2. Learning Goals
1. Explain the essentials of knowledge management
and how it is used to create value for organizations
2. Describe the features and uses of the Delphi method,
simulation, and scenario forecasting aids
3. Discuss the creative process and how to use Osborn’s
creativity model
4. Explain and apply three quality improvement aids:
benchmarking, the Deming cycle, and the Baldrige
quality program
3. involves Recognizing, generating, documenting, distributing,
and transferring among persons useful information, know-
how, and expertise to improve organizational effectiveness
Main Components of Knowledge Management
Enabling technologies
Tacit knowledge
Explicit
knowledge
4. Fundamentals of KM
• KM increases the likelihood of effective use of other aids.
• It is vehicle to take Knowledge, ingenuity, innovation, etc & putting
it at the finger tips of employees wherever & whenever needed
Components of KM:
1. Explicit Knowledge: published (internally & externally) in reports,
manuals, books, journals, government data, online services,
newsfeeds, etc
2. Tacit Knowledge: information, competencies & experience personal
with employees;
a) May be subconsciously understood & applied, difficult to express &
typically shared thru conversations like storytelling (case studies) & shared
experiences
b) Not part of company systems
3. Enabling technologies: intranets, internet, portals, search engines,
workflow software, technical help-desk, etc
KM: Vehicle to carry Knowledge to needy person promptly when needed
5. KM Drivers
1. Information Age has replaced Industrial Age.
2. B/S typically measuring physical assets, is
increasingly measuring a new valuable asset –
KNOWLEDGE.
3. Knowledge becoming more valuable than physical
or financial assets & even natural resources.
4. Information & knowledge (experience, advice, best
practices,& communication, innovations) have
become new competitive weapons
6. Reinventing the wheel
Knowledge attrition
Information
overload
Productivity and
opportunity loss
To overcome above – right knowledge to be available to Right Person at Right Time
8. KM Targets
1. Teams: by bringing together ideas & information
of each team (cross functional & level) –
Collaboration being crucial for meeting customer
needs;
a) Moving ahead quickly & efficiently
b) Reducing duplication & enhancing intergroup problem
solving
c) To identify others who are working on similar
problems
d) Enhances face to face communication among teams
9. KM Targets
2. Customers: satisfied customers foundation of
company’s continuing success;
– KM helps ‘Tracking Customers’ – their
• issues,
• buying patterns &
• expectations
– Provides essential tips & tricks when a technician encounters
unusual problems (during servicing calls)
3. Workforce: workforce single most valuable asset – KM
– tracks employees’ skills & abilities
– Anticipate & identify skill gaps – inputs for training
– To identify expert on various topics & making them available
for solving problems – lists of subject matter experts.
10. Enabling Technology
• Technology is KM enabler.
• Technology is foundation for KM solutions that
automate & centralize sharing of knowledge &
fostering innovation
• Technology to address following issues;
a) Should deliver only relevant information
b) Should support exploration of new ideas &
solution to problems
c) Due to increasing mobility of employees,
technologies should facilitate easy transmission
where decision needs to be made ( telephones,
mobiles laptops, etc)
11. Enabling Technology
• Expert Systems: are computer program based
decision-making processes of human experts
(that stores, retrieves, and manipulates data,
diagnoses problems,) and makes limited
decisions on detailed information about a
particular problem
– Have problem solving capabilities within specific
area of knowledge & technology e.g. personal
budgeting system running on a PC.
12. Enabling Corporate Culture
Sense of trust is essential
Belief that sharing expertise will not be used
against the employee, rather will be rewarded
Process for creating positive culture:
A Knowledge Champion as a Focal Point
Local Knowledge Champions: for field employees inputs
Rewarding the behaviors that support K. Creation
•Knowledge is Power: overcome tendency of hoarding of
info as source of information.
•Appropriate culture needs to be in place or created
13. Using Forecasting Aids
Involves Projecting or estimating future events or
conditions in an organization’s environment
Primarily concerned with & Focuses on external
and vital events beyond the organization’s direct
control
Based on Extrapolation: projection of some
trend or tendency from the past or present into
the future
Forecasting aids available: Delphi
Technique, Simulation & Scenarios
Though risky, forecasting still necessary: anticipate future conditions
15. Based on a consensus of a panel of experts
after refining their opinions, phase by phase
Not foolproof but more accurate than single
expert’s opinion.
Series of questionnaires
Typically involves three phases
Phase I: Questionnaire is sent to a group of
experts
Phase II: Summary of the first phase is prepared
with revised questionnaire
Phase III: Summary of the second phase is
prepared with revised questionnaire
Forecasting Aids: Delphi Technique, Simulation & Scenarios
16. Simulation
Is representation of how a real system performs:
imitates something real, but is not real itself & Can
be altered by users
Normally used to forecast effect of environmental
changes & internal mgmt decisions on Organization
Goal of simulation is to reproduce or test reality
without actually experiencing it
Many types of business simulations, often computer/
software based, such as:
Treasury and Financial Models
Cash management, Income statements, cash
flow projections, Stock and commodity prices
Marketing Models
Sales budgets, Pricing, Market share
projections, and Advertising and market plans
17. Scenarios
Are stories that help people recognize & adapt to
changing features of their environments
Scenarios provide a way to identify alternative paths
that may exist in future & actions that likely are
involved in going down each of those paths
Enables management to ask numerous “what if questions,
or how we can weave in risks & uncertainties to create new
perspectives, such as:
What if the competitor (or set of competitors) commits to a
diversification of its product line (new products for existing and new
customers) through a combination of current and new technologies?
What if the competitor launches a series of new products?
What if the competitor launches a sequence of extensions to its current
product lines (with the specific aim of attracting new customers to the
market)?
18. Considers combinations of uncertainties and questions
in each scenario
Forces managers to evaluate preliminary plans against
future possibilities
“Scenarios are different from forecasts in that
they provide a tool that helps us to explore the
many complex business environments in which
we work, the factors that drive changes, and
development in those environments.”
Jeron Van Der
chief executive of the Shell Group
19. Fostering Creativity
1. All planning & decision making needs to be
supported by creativity.
2. “Creativity is the ability to visualize,
generate, and implement new ideas”.
3. For organizations creativity is no longer
optional – it is imperative.
4. For innovative initiatives to succeed ,
managers & employees alike need creative
thinking skills
20. Fostering Creativity
5. Creative thinking increases the quality of
solutions;
a) helps stimulate innovation
b) Revitalize motivation & commitment by
challenging individuals
c) Serves as a catalyst for effective team
performance
6. Creative process involves five
interconnected stages;
22. Creative Process
1. Preparation stage: involves searching &
collecting facts & ideas.
– requires extensive formal education or many years
of relevant experience to develop this expertise.
– “Creativity is 90% perspiration & 10% inspiration”
– Thomas Edison
2. Concentration stage: involves focusing
energies & resources on identifying & solving
an issue or problem (commitment to
implement must be there at this stage).
23. Creative Process
3. Incubation stage: is an internal &
subconscious ordering of gathered information;
– Relaxing at times distancing oneself from the issue
& allowing subconscious to search for possible
problems/solutions is important
– Yields fresh ideas & new ways of thinking
24. Creative Process
4. Illumination stage: is moment of discovery,
when light bulb seems to be turned on
mentally - mind connects an issue/problem to
a solution.
5. Verification stage: is testing of the created
solution or idea – seeking confirmation or
acceptance of the new approach
Insights from each stage are useful in addressing new issues
at the new preparation stage
25. Three-phase decision-making process that involves:
1. fact finding: defining problem, gathering & analyzing relevant data –
begin with broad view of problem & then define sub-problems.
2. idea finding: generating tentative ideas & possible leads – principles to
generate max ideas: defer judgment on any idea till big list is made &
Quantity breeds Quality
3. solution finding: generating & evaluating possible courses of action &
how to implement chosen course.
Intended to stimulate freewheeling thinking, novel ideas,
curiosity, and cooperation: to overcome blockages to creativity
& innovation – leading to innovative decisions
26. Brainstorming: an unrestrained flow of ideas in a
group or team with all critical judgments suspended
Rules of
brainstorming
1. Criticism is ruled
out
2. Freewheeling is
welcomed
4. Combination
and
improvement
are sought
3. Quantity is
wanted
27. Electronic Brainstorming
Makes use of personal computers that are networked
to input and automatically disseminate ideas in real
time to all team members, each of whom may be
stimulated to generate additional ideas
Individuals may input ideas via the keyboard as
they think of them
No identification of individual or team that generates
each idea
May be better than face-to-face
Safer for lower-level employees
28. A systematic and continuous process of measuring
and comparing an organization’s goods, services,
and practices against industry leaders anywhere
in the world to gain information that will help the
organization improve performance
Can be expensive and time consuming
Helps managers and employees learn from
others
29. Benchmarking
Stages/Process
1. Define the
Domain
2. Identify
the best
performers
3. Collect data
and analyze to
identify gaps
4.Set
improvement
goals
5. Develop and
implement
plans to
close gaps
6. Evaluate
results
7. Repeat
benchmarkings
as needed
30. Comprises four stages—plan, do, study,
and act—that should be repeated over
time to ensure continuous learning and
improvements in a function, product, or
process
31. The Deming Cycle
(adapted from Figure 9.3)
Start
Repeat
PDCA
4. Act 1. Plan
3. Check 2. Do
Repeat
PDCA
Improvement and learning over time
32. 3. Balanced Scorecard Model: Sustainability Tool
– An important aid for decision making
• Takes into account financial & non-financial measures,
internal improvements, past outcomes, and ongoing
requirements for future performance.
• Helps in implementing overall goals & strategies
• Long-term organizational excellence can be achieved by
taking a broader & inclusive approach, not by
focusing solely on financials.
• Is future oriented and not only traditional financial
reports
• Shift to the services and knowledge economy increased
interest in intangibles which are very important for
organizational effectiveness & sustainability.
33.
34. Baldrige Quality Program
Provides a systems perspective for managing an
organization and its key processes to achieve
Performance Excellence thru Role Model
Management Systems
Malcolm Baldrige National Quality Award
Promotes excellence in organizational performance
Recognizes the quality and performance
achievements of U.S. organizations
Publicizes successful performance strategies
Presented to 99 companies in US since 1988
Systems perspective
35. Set of five international standards that define
establish and maintain an effective quality
management system
Standards published by the International
Organization for Standardization (ISO),
headquartered in Geneva, Switzerland
ISO certification is administered by
accreditation and certification bodies within
the country where the firm operates
