Organizations and companies are awash with information, ideas and strategies to help them conduct their operations effectively. However, most of these organizations do not recognize availability of such vital resource (information) in their operations. The inability to recognize and utilize this resource reduces their performance capacity as well as jeopardizing future prospects. This essay will evaluate the effective use of knowledge in organization. Further, the essay evaluates how knowledge management helps organizations in meeting strategic needs as per strategic objectives. Furthermore, the report will also endeavor to give an application of knowledge management in a hypothetical business organization.
Many scholars contend that defining ‘knowledge management’ is not an easy task. Some say that it is “an old wine in a new pot” while others assume that it is the “new wine in the old pot” (Gamble and Blackwell, 2001, p. 2). The debate on which comes first, the egg or the chicken, does not change the effectiveness new knowledge as vital competive tool in modern world.
Knowledge management therefore is a set of tools that facilitates the transfer of knowledge inside the business. The transfer of this information is undertaken by knowledge workers inside the organization who helps in conveying subjective knowledge to explicit or practical information. Gamble and Blackwell (2001, p. 3) asserts that regardless of the definition accorded to KM, it should be a working definition. Once ideas are tranformed to practical strategies organization can embark on working with the information to perk up performances and efficiency.
Murji Shah Corp is an international electronic organization that has a well-known brand name. The organization’s headquarters are based in India with other local and oversees banches in Europe, America, and Africa as well as in other Asian countries. Darwood Nazzi is the firm’s president and CEO at Murij Shah Corp. He is provided with steady support by the board of directors. The board of directors helps the management in decision making as well in implementation of the organization’s strategic plan.
The oversee branches have their managers who work under directions from the head office. Some functional managers such as the production, marketing, and information consultants are distributed to the field branches. However, the organization’s CEO, board of directors, Research and Development (R&D), Knowledge Officers (KO) and finance departments are located in the head office.
The main objective of the organization is to develop sustainable growth. Other objectives that govern the organization are; to ensure the firms meets all the needs of the client efficiently. The organization also strives to offer best quality in the market through continuous renovation and innovation of its product brands. It also endeavors to develop strong customer relationships to enhance mutual understanding. Finally, the firm aspires to diversify its operation to cover a wider geographical region in the end.
Murji Shah Corp’s strategic plan is embedded on the organization’s objectives and they entail expansionary outlook. The firm’s strategic plan is to have its up to date customer needs and information to adopt customer led production system. This would facilitate the organization to produce devices according to customer’s specifications. Secondly, the organization aims at broadening its brand name by offering quality in the market as well as through customer relations. The organition has also endeavor to have the ultra-modern information and communication systems to cover all its operations. Lastly, the organization seeks to remain true to its principles developing the best in technological development.
Murji Shah Corp has a wide range of product that it offers in to the market. The main brands are; both laptops and desktop computers, Microwaves, Fridges, Network switches, ipods and other accessories. Most of its products are produced in India while some are produced in the regional branches depending on the prevailing local production costs. In countries, which lack raw materials or have higher production costs finished products are ordered from other production zones. Mostly the organization outsources its personnel and staff to attract the best skills in the market.
Since Murji Shah is an international organization, it appeals to the entire world. The wide range of its customer base makes it difficult to do direct selling and therefore the orgnization carries out online market to accommodate distance clients. Similarly, the organization carries out online advertisement to popularize its products in the wider market. The organization has managed to acquire several distribution firms to be able to reach to its diverse customer base. Incase a customer places an online order, the marketing team carries out all logistics requirement and the customer will be advised to pick the product at the nearest branch or to a disginated local agent.
Just like other organizations, Murji Shah faces stiff competition from other electronic companies such as HP, Dell, and Toshiba. Likewise, solid competition also prevails in accessories and other brand products. To fend off this competion the organization relies heavily on the Knowledge Officers (KO), research, and development (R&D) to formulate modernities of gaining competitive advantages. One way that this has been done is by out sourcing employees from countries with low wage rates thus keeping production cost low. This has helped the organization to assume low cost market leadership strategy.
Current Knowledge management
Murji Shah Corp has relatively done well in the management of the organization knowledge. Owing to the fact that it has managed to successful venture into the international market, reveals that the organization has utilized the available information well. The Knowlede officers in Murji Shah Corp have been heavily relying on knowledge banks to obtain information. Knowledge banks entails public sources such internet and libraries that provide wide range of information and experiences of other organizations. Ruggles (1997, p. 176) argues that knowledge banks should be jointly utilized with other tools such as brainstorming session to synthesize information completely.
He further asserts that information that is obtained should deal with in a collaborative environment (176). The sole reliance on this tool to form the basis of their international decision has helped the organization although there is much information that has not been utilized by the firm. The organization failure to engage other techniques such as hypertext that provides in-depth analysis of the idea limits the effeciency of the organization performance (Fred et al, 2010, p. 343).
The organization’s knowledge officers, however, engage the marketing committee to critically analyse information obtained as well as internalize the outcome to best fit the organizations needs. In a wider perspective, the KO in its management practices buoys the management. Nevertheless, more need to be done to effectively run the organization as well as reaping absolute potential that is available in the market. Rodan (2002, p. 152) asserts that good knowledge management enhances innovation which forms a competitive force in a competitive environment.
Proposed Knowledge management system
Installation of a new knowledgement system is not an easy task; it requires a totall overhaul of the firm’s operation process (Harrington and Voehl, 2006, p. 35). The transformation entails restructuring the organizations management approach, culture, formation, but the outcomes are well worth the exertion. This being the case, Murji Shah will have to undertake a completely new direction in its performances in ordet to take advantage of knowledge leadership.
Rather than entirely relying on the knowledge banks, the organization needs to diversify its knowledge sources. One reliabnle source that can be used is Rapid Evidence Review (PER) tools. Rapid evidence review is a tool that allows management to consider the actions and the decisions which were done by others in formulating their decisions.Basically, all organizations decision are build on the prior knowledge and decision that were done other firm in the same field.
Adoption of PER helps Knowledge officers to speedly settle on a decision and avoid duplication of resources in decision-making process. PER procedure is a straightforward one that requires organization to group members into small groups that to deliberate on some issues. The identified themes are discussed profoundly to come up with substantial information. Then the sub-groups should discuss their outcome with the entire group and allow them to add their insights and recommendations. Once a concrete decision is attained, a report is generated on the modernities as well as criteria to be used in implemeting the decision (Leask et al, 2008, p. 12).
Fred et al (2010, p. 343) suggest that evaluation of previous works can be used in designing prototypes decisions. According to them, the prototypes should be done in a way that they will perfectly fit in the business context. Generation of prototypes it easier for the organization to test decision samples in real life situation. It is easier to deal with a sampled decision making process since it easier to follow up the implementation process. During the inplementation phase the organization can compare the results obtained againist the previous performances. If the actual performance shows an incremental outcome, the idea should be integrated in the firm’s strategic plan.
Davenport and Prusak (1998) contends that PER has four integral parts that are used in decision formulation namely; improvement of knowledge access, improvement of knowledge milieu, administration of knowledge as an asset and generation of information repositories. With all the four, the organization makes it posible for the management to access and utilize all the information that is available to improve the performance.
Availability of useful information will help employees to improve their performances and employability by enlarging resources present, hence allowing them to make smart judgments. Ideally, increase in information facilitates employees have a better understanding of the organizations strategic plan as well as enhancing their performances. Furthermore, information presented not only provides mere understanding of the organization strategic plan but they also internalize the entire blueprint.
Leask et al (2008, p. 3) suggest that a conducive knowledge information management should strive to link individual with information. In addition, it should also provide a platform to exercise collaborative working helps sharing of techniques. With this kind of working environment, managers are able to implement new ideas to unlock the hidden portentials.
Knowledge management Life Cycle
‘Knowledge management system life cycle’ constitutes a series of steps that are seamlessly linked (Harrington and Voehl, 2006, p. 35). The steps in developing knowledgemanagment are as shown below.
Fig1. Knowledge management lifecycle (Harrington and Voehl, 2006, p. 35).
Phase I: Creating Knowledge
Information is evenly disptributed and it occurs at any place, which include within the firm and outside the firm. Similarly, information occurs randomly at any time and therefore it is inportant for the knowledge officers to be alert to identify any new information. Knowledge emanates from an individual creative thought, ideas, observations or analysis (Malholtra, 2000, p. 223).
Phase II: Capturing Knowledge
Before capturing knowledge, it is important first to identify its value. The value of any information is classified into two categories, hard (explict) and soft (tacit). Once this information is captured the KO will have ample time in processing the idea to produce vital knowledge.
Phase III: Transfering Knowledge
This phase entails converting the ideas generated into a mode that will be easily understood by the stakeholders and the management. This is crucial because some new ideas are ignored simply because they seem worthless. Now, systems should be set up to provide periodical updates to the existing information to avoid information redundancy.
Phase IV: Sharing knowledge
This entails disseminating knowledge collected to relevant departments and action points. This informationis distributed through certain portal as well as other social evenues of sharing information, such as telephones, face-to-face, internet and social chat rooms. This is the most important phase since wrong communication will damage the entire process and hence all parties involved should be very cautious. Conversely, most individuals fear that sharing information cost them personal competitiveness and therefore they prefer remaining silent (Harrington and Voehl, 2006, 35). At this phase, some new ideas are generated and they require capturing husnce they are send back the second stage.
Phase V: Using Knowledge
It is at this point that KMS pays off. Giving out experiences and other information reduces chances of errors from entering into the process. Thus, better responses and feedback are generated to enhance exploitation of the organization opportunities. Sometimes new ideas are generated at this stage and such ideas are refered to the initial stage for further consideration and evaluation.
Phase IV: Disposal of Knowledge
When new ideas are generated, the organization adopts better ways of working as well as assuming superior practices. As the organization install new operation method, keen interest should prevail in disposisng the old systme to avoid loosing historical data that forms the integral part the operation of the organization. Additionally, incase the new system fails to work effectively, the organization may opt to resort to the initial practices hence the old system may still be important.
Importance of the new Knowledge Management System (KMS)
Implementation of the new and effective KMS supplies the organization with numerous opportunities and better way of doing things. The new system will enhance availability of relevant customer information. This information will help Sharji Shah to develop new and superior electronics to meet the need of the customers more efficiently. Utilization of new knowledge makes it possible to shorten new product development cycle.
By reducing the cycle, the organization cuts down on development cost. The other merit that is associated with shorter cycle is the availability of the organization to provide the prduct promptly in the market. For instance when an opportunity emerges Sharji Shah having a shorter production cycle will be able to take advantage before other firms provides their products. Similarly, the organization will stand a better chance to fully exploit all available opportunity both in international market as well as in the local market.
Generally, large organization often finds it difficult to transmit information from the source to all its subsidiaries departmnets and organs. Nonetheless, effective knowledge mangment helps the organization to improve its horizontal information sharing, communications across departments and funtion groups are addressed (Organization for Economic Co-operation and Development, 2004, p. 176). The knowledge officers will be able to transmit the information to the organization with ease and more effective.
Since the knowledge officers, transform subjective information to objective ideas it becomes more user friendly. From a survey done by Organization for Economic Co-operation and Development (2004, p. 176) it was revealed that employees are eager to learn and use new information in their production. However, it was also evident that it is usually to insert a line to distingush new knowledge from the existing knowledge.
Failure to illustrate effectively new knowledge may also cause disjointed response from employees. The applicability of the information makes it easier for junior and subordinate employees to implement the information provide. After working on the information available, the organization develops a culture of taking risks and using all the opportunities available to strengthen its performance. Likewise, it becomes apparent that organization will improve information transmission platform to allow speedy and reliable conveyance. With current diverse geographical outlook, the organization needs reliable and effective information system to obtain prompt feedback.
Information management plays a pivotal role in developing business networks. With business networks business stands a better chance to obtain market information especially availability of opportunities in the market. Conversely, business networks are also ensential in formation of mergers and acquisition. These networks are essential especially when the organization finds it difficult to venture in a new market niche.
Elimination of entry barriers forms a podium for organization to find opportunities as well as increasing the market position. Conversely, according to a research that was done by Organization of Economic Co-operation and Development (2004, p. 175), 60 per cent of the responded disagreed that do not see the impact of forming networks in formation of mergers. Thus, KMS will help Sharji Shah to obtain important information to plan for mergers as well as tapping new markets.
According to a survey, which was done by the Organization for Economic Co-operation (2004, p. 177) it was identified that effective knowledge management increases the firm’s competitive advantage by 92 per cent. Similarly, the survey revealed that KM helps a firm to increase employee retention by 72 per cent. Reduction of employee’s turnover helps the firm to safeguard it information since employee are the custodian of the firm’s internal secrets and knowledge.
Once such information is secured, the organization minimizes chance of information from leaking to the competitors. Should Sharji Shah safeguard its internal secrets, it becomes difficult for the competing firms to anticipate action plan of the firm and its short-term strategies. These observations are in line with the firm management theory since the overall aim of adorpting any management practice is to improve performance as well as enhancing competiveness (Organization for Economic Co-operation and Development, 2004, p. 178).
Knowledge managment plays a fundamental role in the success of modern business firms. However, many organizations find it difficult to identify new ideas and opportunities that exist in the market and hence they fail to take advantages presented. On its part, Shah Corp has a functioning KMS; although it is operational, it is not fully effective. Should the organization effectively implement the system recommended in this essay, the organization will improve its productivity. Furthermore, effective knowledge management will be instrumental towards efficient and effective implementation of its strategic plan. Knowledge is power when it is effectively used. However, if knowledge is mismanaged it would have adverse effects on the organization.
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