In
the recent past, as work
has been shifted from ‘hands to mind’, knowledge and knowledge management have generated a lot of
interest among corporate leaders. It is, of course, the advent of information
society that brought knowledge and the importance of its management within
organizations to the forefront. It doesn’t mean that there was no knowledge
earlier and people were not concerned about it. Knowledge has been with us
since mankind came into existence. Indeed, it is the accumulation of knowledge over
centuries and its application that transformed the agrarian society into an
industrial society and ultimately into an information society. The only
difference between the past and the present is that today, knowledge has become
one of the key factors of production.
Teece,
Pisano and Shuen (1997) aver that organizations with superior knowledge can
combine traditional assets to bring out new and superior products/services that
can provide superior value to customers. Dess and Picken (1999) also believe
that it is the superior knowledge rather than the physical resources which can
enable companies to compete and do better than their rivals, even when their
other resources are not that unique. It is being increasingly felt that the
embedded and intangible capability arising from superior knowledge alone gives
the organization the capability to exploit the physical resources and systems
for withering out global competition and, at the same time, create confidence
among its stakeholders about its potential for future value creation (Rob
Sharkie, 2004).
John
Browne[1],
head of British Petroleum, in one of his interviews said: “Knowledge, ideas,
and innovative solutions are being defused throughout the world today at a
speed that would have been unimaginable ten or twenty years ago. He went on to
say “to generate extraordinary value for shareholders, a company has to learn
better than its competitors and apply that knowledge throughout its businesses
faster and more widely…” He also made an exciting observation: “the wonderful
thing about knowledge is that it is relatively inexpensive to replicate if you
can capture it”. Against this background, this article attempts to define what
knowledge is, what for and how knowledge management is accomplished and the key
role of human resources in effective knowledge management.
1. Knowledge and its Varied Facets
Knowledge,
according to the Webster Dictionary, is “the fact or condition of knowing
something with familiarity gained through experience or association”. According
to Davenport and Prusak, 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. In organizations, it often becomes embedded not
only in documents or repositories but also in organizational routines,
processes, practices, and norms.[2]
In
the context of knowledge management in organizations, knowledge does not
necessarily mean what is there in journals and books, for that is only
information. It is only what is read, manipulated, communicated and embedded in
the employees’ minds that becomes the organizational knowledge. Knowledge in
the context of an organization, is often referred to as intellectual capital,
which comprises –
- Human capital – it is the people’s knowledge, learning, motivation and commitment;
- Organizational capital – it encompasses the processes, systems, management practices, brands, IPRs and the very culture of the organization; and
- External network capital – consists of customer relations, sub-contracts and its very image and reputation in the market.
It
is said that knowledge is the result of processed information, experiential
learning and shared interpretation, and that knowledge provides the company
competency and the competitive edge. Knowledge
is distinct from both data and information and it is essential, as Davenport
and Prusak (1998) said, to understand these three terms for “doing knowledge
work successfully”. Data are “discrete, objective facts about events”. There is
no inherent meaning in data. It is more like raw material of decision-making
but by itself cannot say what to do. On the other hand, information is “communication
concerning some fact or circumstance”. Peter Drucker said that information is
“data endowed with relevance and purpose. It simply adds meaning to data. As
against these two, knowledge is information distilled and interpreted and thus
acquires a purpose. In other words, when purpose is added to information it
becomes knowledge.
Davenport
and Prusak (1998) suggest the following components as the contributors to
knowledge:
- Experience – knowledge develops over time as experience provides a perspective from which to understand the new event.
- Practical utility – it enables one to distinguish what ‘should’ work from what really does. It is something like the difference between what was read from the book and what really happens in the business.
- Speed – it enables the knowledge possessor to recognize patterns and offer shortcuts to solution instead of starting from scratch.
- Complexity – it helps handle complexity with clarity and comfort.
- Evolution – since the key to knowledge is knowing what one does not know, even the knowledgeable gets refined with further experience.
In
the context of knowledge management, it is the employees of the organization
who provide the knowledge. They generally possess two distinct kinds of
knowledge: Explicit Knowledge and Tacit Knowledge. Tacit knowledge is mostly
supposed to exist only in the human minds. It is considered a by-product of
interaction of people among themselves and with the environment. It remains in
the unconscious and maybe we are not even aware of its existence. To put it
otherwise, “we can know more of it than being able to talk about it”. It means
employees often know far more than what they realize. Over the years of doing a
particular job, employees, as Stewart (1999) observed, develop “huge
repertoires of skills, information and ways of working that they have
internalized to the point of obviousness”. It is so embedded in the possessor’s
mind that they no longer think of it but simply do it.
On
the other hand, explicit knowledge is that “which is easily codified and shared
asynchronously”. For instance, a computer servicing company can list probable
failures that can be anticipated based on past experiences and also record
plausible remedies for all such problems and make them available for its
servicing workforce as an operating guide for future use. Similarly, a
five-star hotel can document the ingredients and process involved in making a Chinese
dish and make it available for a new chef to master its making through a few
trials. The Know-how’, that results from the conversion of tacit knowledge into
explicit knowledge can be transferred to others through a well-structured
learning process.
There
is yet another dimension to knowledge: missing knowledge. It is that knowledge
which employees need but do not have to do their jobs. In the context of
knowledge management, it is critical for the organizations to identify that
missing knowledge and create a mechanism that enables them to identify active
missing knowledge and work towards filling that gap.
[1]
“Unleashing the Power of Learning: An Interview with British Petroleum’s John
Browne”, Harvard Business Review, September-October
1997.
[2]
Davenport, T H and Prusak, L (1998), Working
Knowledge: How Organizations Manage What They Know, Boston, MA: Harvard
Business School Press.
....To be continued
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