What is Knowledge in Administration - Essay Example

WHAT IS KNOWLEDGE? What is knowledge? December 03, 2007 Porter (1998) has written about the competitive advantage that organizations try toachieve and the various ways in which this practice helps to achieve the goals of a company. But while everyone knows the utility factor of this practice, it is the proverbial ‘bell the cat’ solution that everyone knows will work but very few know how to achieve and implement. Womack (1990) in his book ‘The machine that changed the world’ traces the unique practices that Toyota initiated after the Second World War to increase productivity and the practices are the first instances of knowledge management that Japanese companies practiced. The paper examines the practice of knowledge management and how it has helped Japanese companies to gain a competitive edge. About Knowledge Management and the Competitive Advantage Porter (1998) gave the structure of the Five Forces Analysis that gives companies a sustainable competitive edge in a market. While the structure allows analysts to form a grouping of manifestations and market forces such as threats of suppliers and substitutes, power of buyers and barriers for new entrants, the framing is not a mantra that yields solutions. Kadapa (2006) argues that after employing tools such as PEST and SWOT, analysts still have to find a way to solve problems and the industry is interested in solutions. At such junctures, when easy solutions are not obvious, it is knowledge management practices that help to provide the means to achieve competitive advantage. Again Drucker (1981) tried to provide answers to the phenomenal success that Japanese industries have achieved since the Second World War when the country was reduced to rubble. The author argues that just by using oriental philosophy, it is not possible to explain how the country went ahead in all fields of industries such as automobiles and electronics. The author suggests that the main secret lay in sharing knowledge and information among the workers and diffusing it to the people who need it, that helped Japan to achieve its success. A rigorous mindset, good knowledge of mechanical and electrical engineering that existed from the pre war days and the insight to apply it effectively helped the country to go forward. By extensively reading the works of the author, it is obvious that he is explaining a culture where knowledge is continuously being recycled and redistributed. Drucker (1999) speaks of the management challenges for the future and speaks of how organizations need to apply and reapply their learning and knowledge if they want their competitive advantage to be sustained. Meyer (et all, 2007) has explained the term Knowledge Management and they speak of knowledge as a thing of value that a person has gained in the course of their work or study and which would help the person to solve a problem faster. Baets (2004) speaks of two types of knowledge, tacit and implicit knowledge. Tacit knowledge is something internalised like the sense of smell, touch, taste and other senses and skills while explicit is a learning that has been accrued by wilful or accidental efforts. Nonaka (1995) have elaborated more deeply on tacit and explicit forms of knowledge and they suggest that Japanese companies give more attention for tacit knowledge creation processes. The companies bring about continuous innovation by creating a link between the outside world and their internal world. The authors speak of explicit knowledge as something that can be expressed in the form of data, figures and table and western companies concentrate more on this form. The Japanese companies on the other hand concentrate on tacit knowledge, which is highly personal and hard to define and includes subjective insights, intuitions, hunches, ideals, values and emotions. They speak of two dimensions of tacit knowledge, technical and cognitive dimension. Technical relates to the skills or crafts and the know-how while cognitive is the schematic, mental models, beliefs and perceptions. The cognitive dimension is difficult to articulate and can be expressed more symbolically in words and phrases. Kadapa (2006) draws a clear distinction between knowledge and information. Information is like receiving bulletin reports about a possible blocked road on the highway but knowledge goes one step further and while giving information about the blocked road, it also provides one with the knowledge of another alternative route that is slightly longer but clear. The author also suggests that a KM practice need not be a full-fledged web based application but it can be as small as a small weekly meeting of supervisors and workers who gather to relate their problems and solutions. Baets (2005) has attempted to explain the benefits that KM practices provide to increase the sustainable competitive advantage and these are increased availability of resources that are mapped to specific problems and solutions, development of a latent clairvoyance power that helps to forecast possible problems and considerable shortening of the learning curve. Cases of Knowledge MANAGEMENT AND Competitive Advantage A few cases where competitive advantage has been driven by KM practices are explained in this section. Cases of Toyota, Sony and other companies are discussed here. Womack (1990) has written about the famed Toyota Production System that many western companies have attempted to copy and few have succeeded in replicating it. According to the author, Taiichi Ohno introduced the concept of avoiding waste in all forms and activities. It has to be noted that while instilling changes in a process is relatively easy, sustaining it for decades is very difficult and when these practices are to be replicated in offshore plants with the same dedication, quality and results and high standards, then success can only be achieved by design and not by accident and the design is called as KM. Fang (2003) has spoken of the knowledge management techniques that Toyota utilizes and the intensive training and knowledge transfer sessions that are provided to all personnel. The author comments that employees are taught all aspects of enhancing productivity, reducing waste and are shown how this has been achieved during all the past decades in various Toyota plants. According to Awazu (2005), the concept of acceptance and rejection of machined parts or understanding waste acquires the same meaning to an employee at Toyota, whether he is working in Japan or Brazil or India. This is knowledge management at work and the practice provides a sharp competitive edge that is sustained by repeated inputs from the KM network. Liker (2003) speaks of knowledge networks in the Toyota Company where informal employee knowledge networks have been created with the express intention of providing ready solutions to people. Takeuchi (2004) has written about Sony Corporation and the development of the innovative Sony Walkman speaks of the manner in which informal KM sessions helped in creating a music system that could be carried around. According to the author, key problems of micro miniature circuits and audio could be developed only by pooling the combined learning’s and knowledge of cross functional teams from production, design and marketing. The product gave the company a huge competitive advantage and helped it to face giants such as Philips and BPL. Sony still makes innovative products such as digital cameras, home theatres and many others by gathering information from customers about their product preferences and then relaying it to the design team who then analyse the feedback to be first on the market with an innovative product. Buckman (2007) suggests that the Sony Vaio is a best example of product innovation and the author points out that the sleek and multi colour case came only after a salesman overheard a customer complaining about laptops that looked like plumbers toolbox. The comments were conveyed to the product development team that is part of the KM network and a new product was offered, becoming an instant success. Regassa (2007) has pointed out that innovation and KM practices have helped the Japanese manufacturers to make profits even in a recession and has pointed out that when US car manufacturers like GM, Ford, Chrylser are downplaying losses, the Japanese are counting profits. The competitive advantage that the Japanese have is the knowledge of one multiplied by the learning’s of thousands. Scott (1992) speaks of the differences in global manufacturing strategies as practiced by the Japanese and other nations such as China, Korea, US and others. The key difference as highlighted is the use of focussed and regenerative KM systems in Japanese companies. Given the fact that companies operate on a global scale, it is only focussed KM systems of the Japanese that have provided the competitive edge to organisations such as Honda. Sugiyama (2007) and Kadapa (2006) have pointed out the dangers of an information glut that exists in some KM systems in US and Europe where the systems have grown in volume but not in quality of the knowledge artefacts and stagger under the load of thousands of documents. Nonaka (1995) has written about the KM practices in Honda where designs are created by cooperative efforts and group knowledge. The authors have pointed out that Honda initially had a tough time in entering the US market that was dominated by Harley Davidson and where motorcycles were ridden by tough people. But the innovative KM driven practices brought in fresh thoughts into the design and marketing of low consumption and high power engines with very good fuel economy and the company succeeded also as a manufacturer of automobiles and other equipment. APQC (2003), Buckman (2004), Bergeron (2003) have provided a number of innovative practices such as group meetings, brain storming sessions, communities of practice, discussion forums, case studies that are uploaded on Intranets, use of web based technology, fast servers operating at high speed broad band and so on, that make up knowledge networks. The student of this paper would like to point out that technology and Intranets is useless unless people use it, for their own development and to spread knowledge, to educate others and to shorten the learning curve. It is this capacity to harness the combined knowledge of thousands of employees that the true sustaining competitive advantage is created. The Japanese perfected the art of learning and distributing knowledge because they believed that knowledge grows when shared and it is this belief that has placed them at the front and provided them with a competitive advantage. References APQC. 2003. Using Knowledge Management to Drive Innovation. American Productivity & Quality Center Awazu Yukika. Desouza Kevin C. 2005. Engaged Knowledge Management Engagement with New Realities. Palgrave Macmillan Baets Walter. 2005. Knowledge Management And Management Learning: Extending the Horizons of Knowledge-Based Management. Springer Science and Business Media, Inc. Bergeron Bryan. 2003. Essentials of Knowledge Management. John Wiley & Sons, Inc. USA Buckman Robert H. 2004. Building a Knowledge-Driven Organization. McGraw-Hill, US Drucker Peter F. 1 January , 1981. Behind Japans Success. Harvard Business Review. Drucker Peter F. 1999. Management Challenges for the 21st Century. Butterworth-Heinemann, ISBN 0-75064-456-7. Duffin, Murray. Japan - Myth, miracle or menace? The TQM Magazine. Bedford: 1994. Volume 6. Issue 2. pp: 45-49 Fang Samsong. Kleiner Brian H. 2003. Excellence at Toyota Motor Manufacturing in the United States. Journal of Management Research News. Volume 26. Issue 2-4. pp: 116-123 Jennex Murray E. 2005. Case Studies in Knowledge Management. Idea Group Publishing, London Kadapa Shashi, 2006, Building KM @ Patni, (eds) Kazi, A.S., and Wolf, P. (2006) RealLife Knowledge Management: Lessons from the Field, KnowledgeBoard, ISBN: 9525004724 Liker Jeffrey, 2003. The Toyota Way: 14 Management Principles from the Worlds Greatest Manufacturer. First edition, McGraw-Hill, p.p 22 - 25; ISBN 0-07-139231-9 Nonaka Ikujiro. Takeuchi Hirotaka. 10 April 1995. The Knowledge-Creating Company: How Japanese Companies Create the Dynamics of Innovation. Oxford University Press, USA Porter Michael E. 1 June, 1998. Competitive Advantage: Creating and Sustaining Superior Performance. Free Press. Regassa Hailu. Ahmadian Ahmad. 2007. Comparative Study of American and Japanese Auto Industry: General Motors Versus Toyota Motors Corporations. Journal of The Business Review. Volume 8. Issue 1. pp: 1-13 Sugiyama Kozo. Meyer Bertolt. 2007. The concept of knowledge in KM: a dimensional model. Journal of Knowledge Management. Volume 11. Issue 1. pp-17-35 Scott Young, T. Kwong K Kern. Li Cheng. 1992. Global Manufacturing Strategies and Practices: A Study of Two Industries. International Journal of Operations & Production Management. Volume 12. Issue 9. pp: 5-18 Takeuchi Hirotaka. Nonaka Ikujiro. 6 Feb 2004. Hitotsubashi on Knowledge Management. John Wiley & Sons Taiichi Ohno, 1995, Toyota Production System: Beyond Large-scale Production, p.p. 47 - 65; Productivity Press Inc., ISBN 0-915299-14-3 Womack James, Jones Daniel, Roos Daniel, 1990. The Machine that Changed the World. New York: Scribner Book Company. ISBN:9780892563500. . Read More