Business Simulations - Essay Example

The knowledge Organization: Knowledge management has always been known to be a discipline which has gained more attention from both academics and practitioners over the last decade. However, the total numbers of simulation games that are designed for knowledge management education have always been limited. This is due to emerging nature and trend of knowledge whose domain established simulation and gamming community. In the current context of economic, knowledge management is understood as being responsible for designing and implementing any system aimed at identifying, capturing as wee as sharing such knowledge in a systematic manner within an organization so that it can later be converted into value (Sveiby 1996, p. 24). Broadly speaking, such knowledge is an effective enterprise value if it contributes positively to the key objective perused by the organization itself.

On the other hand, knowledge management can be defined as an approach, strategic, targeted at motivating as well as facilitating employment of members in development and even using their cognitive abilities through subordination, valorization to its main objective. In addition, to experience and abilities of each one of them (Simerson, 2011, p. 94), knowledge is ultimately, management of intangible assets which generates value for the organization. Most of intangibles assets are interrelated in a form of structure, abstraction and knowledge transfer.

Organization learning, intellectual capital measurement complementary and related concepts generate value for the entire organization. Strategy formulation in knowledge intensive organizations: Given the fact that knowledge flows within the organization is very important in creating completive advantage as well as superior bottom-line and top-line performance, though, the only challenge is developing appropriate mechanisms that are able to facilitate efficient creation, designing and sharing of such knowledge within the corporation.

Knowledge-based view of the organization is created not necessarily from intangible assets (Sveiby, 1999, p.44) but also by intensifying and expanding the new knowledge through creation and sharing. This not only make an organization develop new tangible products and services that eventually improve its market position, but also form the basis of organizational change as well as renewal. One of the main theoretical perspectives that are used in the incentive organization structure is agency theory.

This structure focuses on how the conflicting interests between the principle and the agents can be aligned or be minimized. Considering the fact that knowledge is beneficial for the most of the organizations. Diffusion of experience can sometime lead to the negative consequence to the individual sharing the units (Simerson, 2011, p.38), for instance, engaging in the shift of knowledge to other units within the organization requires resources such as people and time. Therefore, firms need to be very clear on making strategic choices since they have consequences for managing resources.

For instance, in codification strategy, those that are not contributing to the common knowledge data base with one’s own knowledge will definitely lead to missed business opportunities. This will lower the personal and organizational efficiency, and ultimately lower personal income. At the same time, personal strategy, being unable to accommodate face to face dialogue and sharing insight with others thus, missed promotions, lower competition and lost business opportunities when incentives system are attached to the knowledge strategy.

Reference: Sveiby, Karl. The new organizational wealth: managing and measuring knowledge-based assets. San Francisco: Berrett-Koehler Publishers, 1996.  [Accessed on 20 February 2012] Simerson, Byron. Strategic planning a practical guide to strategy formulation as well as execution Santa Barbara, Calif: Praeger, 2011.  [Accessed on 20 February 2012]