KNOWLEDGE MANAGEMENT IN ORGANIZATION

Knowledge management in organization

Knowledge management in organization

Introduction

Knowledge management (KM) is a rapidly growing field that crosses diverse disciplines such as psychology and information systems. KM is often referred to as organizational learning, organizational memory, and expertise management (Thomas et al., 2001). In fact, KM can be viewed as a conceptually complex, evolving, broad umbrella of issues and viewpoints. Traditionally, organizational knowledge needs to become a stable resource if it can be translated into a profitable venue for information sharing. There is a growing rate of turnover among managers and/or knowledge workers who accumulate organization-specific knowledge that are ultimately lost to the firm and possibly gained by their competitors.

Knowledge needs to be captured, interpreted, and eventually transferred in such a manner that the knowledge will continue to serve the organization, regardless of the individuals' original purpose for collecting the information. Given the strategic emphasis on creativity (Mintzberg, 2001a,b; Pfeffer et al., 1995), the most valuable resources available to any organization are human skills, expertise, and relationships. Hence, upper management should capitalize on these assets in determining a KM strategy that is appropriate for the business enterprise (Allee, 1997; Duffy, 2001; Ahanotu, 1998).

Hansen et al. (1999) suggested that there are at least two types of strategies for managing knowledge. They are the codification strategy and the personalization strategy. The codification strategy necessitates storing knowledge into various databases where it can be easily retrieved by anyone in the organization. Codification strategy is where knowledge is carefully codified and stored in databases, where it can be accessed and used easily by anyone in the company. Personalization strategy is where knowledge is closely tied to the person who developed it and is shared mainly through direct person-to-person contacts. To achieve competitive advantage, both of these strategies are important and each strategy can be used depending on the type of business. Specifically, computers are to be used to communicate information, not to store it. However, if a firm's IT policy results in emphasizing the wrong strategy or trying to pursue both simultaneously can quickly undermine a business' competitive status.

Knowledge management in organization

Companies such as Ernst & Young (www.ey.com), a global professional services organization, have used the codification strategy since they frequently reuse their knowledge to achieve long-term advantage and economies of scale. This approach allows people to retrieve knowledge without having to contact the person that originally developed it. By contrast, the Boston Consulting Group (www.bcg.com), an international strategy-consulting organization, has focused on the personalization strategy because they primarily focus on individuals and connect with a number of individuals, not knowledge objects in a database. These firms use e-document (electronic document) systems, but they use them to scan documents to find out who has done the work on a topic, not specifically for the document's content. Hence, a company's KM strategy should reflect its competitive strategy of how it creates value for customers, how that value supports an economic model, and how the company's people deliver on the value (Smith and Offodile, ...