve the KMpractitioner community – including Knowledge Management, KM World, KM News, KMReview, the Journals of Knowledge Management and of Knowledge Management Practice,and the Journal of Intellectual Capital (Spender, 2004). Knowledge has been recognized as one of the most important assets of anorganization. It is the differentiating factor for a company’s success and the benefits arebeyond the visible increase in stock value and balance sheet. It has also brought in theawareness that the organization’s knowledge lies in its people which is benefited byinteractions with people having similar interests. Codifying the knowledge into a rigid set ofrules and instructions will restrict an organization’s ability to come up with new ideas.Knowledge is continuously evolving and new knowledge is generated by sharing existingknowledge. 5

The development of KM for the future can be looked at from different perspectives.One perspective is about the objectives to implement KM, the expectations associated with itand how KM can be used to share knowledge, innovate and use it to the company’sadvantage. The nature of knowledge management initiative is one more perspective. Anotherperspective is related to the speed with KM is evolving and how it is being used. Theorganizations are using even more sophisticated tools for integrating knowledgemanagement into their strategy to gain competitive advantage and incorporate into theiroverall operations.INFORMATION TECHNOLOGY FOR KNOWLEDGE MANAGEMENT It is important for the organizations to consider the impact of technology inknowledge management in order to better understand how technology helps in sharing andexchanging ideas. Collaboration is now the primary focus for companies because corporateknowledge remains locked up in employee files and inboxes even when other knowledgemanagement tools are in use. Web 2.0 has become the virtual office for teams in differentparts of the world to communicate and share ideas. Some of the things that organizations tried as part of the knowledge sharing exercisewas to build ‘experts’ finding database where all the key information of an employee in theorganization would be keyed and in whenever required, the managers can use keywords tofind candidates suitable with the nature of work they have on hand currently. But thisrequires users to keep their profiles up to date which many would forget to do. A few othersystems were completely ignored by the users as they believed that it contained too much oftheir personal information. 6

Some of the ways by which organizations can propagate the existing knowledge withinthe organization are by (Lupfer, 2011):  The organization can have a centralized repository for common problems and also not so common ones so that the employees can refer it when they face an issue before coming up with a new solution if nothing similar has been captured before. This way, repetition of work can be avoided and it saves time.  Companies can provide the tools and applications that will help the people to successfully implement their ideas and improve the existing practices.  Blogging helps to put information out in the open where it’s accessible for all.  Many companies use intranet to share information. The intranet is open for all and employees can be encouraged to add on to the information that already exists in the form of comments or add something that is not available. This will increase the user participation and add to the knowledge of the organization.  Ratings is another way of increasing the credibility of the information being shared as the most highly rated one will be considered to be the most relevant. All that has to be done is give a rank which is even simpler than writing comments.  Companies can give participation rewards to those who contribute the most towards the knowledge sharing process. Recognition and cash rewards are some of the incentives that companies can give.  Communities of Practice bring together people with similar interests to share their ideas and expertise about a topic.CORPORATE MEMORIES Corporate memories refer to the knowledge about services and products accumulatedover a period of time in organizations. The companies lose this precious knowledge when its 7

employees who are the key personnel in the corporate’s memories leave. One way of solvingthis problem is recording everything that is done but this can lead to an informationoverload. Another way of doing it is by capturing only the relevant knowledge by spendingsome time and money on the process. Corporate memories play a key role in a company’sprogress as they have the lessons learnt from previous mistakes and have solutions forproblems that occur frequently. This helps to enhance the processes that are knowledgedriven. The implementation of systems for corporate memories should be supported by ITinfrastructure.IMPACT OF SOCIAL MEDIA ON KNOWLEDGE MANAGEMENT INORGANIZATIONS We are living in an age where internet has changed the way people stay connectedwith each other. With the rise of Web 2.0 technologies, a number of new applications andtools have come into use over the last decade. The tools which brought tremendous changesin the lives of millions of people are now transforming the way the business around theworld operates. A new term “Enterprise 2.0” was coined in the year 2006 by Harvard SchoolProfessor Andrew McAfee, which is basically the application of Web 2.0 tools within theorganization.EFFECT OF SOCIAL NETWORKING PHENOMENON INLEADERSHIP The sensational rise of the creation and distribution of user generated content throughsocial networking sites has led to talks about the potential of social networking intransforming the way organizations work (Ltd, 2008). 8

All the enterprise functions are undergoing a change as a result of the environmentbeing engulfed by social media (Canals, et al., 2005). The current generation who are joiningorganizations as fresh graduates are using social media in ways the baby boomers wouldhave never considered. This change has led to a dilemma in the minds of CEOs and CIOs asthe current organizational policies and structures are yet to figure out how the youngergeneration works. Don Tapscott, co-author of a popular book Wikinomics (Tapscott & Williams, 2006)says that “the Facebook generation will wipe out the command control infrastructure inbusiness today”. He also proposes that the new generation of employees that come into theworkforce will challenge the existing organizational structures which are based on hierarchyand control.EMERGENCE OF SOCIAL MEDIA One of the top priorities of an organization is to capture the knowledge that resides inthe minds of its employees. Though it is true that managing knowledge remains a toppriority, it is also equally true to say that it remains as one of the biggest challenges andelusive goal for most organizations. The emergence of social media has forced us to rethink Knowledge Management andhas created new challenges (Reichental, 2011). The shift from traditional tools to theadoption of social media tools will change the way the knowledge is managed.Organizations typically manage best practices and organizational insights which are instructured form but with the implementation of social media, the future is going to be aboutmanaging unstructured content. 9

The use of social media is going to be a blessing in disguise for KnowledgeManagement. All the features and benefits that are being experienced by people in theconsumer space can be incorporated into enterprise solutions. For example, if a managerwants to know more about a member of his team who joined recently, he can get thedesignation, department, contact number, etc., from the corporate directory services whilethe additional information such as hobbies, interests, previous employment details can bepulled from social networks. In the future, companies will have to use data drivenmanagement techniques to analyse all the new knowledge that is being created through thesocial media. This analysis will result in insights which will be of great value in determiningwhere knowledge resides in an organization. Adrian, VP Sales for Trampoline Systems, which manufactures systems that allowcompanies to monitor, measure and manage social networks, says that the main sources ofinnovation in organizations are employees, business partners and clients. Establishingconnections among these three players through enterprise social computing will enableorganizations to manage knowledge effectively. In addition to this, social computing helpscompanies in identifying experts in organizations and also make communication moreefficient.SOCIAL MEDIA AND KNOWLEDGE MANAGEMENT Collaboration has become the primary focus for companies which are trying toutilize the power of social media in their organizations. The progress in adopting socialmedia is happening at a rapid pace that it leaves a lot of companies scratching their heads inorder to come up with proper strategies. One of the primary strategies a company shouldinclude in the transition phase is to create the best intranet possible. The best intranets are 10

those that integrate social technologies that not only foster collaboration but also knowledgemanagement (Lupfer, 2011). Some of the capabilities the winners of Jacob Nielsen “10 Best Intranets of 2011”possessed are:-  Knowledge Sharing  Participation Rewards  Innovation Management  Customized Collections  Comments  Social Tagging  Ratings  Social Learning Online social networks can be termed as webs of relationships that grow fromdiscussions over computer and internet (Kimball & Rheingold, 2003). When people in anorganization are stretched across time and space, conversations need to take place over anintranet. A well implemented online social network can enhance an organization’s collectiveknowledge and make sure knowledge gets to people so that they can act on it in time. It alsoprovides an important context to knowledge transfer that makes the transfer powerful thanjust going through a document. The inherent nature of the social media provides an onlinespace for sharing experience and insights by storytelling. The right kind of online socialnetwork brings appropriate tools to facilitate communication and showcase projects and bestpractices and make knowledge-transfer happen. Social Media has three basic functions which can be represented as three edges of atriangle (Back & Koch, 2011). They are:- 1. Information Management 2. Communication 3. Identity and Network Management 11

Social Software Triangle (Lindgren, et al., 2002) Employees can use the Information Management aspect of Social Media to collect orco-write information as in the case of wikis. The Communication aspect is used by theemployees to communicate directly with each other either synchronously in instantmessaging applications or asynchronously through weblogs. Employees make use of theIdentity and Network Management to present themselves to others and find others and linkwith each other.BENEFITS OF SOCIAL NETWORKING IN ORGANIZATIONS Social Networking provides a wide range of benefits to organizations. Some of theadvantages listed by AT&T are given below (AT&T, 2008).SOCIAL NETWORKING IMPROVES EMPLOYEE EXCELLENCE: Most of the organizations have global footprints and they should use it to their fullestadvantage. As employees start interacting with their international counterparts, they begin tothink globally. The more opportunities they get to interact with them, the more attentionthey pay to what their online contacts mention. When social network tools are used 12

appropriately in the organizations, employees can use the features to gain deeper knowledgein their areas of interest. These tools provide access to guides and mentors and act as a self-development platform that can be used any time and from anywhere.INCREASES EMPLOYEE MOBILITY: Employees can use the networking tools deployed in the organizations to increasevisibility by sharing their expertise in online communities of practice. In addition toincreasing their visibility, it also increases their credibility. As the number of online contactsthey maintain increases, they will also be frequently solicited.CORPORATE DIRECTORIES AND INTRANET WILL BE REVAMPED: Corporate directories will undergo major changes to have similar capabilities to thatof Facebook and LinkedIn. Additional features such as personalization and providing userrating options will be integrated into the corporate intranet sites to make them moreinformative.INCREASE REVENUES: One of the huge benefits social media brings to the organizations is the way in whichit can be used to increase revenues. As a result of the numerous changes in communication,organizations will be more accessible to its market which is a critical aspect for the successof any business. Some of the benefits of adopting social networking strategy are:-  It allows expanded reach  It provides access to new markets  It helps in maintaining customer relationships  It offers innovative and dynamic marketing practices The adoption of social media by organisations does not provide any guarantee that 13

employees will start using them. So companies will have to alter their strategies and policiesto get employees participate in the collaborative work.ORGANIZATIONS CHANGE THE WAY THEY COMMUNICATE Social networking brings a wide range of innovative technologies that create value toemployees, organizations and to the customers as well. Organizations have started usingthese tools not only for their internal communication but to communicate with customers aswell. They make use of these tools to promote their products and build their brand image.ORGANIZATIONS CHANGE THEIR VISION As the amount of information being made available online increases, businesses havebecome transparent and their corporate social responsibility increases. So organizations havestarted to give importance to collaboration and communication in their vision statements.CHALLENGES FACED IN IMPLEMENTING SOCIAL MEDIA INORGANIZATIONS When intranets are opened to business users outside the organization and wheninternal users start using the different collaborative tools available over the internet, it will bedifficult to maintain security as a whole. It is also important on the employees’ part to becareful about the nature of information they share. As search engines are becoming more andmore powerful, any information leakage can be caught by people using the internet. All thesechallenges make the managers and executives resistive to change. As more number ofapplications that have been developed with collaborative capabilities is being increasinglyused by employees, organizations have to make sure that security is not impacted. 14

FUTURE OF KNOWLEDGE MANAGEMENT TECHNOLOGIES When we look back at the past few decades, we can realize that new technologieshave emerged almost every year and each one has created some sort of business value. Onetechnology that has emerged in the last decade and swiftly evolved into a platform forcorporate communications is social media. In the coming years, social networking tools andstrategies will be “must haves” in any organization (Weisbord, 1987). Some of the companiesthat adopted social media early have developed standards and guidelines on the usage ofsocial media. The policies developed by these companies are likely to shape the future ofsocial media in other organizations and they will also provide an opportunity to learn the bestpractices, successes and failures. In spite of the fact that the usage of social media in organizations is a relatively newphenomenon, it has been predicted to grow steadily in the coming years. A wide range ofsolutions are already available on the market that has been developed to address businessconcerns such as security and accountability. These solutions are relatively inexpensive whencompared to the magnitude of benefits they provide. One of the very few companies that hascreated its own corporate social media platform and enables real-time collaboration among itsemployees around the globe is IBM. If social activities are aligned with an organization’s goal, they can be used to providesupport to all areas of an enterprise such as marketing & sales, communications and customerservice. The kind of information companies pay to get from market researchers such ascustomers’ needs and wants are available for free on the social media outlets. In the nearfuture we can expect more companies to develop their own strategies to make use of thehighly valuable customer intelligence that social networks are generating. 15

CONCLUSION The lifeblood of most organizations was, is and will be conversations. Theinformation and knowledge that was shared through meetings and the informal talks thathappened near the water cooler stations are things of the past. The evolution of social mediahas brought in great advantages to individuals and organizations and the primary advantageis the kind of conversations they make possible. The social media technology is no longerexpensive when compared to the numerous benefits they offer and cost should not be afactor for not implementing them in organizations. When the business and IT team worktogether to refine social networks used in organizations to make them secure and integratethem to their corporate information systems, they can unleash social networks’ maximumpotential and deliver better business results. So with the social media technologycontinuously evolving, we can expect more and more organizations to implement these toolsin the future to manage knowledge and provide better collaboration facilities for employees. 16

REFERENCESAT&T. (2008). The Business Impacts of Social Networking.Back, Andrea, & Koch, Michael. (2011). Broadening Participation in Knowledge Management in Enterprise 2.0. Information Technology, 53.Canals, Agustí, Boisot, Max, & MacMillan, Ian. (2005). Evolution of Knowledge Management Strategies in Organizational Populations: A Simulation Model.Kimball, Lisa, & Rheingold, Howard. (2003). How Online Social Networks Benefit Organizations By Lisa Kimball and Howard Rheingold. 15.Lindgren, Rikard, Hardless, Christian, Hardless, Christian, Nuldén, Urban, & Institute, The Viktoria. (2002). The Evolution Of Knowledge Management Systems Needs To Be Managed. Journal of Knowledge Management Practice.Ltd, Johnson Controls Workplace Innovation Solutions and The Smart Work Company. (2008). Knowledge Management and Enterprise Social Networking.Lupfer, Elizabeth. (2011). Knowledge Management: Creating a Social Intranet Where Employees Can Learn Retrieved 20th October 2011, 2011, from http://socialmediatoday.com/elizabeth-lupfer/285241/knowledge-management- creating-social-intranet-where-employees-can-learnReichental, Jonathan. (2011). Knowledge management in the age of social media Retrieved 20th October 2011, 2011, from http://radar.oreilly.com/2011/03/knowledgemanagement-social-media.htmlSpender, J. C. (2004). A Note on Making Use of Knowledge Management. Paper presented at the Annual MIT/UCI Knowledge and Organizations Conference, LagunaBeach, CA. http://www.crito.uci.edu/papers/2004/spender.pdfTapscott, D., & Williams, A.D. (2006). Wikinomics: How Mass Collaboration Changes Everything. London: Atlantic Books.Weisbord, Marvin. (1987). A Conceptual Framework of the Evolution of Knowledge Management Retrieved 31 October, 2011, from http://i-p- k.co.za/wordpress/allowing-human-ingenuity-to-unfold/a-conceptual-framework-of- the-evolution-of-knowledge-management/WIIG, KARL M. (1997). Knowledge Management: Where Did It Come From and Where Will It Go? Expert Systems With Applications, 13(1), 14. 17

Impact of Social Media on Organizations

by Antony Prakash

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