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Knowledge management

Abstract

The concept of knowledge management has already turned into the integral component of any organizational discourse. Regardless the type of organizational environment, as well as the level of organizational complexity, businesses seek to implement reliable information solutions, to be able to adjust their sophisticated organizational needs to the environmental changes. It should be noted, though, that the concept of knowledge management is no longer limited to managing data; and the more organizations do to combine reliable IT solutions with data management principles, the more likely they are to create competitive advantage and maximize their profits.

Article Main Points

            Introduction

            The concept of knowledge management has already turned into the integral component of any organizational discourse. Regardless the type of organizational environment, as well as the level of organizational complexity, businesses seek to implement reliable information solutions, to be able to adjust their sophisticated organizational needs to the environmental changes. It should be noted, though, that the concept of knowledge management is no longer limited to managing data; and the more organizations do to combine reliable IT solutions with data management principles, the more likely they are to create competitive advantage and maximize their profits.

            Karl-Erik Sveiby was one of the first to realize the unlimited potential of knowledge management and the role it could play for shaping the future of organizations. His definition of knowledge as “the capacity to act in a context” (Bennett, 2004) forms a basic vision of what knowledge management is and how it could work to support organizations in their striving to maximize their profits. In Sveiby’s view, knowledge management is the process of leveraging intangible assets (Bennett, 2004). What seems to be true, however, is that Sveiby’s ideas about knowledge management go against traditional understanding of knowledge management in present day business. The two different interpretations to which Sveiby refers in his interview are actually the two components of one complex system of knowledge management mechanisms, which firms need to adopt to improve their market competitiveness. Leveraging intangible assets in contemporary business environments is impossible without active use of IT technologies; and the importance of sharing and disseminating knowledge should be placed above all other organizational initiatives. Certainly, we cannot underestimate the role which traditional human knowledge may play in expanding organizational potential in business, but managing human knowledge is impossible without turning this knowledge it into a set of comprehensive databases. Whether we have an opportunity to utilize the benefits of quality knowledge management will depend on our ability to deploy reliable IT resources and to integrate them into the basic business operations.

            Sveiby is correct in that “computers can only handle information, so there is no point in trying to figure out quicker ways of storing or transferring or retrieving information, because all you get out of that is more information” (Bennett, 2004). Nevertheless, managing information in business is no less important than creating it. With the growing speed of technological advancement, and given the amount of information which businesses are compelled to process daily, knowledge management helps firms embrace the benefits of competitive advantage. Simultaneously, we have been increasingly concentrated on turning knowledge into a kind of physical substance; but knowledge is inherently intangible, and deploying sophisticated IT solutions cannot turn knowledge into a set of tangible tools. “We should search outside the traditional lines, the traditional tangible realm to get closer to the real source of knowledge” (Bennett, 2004); in other words, in our striving to diversify the sources of knowledge and to turn knowledge into the tool of achieving excellence in businesses, we should not neglect intangible nature of knowledge and data. It is not enough to interpret knowledge in money terms; and in any system of knowledge management, knowledge is primarily the source of information which can be readily used by organizations to maximize their profits.

            Conclusion

            Knowledge management is a complex concept, and while organizations readily embrace the benefits of IT solutions and use them to create competitive advantage, only a few have been able to grasp the true essence of knowledge and the role which intangibility of information may play, when organizations strive to maximize their profits. Not information as such, but organizations’ ability to balance information with knowledge management skills will work to determine the boundaries of knowledge and to support organizations on their way to excellence in business.

References

Bennet, A. (2004). Karl-Erik Sveiby: KM today and tomorrow: what makes me passionate.

Sveiby Knowledge Associates. Retrieved March 12, 2009 from http://www.sveiby.com/

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