Knowledge Management and Business Intelligence

Lecture 24

Today’s Lecture Knowledge Management

TypesDefinitionsActivitiesCycle

Today’s Lecture

• What is Business Intelligence (BI)• Core Capabilities of BI• Why do Companies need BI• Benefits of BI• Examples of BI in use• BI Golden Rules

Knowledge Management Knowledge Management focus on how

knowledge within organisation can be created, captured, stored, and reused within organisation.

Introduction to KM KM is a cross industry field involving other fields

like social science, computer science, and management science.

There is no consensus on definition of Knowledge Management.

However the definition could be defined by understanding the meaning of “Knowledge” which also lack clear-cut definition.

What is knowledge Knowledge can be referred to as

understanding based on some learning activities or generated from long time experience.

Knowledge can be categorized as:Know-how knowledgeKnow-what knowledgeKnow-who knowledge

Introduction to KM…What is Knowledge

What is knowledge Knowledge is a fluid mix of relevant

experience, values, contextual information, and expert insight that provides a framework for evaluating and incorporating new experiences and information [Davenport & Prusak]

Experience (e.g. customer behaviour) Values (e.g. understand/help/encourage customers) Contextual information (e.g. customer buying patterns) Expert insight (e.g. why specific buying patterns occur)

Over 60s buying heavy metal music CDs for their grandchildren

Introduction to KM… Types of Knowledge There are two types of Knowledge

Explicit Knowledge Tacit Knowledge

Explicit knowledge can be easily captured and codified. It is in the form of documents, reports, video presentation, e.t.c

Tacit Knowledge is a personal knowledge and is within the knower’s mind. It is based on the personal beliefs, intuition and experience, and is hard to codify.

Introduction to KM… Organisational Knowledge Organisational knowledge is a resource

consisting of the sum of what is known in that organisation [Holseapple]

About internal matters (e.g. internal processes, know how) About external matters (e.g. competitors, customers) About trading partners (e.g. their processes, getting things done

in partnership with them) About not depleting the more it is used

Introduction to KM …The spiral of knowledge (1) The spiral of knowledge processes helps us understand

how: Knowledge is acquired Knowledge is transformed or converted from one knowledge

category to another Knowledge is shared Knowledge may be created

In the past the processes that underpinned the model were largely informal, but now are becoming more formalised (e.g. encouraged, required, embedded in the way people work)

“The key to knowledge creation lies in the mobilisation and conversion of tacit knowledge.” [Nonaka]

Introduction to KM …The spiral of knowledge (2)

Explicit to Explicit

Tacit to Tacit Tacit to Explicit

Explicit to Tacit

(CombinationProcess)

(SocialisationProcess)

(ExternalisationProcess)

(InternalisationProcess)

Nonaka

Introduction to KM …The Knowledge Spiral (Tacit to tacit) In the socialisation process knowledge is acquired and shared

without being made explicit (i.e. without being captured) For example by:

One person talking to another (informal meeting) If one person imparts knowledge to another then both have the knowledge; and

so on One person talking to many (presentations)

A lecturer imparts knowledge to many Many people talking to many (formal team meetings, informal meetings)

Collaboration, Interacting and sharing experience Seeing how things are done (no articulation)

By observing a knowledgeable person solve a problem, a novice can attempt to solve the same or similar problems

Socialisation usually occurs between people or within groups of workers with a common interest However:

Knowledge from different disciplines can lead to interesting insights New perspectives can question existing knowledge

Introduction to KM …The Knowledge Spiral (Tacit to Explicit) In the externalisation process tacit knowledge is

transformed into explicit knowledge For example by:

An expert writing a document that describes an experience, a way of doing things, what he/she knows, etc.

People producing a meeting report (sometimes), a research report, a video of a seminar, etc.

Producing a documented list of “frequently asked questions” (with answers!)

Strictly speaking, externalisation is the articulation of tacit knowledge

For our purposes, the articulation is captured in some form that can be shared widely

For example: a document that can be read by a select number of people, by all in an organisation (via the organisation’s intranet), or by millions of people (via the Internet)

Very hard process!

Introduction to KM …The Knowledge Spiral (Explicit to explicit) In the combination process various sorts of

explicit knowledge are brought together to form more complex or more useful knowledge Provides a more complete understanding For example:

All of the diagrams, plans, elevations (etc.) for a building produced by architects, surveyors, air conditioning engineers, electricians (etc.) contained in one document

All the tasks required to manufactured a passenger aircraft in a volume of documents

The benefit in combination normally comes from the explicit knowledge of a multitude of experts being made visible as a whole

Introduction to KM …The Knowledge Spiral (Explicit to tacit) In the internalisation process tacit knowledge is

acquired by examining explicit knowledge from many sources By integrating this with existing tacit knowledge new

insights may present themselves For example:

As a student you acquire much of your knowledge by reading different books covering different subjects

As a computer scientist who reads books on how the human brain works, you can see how programs could simulate some “brain processes”

In an organisational context, the acquisition of tacit knowledge leads to action!

Why knowledge management is necessary (1) Issue: organisations don’t know what they

already knowConsequences:

Time spent on rediscovery of knowledge that is already known

Failure to apply existing knowledge Waste of time and money

What’s the problem? Knowledge within the organisation is not visible

Why knowledge management is necessary (2) Issue: employees don’t know what their

colleagues know Consequences:

Inconsistent performance across different parts of the organisation

Expertise localisation Repeated failures Inability to apply what is known Competitors innovate at a faster rate

What’s the problem? Knowledge is not shared rapidly within the organisation

Why knowledge management is necessary (3) Issue: knowledgeable employees leave the

organisation or retire Consequences:

Critical expertise built up over years is lost overnight Expertise may move to competitors without being retained

within the organisation Key customer relationships may be affected Overall organisational knowledge is reduced

What’s the problem? Tacit knowledge walks out the door (and doesn’t return)

Why knowledge management is necessary (4) Issue: employees closely guard their individual

knowledge Consequences:

Knowledge is not visible Knowledge is not shared “Turf wars”: “this knowledge belongs to me (or my

department) and is not yours” A belief that the knowledge is “owned” by the individual

rather the organisation Opportunities for in-depth collaborations are minimised

What’s the problem? Knowledge hoarding by employees

What knowledge management is Definition:

Knowledge Management is a strategy, framework or system designed to help organizations create, capture, analyze, apply, and reuse knowledge to achieve competitive advantage.

A key aspect of Knowledge Management is that knowledge within an organisation is treated as a key asset.

What knowledge management is

A simple phrase that encapsulates a core aspect of Knowledge Management is "getting the right knowledge to the right people at the right time in the right format".

OrganiseKnowledge

MaintainKnowledge

TargetKnowledge

CaptureKnowledge

TransferKnowledge

Knowledge management processes

Knowledge Management Processes

What knowledge management achieves Makes visible organisational knowledge no matter where

it is Provides access to an organisation’s collective expertise

anywhere in the organisation Retains the organisation’s knowledge in times of change Exploits knowledge as a organisational asset Helps to ensure that knowledge is up to date and

relevant Helps the organisation to do the right thing Embeds knowledge in the organisation’s processes Enables the survival of the organisation But:

Part science, part art

Based on Awad & Ghaziri

Knowledge management scope

KnowledgeManagement

Based on Awad & Ghaziri

Technology

Business

People

Organisation

Ideal KM environment

PEOPLE

KnowledgeRepository

Existing methods/Processes

Learning

Newideas

Conversion

Insights

KnowledgeCreation

OrganisationalBenefits

Codified Technology

• New products• New markets• Smarter problem-solving•Value-added innovation•Better quality customer service•More efficient processes•More experienced staff

ExternalEnvironment

Awad & Ghaziri

Knowledge Management Cycle

KM Initiatives

KM Initiatives

KM initiative can be described as a systematic attempt to manage knowledge so as to make it visible, and accessible in the right format and at the right time for the benefit of the organisation.

Any KM initiative focus on one or more KM processes

KM Initiatives

Most of the KM initiatives have one of three aims:Make knowledge visible through maps,

yellow pages, and hypertextDevelop knowledge-intensive culture

Build a knowledge infrastructure

Knowledge Infrastructure

Knowledge infrastructure is the set of specific resources needed to facilitate learning within organisation toward a desired strategic goal.Resources could be physical,

informational, and educational.

KM Initiatives Activities that surround the management

of knowledge are those that have been depicted on the KM cycle.

Other activities include knowledge sharing, and knowledge seeking.

Note that any KM initiative must be aligned with the business objective.