Knowledge Management in Theory and Practice

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Table of Contents

Introduction
What makes up knowledge in an Organization?
Capturing an Organization’s Knowledge
Knowledge Retention and Storage
Knowledge Application
Challenges to Implementing KM Strategies
References

Introduction

Over the past few decades, the concept of knowledge management has become a very common topic in business circles. There has been a sudden rise in interest and activity, evidenced by the high number of publications, conferences, IT products, and job listings.

A number of professional bodies, especially PR professionals, IT expert, and librarians see knowledge management (KM) as a chance to take the centre stage in the corporate world. Unfortunately, there has been no universal definition for KM, and there is confusion as what makes up knowledge in the first place. Therefore, it is best to consider KM in the broadest framework (Dalkir, 2007).

Concisely put, KM is the process by which organizations create value from their intellect and knowledge-based assets. KM entails getting the right information to the required persons at the precise time, and assisting persons create knowledge, share this knowledge, and use it to improve the performance of the organization.

KM can also be defined as a range of strategies and norms employed by an organization to identify, generate, signify, distribute, and enable implementation of insights and experiences (Ferguson, 2005). Frequently, creating value from intellect and knowledge entails identifying what employees, business partners, and the clientele know, and sharing this knowledge among employees, departments, and even with other firms in order to formulate the best organizational practices.

It is important to stress that the definition of KM does not talk about technology; while KM is frequently aided by IT, technology by itself does not amount to KM. KM has assumed a near central role in the corporate world over the past few years as millions of persons prepare to retire over the coming five or ten years.

A large number of senior employees have turned 60 over the past five or six years, therefore, those of them who have not retired are likely to do so in the next few years (Ferguson, 2005). When they finally leave the organization, the knowledge they have acquired over the duration of their career years about their jobs, the organization, and industry practices walks out with them, unless the organization can take steps to preserve this knowledge (Gupta and Sharma, 2004).

Apart from an impending mass retirement, the emergence of outsourcing has forced organizations that have signed outsourcing agreements to tackle the tricky question of transferring the knowledge of their experienced and permanent employees elsewhere, a trend that hinders KM (McInerney, 2002).

KM generally focuses on organizational goals such as enhanced performance, enabling an advantage over competitors, knowledge flow, and constant improvement of the firm. These efforts go hand in hand with organizational learning, and may be differentiated from this concept by a greater emphasis on the management of knowledge as an important asset and a focus on promoting the sharing of knowledge (Wurman, 2001).

What makes up knowledge in an Organization?

In an organization, not all information is important. Consequently, each organization must filter out the information and pick out the sections that qualify as intellectual and knowledge-based assets (Gupta and Sharma, 2004). Knowledge is placed into two categories: explicit and tacit.

Explicit knowledge assets include information such as brand name, company logo, business plans, market studies and customer registers. As a rule, explicit information includes anything that can be documented and stored for future use in an organized way, frequently with the help of IT systems. On the other hand, tacit knowledge, or the knowledge contained in employees’ heads, is hard to define.

The difficulty with defining tacit knowledge is finding a way of recognizing, generating sharing and managing the knowledge. While IT systems can help in disseminating tacit know-how, identifying tacit knowledge in the first place is a major difficulty for many firms (Dalkir, 2007). Studies show that in a number of organizations, tacit knowledge is ten times more than explicit knowledge.

This finding implies the organization is at a high risk if senior employees leave the organization through retirement or resign from their positions, or transfer to another department, as they leave with their tacit knowledge. One of the core functions of a good KM system is to identify tacit knowledge and convert it into explicit knowledge, or transferring the tacit knowledge to other employees (Wurman, 2001).

Knowledge Management Practices in the Contemporary American Business and Industry

KM emerged in the second half of the 20^th century with a rise in the use of computers in aiding business processes. The platform was adopted into specific applications such as knowledge bases, expert systems, group decision support systems, among other uses (Gupta & Sharma, 2004). Early uses of KM in the American business environment included organizational yellow pages that were used as information locators.

Working together with collaborative technologies that had been developed earlier, KM technologies emerged strongly in the mid-1990s. Subsequent KM techniques gave rise to semantic technologies for search, recovery and improvement of e-learning methods (Gupta & Sharma, 2004).

Various KM systems have found their way into contemporary American society, and these are found in almost every sector of business and industry, particularly among large professional service firms. large accountancy and finance corporations have been leading the way in installing KM formal knowledge and management programs, followed closely by IT firms.

In some instances, the task involves establishing a core physical presence, for instance, Ernst and Young Group has recently founded a Centre for Business Knowledge in place of a corporate library, with the introduction of new KM tasks (Dalkir, 2007). Booz Allen and Hamilton’s KOL- Knowledge On-Line has been praised for providing exchange innovative ideas and knowledge amongst a scattered staff.

In 1994, the company established its Knowledge Programme, founded on both traditional and technological technologies, to help push top line growth though:

Creating a company brand through the development and commercialization of top edge thinking;
Facilitating a long-term client relationship by providing partners with a vast range of products to bring to their clients;
Providing employees with the best knowledge required to complete a task and hasten the learning cycle of fresh employees.

The success of KOL cannot is quite evident as at least 62 % of BAH’s clientele access KOL every month, and the company has stated the return on investment for KOL has been more than 1,400 percent (Dalkir, 2007).

Price Waterhouse Coopers has also launched its own KM platform known as Knowledge View, a knowledge network that provides their business consultants to access the best practices. KM has also been used by business managers to aid in decision-making and situation handling. The major role of these KM systems is to collect and distribute information among an organization’s workforce, or with its clients and external partners (Addicott & McGivern, 2006).

Capturing an Organization’s Knowledge

Due to the great value that is found in tacit knowledge, it is important that it should be captured for use by the organization presently or in the future, after senior employees have left the company without having imparted their knowledge to less experienced employees (Gupta & Sharma, 2004). For this reason, organizations have devised a number of strategies for capturing tacit information, known as knowledge management systems.

However, before rolling out a knowledge management system, it is important for the organization to know KM approaches do not lead to an improvement of the organization’s efficiency and effectiveness automatically, rather, the success of this strategy depends on how knowledge is captured. The process should be allowed to flow naturally, rather than coercing employees to ‘give up’ their tacit technology.

Such a strategy may fail since it is known that employees are less willing to give up their tacit knowledge to the collective organization (Dalkir, 2007). Therefore, instead of capturing tacit knowledge, management should encourage the flow of knowledge in the organization and develop ways through which staff share knowledge and ask the leaders to lead with example by sharing their knowledge.

This strategy will more likely influence other experienced employees to share their knowledge with less experienced staff, and hence the knowledge will be retained in the organization when the experienced staff have left the company. Therefore, instead of capturing knowledge, an organization should promote information flow.

There are two ways of capturing knowledge in an organization: technology-based systems and non-technology systems, otherwise known as ‘softer’ systems. Shadowing and joint-problem solving are the two common soft methods that can be used to transfer tacit knowledge within the firm.

In shadowing, less experienced employees observe more experienced employees as they go through their activities to learn how the seniors perform their tasks. For this system to work, it is imperative that the ‘student’ and ‘professor’ discuss their observations in order to have a deeper understanding of the concepts and cement the knowledge transfer.

This exercise gives the trainee staff a first-hand chance to observe the experienced staff performing his task, and learn from him. The weakness of this approach is that some professionals do not like to be observed while undertaking their duties. Besides the system has a weakness in that the accuracy or completeness of gathered knowledge is fades by the lapse between observation and recording (Dalkir, 2007).

In a joint problem-solving approach, the ‘student’ and expert are assigned a common task. Since less experienced staff are frequently unacquainted with the best way to approach a task, they cannot create a step-by-step procedure for completing the assignment, therefore, having them work together with an expert will help them adopt the expert’s approach in completing a similar task in the future.

The difference between the two methods of transferring knowledge is that shadowing is more passive as the novice watches the expert while in joint problem solving, both parties work hand-in-hand on a common task. The third strategy for enabling knowledge flow among staff is organizing a brainstorming session. This is an unstructured, consensus building meeting aimed at generating ideas about a common problem.

A brainstorming session makes it possible for the junior employees to widen their understanding of various concepts relating to the organization (Dalkir, 2007). This method is suitable for individuals working in groups consisting of a number of experts and some less experienced staff, and enables knowledge flow from the experts down to the rest of the employees, hence helping in knowledge retention.

In order to facilitate learning, the trainees should note the frequency of specific responses during the session as these are very important points, besides, he should prompt the experts to generate ideas by asking questions. Apart from helping junior employees, information obtained from brainstorming sessions can be archived for future use (Snowden, 2002).

Exit interviews have also proven to be a very important KM tool. In this strategy, experienced employees leaving the organization are interviewed to capture knowledge that they may have. Rather than capturing HR information, an exit interview also aims to obtain information regarding what it takes to perform the responsibilities previously assigned to the leaving staff member.

If done in the right manner, this strategy can result in a win-win situation for both the firm and the leaving employee: the firm gets to retain some of the leaver’s knowledge while the leaver gets to demonstrate their exceptional contributions to the company (Snowden, 2002). Exit interviews are comparatively fast and cheap.

During the interview, the replacing staff can interview the leaving staff, or be in the presence of the interviewer, and the leaving staff should be asked probing questions that will elicit elaborate answers regarding success stories, areas of caution and challenges (Dalkir, 2007). Mentoring a new employee can also help in knowledge retention.

The mentor is able to teach, train, or coach a less experienced worker, and in the process, transfer a portion of his knowledge to new employees. The main objective of mentoring is to develop the junior employee’s skills, further the understanding of the firm and its culture, and develop the new employees.

Other methods that may be used to capture knowledge include story telling, coaching, knowledge fairs, briefings, peer assist, etc. Technology-based systems that can be used include a collaborative wiki, where all employees can add or erase information (Dalkir, 2007). The organization can also include applications or catalogues on its computer network, where staff can access and add information.

Knowledge Retention and Storage

Once knowledge is captured, it should be archived in the form of explicit information for current and future use. Today, much of the information is stored in paper-based documents to their safety and accessibility (Broadbent, 2008). IT systems are less reliable than paper since they can collapse at any given time, besides papers can be produced in several copies at lower costs than a hard drive back up.

One disadvantage with this storage media is that updating information becomes hard, and invalidates all the previous copies. An advantage of IT systems is that they have a higher organizing power and ease of access than written material, and with ample secure back-ups, can offer the best medium of storage of ‘knowledge’.

The captured information becomes useless if cannot be accessed by the organization’s employees, partners or clients. Therefore, distribution systems must be established to help disseminate this information. Technology, for instance, intranet or internet, allows the information to be disseminated throughout the organization’s employees rapidly.

Since the value of a computer network increases with every individual unit that is added to it, the larger the network, the higher the number of employees that will be able to access it (Broadbent, 2008). Besides, each new member brings resources that may be found useful by one or more members of the network, hence, the network becomes richer and richer with useful information than the individual parts.

This is the concept behind the success of the internet. As the network becomes larger, the cost of the net drops, and this enables users to send more information, hence an increase in knowledge interchange.

Knowledge Application

This is the actual use of knowledge that had been captured, retained and stored. This is a very important step as quality of the captured information relies on its effectiveness and usefulness. Hence, if poor or less helpful information is captured, the organization will only benefit by a similar degree.

It is important to note that in most instances, the users and sources of knowledge are the same thing; employees not only use the information captured earlier, they also input more information, or update the current ones. To ensure that only useful information is input into the KM system, the users must take part in the planning, design, and building of the system.

The final system should reflect the way the users execute their tasks, not the way the creator, or the management executes its tasks. If they find it slow and difficult to use, few or nobody will use the KM system and the organization will have failed to retain knowledge from leaving staff.

The benefits of using KM relate directly to bottom-line savings, however, other benefits are hard to quantify (Broadbent, 2008). In the contemporary business environment, organizations realize more benefits from tacit knowledge rather than explicit knowledge or physical assets, therefore, it must optimize the use of the captured knowledge.

To achieve maximum gains from intellectual assets, KM experts propose that knowledge must be shared and should serve as the basis for collaboration. Collaboration is not the end of process; without an effective business strategy, KM would be pointless (Snowden, 2002). As a result, an effective KM program should help an organization achieve the following:

Promote innovation by enhancing the free flow of knowledge;
Improve customer experience by cutting down the response time;
Increase returns by getting by improving its supply chain;
Improve employee retention rates by recognizing the contribution of staff to the organization, and motivating them;
Restructure operations and cut down costs by removing redundant or less important procedures;

Generally, an effective KM program can lead to improved efficiency, improved productivity, and growth in any organization.

Challenges to Implementing KM Strategies

One of the challenges to implementing KM strategies is to win the support of staff members. Some organizations have a tendency of ignoring employees in installing KM systems and this makes it hard to capture tacit knowledge. This difficulty can be resolved by selling the strategies to employees prior to launching them, because, after all, it is the same employees being asked to give up their knowledge and experience- the core qualities that make them important to the organization.

The second challenge is that KM requires constant maintenance. Similar to physical assets, the worth of knowledge depreciates with time, and must be updated, amended, and some of it deleted regularly. These processes require additional capital outlay. The final challenge to KM is handling large amounts of information. This makes it difficult to pick out knowledge from a sea of information.

References

Addicott, R., McGivern, G., and Ferlie, E. (2006). Networks, Organizational Learning and Knowledge Management: NHS Cancer Networks. Public Money & Management, 26 (2): 87–94.

Broadbent, M. (1998). The phenomenon of knowledge management: what does it mean to the information profession? Information Outlook, 2 (5): 23-36

Dalkir, K. (2007). Knowledge Management in Theory and Practice. Burlington, MA: Elsevier Butterworth- Heinemann

Ferguson, J. (2005). Bridging the gap between research and practice. Knowledge Management for Development Journal, 1 (3): 46–54.

Gupta, J., and Sharma, S. (2004). Creating Knowledge Based Organizations. Boston: Idea Group Publishing.

McInerney, C. (2002). Knowledge Management and the Dynamic Nature of Knowledge. Journal of the American Society for Information Science and Technology, 53 (12): 1009–1018.

Snowden, D. (2002). Complex Acts of Knowing – Paradox and Descriptive Self Awareness. Journal of Knowledge Management, Special Issue 6 (2): 100–111.

Wurman, S. (2001). Information Anxiety 2. Indianapolis: Que.

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