1 Introduction: The Problems and Importance of Knowledge Management

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1 Introduction The Problems and Importance of
Knowledge Management

• By
• B. Nugroho Budi Priyanto
• Ref. Tiwana chapter 1 2

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Long before terms

• Expert system
• Core competencies
• Best practices
• Learning organizations
• Corporate memory
• The only sustainable source of competitive
  advantage is their knowledge.
• Drucker those who wait until this challenge
  indeed becomes a hot issue are likely to fall
  behind, perhaps never to recover.

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Eras of knowledge management
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Why knowledge

• Knowledge management is evident.
• 98 of senior manager of KPMG survey believe the
  reality of KM
• London Times calls it the fifth discipline
  after business strategy, accounting, marketing
  and human resources
• 40 of the US economy is directly attributable to
  the creation of intellectual capital

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Whats knowledge?

• Working definition of knowledge by Thomas
  Davenport and Laurence Prusak
• Knowledge is a fluid mix of framed experience,
  values, contextual information, expert insight
  and grounded intuition that provides and
  environment and framework for evaluating and
  incorporating new experiences and information. It
  originates and is applied in the minds of
  knowers. In organizations, it often becomes
  embedded not only in documents or repositories
  but also in organizational routines, processes,
  practices, and norms.

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Whats Knowledge Management

• According to Kirk Klasson
• KM is the ability to create and retain greater
  value from core business competencies.
• KM address business problems particular to your
  business
• Whether its creating and delivering innovative
  products or services
• Managing and enhancing relationships with
  existing and new customers, partners, and
  suppliers
• Or administering and improving work practices and
  processes.

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KMs value proposition

• Why we have to manage the knowledge in very
  competitive era?
• Companies are becoming knowledge intensive, not
  capital intensive
• Unstable markets necessitate organized
  abandonment
• KM lets you lead change so change does not lead
  you
• Only the knowledgeable survive
• Cross-industry amalgamation is breeding
  complexity
• Knowledge can drive decision support like no
  other
• Knowledge requires sharing IT barely support
  sharing
• Tacit knowledge is mobile
• Your competitors are no longer just on your
  region.

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Managers tools through the decades

• 1950s PERT
• Focus shifts toward distributed expertise
  knowledge
• 1960s Centralization Decentralization
• Tacit knowledge becomes a part of the picture
• 1970s The Experience Curve
• Cultural specificity is recognized
• 1980s Corporate culture
• Learning, unlearning and experience are taken
  into account
• 1990s The Learning Organization
• KM emerges as the unifying corporate goal
• 2000s Knowledge Management

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In a global economy

• Davenport and Prusak suggest
• Knowledge may be your companys greatest
  competitive advantage

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Why should KM

• Two types of companies
• Realized the need to keep up with its competitors
  and remain legitimate player
• One step ahead it already has the core knowledge
  necessary

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Whats behind the Buzz?

• KM is not technology problem it is a process
  problem

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What KM is not about

• KM is not about knowledge engineering
• KM is about process, not just digital networks.
• KM is not about building a smarter intranet.
• KM is not about a one-time investment
• KM is not about enterprise-wide infobahns
• KM is not about capture

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The growth of KM

• Tom Davenports 1998 bestseller, Working
  Knowledge How Organizations Manage What They
  Know, Havard Business School Press.
• Ikujiro Nonaka, 1995 The Knowledge Creating
  Company, Oxford University Press. (in 1991
  Havard Business Review paper)
• Peter Drucker, 1993 The Post Capitalist
  Society, Harper Business Press

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The 10-Step Roadmap

• Identify Knowledge that is critical to your
  business
• Align business strategy and KM
• Analyze knowledge existing in your company
• Build upon, not discard existing IT investment
• Focus on processes, and tacit, not just explicit
  knowledge
• Design a future-proof, adaptable KM system
  architecture
• Build and deploy a result-driven KM system
• Implement reward structures, leadership, and
  cultural enablers needed to make KM work
• Calculate ROI and apply Knowledge Metrics
• Learn from war stories

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The Knowledge Edge
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Getting to why The New World

• Market value of company is not related to their
  assets annual sales, eg
• MS 14B12B, have MV 400B
• Far exceeding than GM, Ford Mitsubishi combine
  (with rank lt 10 in Fortune 500)
• Intel 28B25B, have MV 130B
• Accounting for Abnormal Differences
• Market valuation the measure value that
  investors and market associate with a company

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Top 15 US Companies
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• Ford, Chrysler, nor Mitsubishi even appear on the
  list.
• Neither investor nor the markets perceive these
  capital intensive, production-oriented companies
  as having more value than even Citigroup, which
  comes last on the list.

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Market Valuation some New Company
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A common theme

• One common theme that brings all these companies
  and their very different reason for successful.
  Its their intangibels
• Brand recognition
• Industry-driving vision
• Patents and breaktroughs
• Customer loyalty, their reach
• Innovative business ideas
• Anticipated future prouduct
• Past achievements
• Ground-breaking strategies

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The 24 Drivers for KM (1)

• Knowledge-Centric Drivers
• The failure of companies to know what they
  already know
• The emergent need for smart knowledge
  distribution
• Knowledge velocity and sluggishness
• The problem of knowledge walkouts and high
  dependence on tacit knowledge
• The need to deal with knowledge-hoarding
  propensity among employees
• A need for systematic unlearning

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The 24 Drivers for KM (2)

• Technology drivers
• The death of technology as viable long-term
  differentiator
• Compression of product and process life cycle
• The need for a perfect link between knowledge,
  business strategy, and information technology

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The 24 Drivers for KM (3)

• Organization structure-based drivers
• Functional convergence
• The emergence of project centric organizational
  structures
• Challenges brought about by deregulation
• The inability of companies to keep pace with
  competitive changes due to globalization.
• Convergence of products and services.

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The 24 Drivers for KM (4)

• Personnel drivers
• Widespread functional convergence
• The need to support effective cross-functional
  collaboration
• Team mobility and fluidity
• The need to deal with complex corporate
  expectations

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The 24 Drivers for KM (5)

• Process focused drivers
• The need to avoid repeated and often-expensive
  mistakes.
• Need to avoid unnecessary reinvention
• The need for accurate predictive anticipation
• The emerging need for competitive responsiveness.

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The 24 Drivers for KM (6)

• Economic drivers
• The potential for creating extraordinary leverage
  through knowledge the attractive economics of
  increasing returns.
• The quest for a silver bullet for product and
  service differentiation.

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KM Wagons, Contents and Horses (1)
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KM Wagons, Contents and Horses (2)
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KM Wagons, Contents and Horses (3)
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KM Wagons, Contents and Horses ()