1. Chapter 11: Knowledge Management
Decision Support and Business Intelligence Systems (9th Ed., Prentice Hall)
Chapter 11:
Knowledge Management

2. Learning Objectives
Define knowledge and describe the different types of knowledge
Describe the characteristics of knowledge management
Describe organizational learning and its relationship to knowledge management
Describe the knowledge management cycle
Describe the technologies that can be used in a knowledge management system

3. Learning Objectives
Describe different approaches to knowledge management
Describe the chief knowledge officer and others involved in knowledge management
Describe the role of knowledge management in organizational activities
Describe the different ways of evaluating intellectual capital in an organization
Describe how Knowledge Management Systems (KMS) are implemented

4. Learning Objectives
Describe the roles of technology, people, and management in knowledge management
Describe the benefits and drawbacks of knowledge management initiatives
Describe how knowledge management can revolutionize the way an organization functions
The future of KN: Web 2.0 and beyond…

5. Opening Vignette:
“MITRE Knows What It Knows Through Knowledge Management”
Company background
Problem description
Proposed solution
Results
Answer and discuss the case questions

7. Opening Vignette: MITRE’s View to the KM Process

8. Introduction to Knowledge Management

9. Introduction to Knowledge Management

10. Introduction to Knowledge Management

11. Introduction to Knowledge Management
Knowledge management concepts and definitions
Knowledge management
The active management of the expertise in an organization. It involves collecting, categorizing, and disseminating knowledge
Intellectual capital
The invaluable knowledge of an organization’s employees

12. Introduction to Knowledge Management
Knowledge is
information that is contextual, relevant, and actionable
understanding, awareness, or familiarity acquired through education or experience
anything that has been learned, perceived, discovered, inferred, or understood.
In a knowledge management system, “knowledge is information in action”

13. Introduction to Knowledge Management

14. Introduction to Knowledge Management
Characteristics of knowledge
Extraordinary leverage and increasing returns
Fragmentation, leakage and the need to refresh
Uncertain value
Uncertain value of sharing
Knowledge-based economy
The economic shift from natural resources to intellectual assets

15. Introduction to Knowledge Management
Explicit and tacit knowledge
Explicit (leaky) knowledge
Knowledge that deals with objective, rational, and technical material (data, policies, procedures, software, documents, etc.)
Easily documented, transferred, taught and learned
Examples…

16. Introduction to Knowledge Management
Explicit and tacit knowledge
Tacit (embedded) knowledge
Knowledge that is usually in the domain of subjective, cognitive, and experiential learning
It is highly personal and hard to formalize
Hard to document, transfer, teach and learn
Involves a lot of human interpretation
Examples…

17. Introduction to Knowledge Management
Knowledge management systems (KMS)
A system that facilitates knowledge management by ensuring knowledge flow from the person(s) who know to the person(s) who need to know throughout the organization; knowledge evolves and grows during the process

18. Organizational Learning and Transformation
Learning organization
An organization capable of learning from its past experience, implying the existence of an organizational memory and a means to save, represent, and share it through its personnel
Organizational (corporate) memory
Repository of what the organization “knows”

19. Organizational Learning and Transformation
Development of new knowledge and insights that have the potential to influence organization’s behavior
The process of capturing knowledge and making it available enterprise-wide
Need to establish corporate memory
Modern IT helps…
People issues are the most important!

20. Organizational Learning and Transformation
Organizational culture
The aggregate attitudes in an organization concerning a certain issue (e.g., technology, computers, DSS)
How do people learn the “culture”?
Is it explicit or implicit?
Can culture be changed? How?
Give some examples of corporate culture: Microsoft, Google, Apple, HP, GM, …

21. Organizational Learning and Transformation
Why people don’t like to share knowledge:
Lack of time to share knowledge and time to identify colleagues in need of specific knowledge
Fear that sharing may jeopardize one’s job security
Low awareness and realization of the value and benefit of the knowledge others possess
Dominance in sharing explicit over tacit knowledge
Use of a strong hierarchy, position-based status, and formal power
Insufficient capture, evaluation, feedback, communication, and tolerance of past mistakes

22. Organizational Learning and Transformation
Why people don’t like to share knowledge:
Differences in experience and education levels
Lack of contact time and interaction between knowledge sources and recipients
Poor verbal/written communication and interpersonal skills
Age, gender, cultural and ethical defenses
Lack of a social network
Ownership of intellectual property
Lack of trust in people because they may misuse knowledge or take unjust credit for it
Perceived lack of accuracy/credibility of knowledge

23. Knowledge Management Activities
Knowledge management initiatives and activities
Most knowledge management initiatives have one of three aims:
To make knowledge visible
To develop a knowledge-intensive culture
To build a knowledge infrastructure

24. Knowledge Management Activities
Knowledge creation is the generation of new insights, ideas, or routines
Four modes of knowledge creation:
Socialization
Externalization
Internalization
Combination
Analytics-based knowledge creation?

25. Knowledge Management Activities
Knowledge sharing
Knowledge sharing is the willful explication of one person’s ideas, insights, experiences to another individual either via an intermediary or directly
In many organizations, information and knowledge are not considered organizational resources to be shared but individual competitive weapons to be kept private

26. Knowledge Management Activities
Knowledge seeking
Knowledge seeking (knowledge sourcing) is the search for and use of internal organizational knowledge
Lack of time or lack of reward may hinder the sharing of knowledge or knowledge seeking

27. Approaches to Knowledge Management
Process approach to knowledge management attempts to codify organizational knowledge through formalized controls, processes and technologies
Focuses on explicit knowledge and IT
Practice approach focuses on building the social environments or communities of practice necessary to facilitate the sharing of tacit understanding
Focuses on tacit knowledge and socialization

28. Approaches to Knowledge Management
Hybrid approaches to knowledge management
The practice approach is used so that a repository stores only explicit knowledge that is relatively easy to document
Tacit knowledge initially stored in the repository is contact information about experts and their areas of expertise
Increasing the amount of tacit knowledge over time eventually leads to the attainment of a true process approach
Hybrid at
80/20 to
50/50

29. Knowledge Management - A Demand Led Business Activity
Supply-driven vs. demand-driven KM

30. Approaches to Knowledge Management
Best practices
In an organization, the best methods for solving problems. These are often stored in the knowledge repository of a knowledge management system
Knowledge repository is the actual storage location of knowledge in a knowledge management system. Similar in nature to a database, but generally text-oriented

31. Approaches to Knowledge Management
A Comprehensive View to Knowledge Repository

32. Approaches to Knowledge Management
Developing a knowledge repository
Knowledge repositories are developed using several different storage mechanisms in combination
The most important aspects and difficult issues are making the contribution of knowledge relatively easy for the contributor and determining a good method for cataloging the knowledge

33. Information Technology (IT) in Knowledge Management
The KMS cycle
KMS usually follow a six-step cycle:
Create knowledge
Capture knowledge
Refine knowledge
Store knowledge
Manage knowledge
Disseminate knowledge

34. Information Technology (IT) in Knowledge Management
The Cyclic Model of Knowledge Management

35. Information Technology (IT) in Knowledge Management
Components of KMS
KMS are developed using three sets of core technologies:
Communication
Collaboration
Storage and retrieval
Technologies that support KM
Artificial intelligence
Intelligent agents
Knowledge discovery in databases
Extensible Markup Language (XML)

36. Information Technology (IT) in Knowledge Management
Components of KMS
KMS are developed using three sets of core technologies:
Communication
Collaboration
Storage and retrieval
Technologies that support KM
Artificial intelligence
Intelligent agents
Knowledge discovery in databases
Extensible Markup Language (XML)

37. Information Technology (IT) in Knowledge Management
Artificial intelligence
AI methods used in KMS:
Assist in and enhance searching knowledge
Help for knowledge representation (e.g., ES)
Help establish knowledge profiles of individuals and groups
Help determine the relative importance of knowledge when it is contributed to and accessed from the knowledge repository

38. Information Technology (IT) in Knowledge Management
AI methods used in KMS:
Scan , documents, and databases to perform knowledge discovery, determine meaningful relationships and rules
Identify patterns in data (usually through neural networks and other data mining techniques)
Forecast future results by using data/knowledge
Provide advice directly from knowledge by using neural networks or expert systems
Provide a natural language or voice command–driven user interface for a KMS

39. Information Technology (IT) in Knowledge Management
Components of KMS
KMS are developed using three sets of core technologies:
Communication
Collaboration
Storage and retrieval
Technologies that support KM
Artificial intelligence
Intelligent agents
Knowledge discovery in databases
Extensible Markup Language (XML)

40. Information Technology (IT) in Knowledge Management
Intelligent agents
Intelligent agents are software systems that learn how users work and provide assistance in their daily tasks
They are used to elicit and identify knowledge
See ibm.com, gentia.com for examples
Combined with enterprise knowledge portal to proactively disseminate knowledge

41. Information Technology (IT) in Knowledge Management
Components of KMS
KMS are developed using three sets of core technologies:
Communication
Collaboration
Storage and retrieval
Technologies that support KM
Artificial intelligence
Intelligent agents
Knowledge discovery in databases
Extensible Markup Language (XML)

42. Information Technology (IT) in Knowledge Management
Knowledge discovery in databases (KDD)
A machine learning process that performs rule induction, or a related procedure to establish (or create) knowledge from large databases
a.k.a. Data Mining (and/or Text Mining)

43. Information Technology (IT) in Knowledge Management
Model marts
Small, generally departmental repositories of knowledge created by employing knowledge-discovery techniques on past decision instances. Similar to data marts
Model warehouses
Large, generally enterprise-wide repositories of knowledge created by employing knowledge-discovery techniques. Similar to data warehouses

44. Information Technology (IT) in Knowledge Management
Components of KMS
KMS are developed using three sets of core technologies:
Communication
Collaboration
Storage and retrieval
Technologies that support KM
Artificial intelligence
Intelligent agents
Knowledge discovery in databases
Extensible Markup Language (XML)

45. Information Technology (IT) in Knowledge Management
Extensible Markup Language (XML)
XML enables standardized representations of data structures so that data can be processed appropriately by heterogeneous information systems without case-by-case programming or human intervention
Web 2.0
The evolution of the Web from statically disseminating information to collaboratively creating and sharing information

46. KM System Implementation

47. KM System Implementation
Knowledge management products and vendors
Knowware
Technology tools (software/hardware products) that support knowledge management
Software development companies / vendors
Collaborative computing tools
Knowledge servers
Enterprise knowledge portals (EKP)
An electronic doorway into a knowledge management system…

48. KM System Implementation
Software development companies / vendors
Electronic document management (EDM)
A method for processing documents electronically, including capture, storage, retrieval, manipulation, and presentation
Content management systems (CMS)
An electronic document management system that produces dynamic versions of documents, and automatically maintains the current set for use at the enterprise level

49. KM System Implementation
Software development tools
Knowledge harvesting tools
Search engines
Knowledge management suites
Knowledge management consulting firms

50. Knowledge harvesting tools

51. Knowledge Management Suites

52. Knowledge management consulting firm

53. KMS Implementation
Integration of KMS with other business information systems
With DSS/BI Systems
With AI
With databases and information systems
With CRM systems
With SCM systems
With corporate intranets and extranets

54. Roles of People in Knowledge Management
Chief knowledge officer (CKO)
The person in charge of a knowledge management effort in an organization
Sets KM strategic priorities
Establishes a repository of best practices
Gains a commitment from senior executives
Teaches information seekers how to better elicit it
Creates a process for managing intellectual assets
Obtain customer satisfaction information
Globalizes knowledge management

55. Roles of People in Knowledge Management
Skills required of a CKO include:
Interpersonal communication skills
Leadership skills
Business acumen
Strategic thinking
Collaboration skills
The ability to institute effective educational programs
An understanding of IT and its role in advancing knowledge management

56. Roles of People in Knowledge Management
The CEO, other chief officers, and managers
The CEO is responsible for championing a knowledge management effort
The officers make available the resources needed to get the job done
CFO ensures that the financial resources are available
COO ensures that people begin to embed knowledge management practices into their daily work processes
CIO ensures IT resources are available
Managers also support the KM efforts by providing access to sources of knowledge

57. Roles of People in Knowledge Management
Community of practice (CoP)
A group of people in an organization with a common professional interest, often self-organized for managing knowledge in a knowledge management system
See Application Case 11.7 as an example of how Xerox successfully improved practices and cost savings through CoP

58. Roles of People in Knowledge Management
KMS developers
The team members who actually develop the system
Internal + External
KMS staff
Enterprise-wide KMS require a full-time staff to catalog and manage the knowledge

59. Ensuring the Success of Knowledge Management Efforts
Success stories of knowledge management
Implementing a good KM strategy can:
Reduce…
loss of intellectual capital
costs by decreasing the number of times the company must repeatedly solve the same problem
redundancy of knowledge-based activities
Increase…
productivity
employee satisfaction

60. Ensuring the Success of Knowledge Management Efforts
MAKE: Most Admired Knowledge Enterprises
“Annually identifying the best practitioners of KM”
Criteria (performance dimensions):
Creating a knowledge-driven corporate culture
Developing knowledge workers through leadership
Fostering innovation
Maximizing enterprise intellectual capital
Creating an environment for collaborative knowledge sharing
Facilitating organizational learning
Delivering value based on stakeholder knowledge
Transforming enterprise knowledge into stakeholders’ value

61. Ensuring the Success of Knowledge Management Efforts
MAKE: Most Admired Knowledge Enterprises
“Annually identifying the best practitioners of KM”
2008 Winners:
McKinsey & Company
Google
Royal Dutch Shell
Toyota
Wikipedia
Honda
Apple
Fluor
Microsoft
PricewaterhouseCoopers
Ernst & Young
IBM
Schlumberger
Samsung Group BP
Unilever
Accenture …

62. Ensuring the Success of Knowledge Management Efforts
Useful applications of KMS
Finding experts electronically and using expert location systems
Expert location systems (know-who)
Interactive computerized systems that help employees find and connect with colleagues who have expertise required for specific problems—whether they are across the county or across the room—in order to solve specific, critical business problems in seconds

63. Ensuring the Success of Knowledge Management Efforts
Knowledge management valuation
Financial metrics for knowledge management valuation
Focus knowledge management projects on specific business problems that can be easily quantified
When the problems are solved, the value and benefits of the system become apparent

64. Ensuring the Success of Knowledge Management Efforts
Knowledge management valuation
Nonfinancial metrics for knowledge management valuation—new ways to view capital when evaluating intangibles:
Customer goodwill
External relationship capital
Structural capital
Human capital
Social capital
Environmental capital

65. Ensuring the Success of Knowledge Management Efforts
Causes of knowledge management failure
The effort mainly relies on technology and does not address whether the proposed system will meet the needs and objectives of the organization and its individuals
Lack of emphasis on human aspects
Lack of commitment
Failure to provide reasonable incentive for people to use the system…

66. Ensuring the Success of Knowledge Management Efforts
Factors that lead to knowledge management success
A link to a firm’s economic value, to demonstrate financial viability and maintain executive sponsorship
A technical and organizational infrastructure on which to build
A standard, flexible knowledge structure to match the way the organization performs work and uses knowledge

67. Ensuring the Success of Knowledge Management Efforts
Factors that lead to knowledge management success
A knowledge-friendly culture that leads directly to user support
A clear purpose and language, to encourage users to buy into the system
A change in motivational practices, to create a culture of sharing
Multiple channels for knowledge transfer

68. Ensuring the Success of Knowledge Management Efforts
Factors that lead to knowledge management success
A significant process orientation and valuation to make a knowledge management effort worthwhile
Nontrivial motivational methods to encourage users to contribute and use knowledge
Senior management support

69. Last words on KM Knowledge is an intellectual asset
IT is “just” an important enabler
Proper management of knowledge is a necessary ingredient for success
Key issues:
Organizational culture
Executive sponsorship
Measurement of success

70. End of the Chapter
Questions / comments…

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Copyright © 2011 Pearson Education, Inc.  
Publishing as Prentice Hall