Chapter 11 KNOWLEDGE MANAGEMENT

Learning Objectives Define knowledge and describe the different types of knowledge Describe the characteristics of knowledge management Describe organizational learning and its relationship to knowledge management Describe the knowledge management cycle Describe the technologies that can be used in a knowledge management system

Learning Objectives Describe different approaches to knowledge management Describe the activities of the chief knowledge officer and others involved in knowledge management Describe the role of knowledge management in organizational activities Describe ways of evaluating intellectual capital in an organization

Learning Objectives Describe how KMS are implemented Describe the roles of technology, people, and management in knowledge management Describe the benefits and drawbacks of knowledge management initiatives Describe how knowledge management can revolutionize the way an organization functions

Introduction to Knowledge Management Knowledge management concepts and definitions Knowledge management is the systematic and active management of ideas, information and knowledge residing in an organization’s employees

Introduction to Knowledge Management - Data, Information, Knowledge - Knowledge is used to solve a problem - knowledge provides a higher level of meaning

Introduction to Knowledge Management Characteristics of knowledge Extraordinary leverage and increasing returns Fragmentation, leakage, and the need to refresh Uncertain value Uncertain value of sharing

Introduction to Knowledge Management Knowledge-based economy The modern, global economy, which is driven by what people and organizations know rather than only by capital and labor

Introduction to Knowledge Management

Introduction to Knowledge Management Explicit and tacit knowledge Explicit (leaky) knowledge Knowledge that deals with objective, rational, and technical material (data, policies, procedures, software, documents, etc.) - Leaky knowledge Tacit knowledge Knowledge that is usually in the domain of subjective, cognitive, and experiential learning. It is highly personal and hard to formalize - Embedded knowledge

Introduction to Knowledge Management Knowledge management systems (KMS) A system that facilitates knowledge management by ensuring knowledge flow from the person(s) who know to the person(s) who need to know throughout the organization; knowledge evolves and grows during the process

Organizational Learning and Transformation Learning organization An organization capable of learning from its past experience, implying the existence of an organizational memory and a means to save, represent, and share it through its personnel Organizational memory That which an organization “knows”

Organizational Learning and Transformation The process of capturing knowledge and making it available enterprisewide Learning skills include: Openness to new perspectives Awareness of personal biases Exposure to unfiltered data A sense of humility

Organizational Learning and Transformation Organizational culture A pattern of shared basic assumptions Produces strong measurable results

Organizational Learning and Transformation Reasons people do not like to share knowledge: General lack of time to share knowledge and time to identify colleagues in need of specific knowledge Apprehension or fear that sharing may reduce or jeopardize people’s job security Low awareness and realization of the value and benefit of the knowledge others possess Dominance in sharing explicit over tacit knowledge, such as know-how and experience that requires hands-on learning, observation, dialogue, and interactive problem solving Use of a strong hierarchy, position-based status, and formal power

Organizational Learning and Transformation Reasons people do not like to share knowledge: Insufficient capture, evaluation, feedback, communication, and tolerance of past mistakes that would enhance individual and organizational learning effects Differences in experience levels Lack of contact time and interaction between knowledge sources and recipients Poor verbal/written communication and interpersonal skills Age differences Gender differences

Organizational Learning and Transformation Reasons people do not like to share knowledge: Lack of a social network Differences in education levels Ownership of intellectual property due to fear of not receiving just recognition and accreditation from managers and colleagues Lack of trust in people because they may misuse knowledge or take unjust credit for it Lack of trust in the accuracy and credibility of knowledge due to the source Differences in national culture or ethnic background and values and beliefs associated with it

Knowledge Management Activities Knowledge management initiatives and activities Knowledge management initiatives have one of three aims: To make knowledge visible, mainly through maps, yellow pages, and hypertext To develop a knowledge-intensive culture To build a knowledge infrastructure

Knowledge Management Activities Knowledge creation is the generation of new insights, ideas, or routines Four modes of knowledge creation: Socialization Externalization Internalization Combination

Knowledge Management Activities Knowledge sharing Knowledge sharing is the willful explanation of one person’s ideas, insights, solutions, experiences to another individual either via an intermediary or directly In many organizations, information and knowledge are not considered organizational resources to be shared but individual competitive weapons to be kept private

Knowledge Management Activities Knowledge seeking Knowledge seeking (knowledge sourcing) is the search for and use of internal organizational knowledge Lack of time or lack of reward may hinder the sharing of knowledge or knowledg seeking

Approaches to Knowledge Management Process approach The process approach to knowledge management attempts to codify organizational knowledge through formalized controls, processes and technologies Explicit policies Use of IT Criticism Favored by firms that sell standardized products

Approaches to Knowledge Management Practice approach The practice approach toward knowledge management focuses on building the social environments or communities of practice necessary to facilitate the sharing of tacit understanding Informal social groups meet regularly Adopted by companies that sell highly customized solutions

Approaches to Knowledge Management Hybrid approaches to knowledge management Initially, the practice approach is used so that a repository stores only explicit knowledge that is relatively easy to document Tacit knowledge initially stored in the repository is contact information about experts and their areas of expertise Best practices can eventually be captured and managed so that the knowledge repository will contain an Increasing amount of tacit knowledge over time

Approaches to Knowledge Management Best practices In an organization, the best methods for solving problems. These are often stored in the knowledge repository of a knowledge management system

Approaches to Knowledge Management Knowledge repository The actual storage location of knowledge in a knowledge management system. Similar in nature to a database, but generally text-oriented Knowledge base of an expert system VS Organizational knowledge base

Approaches to Knowledge Management Developing a knowledge repository Knowledge repositories are developed using several different storage mechanisms The most important aspects and difficult issues are making the contribution of knowledge relatively easy for the contributor and determining a good method for cataloging the knowledge

Information Technology (IT) in Knowledge Management The KMS cycle KMS follows six steps in a cycle: Create knowledge Capture knowledge Refine knowledge Store knowledge Manage knowledge Disseminate knowledge

Information Technology (IT) in Knowledge Management

Information Technology (IT) in Knowledge Management Components of KMS KMS are developed using three sets of technologies: Communication Collaboration Storage and retrieval.

KMS Implementation The challenge with KMS is to identify and integrate the three essential components-communication, collaboration, and storage and retrieval technologies

KMS Implementation Knowledge management products and vendors Knowware Technology tools that support knowledge management Software development companies and EIS vendors Software development companies and EIS vendors offer numerous knowledge management packages, from individual tools to comprehensive knowledge management suites

KMS Implementation Knowledge management consulting firms Knowledge management ASPs Integration of KMS with other business information systems

Roles of People in Knowledge Management Chief knowledge officer (CKO) The person in charge of a knowledge management effort in an organization objectives

Roles of People in Knowledge Management The functions of the CKO include: Set knowledge management strategic priorities. Establish a knowledge repository of best practices. Gain a commitment from senior executives to support a learning environment. Teach information seekers how to ask better and smarter questions. Establish a process for managing intellectual assets. Obtain customer satisfaction information in near real-time. Globalize knowledge management

Roles of People in Knowledge Management Skills required of a CKO include: Interpersonal communication skills Leadership skills Business acumen Strategic thinking Collaboration skills The ability to institute effective educational programs An understanding of IT and its role in advancing knowledge management

Roles of People in Knowledge Management The CEO The CEO is responsible for championing a knowledge management effort Finding a competent CKO Prepare the organization for the changes that are about to happen Support Make available to the CKO the resources needed to get the job done

Roles of People in Knowledge Management Officers CFO ensures that the financial resources are available COO ensures that people begin to embed knowledge management practices into their daily work processes CIO ensures IT resources are available Managers also support the knowledge management effort and provide access to sources of knowledge

Roles of People in Knowledge Management Community of practice A group of people in an organization with a common professional interest, often self-organized for managing knowledge in a knowledge management system Make organizations run smoothly Informed people make better decisions Happier workers

Roles of People in Knowledge Management KMS developers The team members who actually develop the system KMS staff Enterprisewide KMS require a full-time staff to catalog and manage the knowledge Help and train users

Ensuring the Success of Knowledge Management Efforts Causes of knowledge management failure The effort mainly relies on technology and does not address whether the proposed system will meet the needs and objectives of the organization and its individuals Lack of commitment Failure to provide reasonable incentive for people to use the system

Ensuring the Success of Knowledge Management Efforts Factors that lead to knowledge management success A link to a firm’s economic value, to demonstrate financial viability and maintain executive sponsorship A technical and organizational infrastructure on which to build Senior management support A change in motivational practices, to create a culture of sharing

Ensuring the Success of Knowledge Management Efforts Factors that lead to knowledge management success Nontrivial motivational methods to encourage users to contribute and use knowledge A knowledge-friendly culture that leads directly to user support Multiple channels for knowledge transfer

Ensuring the Success of Knowledge Management Efforts Potential drawbacks of KMS Failing to pick up the signals in the environment that might have suggested a change in strategy or product focus Neglecting the creative process of new knowledge creation—applying yesterday’s solutions to tomorrow’s problems