1

MANAGING KNOWLEDGE
RESOURCES
Session 18
 2

• Knowledge is a fluid mix of framed experience, values,

contextual information, expert insight and grounded intuition
that provides an environment and framework for evaluating
and incorporating new experiences and information. It
originates and is applied in the minds of knowers. In
organizations, it often becomes embedded not only in
documents or repositories but also in organizational routines,
processes, practices, and norms
• Davenport and Prusak
• Actionable information
• Data and information are essential, but it's the knowledge that can be
applied, experience that comes into context, and skills that are used at that
moment that make the difference between a good and a bad decision.
 3

Knowledge in strategy
Protecting
knowledge
Unique
features Knowledge
at
Products Process, Managing
Customer identifying
or activities combining knowledge
value
services resources
Lower
costs
Leveraging
knowledge
Strategy

Customer Product or Current process, Experience in

related service related location etc recombination
 4

Knowledge based view of the firm

• knowledge-based resources are usually difficult to
imitate and socially complex, heterogeneous
knowledge bases and capabilities among firms are
the major determinants of sustained competitive
advantage and superior corporate performance.
• Information technologies can play an important role
in the knowledge-based view of the firm in that
information systems can be used to synthesize,
enhance, and expedite large-scale intra- and inter-
firm knowledge management
 5

KNOWLEDGE OF THE FIRM

• Present in operating rules, manufacturing technologies,
customer data banks etc
• Similar factors influencing costs of imitation and
technology transfer
• Organizational knowledge: Information and know-how
based
• Creation of knowledge- based on combinative
capabilities
• Firms use metaphors and organizational redundancy to
focus thinking, encourage dialogue and make tacit
instinctively understood ideas explicit
 6

Dimensions of knowledge
• •Complexity, which includes categories and types, and
specifies the degree of context needed to give it meaning
and make it useful- number of parameters required to
define a system
• Codifiable: ability of the firm to structure knowledge into a
set of identifiable rules and relationships that can be
easily communicated
• Life span
• Dynamics
• Focus: operational or strategic
 7

Tacit or explicit knowledge

• “individuals know more than what they can express’
• Tacit knowledge: Search rule of heuristics, that identify
the problem and elements consisting of the problem
• Tacit knowledge is personal, context-specific knowledge
that is difficult to formalize, record, or articulate; it is
stored in the heads of people. The tacit component is
mainly developed through a process of trial and error
encountered in practice.
• Explicit knowledge is that component of knowledge that
can be codified and transmitted in a systematic and
formal language: documents, databases, webs, emails,
charts, etc.
 8

KNOWLEDGE AT GROUP, ORGANIZATION, NETWORK

Individua Group Organization Network

l
Information Facts Who Profits, Whom to
knows accounting contact?
what data, formal Who knows
and informal what?
structure
Know how Skill of Recipes Higher order How to
how to of organizing cooperate
communica organizin principles of How to sell
te problem g how to and buy
solving coordinate
groups
 9

Property rights: knowledge based

res
• knowledge-based resources (e.g., digital movies,
• music, and software) are non-rivalrous in consumption
and globally accessible
 20-10

Organizational knowledge- Related

tasks
• Generating Knowledge
• Identify knowledge for competitive strategy
• Develop ways to acquire or create that knowledge
• “inventing knowledge is not a specialized activity- but a way of
behaving’
• Organizing Knowledge
• Put knowledge into a usable form
• Codification and Personalization
• Distributing Knowledge
• Making knowledge easy to access, use & reuse
 11

Knowledge Centric Drivers

• 1. The failure of companies to know what they already
know.
• 2. The emergent need for smart knowledge distribution.
• 3. Knowledge velocity and sluggishness.
• 4. The problem of knowledge walkouts and high
dependence on tacit knowledge.
• 5. The need to deal with knowledge-hoarding propensity
among employees.
• 6. A need for systemic unlearning.
 12

• Information technology can be applied to leverage tacit

knowledge without transferring or codifying the knowledge
• Knowledge-scaling paradox, then, is that in transferring
and codifying knowledge to achieve the requisite scale, it
may lose strategic properties that keep it from rivals
• If the knowledge is codified, rivals may gain access to it
more easily by hiring away employees or acquiring the
codified knowledge in some other form, such as written
documents or an expert system
 13
Knowledge Processes within the Organization
Knowledge • Research
Creation
Knowledge • Training
Generation • Recruitment
(“Exploration”) Knowledge • Intellectual property
Acquisition licensing
• Benchmarking

• New product
Knowledge
development
Integration • Operations
Knowledge • Strategic planning
Sharing • Communities of practice

Knowledge • Best practices transfer

Knowledge Replication • On-the-job training
Application Knowledge
(“Exploitation”) • Databases
Storage & • Standard operating practices
Organization
Knowledge • Intellectual capital accounting
Measurement • Competency modeling

Knowledge • Project reviews

Identification • Competency modeling
 14

Nonaka
• Creating new knowledge is not simply a matter of
“processing” objective information. Rather, it depends on
tapping the tacit and often highly subjective insights,
intuitions, and hunches of individual employees and
making those insights available for testing and use by the
company as a whole.
 15

Knowledge (Nonaka and Tageuchi, 1995): Spiral of organizational

learning

• Explicit and tacit knowledge

• Conversion
• Tacit to explicit: externalization
• Explicit to tacit: internalization
• Tacit to tacit: Socialization
• Combination: Dissemination of codified knowledge
• Knowledge creation and organizational learning- a
continuous spiral of the four processes
 16

Nonaka’s Knowledge Conversion Matrix

Tacit TO Explicit
Knowledge Knowledge

SOCIALIZATION EXTERNALIZATION
Sharing of tacit knowledge The articulation and
Tacit among individuals and from systematization of tacit into
the organization to the explicit knowledge. Use of
Knowledge
individual metaphor to communicate
tacit concepts

FROM
COMBINATION
INTERNALIZATION A key role of information
Instructions and principles are systems is to combine
Explicit converted into intuition and different units of
Knowledge routines information and other forms
of explicit knowledge
 17

Enabling conditions for knowledge creation (Nonaka and

Takeuchi)

• Organizational intention- vision about type of

knowledge to be developed- linked to core or base
• Autonomy- self organizing cross functional team
• Fluctuation (members react and adapt to environmental signals
=> breakdown of routines) and creative chaos
• Information redundancy- fuzzy division of labour between
departments engaged in cross functional projects, competing teams,
rotation of members
• Requisite variety- organization reflects the
variation and complexity of the environment within
its structure
• Inside -outside connection
 18

Knowledge creation- Nonaka &

Tageuchi
• organizational knowledge can be created
by institutionalizing the reflections of
workers upon their actions, and by
harnessing tacit knowledge through the
provision of mechanisms for collective
gathering of such reflections.
• Not all tacit knowledge is equal, however,
nor easily malleable to the effect of such
organizational frameworks.
 19

Knowledge within the manager

• Knowledge built with experience
• Knowledge loss when experienced people leave
• Knowledge within people has to be factored into the
design of knowledge management systems
20
 21

What is Knowledge Management?

Intellectual
On-the- Courses & Seminars Capital
Data job Accounting
mining Training
IT Benchmarking
Intellectual Property
New Product Protection
Development Customer &
Communications Best
Market Analysis Practice
Strategic Alliances Scenario Transfer
Analysis TQM
Lessons
ERP Research
learned CRM

Definition:
“The systematic leveraging of information and expertise
to improve organizational innovation, responsiveness,
productivity and competency.” (Lotus division of IBM)
 22

D
Knowledge Transfer Mechanisms
I
S M Rules, procedures & directives
a
S
n Manuals &
E y Shared
Modular integration reports
M data
I Communities bases
N Communities -of-interest
A -of-practice E-mail
T Group
Internal -ware
I
consultants Training
O
N seminars
Video
& Data
conferencing
courses exchange
B Meetings
R Personnel
E F transfer Informal
On-the job Fax
A e training
visits
D w Telephone
T
H Low (know-how & High (explicit
contextual kn..) ABILITY TO CODIFY kn.. & information