Chapter 9 Knowledge Management

Knowledge Knowledge is a fluid mix of Experience Values Contextual information Expert insight Knowledge provides a framework for evaluating and incorporating new experiences and information.

Knowledge Knowledge involves Comparison among situations Consequences i.e., the implications of this information for decision and action Connections: how does this information relate to other pieces? Conversation obtaining the thinking of others

Knowledge Knowledge is information that is contextual, relevant, and actionable. Tacit knowledge is usually in the domain of subjective, cognitive, and experiential learning. Explicit knowledge deals with more objective, rational, and technical knowledge.

Explicit vs. Tacit Knowledge Teachable Can articulate Observable in use Schematic Simple Documented Tacit Not teachable Not articulated Highly personal Not easily visible Not easily expressible Acquired through experiences

Characteristics of Knowledge Extraordinary leverage & increasing returns Fragmentation, leakage & the need to refresh Uncertain value Uncertain value sharing

Data, Information, and Knowledge

Knowledge Management A process that helps organizations identify, select, organize, disseminate, and transfer important information and expertise that are part of the organization’s memory

Knowledge Management KM is simply an effort to capture not only explicit factual information but also the tacit information and knowledge that exists in an organization, usually based on the experience and learning of individual employees, in order to advance the organization's mission. The eventual goal is to share knowledge among members of the organization.

Practical Goals of KM Create the Knowledge Repository Improve knowledge access Enhance the knowledge environment Manage knowledge as an asset Knowledge is transformed and disseminated when members teach, learn, communicate, collaborate

Knowledge-based Economy Firms are much larger, with higher turnover and require better tools for collaboration, communication, and knowledge sharing. Firms must develop strategies to sustain competitive advantage by leveraging their intellectual assets for optimum performance. Managing knowledge is now critical for firms spread out over wide geographical areas, and for virtual organizations.

Learning Organization The term learning organization refers to an organization’s capability of learning from its past experience. To build a learning organization, it must tackle three critical issues: Meaning (determining a vision of the learning organization) Management (determining how the firm is to work) Measurement ( assessing the rate and level of learning)

Sharing Knowledge Some reasons people are reluctant to share knowledge include: No skill in knowledge management techniques Willing to share, but not enough time to do so Don’t understand knowledge management and benefits Lack of appropriate technology No commitment from senior managers No funding for knowledge management Culture does not encourage knowledge sharing

Organization Culture The ability of an organization to learn, develop memory, and share knowledge is dependent on its culture. Culture is a pattern of shared basic assumptions. Over time organizations learn what works and what doesn’t work. As the lessons become second nature, they become part of the organizational culture. Generally when a technology project fails, it is because the technology does not match the organization’s culture.

KM vs. KMS Knowledge Management is the organizational process for acquiring, organizing, and communicating both tacit and explicit knowledge so that others may use if to be more effective and productive. Knowledge Management Systems are information systems designed to facilitate codifying, collecting, integrating, and disseminating organizational knowledge

Objectives of KMS Create knowledge repositories Davenport et al. (1998) describe four broad objectives of knowledge management systems in practice: Create knowledge repositories Improve knowledge access Enhance the knowledge environment Manage knowledge as an asset

The Knowledge Management Cycle Create knowledge Capture knowledge Refine knowledge Store knowledge Manage knowledge Disseminate knowledge

The KM Cycle, cont’d.

Organizational Knowledge Repositories Knowledge network model. The individual who has the knowledge transfers expertise through person-to-person contacts. Knowledge repository model. Knowledge contribution and use follows a two-step transfer procedure of person-to-repository and repository-to-person. Captured knowledge is stored in a knowledge repository, a collection of both internal and external knowledge. Hybrid Model. Many organizations use a hybrid of the network and repository models.

Knowledge Repositories Databases. It is possible to structure part of knowledge repository as a DB. Data Warehouses can also be used for KM, especially in conjunction with CRM systems.

Knowledge Repositories, cont’d. Specially Structured Databases. Some systems have been developed in Lotus Notes/Domino Server and hence utilize the Notes database structure. These specialized databases are ideal for storing tacit knowledge because of its nature. Electronic Documents. Others have been developed around electronic document management systems. e.g., DocuShare by Xerox

Strategies for KM The codification strategy typically is adopted by companies that sell relatively standardized products that fill common needs. Knowledge is carefully codified and stored in knowledge repositories structured as databases. The personalization strategy typically is adopted by companies that provide highly customized solutions to unique problems. Knowledge is shared mostly through person-to-person contacts.

Knowledge Systems Development Identify the problem Prepare for change Create the team Map the knowledge Create a feedback mechanism Define the building blocks for the system Integrate existing information systems

Knowledge Management Systems Focus on Creating Gathering Organizing Disseminating an organization’s knowledge rather than its data or information

Knowledge Building Activities Knowledge Acquisition Use of an IT to acquire information related to one's work context. Knowledge acquisition can take place by focused search or scanning. Focused Search Focused search occurs when organizational members actively search in a narrow segment of an organization’s internal or external environment, often in response to actual or suspected problems or opportunities (Huber 1991). Scanning Relatively wide sensing of an organization's external environment (Huber, 1991).

Knowledge Building Activities Knowledge Sharing: Use of an IT to share knowledge related to one's work context. Knowledge Analysis and Interpretation: Use of an IT to analyze and provide multiple perspectives related to one's work context. Verification: The selection of data mining algorithms by the end user. Discovery: Allowing the intelligent capabilities of data mining applications to determine which algorithms to apply to a data set.

Challenges of KM Implementation Lack of understanding of KM and its benefits Lack of time by employees for knowledge management Lack of skill in knowledge management techniques Organizational culture does not encourage knowledge sharing Lack of incentives to share Lack of funding of knowledge management initiatives Lack of appropriate technology Lack of commitment from senior management

Knowledge Management Facilities As storage models become increasingly important, there is a need to have dedicated staff to manage the knowledge repository. The leaders in knowledge storage are major consulting firms such as Accenture, Ernst & Young, KPMG, etc. Most of these firms have one or more Knowledge Center that is open 24 hours per day, every day. These facilities are accessible via the Internet, as is the KMS. These centers function as a reference library, with a manager and reference knowledge specialists

KM and Information Technologies The KMS challenge is to identify and integrate the following three technologies to meet the KM needs of an organization. Communication technologies allow users to access needed knowledge, and to communicate with each other -especially with experts. Collaboration technologies provide the means to perform group work. Storage technologies use a database management system to capture, store and manage knowledge.

KM Technologies Knowware are technology tools that support KM. Collaboration tools, or groupware, were the first used to enhance collaboration for tacit knowledge transfer within an organization. KM suites are complete KM solutions out-of-the-box. Knowledge Servers contain the main KM software, including the knowledge repository.

KM Technologies Electronic document management systems focus on the document in electronic form as the collaborative focus of work. KM Tools capture knowledge unobtrusively (with minimal effort and impact). Enterprise knowledge portals are the doorway into many KM systems. XML provides standardized representations of data structures so data can be processed without case-by-case programming. Application Service Providers have evolved as a form of KMS outsourcing on the Web.

Knowledge Discovery in Databases Knowledge discovery in databases (KDD) involves tasks known as knowledge extraction, data archaeology, data exploration, data pattern processing, data dredging, and information harvesting. This is accomplished with the tool of Data mining. Model marts and model warehouses are analogous to data marts and data warehouses for models. They act as repositories of knowledge by using KDD techniques on past decision instances (stored in data marts and data warehouses).

Knowledge Management Benefits Reduction in loss of intellectual capital when people leave the company Reduction in costs by decreasing the number of times the company must repeatedly solve the same problem Economies of scale in obtaining information from external providers Reduction in redundancy of knowledge-based activities Increase in productivity by making knowledge available more quickly & easily Increase in employee satisfaction by enabling greater personal development and empowerment Strategic competitive advantage in the marketplace

Knowledge Management Issues Buying and Selling Knowledge Most firms are reluctant to sell knowledge, unless they are expressly in the business of doing so. A firm’s knowledge is an asset that has competitive value. Encouraging System Use Employees must be motivated properly to contribute knowledge. The mechanism for doing so should be part of their job, and their salaries should reflect this.

Integration Since a KM system is an enterprise system, it must be integrated with other enterprise and information systems in an organization. The most important systems to integrate with are: Decision Support Systems Databases and Information Systems Customer Relationship Management Systems Supply Chain Management Systems Corporate Intranets and Extranets

Managerial Issues Organizational culture change. How can we change organizational culture so that people are willing to both contribute knowledge to and use knowledge from a KMS? How to store tacit knowledge? How to measure the tangible and intangible benefits of KMS?

Managerial Issues, cont’d. The importance of knowledge management. KM is not another management fad. Implementation in the face of quickly changing technology. How can our organization develop a successful knowledge management system? Determining the roles of the various personnel in a KM effort.

Quote for the Day “Processing data can be performed by machine, but only the human mind can process knowledge or even information.” Jesse Shera