Strategic Knowledge Management and Soft Systems Thinking - Literature review Example

STRATEGIC KNOWLEDGE MANAGEMENT By Name Course Instructor Institution City/State Date Abstract Basically, knowledge is transferred or shared between organizational workers during the back-casting, forecasting, as well as planning process, and so the knowledge workers’ problem solving abilities lie in their creativeness, motivation, professional training, and educational background. The organizational social relationships as it will be evidenced in the paper enhance and facilitate knowledge management and its transfer within the organization to the human capital. The paper critically discusses the Checkland quote “We see in the world many examples of sets of human activities related to each other so that they can be viewed as a whole (Checkland, 1999, pp115), ” in relation to the way that Soft Systems Thinking can develop the intellectual capital of the organization. In view of this assertion, soft Systems Methodology as a research tool for qualitative operations was purposely designed by Checkland to examine as well as model complex systems, which combine technology with organizational and human systems. Soft system thinking enables its users to progressively create learning process that makes them to easily understand the existing problems. Table of Contents STRATEGIC KNOWLEDGE MANAGEMENT 20 1 STRATEGIC KNOWLEDGE MANAGEMENT 1 1 Abstract 2 Table of Contents 3 Critical Discussion of the Checkland Quote in Relation to the Way that Soft Systems Thinking can develop an Organization’s Intellectual Capital 4 Introduction 4 Critical Discussion 5 Knowledge Management and SST 5 Intellectual Capital 9 Social Capital 11 Communities of Practice (CoP) 13 Conclusion 16 References 18 Critical Discussion of the Checkland Quote in Relation to the Way that Soft Systems Thinking can develop an Organization’s Intellectual Capital Introduction The dynamic as well as multifaceted environment that organizations are in currently is forcing them look for changes, which can assist them become accustomed to this environment by continuously analyzing its own performance, monitoring the environment, aspiring for unceasing improvement. Such changes as addressed by Dasgupta and Gupta (2009, p.203) are made possible through innovation, which is crucial requirement for creating knowledge and thanks to the incessant forecasting, back-casting, and planning enables organizations to comprehend, model as well as plan the future to benefit them As stated by Hussain et al. (2004), organizations that can improve as well as promote their human capital knowledge are well suited to manage changes in the multifaceted circumstances they find themselves. Soft Systems Methodology (SSM) created by Checkland some decades ago has demonstrated to be a much-examined social enquiry process into multifaceted problem circumstances that involves systems of human activity. According to Young (2009, p.40), SSM has been used in various applications like project management, information systems, knowledge management, and many others. It makes possible for key problems to be removed from multifaceted situations as well as from conflicting sources of information. The sustainability concept according to Presley and Meade (2002, p.101) is more and more gaining support in manufacturing industry as a tool for lasting feasibility as well as corporate responsibility. Therefore, to allow for sustainability planning as well as application, scores of companies are examining forecasting as well as backcasting as methods that can help them comprehend, model as well as plan the future to benefit them. For this reason, the essay seeks to critically discuss the Checkland quote in relation to the way that Soft Systems Thinking (SST) can develop an organization’s intellectual capital. Critical Discussion Knowledge Management and SST Knowledge management may be defined as a process of capturing, disseminating, and successfully utilizing knowledge (Firestone & McElroy, 2012, p.68). Knowledge management may as well be defined as a discipline promoting an integrated approach to recognizing, capturing, analyzing, retrieving, as well as sharing all information assets of the organization. So, knowledge can be defined as the understandings or ideas that a person has, and which can utilize to realize entity’s goal .According to Checkland (2000, p.S14), the process through which people handle the world can as well be acknowledged as a system. Therefore, system thinking as defined by Ellis et al. (2013, p.552) is thinking systematically and concentrating on dynamic interaction as well as knowledge management through the environment as well as individuals wherein they are operating. Fig 1; Knowledge Pyramid For this reason, knowledge management is similar to an open system wherein the accessible resources are exchanged within the environment. Still, the dynamism as well as openness of the system is attributed to the human activities needed in the enquiry process. In this case, knowledge is expressed by Alipour et al. (2011, p.62) as a whole body of skills and cognitions that is used and shared by people so as to solve issues that can improve performance of the organization. Therefore, ‘soft’ and ‘hard’ that are the two major systems of system thinking are according to Checkland (2000, p.S15) the main intellectual difference of a system. Therefore, soft as well as hard system thinking are balancing since both can be applied at various phases of solving issue related to management. In managing either nebulous or clear problem in the organization, Reisman and Oral (2005, p.165) adress that soft system thinking is crucial for solving decision-making issues while hard system thinking is frequently needed in the concluding stages of problem solving. In this case, soft system thinking is crucial for recognizing and defining the main issue while hard system is used for appropriately solving that problem. Or this reason, the ability of the organization depends heavily on knowledge management. This is evidenced in Sherif (2006, p.73)study, where he claims creating soft system thinking within the organization needs knowledge management process both at the group level and individual level. Fig 2: KM Framework Berg (2013, p.160) proposes that for reasons of management, the organizational knowledge should be considered in three distinct groupings; first, tacit; second, codified; lastly, encapsulated (see how knowledge is created in table one). According to Berg (2013, p.160), accurate evaluation of the inputs’ cost as well as outputs’ value is very crucial for the effective organizational management. Therefore, the value and cost of knowledge must be explicitly measured, so as to effectively determine the profitability as well as efficiency of organizational pursuits. In Berg (2013, p.160) understanding, inability to measure the value and costs of knowledge can in consequence make the organization compete with outdated strategies as well as and tactics. As stated by Berg (2013, p.162), tacit knowledge transfer is exceedingly slow and expensive, because it is manifested only on application, while explicit knowledge communication or transfer between organizations as well as individuals is easy. For this reason, the tacit knowledge communication or transfer needs a superior level of permanence and intimacy as compared codified or encapsulated knowledge transfer. As further noted by Berg (2013, p.162), the knowledge possess by the organization concerning the coordination, integration, and of its resources may be its most inimitable unique resource because other resources in the company do not have distinctiveness Knowledge. This is so especially when knowledge is in tacit form, which debatably is the most unique resource due to its causal ambiguity, nested heterogeneity, in addition to the time compression diseconomies it causes. A business system design according to Rastogi (2002, p.229) has a dynamic structural design that is isomorphic across companies in time as well as space. Rastogi (2002, p.229) further states a dense dynamic connection of knowledge management, human capital, and social capital, which is mainly referred as the knowledge management nexus created the core of business system design. Knowledge management nexus according to Rastogi (2002, p.229) recurrently revitalizes as well as rationalizes the business system design. So, a company’s intellectual capital is viewed as an outcome of its knowledge management nexus. As discussed below, intellectual capital signifies the organization’s meta-capability toward solving problems as well as capitalizing on opportunities in its constant chase for value creation. Table 1: Knowledge Creation Intellectual Capital Intellectual capital or intangible assets according to Choong (2008, p.612) is the most critical resource of in the modern organization and still, scores of organizations cannot define clearly what it is made of; so intellectual value can be defined as an individuals’ collective knowledge in a society or organization. Intellectual capital is for this reason a combined value of structural capital, human capital and rational capital. As stated by Choong (2008, p.609), intellectual capital (IC) has extensively been studied since early 1990s, but the broad scope of these studies have created a magnitude of emphasis as well as definitions, and so various attributes, properties as well as resources are currently being considered as intellectual capital. Furthermore, Choong (2008, p.609) addresses that the literature on intellectual capital is flourished with diverse terms describing either the different or the same information utilized in associating with IC. As evidenced in Ghalib (2004, p.1) study, knowledge together with intellectual capital have been pursued and explored along different dimensions, especially when the world noticed an unexpected rush towards acknowledgment of IC as assets that are exceedingly valuable. Previously, knowledge management was believed to concentrate mainly on corporate intranets, databases as well as artificial intelligence, but recently, this has changed towards both its social and technological connotations. The table below shows elements of intellectual capacity: Table 2: Elements of IC So, as mentioned by Ghalib (2004, p.22) this has made knowledge management to be treated in a systematic way, instead of viewing it a disconnected and isolated component of managing intellectual capital. Presently, Australia –based industries are experiencing an enormous social change, and in consequence, scores of l jobs oriented to labor have been mechanized and business organizations are downsizing so as to introduce structural as well as economic efficiencies. Thanks to the continuous advancement of technology, Young (2009, p.1) noted that the demand for traditional skills has tremendously declined. As a consequence, big organizations like government utilities are corporatizing, and afterwards privatizing, and in a number of instances become floated in the stock market, so as to re-engineer the organizational culture so that both the changed consumers’ expectations as well as the new market economics can be met. Lately in Australia, numerous organizations have shifted from public utilities to organizations that focus more on market and customer service. Therefore, knowledge or intellectual resources are often integrative, synergistic, as well as complementary in their intention to generate crucial value. According to Rastogi (2003), the yields from intellectual resources such as innovation are consequently increasing instead of decreasing or being static. Knowledge or intellectual resources as indicated by Rastogi (2003) generate value through their jointly supportive permutations as well as cross-fertilization, so when detached from each other, they are inclined to become meaningless and less significant. To create a clear understanding of intellectual property, Bucklew et al. (1999) provided an example where a software company’s value is fifteen times more as compare to that of the published book. Such superior value according to Bucklew et al. (1999) goes afar the delivered software products, and so the discrepancy is attributed to the unaccounted factors like a good market position, lots of customers, the brand name of the company rigorous research and development, and so forth. Very thorough financial accounting is present for software products’ sales, but there is almost no systematic accounting for the unseen value of individuals’ knowledge levels, customer bases, the cost of replacing the IT systems, as well as the benefits attributed to training and development. All workers according to Bucklew et al. (1999) have their own unique background, education, skills, experiences, education, as well as external desires that strengthen intelligence as well as integrate knowledge. Therefore, the book value lacks the intrinsic value of the individuals, their innovative ideas as well as competence bases, the infrastructure of the organization, portfolios for research and development, in addition to customer base. Social Capital Social capital according to Nahapiet and Ghoshal (1998, p.243) is concerned with the relationships network offering essential resources for the social affairs conduct, and offering its members with a capital that is owned collectively. Although social capital like knowledge management takes numerous forms, all resultant forms’ characteristics are the same, for instance, structure existence as well as actions facilitations of persons in the structure. As argued by Gupta and Maiti (2008, p.96), although social capital generates value while it achieves targets that cannot be achieved without it, it is not easily traded. Therefore, social capital cannot be considered as a beneficial resource because even if it is beneficial for particular actions it may not be valuable for other actions. However, social capital realised from outside and within the organization is important for developing human capital. So, according to Gupta and Maiti (2008, p.96), value generated by means of knowledge is a combined effort rooted in human capital as well as social capital given that none is a collection of knowledge. For this reason, organizations have to invest in social relationships so as to effectively and efficiently broaden their knowledge ability. The figure below show the various enablers of social capital: Fig 3: Enablers of Social Capital Still, social capital development experiences obstacles such as lack of trust considering that high trust level is needed so as to facilitate sharing of tacit knowledge. Furthermore, fear that knowledge can leak to the competitors can impede the flow of knowledge; the seeming discrepancy in power can generate an insecure environment in social relationships that also doubles up as an obstacle. Importantly, social capital facilitates intellectual capital development by improving the conditions essential for transferring knowledge. In contemporary business setting, social capital has become hard to realize because decisions made and strategies formulated by leaders are ineffective (Kurzynski, 2009, p.359). These leaders have failed to understand that an organization is the basic platform for creating human knowledge (Rastogi, 2002, p.229). Regardless of what is produced in the business, all activities are rooted in organization, development, and exploitation of a vital body of pertinent knowledge. Rastogi (2002, p.229) further states information is knowledge’s feedstock, and so information that is meaningfully organized has knowledge in it. Devoid of continuous learning, generating and creatively utilizing knowledge cannot be achieved Communities of Practice (CoP) Communities of Practice (CoP) according to Wenger (1999) are interactive, collaborative networks of entities in a knowledge topic that is generally defined. Basically, CoP materialized a tool for facilitating knowledge sharing within a learning setting. Recently, CoP has dominated knowledge management literature, and equally their implementation in the business world has also increased. As argued by Wenger (1999), towards the end of 20th century most organizations concentrated primarily on using internet as well as databases to capture as well as share knowledge for performance improvement of critical organizational tasks. However, the database knowledge was not effective in solving multifaceted issues within the organization considering that every problem needs a distinctive resolution approach. For this reason, Communities of Practice turned out to be important to transference of knowledge. So, CoP is defined by Blackmore (2010, p.105) as a set if individuals sharing a desire what they do as well as enlighten themselves how to perfect it through regular interaction. For this reason, CoP may be enhanced with tools such as Social network analysis (SNA). Such tools can assist the Communities of Practice to enhance re-use of knowledge, flow of information, as well as generate the ability to main opportunities or issues, promote value-creating interactions as well as involve workers by means of community efforts. As indicated by Wenger (1999), a fostering and supportive environment encourages workers to effectively interact and share experiences and information, which can assist workers to fathom the position in the workplace’s collective dimensions. CoP normally consists of persons from diverse geographic locations, so leaders of the community always experience challenges of searching in the network so as to find members from a possible existing community. As stated by Hinton (2003, p.5), an organization is successful in knowledge management can be considered as a learning organization. This is because; knowledge and people are the building blocks, through which creation of knowledge occurs. Therefore, learning reinforced by knowledge management can improve knowledge’s diversity as well as depth. So, in Hinton (2003, p.5) assertion, the strategy of knowledge management that is aligned with organization processes, culture, structure, as well as technology infrastructure promotes creativity and innovation. Fig 4: Conceptual Underpinnings of Social Learning In Cox (2005), study he asserts that the dominant utilization of CoP term in the knowledge management and organizational literature connotes intra-organizational, informal group precisely promoted by management so as to improve creativity as well as learning in the organization. According to Cox (2005, p.538), it is crucial to make a logical distinction amongst the rather creative as well as intense relations, which surface where an activity is performed by numerous persons. Basically, this is to some extent rare in everyday work, and also it is a social relations’ invention. There is a growing acknowledgment that for organizations to be considered communities of communities, they must possess various forms of CoP, and not only communities of practice. In organizations according to Cox (2005, p.538), the indirect social relations’ latent power may be channeled into purposes of the organization. Besides that, with correct facilitation, providing direct incentives, technical mediation, as well as devoted time offer a foundation for creating dynamic groups rooted in direct social relations. However, the uncertainty of whether the above assertion is genuine empowerment is the answer to why scores of communities for practice fail. Basically, modern management concentrates in boosting business profitability through improving productivity as well as outsourcing, downsizing, streamlining, as well as trying to outdo the competitors. Managers have turned a blind eye on CoP and rather they concentrate more on the bottom-line management, in consequence, losing the sense of accountability for the welfare of the society, employees, and the industry. As stated by Hinton (2003, p.6), the key concern while developing a Community of Practice should be based on how the entities function in the contexts of their workplaces as well as the level of effectiveness, subject interest, and networking. In consequence, the context of the workplace will disclose work habits, attitudes, as well as desired styles of communication. This as mentioned by Hinton (2003, p.6) will disclose the communication channels suitability. Success of CoP relies heavily on support from management. Certainly, if time as well as resources allow, it one can alter the existing habits in the workplace so as to exploit technological options that are more sophisticated, hasten espousal and benefits, as well as promote learning within the workplace. So poor training results in the failure of Cop. Conclusion In summarizing the fundamental outcomes of this essay, it has been mentioned that soft system thinking concentrates on the human beings, organizational development, job trust, output, and satisfaction, as well as creativity and in improving various elements of intellectual capital. On the other hand, Communities of Practice provides a channel for knowledge transfer and allow for the intellectual assets leveraging in the organization. Besides that, CoP has a number of tangible benefits such as reducing new workers’ learning curves, reacting hastily to the inquires and needs of the end users, decreasing rework, as well as producing novel ideas for services and products. So, CoP is without a doubt a valuable tool that can be used by organizations to capitalize on information and knowledge assets. Moreover, knowledge management results in improved excellence, and is the main driver for innovation. 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