This document discusses knowledge management strategy and its relationship to organizational strategy. It argues that knowledge, rather than physical assets, now drives competition so knowledge management is crucial. Effective knowledge management requires aligning knowledge processes with strategic goals and intellectual capital assets. Visionary leadership plays a key role in developing an organizational knowledge culture and competitive advantage through tacit knowledge. A knowledge management strategy should support organizational strategy and decision-making across all levels.
2. 2 T.S. Younis
businesses today (Lee and Hong, 2002, p.17). As such, Knowledge Management (KM) is
considered a new terminology in management thought. The KM as a concept is highly
related to the meaning of organisational learning, organisational reengineering, human
capital, intellectual assets and information technology. All those terminologies come up
with a new generation of management paradigm (Gloet and Berrell, 2003).
Accordingly, all organisations are concerned with knowledge as an access to new
essence of success and competition. Even those organisations which are regarded as
leaders in the market are more concerned with KM to sustain and enhance continuous
progress in their achievements.
Knowledge is not restricted to production in itself, but it is extended to cover all
aspects and practices in everyday work in an organisation. However, this issue is
considered as a clear cut between developed and underdeveloped entities and
organisations. Therefore, knowledge and how to manage this valuable resource is
regarded as a core point for determining corporate strategy in this paper.
Content analysis to KM as a great value creation to the overall organisation’s grand
strategies is used as an important framework for theoretical interpretation. Moreover,
classical physical management is not sufficient to manage today’s organisations, at
present, all theories and practices are more knowledge-based models rather than
theoretical orders and unattainable desires. So, knowledge is the driver of the new
competition, besides it is a strategy for comparative advantage.
Knowledge Management Strategy (KMS) is badly needed to support the
organisation’s grand strategies besides adding values meanings of different strategic
decisions.
2 Research methodology
KM research lacks a common conceptual core; it is cross disciplinary, addresses a wide
variety of phenomena.
This work tends to analyse KM theories and basic concepts. It is to put organisational
knowledge into a form that is explicit, accessible and understandable to those who
formulate strategies across all organisational hierarchies. The deduction approach is
adopted through laying out a number of questions delineating the fundamental axes of
research. Content analysis is used for analysing the logic of theories and concepts
surrounding (KMS). Hypotheses are philosophically stated so that the research objectives
may clearly surface throughout discussion.
Logical and content analysis outcomes are used as a methods of reviewing and
synthesising previously published materials regarding KM. Consequently, this analysis
will lead to construct theoretical model towards an integrated concept between strategic
management theory and KM.
3 Research significance and justifications
There are a number of drivers and motivations leading to undertake a KM issue in this
paper such as:
1 it is a new way to gain the competitive advantage that comes across developing
knowledge creation and innovation
3. Strategic vision to KMS: an evaluative paradigm 3
2 developing a new image about organisational practices based upon knowledge
practices
3 emphasise importance of the issue of organisational learning and leveraging
human capital and intellectual people across the organisation
4 building knowledge organisations and best practices
5 leveraging organisational knowledge to deliver long-term advantage to a
business and is based on a business strategy that involves knowledge processes
6 to operate efficiently, it is imperative to possess knowledge on a broad spectrum
of issues and concepts that affect business activities around the globe
7 successful management in the new millennium requires developing new
methods and approaches to suit the challenges and opportunities of this new era
of knowledge revolution
8 justifying the issue of creating new positions in organisations besides
reengineering of organisational tasks and roles.
4 Research model and research problem definition
There is no doubt that the difficulty of writing on this subject requires a theoretical model
to facilitate the process of contribution to the theory of KM. Moreover, theory and the
relations of the variables reflecting research orientations towards building a researcher
theory and desired paradigm are required (Figure 1).
Figure 1 Research model
Source: Author (this figure is designed by the author Tariq shareef Younis).
The primary justification for entering into this issue lies in the multiplicity of approaches
and concepts that are to be classified and identified as logical relations to a minimum
level. The theoretical model has been designed on two directions.
4. 4 T.S. Younis
We argue that in spite of growing literature in KM, there are two orientations; the
first one, advanced information management systems or information technology to
manage knowledge (tangible), the second, advances in humanistic approach (intangible)
as a basis for action. Nevertheless, this model is aiming to contribute through directing
its interpretation to ideas and concepts for KM competitive strategy formulation on the
basis of logical relationships between variables that could be used for general application
across different cultures and organisations regardless of organisation residency. Any
organisation whether it exists in the Arab World, Underdeveloped Countries or in
Developed Countries, has an access to acquire or possess information technologies, but
the problem is in the intangible aspect of KM.
The main hypothesis of the research is philosophically formulated as: at a time,
organisations do not have the same access to information technology, but the possibility
of human resources is the de facto exist. It is therefore possible to be used as a strategic
source of producing, developing, sharing and utilising knowledge. Such desires are
subject to visionary leadership and knowledge-based entities in an organisation.
5 KM strategy and strategic thinking
KM is a term that has come in to common usage in business over the past ten years.
It means different things in different contexts to different people. Generally, it refers to
exactly what the words describe the management of knowledge in organisations (Zhou
and Fink, 2003). More specifically, however, there are different interpretations of what is
‘knowledge’ and what is being ‘managed’. Applied in an IT context, knowledge is more
likely to be linked to the concept of` ‘information’ and ‘management’ is more likely to be
associated with the management of hardware and software facilities, including matters
such as communications technology. Applied in a business context, less attention is
typically focused on these technical aspects of KM and more emphasis is given to social
aspects, such as organisation theory, leadership and other issues on the human side of
management. However, KM is clearly to be interpreted in the second, broader sense
(Keong et al., 2001, p.268). Strategy, on the other hand, is a vehicle of KM.
KM practices refer to a more practical and perceptible level of research. From this
dimension, KM can be viewed as an organisational innovation involving important
changes in the introduction of the strategy and in traditional management practices.
Works that have focused on the process of introduction of KM in the firm have centred
on the most relevant areas so that the system can be applied effectively (Marqués and
Simón, 2006, p.143).
The emergence of the knowledge economy necessitated many organisations to
recognise knowledge as a crucial resource to achieve sustainable competitive advantage.
This recognition resulted in imparting strategic importance to the KM and triggered the
commencement of formal KM programmes in many organisations. In the last few years,
several theories have been put forward for practising KM. However, given the abstract
nature of the subject area, there is little consensus on the components and ways of KM
(Oliver and Kandadi, 2006, p.6).
The relationship between KM and strategy could be defined through the fact that the
strategic plan directs all activities of the organisation, including knowledge towards
achieving the visions and goals. The KM task as new function must be implemented
within the framework of the strategic directions of the senior management in the
5. Strategic vision to KMS: an evaluative paradigm 5
organisation. In this respect, KM follows strategy and knowledge is an outcome of
strategic apex visions and strategic thought. On the other hand, the explicit knowledge is
considered as a supportive base for strategic actions and practices. Whereas tacit
knowledge is considered as an outcome of vision–mission interaction that support
internal knowledge environment with ever new trends toward competitive advantage,
however, knowledge generation comes from strategic thinking and innovative
actions across all strategic management processes. Strategy in this context is about
ideas and the development of novel solutions to create competitive advantages.
Creative thinking on the other hand refers to “how people approach problems
and solutions-their capacity to put existing ideas together in new combinations”
(Bonn, 2001, p.64).
However, strategic thinking defined as
“a way of solving strategic problems that combines a rational and convergent
approach with creative and divergent thought processes. Such process
orientation focuses this investigation on how senior managers (strategic apex)
in an organizational setting attempt to understand and take strategic action in
an environment that is highly complex, ambiguous and competitive. It
represents an important antecedent to strategic decision-making and may
provide a key to better understand organizational change phenomena and
ultimately, organizational performance and survival. It is important to note that
strategic thinking is closely associated with acting in an ongoing and
intertwined process. Improving strategic thinking” (Bonn, 2005, p.336).
Building on the above discussion KMS and strategic thinking, this view aims to
contribute to our understanding of strategic thinking by proposing a multilevel approach
that aims to better integrate the construct strategic thinking with existing theories of KM.
6 Strategic apex, KM and vision
Strategic apex plays a great role in managing the process of KM, starting from
formulating their vision towards future existence and leading their organisations to
excellence compared to their rivals. We believe that the positive leadership
characteristics at various levels of management in general and in strategic apex in
specific are a vital aspect for developing knowledge avenues in organisations. These
attributes include the desires of leaders to practise most knowledge base behaviour such
as; empowering subordinates, allocation of resources, openness towards change and
experimentation, developing trust, tolerance to mistakes and building long-term
perspective of the organisational goals among employees (Oliver and Kandadi,
2006, p.6). Emphasis on such criteria is regarded as a start point to formulate learning
strategy and pass it to implementation across the management hierarchy. The main role
of middle and front end management in this respect is to translate the meaning of vision
as tacit meaning into explicit meaning in the work. Hence, the integration between
ongoing flows of knowledge creation will be received by junior managers for daily
translation. It is a matter of capturing knowledge at the time created in a dynamic
functional nature. The strategist’s task is restricted to the process by which he or she can
rise above the daily managerial processes and crises to generate knowledge; it is a matter
of challenges to existing assumptions and develops new and innovative solutions
(Bonn, 2001, p.63).
6. 6 T.S. Younis
The application of the Strengths, Weaknesses, Opportunities and Threats (SWOT)
framework is important to be considered for vision determination. According to
(Porter, 1979, p.137), the nature and degree of competition in an industry hinge on five
forces: the threat of new entrants, the bargaining power of suppliers, bargaining power of
buyers, the threat of substitute products or services and the jockeying among
current contestants. Knowledge of these underlying sources of competitive pressure
provides the groundwork for a strategic agenda of action. This model focuses on the
external side of strategy, helping firms analyse the forces in an industry that give rise to
opportunities and threats. Accordingly, firms that use their internal strengths in
exploiting environmental opportunities and neutralising environmental threats, while
avoiding internal weaknesses, are more likely to gain competitive advantage than other
types of firms. This model is used as a frame of reference for gaining tacit knowledge
(Halawi et al., 2006, p.385).
7 Competitive advantage and agents-vision
Competitive advantage comes from adding value through intangible assets such as
knowledge creation not simultaneously created by current or potential competitors.
However, organisations depend on people for sustaining their knowledge; they create and
embed knowledge in the organisation. Some authors called them intelligent agents or
visionary leaders (Carneiro, 2001, p.358). Agents are conceptually defined as entities that
are able to understand the sense of a given situation and to act accordingly to some
orientation; they are owners of tacit knowledge. Intelligent agents (visionary people)
contribute directly in improving the organisation’s performance. Acquisition of new
knowledge leads to create multiple perspectives to diagnose problems facing future
progress and sustaining competitive advantage.
The strategic manager’s vision provides strategic road map to KM. Vision in this
meaning pursues a cyclic and incremental approach for reviewing existing knowledge
and provides guidelines for new application and renewing the concept tasks, roles and
mission of an organisation. Therefore, it prepares ground for future orientation and
development activities for integrated practices in the context of an organisation. Recent
studies emphasises the use of Intellectual Capital (IC) as interface to visionary personnel
in an organisation. Thus, knowledge driven economy has seen the increasing importance
being placed on maximising the organisation’s IC. The term ‘IC’ is often a synonymous
term of intellectual assets, intangible assets or knowledge assets, at the same time KM
systems are being developed. Integration of IC and KM requires alignment of KM
processes with IC assets to meet the organisation’s strategic needs. A theoretical
conjecture is developed in which there are components of elements to achieve strategic
objectives (Zhou and Fink, 2003, p.34).
While KM has the purpose of maximising the organisation’s knowledge-related
effectiveness, four areas can be identified, they are (Zhou and Fink, 2003, pp.35–36):
1 monitoring and facilitation of knowledge-related activities
2 establishing and updating of knowledge infrastructure
3 creation, renewing and organising of knowledge assets
4 utilising knowledge assets effectively.
7. Strategic vision to KMS: an evaluative paradigm 7
These four KM areas have different functions and activities, and therefore, serve
different subpurposes. Whereas the goal of IC is to create and leverage intellectual assets
and to improve a firm’s value creating capabilities from a strategic perspective.
IC and KM serve different purposes, while they have similarities. They differ from each
other, but they also complement one another. In terms of scopes, IC and KM cover
almost all aspects of organisational activities. Both are broad and embrace the whole
range of intellectual activities within an organisation; from knowledge creation to
leverage.
However, to put the above discussion into logical interpretation we find that IC is
identifying and structuring the related KM processes that are linked to the desired
IC elements, whereas KM is organising and facilitating KM processes to create and
maximise the IC targeted. This logic comes as the outcome of strategic vision as a
complex whole system towards strategic orientation and comparative advantage.
8 Conclusion
At present, all organisations are concerned with knowledge as an access to new essence
of success and competition. Even those organisations which are regarded as leaders in
the market are more concerned with KM to sustain and enhance continuous progress in
their achievements.
Knowledge is not restricted to production in itself, but it is extended to cover all
aspects and practices in everyday work in an organisation. However, this issue is
considered as a clear cut between developed and underdeveloped entities and
organisations. Therefore, knowledge and how to manage this valuable resource is
regarded as a core point for determining corporate strategy in this paper.
Content analysis of KM as a great value creation to the overall organisation’s grand
strategies is used as an important framework for theoretical interpretation. Moreover,
classical physical management is not sufficient to manage today’s organisations, at
present, all theories and practices are more knowledge-based models rather than
theoretical orders and unattainable desires. So, knowledge is the driver of the new
competition, besides, it is considered as the strategy used to attain comparative
advantage.
The above discussion has come up with many ideas which address the frame of
reference suitable to build strategic paradigm; emphasises the use of KM as a source of
sustainable development to management and organisation.
The variables described in this paper are based on the theoretical existence of KM
practices at organisations with well-established KM programmes. These can serve as
pragmatic guidelines for KM practitioners in developing knowledge culture.
Despite the emphasis on the crucial role of organisational strategy in KM, there is a
lack of clarity on how to influence and develop knowledge culture in organisations.
We referred to the knowledge culture to represent: a way of organisational life that
enables and motivates people to create, develop, share, utilise and apply knowledge for
the benefit and enduring success of the organisation.
Vision and intellectual dimensions are also defined in order to make an integrated
outlook to the total interpretation of ideas and meanings. Emphasis has gone to the
human capital existence for conveying desires into real practice. In today’s
8. 8 T.S. Younis
knowledge-based global marketplace, human capital has replaced physical capital as the
source of competitive advantage.
An organisation managing knowledge well has the potential to create significant
value, but only if it is linked to its overall strategy. KM is the latest strategy in increasing
organisational competitiveness.
References
Bonn, I. (2001) ‘Developing strategic thinking as a core competency’, Management Decision
Journal, Vol. 39, No. 1.
Bonn, I. (2005) ‘Improving strategic thinking: a multilevel approach’, Leadership and
Organization Development Journal, Vol. 26, No. 5.
Carneiro, A. (2001) ‘The role of intelligent resources in knowledge management’, Journal
of Knowledge Management, Vol. 5, No. 4.
Gloet, M. and Berrell, M. (2003) ‘The dual paradigm nature of knowledge management:
implications for achieving quality outcomes in human resource management’, Journal
of Knowledge Management, Vol. 7, No. 1.
Halawi, L.A., McCarthy, R.V. and Aronson, J.E. (2006) ‘Knowledge management and the
competitive strategy of the firm’, The Learning Organization, Vol. 13, No. 4.
Keong, F.O.C., Willett, R.J. and Yap, K.L. (2001) ‘Building a knowledge-based business school’,
Education and Training Journal, Vol. 43, No. 4.
Lee, S.M. and Hong, S. (2002) ‘An enterprise-wide knowledge management system infrastructure’,
Industrial Management and Data System, Vol. 102, No. 1.
Marqués, D.P. and Simón, F.J.G. (2006) ‘The effect of knowledge management practices on firm
performance’, Journal of Knowledge Management, Vol. 10, No. 3.
Oliver, S. and Kondal, R. (2006) ‘How to develop knowledge culture in organizations?
A multiple case study of large distributed organizations’, Journal of Knowledge Management,
Vol. 10, No. 4.
Peter, H. and Meister, D.B. (2003) ‘Introduction: fragmentation and integration in knowledge
management research’, Information Technology and People, Vol. 16, No. 3.
Porter, M. (1979) ‘How competitive forces shape strategy’, J. Birkinshaw (Ed). Harvard Business
Review, March/April, pp.137–145. Also reprinted in The International Library of Critical
Writings in Business and Management Strategic Management, Cheltenham: Edward Elgar
Publishing.
Zhou, A.Z. and Fink, D. (2003) ‘The intellectual capital web: a systematic linking of intellectual
capital and knowledge management’, Journal of Intellectual Capital, Vol. 4, No. 1.