Main Aspects of Knowledge Management - Coursework Example

Knowledge management Question Apparently, organization culture is defined as the observable values and behaviors that are practiced by an organization and mostly result to the uniqueness in social and psychological environment. As such, organization culture revolves around the expectations, experiences and philosophical concept that entails the general work performance and the social interactions there of both internally and externally. In this regard, Nucor steel emerges as one of the renowned companies with expertise in organization knowledge management. It is argued that, before the concept of knowledge management in relation to organization culture was put into practice, organization performance was below par. For instance, it is said that regional managers in the steel company were not willing to share or make use of ideas from other regional managers making it complex for the company to improve in terms of performance. None the less, Nucor argues that there must be a strategy in which organization culture affects knowledge creation and sharing (Vijay & Gupta, 2000). According to him, organizations should set examples through the use of social ecology. Basically, social ecology refers to the social environment in which people operate. Its main function entails motivating formal and informal expectations of individuals that are in a given organization, with the inclusion of what qualifications should be met by those that intend to work for the organization. Additionally, concept social ecology ensures that the freedom of an individual is shaped in reference to making decisions that benefit the organization. Of most importance is that, having random structures such as leadership, people, information structure, reward systems among others improve the connection between knowledge management and organization culture. Vijay & Gupta, 2000 argue that the use of Information management has continuously benefited most companies due to its crucial role in knowledge management, but only when used appropriately. Therefore, companies that yearn for sustainable advantage especially in performance and gaining of knowledge must effectively use technology that has been incorporated with social ecology. It is worth mentioning that companies must be willing to update their data on knowledge management to ensure that there is reduced risk of having competitors with similar ideas in terms of products and services that a particular organization may be rendering. Furthermore, the impact of knowledge management on the overall performance in any organization must be measured through the assumption of knowledge that is held by individuals, as well as, corporate groups in calculus relation to the rate at which the same knowledge is shared throughout the organization. Some of the issues that relate to knowledge management include: knowledge creation, acquisition, retention, identification, outflow, transmission and knowledge inflow (Vijay & Gupta, 2000). In relation to this, social capital is basically described as the assumed collective or economic benefits that mostly emanate from privileged treatment and cooperation that is found between individuals and groups. Never the less, various scholars have different schools of thoughts in relation to concept social capital. It is important to comprehend that social networks are highly valuable in an organization. For instance, through the incorporation of social ecology, Nucor Steel emerged as one of the best companies in terms of overall performance (Vijay & Gupta, 2000). Question 2 It is apparent that financial accounting plays a critical role in indicating financial position of an organization. Nevertheless, traditional financial accounting falls short in measuring the value of an organization. However, studies have documented that although traditional accounting systems can be used to measure the value of an organization, they underline little on how the said value can be achieved and improved. First, traditional accounting has always been viewed as a historical thing that cannot transform an organization. In addition, according to Horning (2007), they offer little indication of future performance of an organization, offer short-term indications and above all, they are internally focused rather than externally focused. This leaves out major issues such as competitors, emerging markets and has little innovation attached to them. In this regard, it is evident that traditional financial accounting cannot foster knowledge and capabilities. Basically, as Kennerley & Neely (2003) puts it, traditional financial accounting does not provide a platform on which important records such as purchase of assets and training costs can be counted as profits. In fact, traditional financial accounting perceives them as loss. In light of this, it is correct to argue that costs such as market research, customer experience research and costs of studying other forces of the market does not add up anything as far as traditional financial accounting is concerned. However, according to (Kennerley & Neely, 2003), strategic value of knowledge can only be realised after extensive research of the market and other aspects that constitute organizational value. Conversely, since the utilization of (modern) double-entry form of accounting that is considered to play a critical role in fostering industrialization, invention has been considered as a critical cost that help organizations flourish (Horning, 2007). This is contrary to what traditional accounting would view such costs. Instead of viewing such a cost as short-term issue that would yield good returns in the long-term, such costs are highly discouraged in traditional financial accounting. Measurement of value or performance of an organization has shifted gear from traditional accounting to the use of knowledge accounting such as balanced scorecard. The main purpose of the use of such systems is to improve performance of organizations in ways that traditional accounting has failed (Kennerley & Neely, 2003). In addition, performance measurement and control systems are used by managers to maintain or modify organizational activities. They help in setting organizational goals as well as giving feedback on the same to the managers for appropriate actions. For instance, balanced scorecard measures organization’s strategy. However, scorecard emphasizes on measuring things that directly relate to organization’s strategy. Unlike traditional financial accounting system, balanced scorecard articulates on financial matters, customer issues, international business perspective, and learning and growth. These are crucial aspects that can help organizations in improving in order to develop and maintain competitive advantage. Therefore, when the four perspectives have been combined, they consolidate a strategy that the organization can invest in for better results. For instance, through learning and growth, the issue of training and development comes in. When an organization subjects its workforce to training, it becomes potentially able to develop an organizational culture of top results. Question 3 According to Pink, the idea of individuals using their right mind in reference to their work description is very crucial. In fact, it is argued that individuals with the right set of mind are assured of a bright future ahead. As such, the world is now said to be moving from linear computer based age of information to a conceptual age that revolves around innovation, creativity and empathy. In addition, individuals with great minds are certain of receiving rewards and recognition. In support of his argument, Pink refers to a particular degree ‘ Masters of Fine Arts’ as the most valued degree in business and further says that it is one of the degrees that not accessible since there are only a few schools that offer the course (Pink, 2006). Consequently, Pink articulates that the emergence of the degree has further led to the shifting of business thinking as most of the work that was previously done by graduates with ‘Masters in Business Administration’ are now accessible through outsourcing. Similarly, individuals who have major positions in the world of business have recognized that their biggest competitive difference is that products from their organizations must have the physical beauty and compel emotionally. Pink argument is further illustrated by the persuasion he gives in relation to thinking. He argues that thinking comes in two aspects of analyzes; the left brain verses the right brain thinking. As such, he believes that individuals need to maintain their left brain skills but also master the six essentials of right brain aptitudes that include; symphony, play, design, empathy, story and meaning (Pink, 2006). In a general sense, the aptitude of design is crucial to any business because it ensures that products in a given business are user friendly, compact, as well as, useful. In addition, it becomes easier to comprehend how products are made better. In regard to story, Pink insists that there must be information on how a particular product has passed from one generation to another, a process that leads to emotional impact. In addition, Pink argues that symphony denotes the capability of an individual to multi task through blending their knowledge and going beyond their limits to make situations work. Apparently, the aptitude of empathy is denoted as the emotional aspect where an individual is expected to assume the situation of another individual, and as a result more success is witnessed in business. In terms of play, it is evident that the creation of play and related articles has brought about a great impact in the world of business thus increasing the anticipation for a greater future in business. Finally, the aptitude of meaning simply refers to the purpose of an individual in relation to life (Pink, 2006). Actually, the arguments laid down by Pinks confirms the impact of right hand aptitudes as some of the issues that have continuously changed the business world in terms of gaining knowledge regarding the improvement of performance for any organization. In fact, I concur with Pink in his arguments that the future belongs to those who have the right mind to do things differently (Pink, 2006). References: Horning, J. (2007). Knowledge Accounting: Inventory, Capital, Depreciation. Retrieved on 24th Feb. 2014 from: http://horning.blogspot.com/2007/04/knowledge-accounting-inventory- capital.html Kennerley, M. & Neely, A. (2003). Measuring performance in a changing business environment. International Journal of Operations & Production Management, 23 (2): 213-229. Pink, D. (2006). A Whole New Mind: Why Right-Brainers Will Rule The Future. New York: Riverhead Books. Vijay, G & Gupta, A. (2000). Knowledge Management’s Social Dimension Lessons from Nucor Steel. MIT Sloan Management Review, 42(1), 71-80. Read More