A resource based view of organizational knowledge management systems


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A resource based view of organizational knowledge management systems

  1. 1. Journal of Knowledge ManagementEmerald Article: A resource-based view of organizational knowledgemanagement systemsPeter Meso, Robert SmithArticle information:To cite this document: Peter Meso, Robert Smith, (2000),"A resource-based view of organizational knowledge management systems",Journal of Knowledge Management, Vol. 4 Iss: 3 pp. 224 - 234Permanent link to this document:http://dx.doi.org/10.1108/13673270010350020Downloaded on: 07-12-2012References: This document contains references to 27 other documentsCitations: This document has been cited by 47 other documentsTo copy this document: permissions@emeraldinsight.comThis document has been downloaded 5858 times since 2005. *Access to this document was granted through an Emerald subscription provided by UNIVERSITY OF THE ARTS LONDONFor Authors:If you would like to write for this, or any other Emerald publication, then please use our Emerald for Authors service.Information about how to choose which publication to write for and submission guidelines are available for all. Please visitwww.emeraldinsight.com/authors for more information.About Emerald www.emeraldinsight.comWith over forty years experience, Emerald Group Publishing is a leading independent publisher of global research with impact inbusiness, society, public policy and education. In total, Emerald publishes over 275 journals and more than 130 book series, aswell as an extensive range of online products and services. Emerald is both COUNTER 3 and TRANSFER compliant. The organization isa partner of the Committee on Publication Ethics (COPE) and also works with Portico and the LOCKSS initiative for digital archivepreservation. *Related content and download information correct at time of download.
  2. 2. IntroductionA resource-based view The resource-based view (RBV) of the firmof organizational defines a strategic asset as one that is rare,knowledge management valuable, imperfectly imitable and non- substitutable. An asset should meet allsystems conditions concurrently to qualify as a strategic asset (Peteraf, 1993; Michalisn et al., 1997;Peter Meso and Wernerfelt, 1984). With the advent ofRobert Smith knowledge management (KM), intellectual capital is gaining increasing recognition as the only true strategic asset (Hamel, 1998). ThisThe authors has led to a proliferation of organizationalPeter Meso and Robert Smith are both Professors in the knowledge management systems (OKMS), forDepartment of Management and Information Systems, managing intellectual capital. However,Kent State University, Kent, Ohio, USA. according to the resource-based view, tangible assets are not strategic because they can be acquired or imitated. Thus this paper addressesKeywords the question: ``Are OKMS strategic assetsKnowledge management, within the context of the resource-based view?Knowledge management systems, Explicit knowledge, The answer to this question is pertinent inTacit knowledge, Competitive advantage, enabling the firm to determine whether it isOrganizational learning strategically wise to capture and share its knowledge via an OKMS. Should it be that anAbstract OKMS eliminates the intangibility of tacitWith the advent of knowledge management, intellectual knowledge, it may not be strategically wise tocapital is gaining increasing recognition as the only true invest the firms knowledge in an OKMS.strategic asset. This has led to a proliferation of Doing so would render the otherwise strategicorganizational knowledge management systems (OKMS), asset non-strategic, easily acquired orfor managing intellectual capital. This article addresses replicated by competitors, and hence dilutethe question: ``Are OKMS strategic assets within the the sustainable competitive advantage of thecontext of the resource-based view? Two views of OKMS firm. Alternatively, should it be that anemerge ± the technical and the socio-technical view. An OKMS enables a firm to leverage the strategicanalysis of OKMS from each perspective is presented and value of its knowledge, it would be advisabletheir resultant implications on the competitive position of to invest the firms knowledge in such anthe firm explained. The findings indicate that, for a firm to OKMS (Peteraf, 1993; Michalisn et al., 1997;reap long-term strategic benefit from OKMS, it should Wernerfelt, 1984).adapt the broader socio-technical view when developing, The first part of the paper defines strategicimplementing and managing its OKMS. This suggests that assets, while the second part reviews KM.firms need to consider not only the technology but also The third part defines OKMS, presenting thethe organizational infrastructure, the organizational common views of such systems and analyzingculture and the people who form the OKMS, and the how each view influences the strategic valueknowledge that is to be processed by these OKMS. of the OKMS.Electronic accessThe current issue and full text archive of this journal is Strategic assetsavailable at The resource-based view holds that thehttp://www.emerald-library.com resources a firm holds can determine the firms sustainable success in a given market. It specifies that there are two types of assets, strategic and non-strategic. Non-strategic assets do not contribute to the long-term success of the firm. Sustainable competitiveJournal of Knowledge ManagementVolume 4 . Number 3 . 2000 . pp. 224±234 success results only from strategic assets# MCB University Press . ISSN 1367-3270 (Figure 1). Four conditions jointly define the 224
  3. 3. View of organizational knowledge management systems Journal of Knowledge Management Peter Meso and Robert Smith Volume 4 . Number 3 . 2000 . 224±234Figure 1 Relationship of strategic assets to sustainable competitive advantagecharacteristics of a strategic asset ± valuable, are so ingrained as to be taken for granted. Itrare, imperfectly imitable, and non- resides within the individual and is difficult tosubstitutable. A resource is valuable if it express in words. Every employee has aallows the firm to exploit the opportunities in wealth of tacit knowledge deeply rooted inthe market or thwart competitive threats. If it his/her actions, and his/her commitment to ``ais owned by a very small number of all the particular craft or profession, a particularfirms in the industry, then it is rare. It is technology, a product market, or the activitiesimperfectly imitable if it can be sustained for of a work group or team (Nonaka, 1991). Inlong periods of time without competitors most organizations, tacit knowledge is rarelyreplicating or acquiring it. Finally, it is non- shared or communicated. Therefore, it issubstitutable if it has no strategic equivalents. often lost when the individual possessing itBecause all tangible assets can either be leaves the organization. Tacit knowledge canimitated or acquired, they are not strategic. also be seen as that knowledge which residesTherefore, a further quality for strategic assets in the culture of the organization (Figure 2).is that they are intangible. The resource-based An example is self-motivated creativity, whichview also operates under two assumptions: refers to the will, motivation, and adaptabilitythat ex-ante conditions to competition exist for success exhibited by employees workingand that the ex-post conditions to competition within certain corporate cultures. It is difficultcan be maintained (Wernerfelt, 1984; to identify the precise cause of care-why. ButMichalisn et al., 1997; Peteraf, 1993). literature on KM acknowledges that high levels of care-why significantly enhance the overall performance of the firm (Davenport etKnowledge management al., 1998). Other examples include organizational tacit knowledge, whichKM is the process of capturing the collective comprises such knowledge as causalexpertise and intelligence in an organization ambiguity ± the inexplicable chemistry ofand using them to foster innovation through resources that provides sustainablecontinued organizational learning (Nonaka, competitive advantage to a firm (Michalisn et1991; Quinn et al., 1996; Davenport et al., al., 1997), and cultural tacit, which is the1998). According to Nonaka, two types of inexplicable knowledge resident in theknowledge reside in any organization ± tacit corporate culture (Michalisn et al., 1997).and explicit knowledge. Tacit knowledge Explicit knowledge is knowledge that can beconsists of mental models, beliefs and codified. Because it is easily shared andpersuasions of each individual employee that communicated, most organizations have 225
  4. 4. View of organizational knowledge management systems Journal of Knowledge Management Peter Meso and Robert Smith Volume 4 . Number 3 . 2000 . 224±234Figure 2 The knowledge matrixcaptured this knowledge in ordered organizational learning. Therefore, KM canrepositories, systems, or operating be viewed as the creation of sustainabletechnologies of the firm, thus making it competitive advantage through continuedavailable to all the members of the organizational learning (Figure 3). Since theorganizations. There are three types of ``value of the intellect increases markedly asexplicit knowledge resident in any one moves up the intellectual scale fromorganization ± cognitive knowledge, advanced cognitive knowledge through advanced skillssystems skills, and systems understanding and systems thinking to self-motivated(Figure 2). Cognitive knowledge, also termed creativity, enhancing intellectual capital``know-what, is the ``basic mastery of a within the firm assures the sustainablediscipline that professionals achieve through competitive advantage of the firm (Nonaka,extensive training and certification (Quinn et 1991; Quinn et al., 1996; Hamel, 1998).al., 1996). Advanced skills or ``know-how The major goal of KM is to enhancerefer to the ``ability to apply rules of a innovation. In a bid to achieve this goal and todiscipline to complex real-world problems maximize the benefits that can be derived from(Quinn et al., 1996). Systems understanding, effective KM, many firms are investing heavilyalso termed ``know-why is the deep in the development of OKMS aimed atunderstanding of the web of cause-and-effect supporting knowledge work and enhancingrelationships underlying a discipline (Quinn et organizational learning (Davenport et al., 1998).al., 1996; Nonaka, 1991). However, there are differences in what firms Organizational learning is the process of perceive an OKMS to be. Such differences havecontinued innovation through the creation of resulted in two common perceptions of OKMS:new knowledge (Quinn et al., 1996; Nonaka, the technical perception; and the socio-technical1991). It is an ongoing process that takes perception. Each perception is examined in theplace as employees engage in knowledge work next section. The implications of each(Davenport et al., 1998). Nonaka (1991) perception on the approaches used to developstates that organizational learning emanates OKMS, and the resultant impact on thefrom the iterative process of articulation and sustainable competitive positions of the firms areinternalization. Articulation occurs when an also examined.employees tacit knowledge is captured asexplicit knowledge and internalization occurswhen this captured explicit knowledge is then Organizational knowledge managementtransformed into another employees tacit systemsknowledge. Therefore, organizationallearning occurs at the intersection of tacit and From the perspective of knowledge work, anexplicit knowledge during the interaction of OKMS is a system that provides for thethe various employees, departments or teams creation of new knowledge, the assembly ofin a firm (Nonaka, 1991). externally created knowledge, the use of Sustainable competitive advantage results existing knowledge, and the finding offrom innovation. Innovation in turn results knowledge from internal and external sources.from the creation of new knowledge. New Nonakas spiral of knowledge creation leadsknowledge is created in the process of to the definition of an OKMS as that which 226
  5. 5. View of organizational knowledge management systems Journal of Knowledge Management Peter Meso and Robert Smith Volume 4 . Number 3 . 2000 . 224±234Figure 3 How knowledge relates to organizational learning and sustainable competitive advantagesupports organizational learning by enhancing geographically dispersed professionals.the exchange and sharing of tacit and explicit Examples of group-ware software productsknowledge (Figure 3). Taking Quinn et al.s being marketed as OKMS are Lotus Notes,(1996) definition of intellectual capital, an Network Delivery Knowledge, and FulcrumOKMS can be seen as that which organizes a Knowledge Network. Lotus Notes is the mostfirms know-what, know-how, and know-why widely used. Lotus Notes is a documentinto explicit knowledge resident in the firms database that enables the communicationdatabases and operating technologies between colleagues, the collaboration among(Nonaka, 1991; Quinn et al., 1996; teams, and the co-ordination of strategicDavenport et al., 1998; Sviokla, 1996). The business processes within an organization. Itadvent of KM has resulted in two can contain both structured and unstructuredpredominant perspectives of what constitutes content, thereby surpassing limitations thatan OKMS ± the technical perspective and the relational databases impose on thesocio-technical perspective. Following are organization. Notes uses replicationdescriptions and analyses of each. technology to allow users in diverse locations to access the same knowledge. It supportsThe technical perspective e-mail, pull and push technologies, and workThis perspective holds that an OKMS is an flow automation. The software also providesadvanced assembly of software, and its up to four levels of security: authentication,associated hardware infrastructure, for access control, field-level privacy, and digitalsupporting knowledge work and/or signatures (IBM, 1998; Kurchak Associates,organizational learning through the free 1998; Fulcrum, 1998; Hibbard, 1997).access to and increased sharing of knowledge Group-ware technologies, including Lotus(Figure 4). The technology-centered OKMS Notes are developed by independent softwarein use today are employing one technology or houses and sold to any willing buyer.a combination of ten key technologies: group- Therefore, they are easily acquired. Theware, messaging, Web browsers, document security features found in any group-waremanagement, search and retrieval, data system do not prevent the imitability of themining, visualization, push technology, group knowledge resident in the system. Lotusdecision support, and intelligent agents. Of Notes, for example, employs RSA public keythese group-ware and Web browser encryption technology ± the de facto industrytechnologies are the most prominent standard ± to secure the knowledge resident in(Hibbard, 1997; Chaffey, 1998). its knowledge bases (IBM, 1998). However, Group-ware software packages are because this security standard is also used byadvanced decision support systems developed other organizations in the industry, it is notto enhance collaborative group work, between proprietary. Mechanisms employed by 227
  6. 6. View of organizational knowledge management systems Journal of Knowledge Management Peter Meso and Robert Smith Volume 4 . Number 3 . 2000 . 224±234Figure 4 The technical perspective of a knowledge management systemcorporate intelligence agents, industrial commitment to the system. Finally, Webespionage experts, and computer hackers may technologies adapt the natural way ofenable unauthorized users to circumvent the communication between individuals. Theysecurity controls and access strategic surpass organizational hierarchies, formalcorporate knowledge (Crock et al., 1996) communication policies, physical barriers,resident in the group-wares knowledge bases. and social groupings to make available toTherefore, when viewed solely from a everyone knowledge articulated by any othertechnological perspective, group-ware professional. However, these technologies dotechnologies do not satisfy the requirements not provide for the development of well-of a strategic asset. The strategic value of structured KM systems. Web-based KMgroup-ware does not result from the quality of systems are thus difficult to manage, maintaintechnology used to develop these systems. and evaluate. Such systems do not allow the Web-based technologies entail employing a organization to keep an accurate inventory ofWeb browser to access knowledge resources the intellectual capital it possesses and whaton the Internet or on intranets that link the true value of these assets is (Hibbard,geographically dispersed professionals. These 1997; IBM, 1998; Musciano and Kennedy,technologies are popular with most 1996).organizations for several reasons. First, they From a resource-based view, Weballow for the in-house development of KMsystems, hence building some proprietary technologies may provide limited strategiccharacteristics into the system. Second, they advantages. For example, Web browsers areallow for the development of a naturally not rare ± they are easily acquired. The Webexpanding, flexible and easy to use KM pages developed by these browsers are easilysystem. This encourages employees to take imitated. Further, Web-based systems haveadvantage of the system. Third, because it is substitutes in group-ware, messaging,very simple to develop Web pages, the document management, push technologies,employees themselves do most of the intelligent agents, search and retrieval, anddevelopment of the OKMS. This not only data mining technologies. The strategic valueminimizes the cost of developing the OKMS, of Web-based KM systems is thus greatlyit also enhances employee participation and diluted. Therefore, taken on their own, 228
  7. 7. View of organizational knowledge management systems Journal of Knowledge Management Peter Meso and Robert Smith Volume 4 . Number 3 . 2000 . 224±234Web-based technologies do not constitute knowledge management can be viewed as astrategic assets. socio-technical system of tacit and explicit business policies and practices. These are enabled by the strategic integration ofSocio-technical perspective information technology tools, businessThe socio-technical perspective recognizes processes, and intellectual, human, and socialthat there is more to OKMS than mere capital.technology. Under this perspective, OKMSare seen as being complex combinations of Technology infrastructure comprises thetechnology infrastructure, organizational hardware, software, middle-ware andinfrastructure, corporate culture, knowledge, protocols that allow for the encoding andand people (Figure 5). Carayanis (1998) electronic exchange of knowledge. Threeconcurs with this by stating that: types of technology infrastructure are found While information technology can be considered in an OKMS: knowledge oriented as a value-adding technological infrastructure, technologies, function oriented technologies,Figure 5 Organizational knowledge infrastructure and its relation to sustainable competitive advantage 229
  8. 8. View of organizational knowledge management systems Journal of Knowledge Management Peter Meso and Robert Smith Volume 4 . Number 3 . 2000 . 224±234and specialty oriented technologies. engineers are able to gain insightfulKnowledge oriented technologies such as knowledge about the customers, customergroup-ware and Web browsers directly needs, trends in consumer tastes and theprocess knowledge work and the sharing of evolution in consumer behavior that allowsknowledge within the organization. Function them to remain in front of the innovationoriented technologies such as office curve. Thus by effectively harnessing theautomation, robotics and desk-top computing capabilities provided by informationtechnologies support operational level technologies, Ford is attempting to create aactivities such as data processing, production, sustainable competitive advantage in the autoand service delivery while collecting the data industry (Kerwin, 2000).that eventually get refined into information Organizational infrastructure refers to the setand further into knowledge for use in of roles and organizational teams whoseorganizational learning. Specialty oriented members have skills to serve as resources fortechnologies support highly specialized individual projects. The way these roles relate tofunctions within the firm. Usually these are each other within the context of thethose functions that require high levels of organizations structure defines theknow-how. Examples of these technologies organizational infrastructure. The organizationalinclude computer-aided design and infrastructure defines the organizationsmanufacture (CAD/CAM) software, and management style and philosophy. Itexpert systems software (Davenport et al., determines how the employees of the firm are1998; Hibbard, 1997). organized into formal and informal teams of All the technology infrastructure used in departments; how these teams interact formallyOKMS (including software) is tangible. and informally; and the role and goals of eachBecause this technology infrastructure is team and how these relate to the overalllargely software-dependent, it is easily corporate strategy (Davenport et al., 1998).replicated, copied, pirated, reverse- Organizational infrastructure is intangible.engineered or cloned, even when protected by No two organizational infrastructures areregulatory assets such as copyrights, patents alike. Well-developed organizationaland licenses. The hardware infrastructure infrastructure can be a source of sustainablefound in OKMS is largely standard and thus competitive advantage. This advantage is noteasily imitated. Therefore, the technology derived from the organizations hierarchy.component of the OKMS is not a strategic Rather it is derived from the dynamicasset (Michalisn et al., 1997; Wernerfelt, interaction of the teams and individuals that1984; Long, 1994). make up the hierarchy. Though it may be easy The Ford Motor Company is a clear to replicate or imitate the organizationsexample of a firm that is re-inventing its hierarchy, it is extremely difficult to replicatecorporate architecture by investing heavily in the precise nature of interaction between thetechnologies for KM systems. It is using KM roles and the teams in the hierarchy. Thesystems to redefine the auto manufacturing more advanced the organizationalindustry, gain a competitive stronghold in infrastructure, the greater the economic rentsemergent electronic markets, and get closer to it will generate for the organization.its customers. The firm has established the Therefore, organizational infrastructure is aautoxchange mart ± an information strategic asset (Davenport et al., 1998;technology-intensive KM and electronic Michalisn et al., 1997).commerce system intended to shift the car- Federal Express (FedEx) is an example of amanufacturing model from the conventional firm that has built an information-technology``push business model to the emergent intensive global organizational infrastructure``pull model. In the ``pull model, the that meets the criteria of a strategic asset. Theconsumer determines the precise organizational infrastructure effectivelyconfiguration of the car before it is connects the internal and externalmanufactured. Thus, consumers get highly stakeholders at FedEx to each other in ancustomized products while the firm saves online, real-time mode. In this way it allowssubstantial amounts of capital that would FedEx to dynamically exchange knowledgeotherwise be tied up in large inventories of with its customers, vendors, suppliers andfinished products. Further, auto designers, trade partners while effectively transacting thefinanciers, marketers, and production firms core business functions. Further, all 230
  9. 9. View of organizational knowledge management systems Journal of Knowledge Management Peter Meso and Robert Smith Volume 4 . Number 3 . 2000 . 224±234employees at the firm have instantaneous organizations databases, systems, andaccess to the knowledge resources resident in operating technologies. In so doing, theyits technologies, databases and operating make personal knowledge available forprocedures. Employees can easily interact corporate use. Further, they tap into theacross time zones, political borders, business corporate pool of explicit knowledge,divisions, and organizational hierarchy levels internalizing it into personal tacit knowledgein a real-time online mode, thereby that they then use to generate new knowledge.facilitating instantaneous exchange of This new knowledge is then articulated backknowledge. While it may be possible to into the corporate databases, systems andimitate the technological infrastructure at operating technologies, further expanding theFedEx, it is extremely difficult to replicate an corporations intellectual assets (Quinn et al.,organizational structure equivalent to 1996; Nonaka, 1991; Davenport et al., 1998;FedExs in complexity, behavior, and Sviokla, 1996; Michalisn et al., 1997).productivity. A case in point is United Parcel As individuals, employees do not meet theService (UPS) and Document Handling requirements for a strategic asset. They easilyServices (DHL) which have OKMS that are transfer from one organization to the next.almost as elaborate, global and extensive as Their productivity depends on a complexthat at FedEx, yet enjoy significantly smaller combination of factors: motivation, reward,market share both globally and domestically skill levels, experience, health and evenwhen compared to FedEx (Rao et al., 1999). emotional factors. However, as teams or units General Electric is yet another firm that has of workers, employees satisfy the conditionsdeveloped a ``social architecture that enables of a strategic asset. The teams formed by theit to keep ahead of its competitors in almost employees, and the synergies emanating fromall the markets it serves. The organizational these teams, result in organizational learning.infrastructure at General Electric has Organizational learning is a strategic asset.facilitated the maturing of this social Since it is the collaboration betweenarchitecture by allowing a seamless flow of employees that enables the process ofknowledge across all employees regardless of organizational learning, the collection oftheir position, authority, or geographical employees ± human resources in total ± is apostings. Hence, suggestions from anyone in strategic asset. Said another way, because thethe firm are quickly assessed through a employees are the custodians and developersspecific process called ``Work out (Layne, of intellectual capital, when they work2000). While it may be easy to replicate together or collaborate, they constitute aGeneral Electrics organizational hierarchy, strategic asset (Michalisn et al., 1997; Grant,the fabric that holds its organizational 1998; McNearney, 1996; Spitzer, 1996;infrastructure together, thereby facilitating a Nonaka, 1991; Quinn et al., 1996).productive ``social architecture and highly Leading consulting firms have continued toeffective knowledge sharing processes such as maintain a lead in investing in their employees``work out, is extremely difficult to replicate, as a core element of their strategic competitiveimitate or even substitute. In that sense it is advantage. Strategy consulting firms such asalso valuable and rare. Bain, Boston Consulting Group and The core of the OKMS is the people. This McKinsey have developed elaboratecomponent includes all the organizations information-technology enabled KM systemsstakeholders ± employees, owners, customers, that accentuate dialogue between individualssuppliers and regulators/legislators. However, rather than knowledge objects in a database.employees are the most significant They make effective use of communities ofparticipants. Employees are the key source of practice, brainstorming sessions, one-on-onethe intellectual capital acquired and managed conversations, apprenticeship, and computer-by the OKMS. Intellectual capital is an supported collaboration and group workintangible asset. It is also rare, valuable, non- technologies to keep their employees activelysubstitutable and difficult to imitate. engaged in perpetual organizational learningTherefore, intellectual capital is a strategic (Hansen et al., 1999).asset. Further the employees propel the Microsoft is another example of a firm thatorganizational learning process. They has developed a successful KM system usingarticulate personal tacit knowledge into the the socio-technical approach. It has, over theexplicit knowledge resident in the past decade, quietly assembled over 245 of 231
  10. 10. View of organizational knowledge management systems Journal of Knowledge Management Peter Meso and Robert Smith Volume 4 . Number 3 . 2000 . 224±234the brightest researchers from around the always charge the lowest fare ± but theyglobe and provided them with resources to cannot copy its culture. Indeed, Southwestconduct leading-edge research and Airlines has ranked among the top tendevelopment of future software products. The corporations best to work for in the USA overorganizational infrastructure that Microsoft the past few years. It has also remained ahas established to support its researchers and dominant player in the very competitiveproduct developers facilitates a rich exchange airline industry. Its culture allows itsof knowledge across disciplines hitherto employees to acquire knowledge quickly bothconsidered remotely related. Yet Microsoft from its clients and from fellow employees. Ithas been able to tap the ensuing knowledge allows employees to use the knowledgeinto its products, hence expanding its market instantaneously as they make decisions, andshare very rapidly while remaining well at the encourages employees to disseminate theirforefront of innovation in the software knowledge to colleagues. Its culture rewardsindustry. Like General Electric it has been learning and the development of others. Asable to expand its product offerings, such Southwests employees are able toreshaping itself successfully as the business provide very high levels of customerenvironment evolved from the standalone satisfaction, thus generating the repeatPersonal Computer, to the Client-Server business that keeps it competitive (Colvin,Architecture and more recently to the 1997).Internet and Electronic Commerce business Knowledge may be tangible or intangible inmodels. While technology is an integral part nature. Know-what, know-how, and know-of its KM system, people are even more why, when articulated into the organizationsimportant. So are the culture and the database and operating technologies, areorganizational infrastructure that cement the tangible. Similarly, explicit knowledge isinteractions of its people and technology tangible because it has been encoded intocomponents, hence generating the knowledge documents, databases, or some otherthat keeps Microsoft competitive (Stross, permanent medium. Explicit knowledge1997; Kurtzman, 1998). exhibits strategic characteristics only when it Culture refers to the shared beliefs, norms, is proprietary. For this type of knowledge toethics and practices within an organization. A remain proprietary, it has to be protectedknowledge friendly culture is one in which the from other parties. Such protection isemployees highly value learning and exhibit a achieved through legal assets such as patentspositive orientation to knowledge. It is one in or copyrights, or through security featureswhich experience, expertise and rapid such as access controls and encryption. Wheninnovation are held to be more important explicit knowledge is captured on electronicthan hierarchy. Such a culture deeply media it becomes increasingly vulnerable toembraces knowledge and the opportunities piracy regardless of the types of protectionthat come with learning. A knowledge being used to protect it. Piracy dilutes theunfriendly culture, on the other hand, is one strategic value of knowledge. Therefore,that neither values nor rewards knowledge. articulating knowledge makes it easier toCulture is intangible. It is unique to each acquire and/or imitate that knowledge, henceorganization. A knowledge friendly culture diluting its strategic properties (Quinn et al.,cannot be replicated, imitated, acquired or 1996; Michalisn et al., 1997; IBM, 1998;substituted. It develops within the Crock et al., 1996).organization, and remains unique to that Tacit knowledge, on the other hand, isorganization. Therefore, a knowledge friendly intangible. However, it only becomes strategicculture is a strategic asset. when used to advance the objectives of the Southwest Airlines is an example of a firm firm. When this knowledge is not used in thethat has developed a world-acclaimed positive interest of the firm, it does not contribute anycorporate culture that has contributed value to the firm. Because tacit knowledgesignificantly to its corporate success. In the resides in an individual, its benefits are notwords of Southwest Airlines founder, Herb long-term. It is lost when the individual leavesKeller, Southwests competitors can do the organization. Therefore, tacit knowledge,everything it does ± fly one type of aircraft, though rare, non-substitutable, inimitable,serve no meals, transfer no luggage, give no and valuable (when used to advanceassigned seats, fly mostly short hauls, and corporate goals), does not satisfy the ex-post 232
  11. 11. View of organizational knowledge management systems Journal of Knowledge Management Peter Meso and Robert Smith Volume 4 . Number 3 . 2000 . 224±234conditions of a strategic asset. Further, by articulating this asset and thus making itbecause tacit knowledge can be captured as readily available to competitors.explicit knowledge through the process ofarticulation, it becomes possible to acquire.These two observations limit the strategic Referencesvalue of tacit knowledge (Michalisn et al.,1997; Peteraf, 1993; Wernerfelt, 1984). Carayanis (1998), ``The strategic management of Care-why, the knowledge that resides in the technological learning in project/programculture of a firm, is also intangible. Unlike management: the role of extranets, intranets and intelligent agents in knowledge generation,tacit knowledge it cannot be articulated into diffusion, and leveraging, Technovation, Vol. 18explicit knowledge. However, care-why is No. 11, pp. 697-703.largely related to the culture of the Chaffey, D. (1998), Groupware, Workflow and Intranets:organization. It has strategic value only when Reengineering the Enterprise with Collaborativethe culture of the organization is knowledge Software, Digital Press, Boston, MA.friendly. This is because such cultures foster Colvin, G. (1997), ``The changing art of becomingthe development of care-why. A culture that is unbeatable, Fortune, 24 November, pp. 299-300. Crock, S., Smith, G., Weber, J., Melcher, R.A. andnot knowledge friendly stigmatizes care-why, Himelstein, L. (1996), ``They snoop to conquer,thereby incapacitating organizational learning Business Week, 28 October, pp. 172-6.and the resultant benefits. Therefore, the Davenport, T.H., De Long, D.W. and Beers, M.C. (1998),strategic value of care-why is tied to the ``Successful knowledge management projects,strategic value of the organizations culture Sloan Management Review, Winter, pp. 43-57.(Quinn et al., 1996; Michalisn et al., 1997; Fulcrum (1998), Fulcrum Knowledge Network, http://Davenport at al., 1998). www.fulcrum.com/english/products/fknhome.htm, On the whole the socio-technical 9 April, p. 1. Grant, L. (1998), ``Happy workers ± high returns, Fortune,perspective enables a firm to reap sustainable 12 January, p. 81.competitive advantages from its OKMS Hamel, G. (1998), Strategic Flexibility: Managing in a(Figure 5). The organization that develops its Turbulent Economy, Wiley, Chichester, UK.OKMS, so that the intangible components Hansen, M., Hansen, N. and Tierney, T. (1999), ``Whatsare strategically and appropriately your strategy for managing knowledge?, Harvardsynchronized with a well-developed Business Review, March, pp. 106-16. Hibbard, J. (1997), ``Knowing what we know,technology infrastructure, acquires a system Informationweek, 20 October, pp. 46-64.that is rare, difficult to imitate, valuable and IBM (International Business Machines) (1998), ``Lotusnon-substitutable. Such a system is strategic notes: an overview, http://www.lotus.com/core/and will accord the firm the sustainable content.htm, 25 April, pp. 1-12.strategic advantages it needs to leverage its Kerwin, K. (2000), ``At Ford, e-commerce is job 1,competition. Business Week, 28 February, pp. 74-8. Kurchak Associates (1998), ``Network delivery knowledge, http://www.coursewaresource.com/ kurchak/, 9 April, p. 1.Conclusion Kurtzman, J. (1998), ``An interview with Brian Arthur, Strategy and Business, 2nd quarter, pp. 95-103.In order to leverage its strategic competitive Layne, R. (2000), ``GE chief outlines strategies for future,position, a firm needs to adopt the socio- The Beacon Journal, 26 February.technical perspective when developing its Long, L. (1994), Introduction to Computers andOKMS. In so doing it addresses all the Information Processing, 4th ed., Prentice-Hall Inc., Upper Saddle River.components pertinent to the implementation McNearney, D.J. (1996), ``Employee motivation:of the OKMS as a strategic system by giving creating a motivated workforce, HR Focus, August,appropriate focus to those components that pp. 1-6.generate sustainable competitive advantage. Michalisn, M., Smith, R. and Kline, D. (1997), ``In search ofOKMS that simply exploit the tangible strategic assets, revised and submitted to theaspects of knowledge do not leverage the International Journal of Organizational Analysis,firms sustainable competitive advantage. On August, pp. 1-39. Musciano, C. and Kennedy, B. (1996), HTML:the contrary, they dilute the sustainable The Definitive Guide, OReally & Associates,competitive position of the firm. Therefore Bonn.organizations that adapt this approach risk Nonaka, I. (1991), ``The knowledge creating company,losing their true source of sustainable Harvard Business Review, November-December,competitive advantage ± intellectual capital ± pp. 96-104. 233
  12. 12. View of organizational knowledge management systems Journal of Knowledge Management Peter Meso and Robert Smith Volume 4 . Number 3 . 2000 . 224±234Peteraf, M.A. (1993), ``The cornerstones of competitive Stross, R. (1997), ``Mr Gates builds his brain trust, advantage: a resource-based view, Strategic Fortune, 8 December, pp. 84-98. Management Journal, Vol. 14, pp. 179-91. Sviokla, J.J. (1996), ``Knowledge workers and radicallyQuinn, J.B., Anderson, P. and Finkelstein, S. (1996), new technologies, Sloan Management Review, ``Managing professional intellect: making the most Summer, pp. 25-40. of the best, Harvard Business Review, March-April, Wernerfelt, B. (1984), ``A resource-based view of the pp. 71-80. firm, Strategic Management Journal, Vol. 5,Rao, B., Navoth, Z. and Horwitch, M. (1999), ``Building a pp. 171-80. world class logistics, distribution and electronic William, M.L. and MacDermid, S.M. (1994), ``Linkages commerce infrastructure, Electronic Markets, Vol. 9 between employee benefits and attitudinal and No. 3, pp. 174-80. behavioral outcomes: a research review andSpitzer, D.R. (1996), ``Rewards that really motivate, agenda, Human Resources Management Review, Management Review, May, pp. 45-50. Vol. 4 No. 2, pp. 131-60. 234