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Knowledge management
- 1. KNOWLEDGE MANAGAMENT by Morten T. Hansen, Nitin Nohria, Thomas Tierney Ahmed Ahmed Stefanie Schiefer Pasha Binyatov Uchenna Egbete Meera Segar Nadeen Alkaydi Niccolo Colatrella Università della Svizzera italiana, International Business, 2013
- 2. What is the knowledge? • Knowledge is the fact or condition of knowing something with familiarity gained through experience or association • In 1990s Università della Svizzera italiana, International Business, 2013 Natural Resources Intellectual Assets Industrialized economy
- 3. What is the knowledge management? Strategies and processes designed to identify, capture, structure, value, leverage, and share an organization's intellectual assets to enhance its performance and competitiveness. Università della Svizzera italiana, International Business, 2013 Knowledge management based on two critical activities: • capture and documentation of individual explicit and tacit knowledge • And its dissemination within the organization.
- 4. What is the explicit and tacit knowledge? Università della Svizzera italiana, International Business, 2013 Explicit knowledge Tacit knowledge • Explicit knowledge - is rational knowledge that can be expressed as data which includes theoretical approaches, problem solving, manuals and databases • Tacit knowledge – is experience based knowledge that can not be expressed as data which includes cognitive skills such as beliefs, images, intuition and mental models as well as technical skills such as craft and know- how.
- 5. Why is Knowledge Management important? Università della Svizzera italiana, International Business, 2013
- 6. Knowledge management in consulting business Università della Svizzera italiana, International Business, 2013 Consulting Business Codification Strategy Personalization Strategy • Codification strategy – in some companies knowledge is carefully codified and stored in databases to make it accessible by anyone in the company • Personalization strategy– in other companies knowledge is closely tied to the person who developed it this kind of knowledge shared through person to person contacts
- 7. Codification vs. Personalization Università della Svizzera italiana, International Business, 2013 Codification Personalization provide high-quality, reliable, fast information- systems Competitive Strategy provide creative, analytical advice Reusing codified knowledge Channeling individual expertise once investing in knowledge asset; reuse it many times Large teams with high ratio Economic Model Customized solutions to individual problems Small teams with low ratio Focus: generating large overall revenues Focus: maintaining high profit margins Electronic document to codify Knowledge Mgnt. Strategy Networks to link people People to documents Person to person
- 8. Codification vs. Personalization Università della Svizzera italiana, International Business, 2013 Codification Personalization Invest heavily in IT Information Technology Invest moderate in IT Goal: to connect people with reusable codified knowledge Goal: to facilitate conversations Train people in groups Human Resources Train people in one-to-one meetings Hire people who are well suited to reuse of knowledge Hire MBAs who like problem solving Focus: reward people for using/contributing to document databases Focus: reward people for directly sharing knowledge with others
- 9. Examples Codification vs. Personalization Università della Svizzera italiana, International Business, 2013 • Consultancies – Economics of reuse vs. experts economics – Exchange of knowledge between co-workers
- 10. Examples Codification vs. Personalization Università della Svizzera italiana, International Business, 2013 • Health Care and High Tech – Saves cost of doing business – Simplified service – Makes innovation easier – Knowledge is transferred between co-workers
- 11. Codification Vs. Personalization • Pick the best strategy. • Use knowledge effectively. • Do Not Straddle. • Do not Choose one over the other. • A firm cannot be equally perfect in both. • Very costly • Not fully effective • Need to excel on one more than the other. – Mix of Codification & Personalization. Università della Svizzera italiana, International Business, 2013
- 12. Problems with document-driven systems Major U.S company • Relying on a consulting company because of comfort. Bain consulting Company • Relying on documents only do not get full information needed. CSC Index and Straddling • Fully established both strategies. • Two kinds of staff: – Initial IT focus – Corporate Strategy focus • Both groups had different interests Clash! • Firm overtaken by rivals. • Lack of competitiveness. • Revenues went down. Università della Svizzera italiana, International Business, 2013
- 13. Getting The Incentives Right • People need incentives to participates in the knowledge sharing process. • The two knowledge management strategies call for different incentive systems. • In the codification model, managers need to develop a system that encourages people to write down what they know and to get those documents into the electronic repository. Università della Svizzera italiana, International Business, 2013
- 14. Getting The Incentives Right • The level and quality of employees’ contributions to the document database should be part of their annual performance reviews. • In the companies that are following the personalization approach, managers need to reward people for sharing knowledge directly with other people. Università della Svizzera italiana, International Business, 2013
- 15. Incentives & Technology Codification • Encourage employees to document knowledge. – Part of annual performance reviews. – E.g. Ernst & Young strategy. • Heavy investment in IT Personalization • Reward for sharing knowledge. – E.g. Bain strategy. • Low investment in IT Università della Svizzera italiana, International Business, 2013
- 16. Do Managers Need To Isolate Knowledge Management? • Some CEOs have put knowledge management at the top of their agendas. • Others have not given it the same attention as they have given cost cutting, restructuring, or international expansion. • Companies that isolate knowledge management risk losing its benefits, which are highest when it is coordinated with HR, IT, and competitive strategy. • That coordination requires the leadership of the general manager. Università della Svizzera italiana, International Business, 2013
- 17. Don’t Isolate Knowledge Management • When CEOs and general managers actively choose a knowledge management approach both the company and its customers benefit. • When top people fail to make such a choice both suffer. • Customers may end up paying for a customized solution when a standard solution would have worked perfectly well. • Within the organization, employees will be confused about priorities. Università della Svizzera italiana, International Business, 2013
- 18. Don’t Isolate Knowledge Management • The issue will quickly become politicized, and people will battle for resources without seeing the whole picture. • Only strong leadership can provide the direction a company needs to choose, implement, and overcome resistance to a new knowledge management strategy. Università della Svizzera italiana, International Business, 2013
- 19. Choosing the right strategy • Competitive strategy should drive the knowledge management strategy. • What values do customers expect from the company? • How does the knowledge that resides in the company add value to the customer? • Clear answers are needed to make a knowledge management strategy. Università della Svizzera italiana, International Business, 2013
- 20. • Do company’s offer Standardized or customized products? • Knowledge management is based on the reuse companies that create standardized products. • Customized products are unique and vary dramatically, KM brings limited value. • Do you have a mature or an innovative product? • Matured products normally benefit form the KM. • Do people rely on explicit or tacit knowledge to solve problems? • Tacit knowledge is hand to be codified whereas explicit can be easily stored. Università della Svizzera italiana, International Business, 2013 Choosing the right strategy
Notas do Editor
- In 1990s industrialized economies has shifted from natural resources to intellectual assets, companies started to think about the knowledge underlying their business and how that knowledge is used.
- - For example, Ernst & Young at performance reviews, consultants are evaluated along five dimensions, one of which is their “contribution to and utilization of the knowledge asset of the firm”. At Bain, the partners are evaluated each year on a variety of dimensions, including how much direct help they have given colleagues. The degree of high quality person to person dialogue a partner has had with others can account for as much as one quarter of his or her annual compensation. Ernst & Young is one of the world's leading professional services organizations, helps companies across the globe to identify and capitalize on business opportunities. http://www.ey.com/CH/en/home Bain & Company is a global management consulting firm. Our business is making companies more valuable. http://www.bain.com/