Strategic Knowledge Management and Innovation

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This book looks into the use and application of Knowledge Management Process (KM Process) in the creative and innovative organizations in the context of Malaysian enterprises. The premise of this book is about KM Process. KM Process can be defined as a continuous process of managing and applying knowledge and skills in the right place at the right time. It is an integrated part of  KM enablers, KM Process, through organizational creativity and innovation that results in the organizations to become more competitive and thus improve their organizational performance.

The main concept within the KM Process is “Value Sharing Process” ™, which focuses on creating high value and sharing of products and services in the marketplace, that are commercially viable, and able to sustain and survive in the competitive global environment. It includes four modes of KM Process: Knowledge Creation, Knowledge Conversion, Knowledge Communication and Knowledge Change. This main concept within the KM Process is particularly suitable for innovative organizations.

The result of high value in products and services (a real productivity) will lead to high income for  individuals and organizations, which in turn will lead to high consumption (by individuals) and investment (by organizations), and hence organizational performance and economy growth for the nation.

The intermediate outcome of KM Process is organizational creativity and innovation, which will ensure the long term sustainability and survival of organizations in the competitive and globalised economy.

Organizational performance is the final outcome of  KM Process through innovative organizations. It can be achieved through competitive advantage and can be measured by using Balanced Scorecard or Key Performance Indicator.

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The Current Development of Knowledge Management

By Dr Tan Thai Soon

1. The Concept of Knowledge Management (KM)

The concept of “Knowledge Management” has been perhaps the most important phenomenon to emerge in recent years in the study of management. KM has been defined as the process involved in seeking to “understand, focus on, and manage systematic, explicit, and deliberate knowledge building, renewal, and application, that is, manage effective knowledge processes” (Wiig, 1997) and the process of “continually managing knowledge of all kinds to meet existing and emerging needs, to identify and exploit existing and acquired knowledge assets and to develop new opportunities” (Quintas, Lefrere and Jones, 1997).

The objective of developing a KM model is to “create knowledge repositories, attempts to improve knowledge access, and attempts to improve knowledge cultures and environments” (Davenport and Prusak, 1998). Broadbent (1998) indicates that “knowledge management is about enhancing the use of organizational knowledge through sound practices of information management and organizational learning.”

The KM can be personal KM or organizational KM.

2. The Development of Knowledge Management

2.1. First-generation KM
The rapid development of Information Technology in the late 1990s has accelerated the development of KM, as can be seen from the works of many management writers (Sviokla, 1996; Davenport, 1997; Alavi and Leidner, 1999). Information technology has been used as a knowledge creation tools (Nonaka et al., 1996); as a basis for information management (Broadbent, 1998); for information systems (Alavi and Leidner, 1999); and for codefication tools (Hansen, Nohria and Tierney, 1999).

The development of information technology provides a new means for the subsequent development of information management into KM. In short, the KM practitioners use information technology as a tool, a systems, data based and repository, and for information management. It is all about “delivering information to support a task” and about “individual performance in the field” to get the job done (McElroy, 2000). In this respect, it has been referred to as “first-generation KM” (McElroy, 2000)

2.2. Second-generation KM
The next generation of KM saw the management writers integrating the organizational learning and KM (McElroy, 2000). According to McElroy (2000) “many practitioners of KM are now turning to the organizational learning community as a source for what it means for an organization to learn.” In short, KM writers try to integrate organizational learning into KM. This development of KM thus put the focus more on organization learning rather than on the individual in the workplace. This trend can be regarded as “second-generation KM” (McElroy, 2000).

2.3. Strategic KM
Current developments in KM have seen many writers argue that KM is best represented as “strategic knowledge management”. Snyman and Kruger (2004) have argued that KM strategy should be an integral part of business strategy. With others, they argue that strategic KM needs to be integrated with organizational performance in order to increase efficiency and thus the competitive advantage of firms. This development can be seen as deriving from the globalization of the world economy and the increased competitive nature of modern business.

Strategic KM includes leadership direction on KM vision & mission, communication (internal & external), and control & feedback. Example of the current development of strategic KM includes e-business, e-commerce, e-banking and e-solution. It is an integral approach to knowledge management which involves strategy and other knowledge enablers, knowledge creation process, organizational creativity and organizational performance.

2.4. Summary
The early development of KM has been related to the development of information technology in the late 1990s. The subsequent development of the KM focus on the learning process, which covers people aspect of the knowledge learning process, knowledge sharing and knowledge retention. The current development of KM includes the strategy aspect of KM which involves leadership involvement, communication and control and feedback. These latest development, includes strategy, technology and people aspects of knowledge management.

From Human Resource Management To Knowledge Management

By Dr Tan Thai Soon

The similarity  between the human resource management (HRM) and knowledge management (KM) is that both are involved in the development of the human capital, but they are difference in the way in which the human capital are being manage.

Knowledge can not be managed in the same way as we manage the human capital or the “people”. Rather, it is being manage as a “process”, a process of sharing and transferring of knowledge.

For example, HRM focus on training and retaining of human capital, but KM focus on the process of  sharing and transferring of knowledge.