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Module 2:Knowledge and Knowledge Management

Data

Data consists of discrete, objective facts about events. It says nothing about its own importance or
relevance.Data is essential raw material for the creation of information; it can be quantitative or
qualitative. Data could be a number, an image, or words, or sounds whose existence have no context. It
does not represent anything,it is a lifeless entity. Its existence could be the result or outcome of some
process. It does not evoke any response. It cannot be interpreted. It may have a structure or may be
unstructured. Data is defined as raw numbers, images, words, sounds which are derived from
observation, or measurement, or processing.Data comes about through research, gathering from
different sources, and through transaction processing.
Example: Census data, rainfall statistics.

Information
When data is represented with context it has some meaning. Information in data that is organised in a
way that makes it useful for an end-user to make decisions. It represents something. It evokes some
mental response.Data when processed with some context becomes information. The information
represents something meaningfully. It may have surprise value. It evokes a mental response. When data
is processed over a time, or region, or any other referential key or some other context, it reveals
information. The purpose is to interpret the trend and its pattern. The entire processing of interpretation
is judgmental. The organisation and the concerned people look at this process as a support to decision
making in the same or in a different area. The information, in contrast to data, reduces uncertainty due
to additional value added by interpretation of trend and pattern.

Knowledge
According to a dictionary definition, knowledge is ‘the fact or condition of knowing something with
familiarity gained through experience or association; acquaintance with or understanding of a science,
art, or technique; Knowledge is broader than information and data, and requires understanding of
information. It is contained in the relationships of information, its classification, and its meta-data. It is
an outcome of understanding and insight gained through experience of doing something repeatedly,
solving a number of similar problems, and so on. The experience develops into thumb rules, guidelines,
procedures, models to deal with new situations.
Knowledge emerges out of application of data and information. The knowledge has more intellect into
it compared to data & information. It is a fluid mix of framed experience, values, contextual
information and expert insight that provides a framework for evaluating and incorporating new
experiences and information. Knowledge (set of information) is built out of experience of doing certain
things. It is an intelligent observation of cause and effect. It provides better insight in to the situation by
providing different views or perspectives for the problem, and helps to solve the problem effectively.

The advantage of knowledge is that it provides better insight in to the problem, creates different views
or perspectives and helps to solve it effectively. This results in saving of time needed to search for a
solution in difficult times. The knowledge is specific to the domain and the nature of the problem.
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ATTRIBUTES OF KNOWLEDGE
Characteristics of Knowledge
Expandable Knowledge, on use, expands, becomes more rich.
Example: Customer behaviour knowledge is expandable with more consumer behaviour research,
customer feedback on product or service usage, and so on. Knowledge cannot be a constant entity as it
changes with experience of using it.
Compressible It can be compressed by codes, symbols and diagrams.
Example: Knowledge of product usage under different conditions is documented in product manual and
in some cases, it is posted on the website of the organisation. Product knowledge normally has text
accompanied by process diagrams, pictures, standard symbols, etc. One can examine the TV manual,
vehicle manual, camera manual, and all such manuals. Knowledge in these manuals is compressed
using codes, symbols and diagrams.
Transportable On compression or otherwise, it can be moved from one location to other through
network.
Example: Systematically compressed knowledge can be stored on any electronic media, server or
database for access to download or transfer through network.
Sharable It can be shared and does not reduces in any manner on sharing.
Example: Since knowledge is on media, it can be shared selectively with selected people backed by
security measures. Sharing of knowledge makes it more enriched due to experience. Sharing
encourages its use more intelligently. Internet and Intranet and network of knowledge workers share
knowledge for collaboration in work.
Diffusive It is easy to diffuse if not protected wisely.
Example: Knowledge being of high economic value runs the risk of getting diffused or stolen. Hence, it
needs protection. Confidential data, information and knowledge need security cover of highest order to
mitigate the risk of diffusion in wrong hands.
Substitutable It substitutes or replaces the need for other resources. If knowledge is not available at
branch location, an expert needs to rush to the branch. If the knowledge possessed by the expert is
available in knowledge data base then it substitutes the expert resource.
Example: When computer vendors developed knowledge based on line support Systems for their
customers, the number of support engineers reduced. The distributed knowledge, know how, was
systematically programmed for online support.

EXPRESSION OF KNOWLEDGE
Knowledge, for more understanding and expression, can be classified in seven ways.

Procedure This knowledge systematically guides how to execute a task or conduct an activity. The
procedure details the steps to be carried out and skills and tools required to complete the task
successfully.Knowledge when used repeatedly in a particular manner becomes an automatic
application to perform some task or activity. It becomes a procedure well accepted by all. Knowledge
is expressed in a procedural format.
Declarative This knowledge declares the ‘cause and effect’ immediately. For example, if body
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temperature is 99°C or more, the person has a fever. If blood pressure is more than 100 points, chances
of heart attack are very high. Thus knowledge is a declarative statement of the cause and effect
relationship.
Structured When knowledge can be organised in a structured manner using some reasoning or logic, it
is termed as structured knowledge. The engineering drawing is a structured knowledge explaining the
design, the relationships between different systems, and so on. Knowledge is expressed in hierarchical,
network or layered structure.
Experiential This knowledge is built out of different events, episodes or pre-planned experiments. For
example, study of accidents on Highways and Freeways during night reveals certain characters of
drivers and their style of driving. This reveals association of accidents to certain types of drivers. These
findings are obtained from research and analysis of available data or data obtained through setting up
an experiment.
Semantic When knowledge is organised in structured manner using engineering and scientific facts,
it is termed as semantic knowledge. Knowledge is built on sound concepts, theories, facts and
relationships among different variables and constants. For example, body weight has an impact on
blood pressure and blood sugar which may lead to stroke or cardiac arrest. It requires regular check up
from a cardiologist.
Know how Know how is more precise, and is at variance with knowledge. Know how is the
knowledge which is built out of practical experience obtained by applying knowledge. Know how is
more useful in building expert systems. It is an expression of the knowledge which has more value due
to a component of experience gathered by application of knowledge.
Rule Knowledge when precise and complete and on application gives the same outcome, it is termed as
a rule. This is an expression for the well defined, logical flow of set of instructions which, when
applied by anybody, give the same result. It is far superior to procedure.
Program When knowledge is recast into a set of instructions, arranged in a logical sequence, giving
regard to conditions and standards, etc, it is termed as programme. Program continues to give same
results till it is changed. The software program is an example of knowledge as a program.
Heuristics It is a knowledge which built on some reasoning of credibility, inductive or deductive. The
outcome will not be as precise as in the case of procedure, rule or programme.

Business Intelligence
Business intelligence is a set of concepts, methods and processes to improve business decisions using
information from multiple sources and applying experience and assumptions to develop an accurate
understanding of business dynamics. It is a combination of methods and processes with tools to extract
information from various sources. It enables the gathering, management and analysis of data to produce
information which represents the new scenario. This information is distributed to people throughout the
organisation to improve strategic and tactical decisions to deal with the new situation effectively.

The power of business intelligence actually relies on the knowledge acquired through the analysis of
various reports taken using business intelligence reporting tools. Business intelligence reporting tools,
or OLAP Tools, provide different views of data by pivoting or rotating it across several dimensions.
Business intelligence tools are capable of displaying data in several formats, like tables, pivots, charts,
query results and reports.
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Business intelligence succeeds when the organisation first determines what constitutes ‘intelligence’
for the current business scenario and then proceeds to establish systems and processes to produce that
intelligence. A competitive business organisation has following business intelligence (BI) in place.

• Multidimensional analysis of key results or events

• Data mined view of a situations
• Forecasting models
• Business analysis (OLAP) diagnosing the problem
• Visualisation for different perspectives
• Querying and reporting systems
• Knowledge management for knowledge applications
• Balance scorecard preparation
• Digital dashboard preparation
• Enterprise portal implementation
• Relevant databases

Modeling and Analysis techniques for Business Intelligence

BI requires extensive use of modeling and analysis techniques. Let us briefly discuss what they are and
how they are used.
Business Modeling
A business model provides information in a graphical way, in diagrams, to the members of an
organization to understand and communicate the business rules and processes effectively. Business
process modeling, process flow modeling and data flow modeling are sub-categories of business
modeling.

Data Modeling
Data modeling is about representing the real world set of data structures or entities and their
relationships in the form of data models, required for a database creation. Data model is a visual
representation of the database. It consists of types and phases, like conceptual data modeling, logical
data modeling, physical data modeling, enterprise data modeling, relational data modeling and
dimensional data modeling. It provides tabular picture of an entity by its attributes and relationship
structure.

Dimensional Modeling
Dimensional model comprises of a fact table and many dimension tables, and is used for calculating
summarised data in different perspectives. A fact table contains various measures or facts, like sales
amount,production amount, etc., whereas a dimension table describes the particular entity, like time,
state, etc., based on which the required facts are measured.

ETL, An Implementation Process

ETL, an acronym for ‘Extraction, Transformation and Loading’, is a collection of application tools
associated with extracting data, transforming that data into business data and finally loading it into a
data warehouse.
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ETL tools populate the data warehouse. The transformation involves several processes, like data
cleansing, data profiling, data type conversion, validating for referential integrity, performing
aggregation, if needed and de-normalisation and normalization of data.

OLAP
OLAP, an acronym for ‘Online Analytical Processing’, is a technique by which the data, sourced from
a data warehouse or data mart, is visualised and summarised to provide perspective multidimensional
view across multiple dimensions. Generally, OLAP refers to OLAP Tools (for example, Cognos,
Business Objects, etc.) that help to accomplish these tasks.. OLAP tools provide options to drill-down
the data from one hierarchy to another.
OLAP tools visualise data in an understandable format, like in the form of Scorecards and Dashboards,
with Key Performance Indicators enabling managers to monitor and take immediate action.

Data Mining
Data mining is a set of processes related to analysing and discovering useful, actionable knowledge
from data warehouse, data stores or data sets. This knowledge discovery suggests patterns or
behaviours within the data that lead to some strategic thinking leading to profitable business action.

Ontology
An ontology is a formal specification of the vocabulary to be used in specifying knowledge. It may be
thought of as a network of objects, each of which has attributes or properties unique to that object.

HUMAN THINKING AND LEARNING

At the core of knowledge and related initiatives, processes and activities is human learning. Figure 2.4
shows a model of the human learning process.
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The human learning process is a long one and squarely dependent on individuals and their intrinsic
abilities to view situations from different angles, and connect conceptual constructs to resolve the
problem situation. When lessons become more valid for application and provide confirmed problem–
solution relationship, the body of lessons become knowledge. This may be tacit or explicit and may
belong to any class. The human learning process described for individuals is also applicable to groups
or teams coming together to achieve something concrete. For example, a project manager and his team
learn together a number of lessons of better project management. A group of fire fighters equipped with
fire fighting equipment learns a number of lessons during the course of various fire extinguishing
challenges. New group learning processes are always emerging and the lessons are learnt by the team.
It becomes a body of lessons when the group comes together and deliberates on them to build aids and
tools to perform better.

TACIT AND EXPLICIT KNOWLEDGE

Knowledge, on creation, can be put into two types, tacit and explicit

Explicit Knowledge
Explicit knowledge can be articulated into formal language text, mathematical expressions,
specifications,manuals, etc. Explicit knowledge, in electronic media, can be readily transmitted to
others. Also, it can be easily processed by a computer, transmitted electronically or stored in databases:
• This knowledge can be systematically expressed; it is possible to code and it can be stored,
transferred and shared through any medium.
• Explicit knowledge is that which is written down or expressed in some tangible form, such as in a
procedure manual, document or computer database.
• Examples Dictionary, recipe book, software product, ready reckoner, rule, procedure, programme,
heuristics and solution model.

Tacit Knowledge
It is a personal knowledge embedded in individual experience and involves intangible factors, such as
personal beliefs, perspective and the value system. Tacit knowledge is hard to articulate with formal
language like explicit knowledge. It contains subjective insights, intuitions and hunches and conceptual
models of solutions. In addition, there are two dimensions to this knowledge. For communication, this
knowledge must be converted into words, models or numbers to understand and to communicate. It
cannot be shared or transferred easily as it is not possible to code. It is subjective, personal, may have a
bias, context specific and difficult to share due to its nature. It is termed as insight, experience,
judgement, ability to differentiate, and is also termed as know how and know why.
Examples Knowledge possessed by consultants, strategists, scientists, designers and Architects.
Some key features of tacit knowledge are:
• Highly personal
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• Hard to formalise and therefore difficult to communicate to others

• Deeply rooted in action and in an individual’s commitment to a specific context, profession, activities
of a work group or team
• Something that we simply know, possibly without the possibility to explain
• Human beings are the storage medium of tacit knowledge
• Not very easily amenable to technology

KNOWLEDGE: A DRIVER FOR CREATIVITY AND INNOVATION

Creativity and innovation in every aspect of the business are highly beneficial for survival, growth and
attainment of superior performance.Creativity is the phase in which ideas emerge, and in innovation
idea gets converted into practice. Creativity is a result of knowledge application to search an idea
which will transform or radically change the present scenario. Knowledge makes innovation faster and
better. Idea is a conceptual model of the solution developed out of knowledge. It germinates out of tacit
and explicit knowledge. Throughout the process of creativity and innovation, the knowledge
continually moves from tacit to explicit and qualitatively improves all the time.

classify knowledge as a driver for creativity and innovation in the following manner
Customer Knowledge
Products or Services Knowledge
Process Knowledge
People Knowledge
Organisation Knowledge Database
Knowledge in Stakeholders Relationship
Technology and Sciences

Customer Knowledge

Customer interfacing systems, like order processing, service management and CRMs capture a lot of
data which then moves to data warehouse for intelligent use through data mining applications. DWH
and data mining produces a lot of knowledge about customer behaviour, choices and biases, and so on.
This knowledge is potentially strong to generate ideas and to develop innovative strategies to enhance
the business. Traditionally, organisations rely on market research, different surveys on customer
satisfaction and perception. But knowledge gathering through such means is not continuous, and this
approach has a limited scope and specific focus. Customer knowledge here means discovering what is
not expressed by the customer, what is not stated by the customer in requirement specifications, and so
on. Customer knowledge is about why certain customers are loyal and why some are not. This
knowledge is captured during customer interactions, feedback surveys, unsolicited comments on a
number of things, comments on what competitors are doing, and so on. This knowledge generates
different innovative value propositions the customer is looking for, a booster for creativity and
innovation.
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Products or Services Knowledge

During the course of business transactions, the customer gives valuable feedback through various
channels of communication. Knowledge can be captured through analysis of data and information
delivered through these communications. Further, knowledge can be searched from the repositories of
the systems, namely Feedback Analysis, Service Demand Analysis, Analysis of Complaints and
compliments on various offers, Demand Analysis of New Features and Ideas, and so on.
Organisations also generate considerable knowledge during product or service design and development
cycle. Many problems come up, and solutions are discussed, and one of them is adopted. But this
knowledge of problem solving is not digested for future benefit. The process of product & service
design and development exposes a number of the facets of the market, applications, customers, and
new business opportunities. This knowledge is potentially a source for creativity and innovation. It can
be used to develop user guides, procedure manuals, online databases and new product ideas. Some of
this knowledge can be embedded into the system or product itself. Its main and major sources are user
interviews, prototype results and modifications, application experience, quality audits, customer help
desks, noting in service diary during warranty/ guarantee period, test marketing and all such customer
focused activities.

Process Knowledge

The manufacturing and servicing processes are critical to business success of a business. These
processes are designed to serve the customer better. They are audited and improved continually for
small gains and reengineered for radical improvements. During the process operations data and
information are captured which generate knowledge about process efficiency and effectiveness, a
driver for process innovation. The processes are designed with specific goal in mind. The process
definition and various stages are designed to operate and perform in a predetermined manner. As the
process is used over time, it undergoes a change for meeting new demands. Many times, certain
exceptions are handled by making temporary modifications within rules or policies. This continuous
modification of the process generates a process knowledge which should be captured and stored for
searching creative new ideas.
You may study the loan processing system of any bank, designed to handle many interconnected and
interdependent processes for deciding about the loan request from the customer. Every proposal, on
analysis, would reveal that the bank has to learn a lot.

People Knowledge

The people in the organisation are the only live sensitive resource. They possess knowledge mostly
tacit,generated out of experience and learning during the course of execution of plans and strategies.
The learning cycle has four stages: plan, act, observe, and reflect’. The plan, the first stage, includes
thinking, conceptualising, strategising, and devising a set of actions to implement strategies. The act
stage stipulates execution of various actions stated in a plan. The third phase is Observe in which
people make intelligent observations on the operations, methods and practices evolved over a period.
The key observations are the learning, such as dos and don’ts, right and wrong, choices of tools and
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technology, methods and materials,and so on. The reflect is the last phase in the learning cycle. In this
phase, people reflect upon what they have learned and how it can be used in practice.
The people develop formal or informal networks, communities to exchange ideas, solutions and
practices developed out of learning and experience in the organisation. Certain individuals, dedicated
teams and experts’ in the organisation are the custodians of this knowledge. They should be identified
and knowledge management systems be designed to capture the knowledge systematically.

Organisation Knowledge Database

The knowledge database is a repository of most important knowledge of the organisation stored for
access to all those who need it. The knowledge here is not the one defined, but is the one which, in
general parlance, is required by all. The examples are customer histories, best practices, product
history, vendor experiences, case histories, problem and solution instances, Yellow pages for the
organisation, Blue pages providing access to external contacts, project reviews, and project closure
reports, and so on. These repositories are of explicit knowledge. The organisations which operate in
very complex customer intensive businesses, like banking,insurance, tourism hospitality, airlines, and
similar businesses, develop organisation knowledge domain specific data bases for guidance and for
solving the problems of exceptional nature.

Knowledge in Stakeholders Relationship

During the course of business execution, the organisation builds relationships with vendors, customers,
business partners, and stakeholders. Each relationship begins by engaging them in some business
transaction.This relationship then develops into thick relationship because of common business interest.
Further, this relationship strengthens as both are always in a win-win situation in their respective
business. Due to this relationship both step out and share knowledge, ideas and information. The
organisations build a relationship database which explicitly states the nature of relationship, the
knowledge about each others’ competencies, the expertise for which the partner is recognised, the
partners’ value systems etc. The database in summary describes the partner relationship with the
organisation.

Technology and Sciences

Technology and sciences are great sources of knowledge generation. Engineering, electrical, and
electronic technologies and material sciences are sources of knowledge giving ideas for innovation. In
recent past, Internet and chip technology has brought about a revolution in how the business is done. It
has affected and our personal and professional lives. Figure 2.8 shows the strategic sources of
knowledge leading to generation of knowledge assets and products. Figure 2.9 shows the link between
knowledge, creative and innovation cycles.

The knowledge cycle is about creation of knowledge. In creative cycle, knowledge in the organisation
inspires people to imagine new ideas for transformation, or for solving the problem. Knowledge is also
used to translates idea into practice. All the eight knowledge heads discussed here are the sources of
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creative ideas and innovation for radical improvement in product, processes and service delivery,
which the customer is looking for.

KNOWLEDGE: A STRATEGIC RESOURCE

Knowledge which is unique to an organisation and is a clear differentiator, and further puts the
organization ahead of its competitors, is knowledge asset. Knowledge assets are created out of
intelligent use of existing knowledge over a period of time. They assets change both in terms of content
and value. They are recognized as the capital of tremendous financial value to the organisation. These
assets, also known as intellectual asset can be put into three categories, as suggested by Sveiby, Saint
Onge and Bontis.

• Human Capital Individuals or groups possessing competencies, skills, experience, know how,
intelligence and wisdom. It is invaluable and difficult to code and share.

• Structural Capital It is embedded in the organisation’s infrastructure, such as critical processes,

knowledge products exclusively developed by the organisation, information systems, KMS, LMS
and proprietary databases. This knowledge remains in the organisation even though the people who
created it leave the organisation.

• Brands, Trademarks, Patents These are the capital assets on which business is leveraged. They
together are knowledge bodies which are legally protected and are the prize possession of the
organisation.
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BUSINESS BENEFITS OF KNOWLEDGE

Many organisations are using technology to realise the benefits of knowledge. The systematic approach
to knowledge initiative and its implementation gives the following benefits
• Mistakes impacting business are largely avoided
• Faster proactive response to emerging scenario
• Process improvements
• Strategic management improved
• Opens door for new business opportunities
• Enhances customer satisfaction
• Contains business risk at all levels
• Creates flat and lean organization

TOOLS FOR KNOWLEDGE MANAGEMENT

There are a number of tools—web enabled and IT driven traditional tools—which form the backbone
of knowledge search and subsequently its management. These are support tools, or enablers, or drivers,
to manage knowledge initiative.

• DBMS Tools In the process of KM, large amount of data needs to be accessed from several sources,
which include documents, folders, files, organisation’s databases working for MIS and Enterprise
software. The process of identification of the knowledge and data required to build needs access to
these sources. On accessing the data, its down loading and processing to create Knowledge requires a
variety of tools. These tools are capable of searching, accessing, cleansing, manipulating, structuring
and storing in the required format. They are broadly called data management tools and Database
creation tools.

• Process Management Tools These tools include process modeling and diagramming tools. In
the KM initiative phase, are needs to study critical business processes, production and transaction,
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which are, by themselves, knowledge repositories. These processes are evolved over a period, out of
experience in using them. The study of these processes require modeling tools for process abstraction,
for benchmarking and for setting the target, diagramming for details, and then for reengineering and
process analysis.

• Workflow Management Tools Workflow management tools focus on management of documents,

content management on the trail of work centres. Different people in the organisation contribute to
work flow by sharing their specific expertise for completion of process. These tools are capable of
handling the multimedia used in work flow. In KM processes, development and application, work
flow management tools are used for design and implementation

• Enterprise Software (ERP/SCM/CRM) These software packages are tools for managing
resources, supply capabilities, and relations with customers and business partners. These packages,
in the execution process, develop knowledge which is not systematically recorded or designed to
store. The databases, files and folders of these packages have a hidden knowledge. The enterprise
software are implemented using best practices of executing a task, which is knowledge for others to
use. The knowledge is then extracted by data management tools and process mapping tools.

• Agent Tools Agent tools are autonomous programs designed to perform a specific task. Agents can
be designed to search information based on supporting input data specification. Intelligent agents will
be able to handle context relevant information seeking. These embedded in the system will offload
the work put in by knowledge workers to seek information and knowledge from the repositories.

• Search Engines Search engines are designed to search information based on search inputs given to
the engine. Some search engines are generic and customised to specific domain.

• Collaborative Tools Collaborative working for knowledge sharing is a necessity. These tools help
in setting up bulletin boards, real time video conferencing and chat sessions are some examples of
collaborative tools.

KNOWLEDGE MANAGEMENT
There are a number of definitions of knowledge management. In essence, all of them are same. Some
have been discussed here.
Knowledge management is a system’s approach to identify, validate, capture and process knowledge,
and then organise the knowledge elements into knowledge assets for business function operations and
decision making.

Knowledge management is the process of creating economic value from the organisation’s intangible
assets, namely human capital, structure capital, customer capital, business partner capital, to be ahead
of the competition.

Knowledge management is the process of capturing and making use of the organisation’s collective
expertise developed out of experience for improving business operations and performance.
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Knowledge management is the discipline of capturing expertise, competencies and skills and storing
in databases in the form and kind for dissemination and application for resolving issues affecting the
business and its position in the market.

Knowledge management is the process for developing knowledge and knowledge assets to build
knowledge strategy, supporting first to build strategy and then its implementation.

Knowledge management involves blending a company’s internal and external information and turning
it into actionable knowledge via a technology platform.

Knowledge is a fluid mix of framed experience, values, contextual information and expert insight that
provides a framework for evaluating and incorporating new experiences and information. It originates
and is applied in the minds of the knower.

Figure 3.1 shows the landscape of knowledge management. The landscape consists of technology,
consulting and related activities, content generation systems for users of the organisation and
knowledge generation processes and systems. Within each of these four overlapping and
interdependent contributors there are supporting aids, tools and processes, which result in the overall
and landscape making an impacting on the organisation’s business performance.

The importance of KM in recent years has risen due to its ability and proactive preparedness to face the
challenges of globalisation, competition and knowledge economy. The organisation recognises it as the
key result area, a management function affecting the rest of the business management functions.
Knowledge management addresses the following problems of the organisation.
• Ageing workforce leading to loss of knowledge due to their exit
• Mergers and acquisitions disturbing human resource balance
• Urgent need of expertise to be fulfilled which is not planned
• Lack of resilience in the organisation to face the competition onslaught
• Not able to generate economic value out of investment in human capital and technology
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Knowledge Management Perspectives

During the course of last five years, two perspectives of KM have emerged.
• Technology Centered Knowledge Perspective
• People Centered Knowledge Perspective

KNOWLEDGE INITIATIVE
Knowledge initiative is the first step towards KM in the organisation. There are two thrust approaches
in launching the knowledge initiative.

• Knowing what you have and what you know

In this approach, knowledge management life cycle process is used. Identification of knowledge is a
non issue as it is already recognised by users as useful knowledge. It needs to be captured, organised
and stored for transfer or sharing. The source of this knowledge could be within the organisation or
from outside.

• Searching knowledge which you do not know

In this initiative, what knowledge the organisation should have is determined and the initiative
focuses on the KM cycle to identify, search, acquire or create, organise and store to transfer or share
knowledge in the organisation.

KNOWLEDGE MANAGEMENT PROCESS

The processes mentioned from ‘creation to use and exploitation’ are very important to ensure that the
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knowledge which enters into the knowledge database is after due diligence. Hence, these processes,
each one of them, have a unique role in the Knowledge Development Cycle. These processes together
ensure quality and vitality of knowledge. They tests knowledge before it is used and, if found deficient,
it is put in an archive. The process is given below.
• Identification Knowledge is not to be searched in isolation of business, business needs. It has to be
identified as the relevant so that it is useful to the organisation in its better management.

• Creation Includes identification, formulations and recognition of its source and testing for
vitality.

• Aggregation Means assembling and clustering knowledge entities into one unified set, easy to
code, store, share and use.

• Organisation This includes structuring knowledge into different organised formats, such as
E-manual, Portal, Database and Folder for access to users.

• Store Knowledge so generated and organised is stored in structure and format for easy access to
share and use. It could be at different locations on the network for various technical reasons and for
user requirements.

• Share Share is a process which takes care of dissemination of knowledge to users. It includes
dissemination and its security.

• Use Use of the knowledge is at the initiative or choice of the user. The process keeps track and
watch on knowledge, and keeps the log of ‘who, when, where’. Such log, at the time of review,
reveals the level and quality of usage. This becomes the key for declaring knowledge as ‘vital and
valid’.
• Validity of Knowledge Knowledge needs validation regularly at some interval to check its utility for
which it is created. Such review may not reject knowledge but enrich it by its experienced usage.

KNOWLEDGE DEVELOPMENT AND MANAGEMENT CYCLE

For convenience of understanding, KM cycle is split in two cycles, working closely with each other.
Knowledge is developed first, and then it is managed for effective use. Hence, the two cycles are
Knowledge Development and Knowledge Management.
Knowledge Development (KD) Cycle
The KD cycle is about search, identification, validation and creation of knowledge. In this cycle,
appropriate required knowledge is determined identified, searched, created and stored for handling,
storing and transferring to users for application in decision making.
Knowledge Management (KM) Cycle
KM cycle moves through four main phases, each having specific activities. The KM cycle deals with
the process of capturing and organising knowledge to transfer it to users, sharing and effective use. It
measures the knowledge performance and evaluates for its continuity in the organization.

Figure 3.9 gives the process flow details of KD and KM cycles.

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Knowledge Management (KM) Cycle

There is a three steps approach to knowledge management. It moves through three phase cycle before it
is integrated into systems and processes of the organization.
• Knowledge Definition (Identification, Validation): Recognition of knowledge utility and validating
for application.

• Knowledge Generation (Creation, Acquisition): Knowledge creation by self and acquiring from
other reliable sources external to organisation.

• Knowledge Application (Measurement, Archiving): Measuring knowledge for its performance and
validating it for continuity, and learning more lessons to enrich the knowledge. Infrequent use of
knowledge is taken to archive.

A matured knowledge is then attempted to be integrated into systems and processes where it is
frequently used. Integration is done through business rules, models and algorithms formulae, and so
on.Within the KM cycle, there are four cycles closely linked to each other. The cycles are ‘Data,
Information and Knowledge
and Application’. Figure 3.10 shows the four cycles.
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In the data cycle, data is identified for business relevance along with its Metadata. Then it is processed
for correctness, completeness, and is cleansed and organised for data processing application. This
processed data is then stored in Database. In the information cycle, data is chosen with context and its
purpose in mind, and is processed for contextual relevance and reference. Such processed data
represents the context and entities fully. It may also have some surprise element, and it evokes response
to think and act. Such information is then stored for application.
In the knowledge cycle, the stored information is chosen for processing with some objective. When
such information set is processed for discovering insight, trend, pattern, cause and effect relation, the
result is ‘knowledge’.
In the application cycle, knowledge is put to use directly or through embedded, integrated systems.
The application experience enriches knowledge. In some cases, new knowledge is found. New
knowledge could be tacit or explicit. All four cycles operate on the Network of the organisation,
generally known as knowledge network.

KNOWLEDGE NETWORKING
The KM cycle developed for the organisation operates on the network platform.
KM network platform has two components, Computer Network and the people from the organisation
and outside.
In knowledge network, people share information, knowledge and experiences to develop new
knowledge and new knowledge assets
 18

Charles Savage defines knowledge networking as the process of combining and recombining one
another’s knowledge, experiences, skills, capabilities and aspirations in ever changing profitable
patterns

Table 3.1 shows the key characteristics of Knowledge Network.

Knowledge networks bring many benefits. The degree of benefits varies with how static or dynamic
the network is. Networking allows uninterrupted flow of knowledge and rapid access to its storage
place.The knowledge movement through different nodes makes it richer by its experience of
application to solve problems. In the process of flow of knowledge, users get creative ideas and
innovative solutions to solve the problems.

Knowledge network provides a common platform to the users to solve the problems, get better insight,
and generate new ideas and strategies. The second best benefit of knowledge network is that it
facilitates building relationships between network partners leading to collaborative working on many
other issues requiring immediate attention and resolution

Knowledge networks are driven by knowledge workers. The success of knowledge management
depends on how good the knowledge workers are. In the knowledge driven organisation, it is virtual
working with information and knowledge. The character of a good knowledge worker can be
summarised as under.
• Proactive and willing to act beyond given role and scope
• Motivated to enter into other’s domain to seek additional knowledge
• Effective team worker: shares knowledge, collaborates and contributes
• Leads to set the goals, achieve consensus among team members
• Has broader perspective and wider context. Sees the bigger picture
• Finds way through people, policy and politics in the organisation
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PRINCIPLES BEHIND KM SUCCESS

KM is a Discipline

KM Initiative must be Backed by Several Champions Across

the Organisation

Accepting Knowledge as a Key Strategic Driver is Cultural Change

Create a Change Management Plan for KM Initiative

Knowledge Management, a Strategic Initiative

THEMATIC ANALYSIS OF KNOWLEDGE MANAGEMENT

In this section, we take up the thematic analysis of knowledge and its management.

• Knowledge management is a discipline founded on economics and management science, driven by

systems thinking and used for knowledge creation for problem solving and performance improvement.
Figure 3.13(a)

• Knowledge Management is driven by internal and external forces. KM initiative is driven by internal
forces to remove bottlenecks, improve performance and maintain competitive necessities and external
forces, demanding more from the organisation to meet the needs of expanding markets, demanding
 20

customers and stake holders. Figure 3.13(b)

Knowledge management process is required to focus simultaneously on a number of centres. It is HR

centric because HR is the single largest contributor to the endeavour.

It becomes automatically technology centric as knowledge needs to be taken to users by transfer

and share processes for which technology is an enabler or a driver. While KM process, major effort
 21

is to search knowledge which is useful for business benefit, it endeavours to make some part of
knowledge body of a high value that is termed as intellectual capital. Further, success of KM process
is measured by the increase in organisation’s effectiveness while balancing the efforts in favour of
HR, technology and intellecual property.

• Knowledge Management makes business impact on efficient and effective transfer and sharing
mechanisms in the Knowledge Network. Figure 13.13(d)

The knowledge developed needs to be transferred at user locations and then be shared by those users
among themselves for application. The transferring and sharing tools installed on the knowledge
network are the backbone of KM.
• Knowledge Management rides on basic processes and is enabled by certain drivers. Figure 13.13(e)
 22

While processes are clear enough to understand they are not easy to implement if enablers are not
in place, and are not in sync with each other. The critically important enablers are leadership, work
culture and management thrust.
• Knowledge Management has two stages, development and management Figure 13.13(f).

Knowledge management is a discipline and is driven by external and internal forces. It is a multi-focus
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activity concentrating on HR, IS and IT, IC and IPs, and on achieving organisational effectiveness.
KM survives on efficient transfer of knowledge and sharing by needy users without any hindrance. All
these details of KM are easy to understand but the last aspect of Knowledge Management Generation
and Application-needs elaborate exposition to appreciate its importance in Knowledge management.
Let us take a practical example to explain first knowledge generation.

SECI MODEL: KNOWLEDGE TRANSFORMATION AND ITS DYNAMICS

Three researcher groups prescribed three processes of transformation and dynamics, i.e., knowledge
creation
and utilization. They are:

– Nonakas’s: Socialisation–Externalisation–Combination–Internalisation
– Earl’s: Knowledge inventorying–Auditing–Experiencing–Socialising
– Hedlund’s: Internalisation–Articulation– Reflection–Dialogue–Expansion

All three research groups believed that unless the identified knowledge is transformed in some way it
would be useless or be not usable. Knowledge transformations and its dynamics point out to processes
which make it possible. But it also relies heavily on technology (human and machine) and knowledge
culture of the organisation. The process advocated by Nonaka’s is that of socialisation; Earl’s emphasis
is on inventorying and auditing, while Hedlund’s is on participation through internalisation and
dialogue.

The process, technology and work culture together from the infrastructure of transformations and
dynamics of knowledge. The technology majors are data warehousing and mining, document
management system, content management systems and Groupware and web based communication. The
second component of infrastructure is appropriate knowledge culture for knowledge management. The
knowledge culture is seen when people make special efforts in learning out of experience and
articulating it in tacit or explicit knowledge. The effort is also seen when knowledge is upgraded or
replaced by a new knowledge acquired by its usage in business applications.

The SECI Model of Knowledge Creation

According to Professor Ikujiro Nonaka, knowledge creation is a spiraling process of interactions
between explicit and tacit knowledge. The interactions between then lead to the creation of new
knowledge. The combination of the two categories makes it possible to conceptualise four conversion
patterns. The four modes of knowledge conversion interact in the spiral of knowledge creation. The
spiral becomes larger in scale as it moves up through organisational levels, and can trigger new spirals
of knowledge creation.

Socialisation: Sharing tacit knowledge through face-to-face communication or shared experience. An

example is an apprenticeship.
Externalisation: Developing concepts which embed the combined tacit knowledge, and which enable
its communication.
Combination: Combination of various elements of explicit knowledge. Building a prototype is an
example.
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Internalisation: Closely linked to learning by doing. Explicit knowledge becomes part of the
individual’s knowledge base (e.g. mental model) and becomes an asset for the organisation.

For effective management of knowledge creation and its exploitation, the organisation has to map its
inventory of knowledge assets. Cataloguing is however not enough. Knowledge assets are dynamic;
new knowledge assets can be created from the existing ones.

Four categories of Knowledge Assets

• Experiential Knowledge Assets: Tacit knowledge with common experience. They are skills and know
how of individuals, such as care, love and trust; energy, passion and tension.
• Conceptual Knowledge Assets: Explicit knowledge articulated through images, symbols and
language texts. They are product concepts, design and brand equity.
• Routine Knowledge Assets: Tacit knowledge made a routine and embedded in actions and practices.
They are know how in daily operations, such as organisation routines and organisation culture.
• Systemic Knowledge Assets: Explicit knowledge packaged into documents, manuals, specifications,
databases, patents and licenses.

Nonaka and Takeuchi believed that organisations create and use knowledge through the interactions
between tacit and explicit knowledge. It begins first with creation of tacit knowledge. Its use in a
number of occasions induces and encourages transforming it into explicit knowledge. The process of
creation and interaction is continuous. The conversion of tacit to explicit and back to tacit is through
human interaction.The conversion process improves knowledge, both in quantity and quality, when the
loop is complete. The conversion process has four steps or stages, Socialisation, Externalisation,
Combination and Internalisation (SECI), all driven by people in the organisation.

Let us understand the SECI model through an example of a Pharmaceutical company selling pharmacy
products, first through introduction to doctors and then through retail medical shops.

The medical representatives (MR) visit doctors and distribute sample medicines for testing. During
the discussions, the doctors share a specific health problem, MR explains the new medicine’s strength
in handling the problem. This phase is socialization, where MR collects tacit knowledge from various
doctors.The experience of each doctor is different, clinical analysis is different, and diagnosis is also
different.The information about the new medicine in context of specific ailment collected from all
doctors is tacit knowledge. All MRs make a record of tacit knowledge and exchange with each other.
The tacit knowledge collected by all MRs is combined systematically by editing and processing in a
table form. This table shows the details of the ailment, patient condition, prescription, patient’s
feedback, and doctor’s diagnosis. This process externalisation which puts together tacit knowledge
elements of all MRs, or their groups, into a format for all to use for sharing with doctors and learning
more through interaction. Externalisation is the process of articulating and translating distributed and
assorted tacit knowledge elements into an organized format, making it explicit knowledge, easy to
read, understand and share.

This explicit knowledge, after fair amount of testing and confirmation by doctors, is taken
systematically for integration into the development process, manufacturing process, distribution
literature or in CD for sharing with doctors. This process is called combination where explicit
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knowledge takes a form and format for communication, dissemination and for making it part of a
system or process. In this stage, group knowledge sets are put together for organisation’s use.

The clinical experience of new medicine is again collected by MRs from the doctors on more specific
issues of the ailment. In this phase, the experience of explicit knowledge gives rise to new learning, a
tacit knowledge.

This advanced tacit knowledge is further shared with concerned experts and specialists to take it
forward for improvement. The process is termed as internalisation for learning and acquiring new tacit
knowledge in practice.

The SECI model explains the process of knowledge creation, conversion from tacit to explicit and back
to new tacit, and its utilization in practice. The process is repetitive in nature and needs to be executed
through well defined activities, called routines. The organisations must build the reliable Dynamic
Systems for Knowledge Creation and Utilization (DKCU), incorporating the creative routines for
execution of the SECI model. These systems integrate changing contexts and ensure that new
knowledge is created through SECI to put into practice. The SECI model needs DKCU as a support
system.