Definitions of Knowledge Management - Essay Example

? Knowledge Management Introduction This paper will serve as an executive report to the senior management of Bobco and the aim is to shed some light on the dynamics, benefits, implementation, feasibility, and execution of knowledge management in the organization. Bobco is a banking company having many of the banks of its network in New York. It has been in the market for the past five decades with good and impressive figures. Recently, the company has been facing many competitive pressures from macro environmental factors that are political, social, legal, and technological. Furthermore, forces inside the industry, which include buyers, suppliers, new entrants, substitutes, and most importantly, rivalry in the industry. Therefore, the report presents knowledge management as solution to most of these problems and a tool to strengthen company’s situation. Discussion Definitions of Knowledge Management Without any doubts, for the past few decades the world has been changing at exponential rates. The ability of human mind of discover the secrets of nature, explore the seas, capture the air, fly into the sky and others have allowed us to live in a world which is a better and comfortable place. However, on the other hand, these technological advancements have really increased the amount of information and knowledge that was available before. In fact, never in the history before, we felt the need to manage the knowledge that we possess. Furthermore, the future that awaits for us where our success would be a direct result of our ability to effectively use, manage, and develop our knowledge. Technological capital and human intellectual capital may not get a place on the balance sheets of the organization but they will be getting much attention in the corporate goals, mission statements, and organizational cultures of the many companies. People understand that the only thing, which has the ability to limit them, is their ability to leverage and use the human mind (Stankosky, pp. 234-235). Despite the fact that there has a lot of research in this field and lots of ink is being devoted to the subject, yet authors and experts have not been able to reach a consensus or one unified definition for this topic. According to Robert S. Seiner, Knowledge Management can be defined as a concept in which an enterprise gathers organizes, shares, and analyzes the knowledge of individuals and groups across the organization in ways that directly affect performance (Frappaolo, pp. 26-28). According to Meredith Levinson, ‘Knowledge Management is the process through which organizations generate value from their intellectual and knowledge based assets. According to Robert Villegas, Knowledge Management is simply the transfer of knowledge from one person to another, the result of which enables the recipient to benefit from the collected wisdom of the more experienced members of an organization or group’ (Becerra-Fernandez & Sabherwal, pp. 341-348). In other words, Knowledge Management is actually a cyclical system or a multiplier effect, which helps an organization in efficient achievement of its objectives and the same happens because the organization’s habits, planning and its execution is deeply rooted in the tacit and explicit learning of the organization (Stankosky, pp. 234-235). Why implement Knowledge Management? Following are some of the direct and clear benefits that Bobco will benefit from by the implementation of knowledge management in the organisation. First, the company would be in a great position to decrease the operational costs. Quite understandably, the market place of today has turned into a ruthless, aggressive, bloody, and destructive place where survival of the fittest is the order of the day. Even Bobco is operating in a market where the pressures for decreasing costs are increasing everyday. Despite the fact that sales have increased yet the profit margins have been shrinking due to increased pressures to outclass competitors. Attaining efficiency is the key for the business, which has been mentioned in many of the organizational goals and objectives as well. Knowledge Management can help in the sane. When employees from different department are more aware about the best practices to perform a job, there is a high probability that they would perform in that very efficient way. Furthermore, organizations that have successfully implemented knowledge management end up creating an organizational culture where employees work together to find those best practices. In fact, the company creates a culture where employees take calculated and informed risk to learn and even if they fail, they end up learning from their mistakes. Second, quite understandably, when employees are learning best practices and other systems are in a process of being aligned according to best practices, the same clearly means that the organization is moving towards delivering higher quality standards to its customers. Quality improves when systems and employees are working in collaboration, with speed and with optimized communication (Stankosky, pp. 234-235). Third, one the biggest problem that Bobco has been facing relates to its high turnover rates compared to the industry average. The human resource department has been repeatedly telling the company that high turnover rates are costing the company too much. The cost of putting up an ad, recruiting the candidates, screening them through arranging all the tests and interviews, training him before he starts his job and others indirect costs end up becoming a huge pile for the organization. Despite the fact that the company is working on other measures to decrease the turnover rates and retain its employees, knowledge management can make great contributions in retaining and even attracting new talent. Quite understandably, smart and career driven employees are well aware of the fact that how important to is in today’s world to keep yourself abreast of all the changes and happenings. Furthermore, individuals not only work in organisations to earn money but they have other objectives as well and one of the most important one of them is to learn and improve over a period of time (Becerra-Fernandez & Sabherwal, pp. 341-348). If Bobco implements knowledge management and invests on the learning and improvement of its employees, it will definitely stay for longer in the company. The idea is that employees which are more knowledgeable and who have better access to knowledge systems tend to stay in the company for longer because they know that they are growing and learning along with the organization. Another aspect of looking at the same issue is that even if knowledge management fails to cover up the turnover rates, it would definitely have some impact on the losses that occur from employees leaving the organization. It is common to hear from various teams and departments repeatedly that they have not been able to complete an assignment on time or able to produce the same results because the crucial person or the one having access and understanding of the system left the organization for any reason. By proper implementation of knowledge management loss of a key person would not mean that any system, machine, assignment, or project would stop because then employee would be having all the information about the work processes and dynamics of its surrounding (Frappaolo, pp. 26-28). Fourth, another important benefit of knowledge management is that it would certainly increase the sales by increase in customer satisfaction. As mentioned earlier, that it would have a multiplier effect on the operations. With increase in quality, speed, and employee productivity, there would surely be an increase customer satisfaction thus increasing the sales revenue for the company. Implementation of knowledge management would allow the company to have a better know how about its customers, they preferences habits, demographics, buying patterns, and others. Lastly, and other most importantly, Knowledge management can become a sustainable competitive advantage of the company. As mentioned earlier in the paper that organizations are now competing in an extremely vicious environment where the battle of increasing one’s market share now involves taking away the market share of the other. Even the banking industry has now becoming increasingly competitive. Bobco clearly needs something which could become its sustainable competitive, something which would Bobco to outclass its competitors over a long period. Knowledge management can give Bobco exactly what it is looking for. Knowledge Management would allow the company to become more responsive to customer needs, adaptive to changing market situations, innovative in terms of its operations, creative in terms of its strategies and proactive in terms of its future actions and moves (Keyes, pp. 45-48). Implementation Strategies of Knowledge Management Despite the fact that knowledge management is an inevitable reality, which employees and organizations know about yet many of them are hesitant of, accept of implement knowledge management respectively. One of the reasons behind the same is the fact that it is not a matter of will or thinking but it has to happen with careful planning, strategy making, and execution. Following are some steps with which Bobco can implement knowledge management within the organization with maximum smoothness, minimum resistance to change and favorable results. First, the organization will have to ensure that it creates a sense of urgency within every corner of the company. It has to ensure that knowledge management emerges as the new hype or the next big thing in the company and employees really become curious about the same. Second, the senior management will have to make a powerful coalition with the influential employees, opinion makers and team leaders in the company. This will ensure that all employees are being influenced with the vision of implementing knowledge management. Third, Bobco’s top heads will have to sit down and create a vision for this knowledge management implementation. Questions like what we expect out of this. Where do we see the organization after five years, ten years, fifteen years down the road has to be answered? Where is the organization going? Is the direction in line with knowledge management strategy? Fourth, once the senior management is done designing the vision of the company then it is equally important to communicate to all the employees of the company. It is crucial that they embrace the vision in the same way as the senior management of the company does. Until and unless the employees are aboard for strategy execution, organization is least likely to achieve nay success (Frappaolo, pp. 26-28). Fifth, then the managers would have to work in removing all the obstacles that they would face in the implementation of knowledge management whether in form of ideologies, thoughts, traditions, mindsets, people, systems, technologies and others (Becerra-Fernandez & Sabherwal, pp. 341-348). Sixth, Bobco will work then on creating short-term wins for the company and more the employees. Implementing knowledge management out of nowhere would be a wrong decision and implementing it all of a sudden would be a wrong decision. Therefore, it is advisable to do the same in small steps, according to the understanding and level of employees. Seventh and last, would be to build on that small wins and implement the whole change gradually yet decisively. However, in doing so, it would have to be extremely responsive to all the macro and micro environmental factors, which can affect the process. If there were any, then it would be time to stop, think, adjust, and then move forward (Stankosky, pp. 234-235). Costs Associated with Knowledge Management However, one the other hand, there would be some costs associated with the implementation of the overall system as well. First, would be the direct cost of acquiring all the technology that would be required in implementation and execution of technology management. New, faster, and customized computer systems, softwares, databases, and other would be required to take a start. Second, would be the best of training and educating employees about the same. Quite understandably, employees need to be trained, told, explained, and taught about how to use, access and benefit from these systems. This training would be of all employees and since this is a very important aspect, a huge investment would have to make here so that the rest of the investments make sure. Third, would be an indirect soft cost of changing the organizational culture. Quite understandably, the implementation of these new systems would require the senior management and other managers to overcome the inertia and hangover of the previous systems. There is a quite a possibility that the company would face some resistance in the initial days, due to training of employees work time would be lost, employees would be less productive due to change and fear of change and others (Stankosky, pp. 165-168). However, important to note is that these costs (in respect to the benefits that knowledge management would provide) are negligible over a long-term period. In other words, the over all return on investment is extremely high and therefore, the company must undertake the adventure. Conclusion Towards the end of this report, it is evitable that knowledge management is huge reality which not only Bobco but also all organizations in almost all industries are facing today. The questions is not about the implementation of knowledge management today, the real question and the defining factor is how quickly the organization would implement and how sincere, committed, dedicated the organization and its people are towards knowledge management. As we move deeper and deeper in the 21set century, experts agree that the amount of knowledge available to organizations will increase and effective management of human capital would become the competitive advantage for many firms. Therefore, it is highly recommended that Bobco must quickly make its first move towards implementing knowledge management before it is too late (Becerra-Fernandez & Sabherwal, pp. 341-348). Works Cited Becerra-Fernandez, Irma., & Sabherwal, Rajiv. Knowledge Management: Systems and Processes. M.E. Sharpe, 2010. Frappaolo, Carl. Knowledge management. John Wiley & Sons, 2006. Keyes, Jessica. Knowledge management, business intelligence, and content management: the IT practitioner's guide. Auerbach Publications, 2006. Stankosky, Michael. Creating the discipline of knowledge management: the latest in university research. Butterworth-Heinemann, 2006. Read More