OCMT
KNOWLEDGE MANAGEMENT
UNIT I
INTRODUCTION TO KNOWLEDGE MANAGEMENT
Dr Uday
1–0
UNIT I - INTRODUCTION TO KNOWLEDGE MANAGEMENT
Learning objectives
1. Meaning and definition
2. Basic terminology: Data, information and knowledge
3. Characteristics of knowledge
4. Types of knowledge: Explicit and tacit
5. Difference between explicit and tacit knowledge
6. Concept of knowledge management
7. Benefits of knowledge management
8. Forces driving knowledge management
9. Intellectual capital: Types
10. Knowledge management system cycle
1–1
1. Knowledge Management: Meaning and
Definition
 Knowledge Management (KM) is a process of
acquiring, creating and sharing knowledge in
order to achieve the organizational objectives
by making the best use of the knowledge.
 KM is a group of systems and practices for
identifying, capturing, storing and disseminating
information
1–2
2. Basic terminology:
Data, Information and Knowledge
Old Py
– data
• information
– knowledge
» wisdom
Definition
Reason
DATA
INFORMATION
KNOWLEDGE
Raw facts, figures
and records
contained in a
system.
Data placed into
a form that is
accessible, timely
and accurate.
Processing
Storing /
Accessing.
Information in
context to make
it insightful and
relevant for
human action.
Insight,
innovation,
improvement.
Collection of facts,
measurements,
statistics
Organized data,
Contextual,
relevant,
actionable
information
3
3. Characteristics of knowledge
1.
2.
3.
4.
Explicitness
careful thoroughness of detail ; leaving nothing merely implied
Codifiability
Arranged in systematic collection
Teachability
suitability for use in teaching
Knowledge Specificity
Specific knowledge possessed
1–4
4. Types of Knowledge: Explicit and Tacit
1. Explicit: Explicit knowledge is the knowledge
that is codified, recorded, or actualized into
some form outside of the head
Eg.: Books, periodicals, journals, maps, photographs, audiorecordings, web pages, websites, portals
2. Tacit: Tacit knowledge is the knowledge that is
available from experience and insight, not in a
recorded form, but in our heads and intuition.
1–5
5. Explicit and Tacit: Differences
Documented information
that can facilitate action.
Explicit knowledge
Know-how & learning embedded
within the minds people.
Tacit (Implicit) knowledge
1. Formal or codified
1. Informal and un-codified
2. Documents: reports, policy
manuals, white papers,
standard procedures
2. Values, perspectives & culture
3. Databases
3. Knowledge in heads
4. Books, magazines, journals
(library)
4. Memories of staff, suppliers and
vendors
1–6
6. Concept of Knowledge Management
1. There are two general types of information, explicit
and tacit.
2. Tacit and Explicit Knowledge often conflict.
3. Not all information is valuable.
4. Need to recognize how people
communicate and share information
and knowledge
“I know that’s
what the
manual says,
but this is how
we really do it”
The explosion of
communication
modalities means
that you need a
triage function.
People know more than what they
say, and they say more than what
they write down.
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7. Benefits of KM
1.
2.
3.
4.
5.
Leveraging core business competencies
Accelerating innovation and time to market
Improving cycle times and decision making
Strengthening organizational commitment
Building sustainable competitive advantage
1–8
8. Forces driving KM
1.
2.
3.
4.
Increasing Domain Complexity
Accelerating Market Volatility
Intensified Speed of Responsiveness
Diminishing Individual Experience
1–9
Forces driving KM: Summary
1. Increasing Domain Complexity: Intricacy of internal and
external processes, increased competition, and the rapid advancement of
technology all contribute to increasing domain complexity.
2. Accelerating Market Volatility: The pace of change, or volatility,
within each market domain has increased rapidly in the past decade.
3. Intensified Speed of Responsiveness: The time required to take
action based upon subtle changes within and across domains is
decreasing.
4. Diminishing Individual Experience: High employee turnover
rates have resulted in individuals with decision-making authority having
less tenure within their organizations than ever before.
1–10
Increasing Domain Complexity
 Complexity of the underlying knowledge domains is increasing.
 Thus, complexity of the knowledge required to complete a specific
business process task has increased as well.
 Intricacy of internal and external processes, increased competition, and
the rapid advancement of technology all contribute to increasing domain
complexity.
 Example: New product development now typically requires:
- not only brainstorming sessions by freethinking product designers
- but also partnership of inter-organizational teams representing many
various functional subunits (finance, marketing, engineering, …)
 Professional recruiters increasingly emphasize not just excellent
educational and professional qualifications, but also have outstanding
communication and team collaboration skills…
 enabling them to share their knowledge for the benefit of the organization.
1–11
Accelerating Market Volatility
 The pace of change, or volatility, within each market domain has
increased rapidly in the past decade.
 Market and environmental influences can result in overnight changes in an
organization.
 Corporate announcements of a missed financial quarterly target could
send a company’s capitalization into a downward spiral.
- Along with their entire industry, sometimes!
 Stock prices have become increasingly volatile in recent years
- A result of “day trading” phenomenon (sharp increase in
nonfinancial professionals who are making a living from
exploiting steep market fluctuations).
1–12
Intensified Speed of Responsiveness

The time required to take action based upon subtle changes within and across domains is
decreasing.

Rapid advances in technology is continually changing the decision-making landscape.
- Decisions must be made and implemented quickly –
otherwise the window of opportunity closes.

Example: hotel booking business

- Yesterday… low-tech…
customer makes a request
individual sales representatives return to the office
discuss the opportunity with their manager
draft a proposal
mail the proposal to the client
client accepts or rejects the offer
- Today… with online auctioning/bidding markets…
hotel manager: “should I book a $200 room for the bid offer of $80 and fill the room,
or risk not accepting the bid hoping to get a walk-in customer that will pay the
$200?”
manager only has minutes after a bid offer to make the decision!
1–13
Diminishing Individual Experience
 High employee turnover rates have resulted in
individuals with decision-making authority having less
tenure within their organizations than ever before.
• Example: Fortune 300 CEOs
Proportion below age 50:
-1998: 5%
-2000: 15%
Median tenure in office:
-1998: 7 years
-2000: 5 years
1–14
9. Intellectual Capital: Types
1. Human capital
 The body of knowledge the company possesses
 Knowledge in the minds of Microsoft and Yahoo’s software
developers, researchers, academic collaborators, business
managers, …
 Also, knowledge in the minds of vendors and customers
2. Structural capital
 Everything that remains after the employees go home
 Copyrights, customer files, business process software, databases, software
manuals, trademarks, organizational structures, …
 In other words, organizational capability
 Intellectual capital is ubiquitous – but there are still no standard tools to
manage it as an asset!
1–15
10. Knowledge Management System Cycle
1.
2.
Creates knowledge through new
ways of doing things
Create
Identifies and captures new
knowledge
Capture
Knowledge
3.
Places knowledge into context so
it is usable
4.
Stores knowledge in repository
5.
Reviews for accuracy and
relevance
6.
Makes knowledge available at
all times to anyone
Refine
Disseminate
Manage
7.
Store
Disseminated knowledge
becomes tacit to become
explicit again in the cycle.
1–16