review nowledge anagement and nowledge …

Alavi & Leidner/Knowledge Management

MIS Quarterly Vol. 25 No. 1, pp. 107-136/March 2001 107

MISQ REVIEW

REVIEW: KNOWLEDGE MANAGEMENT ANDKNOWLEDGE MANAGEMENT SYSTEMS:CONCEPTUAL FOUNDATIONS ANDRESEARCH ISSUES1, 2

By: Maryam AlaviJohn and Lucy Cook Chair of Information

TechnologyGoizueta Business SchoolEmory UniversityAtlanta, GA [email protected]

Dorothy E. LeidnerTexas Christian UniversityFort Worth, Texas 76129U.S.A., andINSEAD77305 Fontainebleau [email protected]

Abstract

Knowledge is a broad and abstract notion that hasdefined epistemological debate in western philo-sophy since the classical Greek era. In the past

1Richard Watson was the accepting senior editor for thispaper.

2MISQ Review articles survey, conceptualize, andsynthesize prior MIS research and set directions forfuture research. For more details see

http://www.misq.org/misreview/announce.html

few years, however, there has been a growinginterest in treating knowledge as a significantorganizational resource. Consistent with theinterest in organizational knowledge and knowl-edge management (KM), IS researchers havebegun promoting a class of information systems,referred to as knowledge management systems(KMS). The objective of KMS is to support crea-tion, transfer, and application of knowledge inorganizations. Knowledge and knowledge man-agement are complex and multi-faceted concepts.Thus, effective development and implementationof KMS requires a foundation in several richliteratures.

To be credible, KMS research and developmentshould preserve and build upon the significantliterature that exists in different but related fields.This paper provides a review and interpretation ofknowledge management literatures in differentfields with an eye toward identifying the importantareas for research. We present a detailed processview of organizational knowledge managementwith a focus on the potential role of informationtechnology in this process. Drawing upon theliterature review and analysis of knowledge man-agement processes, we discuss several importantresearch issues surrounding the knowledge man-agement processes and the role of IT in support ofthese processes.


108 MIS Quarterly Vol. 25 No. 1/March 2001

Keywords: Knowledge management, knowledgemanagement systems, research issues in knowl-edge management, organizational knowledgemanagement, knowledge management review

ISRL Categories: HA, A103, DD07, IB03

In post-capitalism, power comes fromtransmitting information to make it pro-ductive, not from hiding it.

Drucker 1995

Introduction

A knowledge-based perspective of the firm hasemerged in the strategic management literature(Cole 1998; Spender 1996a, 1996b; Nonaka andTakeuchi 1995). This perspective builds upon andextends the resource-based theory of the firm ini-tially promoted by Penrose (1959) and expandedby others (Barney 1991; Conner 1991; Wernerfelt1984).

The knowledge-based perspective postulates thatthe services rendered by tangible resourcesdepend on how they are combined and applied,which is in turn a function of the firm�s know-how(i.e., knowledge). This knowledge is embedded inand carried through multiple entities includingorganization culture and identity, routines, poli-cies, systems, and documents, as well as indivi-dual employees (Grant 1996a, 1996b; Nelson andWinter 1982; Spender 1996a, 1996b). Becauseknowledge-based resources are usually difficult toimitate and socially complex, the knowledge-based view of the firm posits that these knowledgeassets may produce long-term sustainablecompetitive advantage. However, it is less theknowledge existing at any given time per se thanthe firm�s ability to effectively apply the existingknowledge to create new knowledge and to takeaction that forms the basis for achieving compe-titive advantage from knowledge-based assets. Itis here that information technologies may play animportant role in effectuating the knowledge-based view of the firm. Advanced informationtechnologies (e.g., the Internet, intranets, extra-nets, browsers, data warehouses, data mining

techniques, and software agents) can be used tosystematize, enhance, and expedite large-scaleintra- and inter-firm knowledge management.

Although the concept of coding, storing, and trans-mitting knowledge in organizations is not new�training and employee development programs,organizational policies, routines, procedures, re-ports, and manuals have served this function foryears (Alavi and Leidner 1999)�organizationaland managerial practice has recently becomemore knowledge-focused. For example, bench-marking, knowledge audits, best practice transfer,and employee development point to the realizationof the importance of organizational knowledge andintangible assets in general (Grant 1996a, 1996b;Spender 1996a, 1996b). Given the importance oforganizational knowledge, our objective is tosynthesize the relevant and knowledge-centeredwork from multiple disciplines that in our viewcontribute to and shape our understanding ofknowledge management and knowledge manage-ment systems in organizations.

The paper is organized as follows: the nextsection presents a review of the managementliterature on knowledge and the firm. This sectionprovides a comprehensive summary of alternativeviews of knowledge and knowledge taxonomiesand their implications for knowledge management.The following section adopts the process view ofknowledge management and presents this view indetail with an eye toward identifying the potentialrole of information technologies in the variousstages of the knowledge management process. Abroader organizational perspective on knowledgemanagement research is then provided by dis-cussing important research themes that emergefrom the review of the literature. The final sectionprovides a summary and presents the discussionof the four general conclusions of our work.

Knowledge and the Firm:An Overview andBasic Concepts

The question of defining knowledge has occupiedthe minds of philosophers since the classical


MIS Quarterly Vol. 25 No. 1/March 2001 109

Greek era and has led to many epistemologicaldebates. It is unnecessary for the purposes of thispaper to engage in a debate to probe, question, orreframe the term knowledge, or discover the�universal truth,� from the perspective of ancient ormodern philosophy. This is because such anunderstanding of knowledge was neither a deter-minant factor in building the knowledge-basedtheory of the firm nor in triggering researcher andpractitioner interest in managing organizationalknowledge. It is, however, useful to consider themanifold views of knowledge as discussed in theinformation technology (IT), strategic manage-ment, and organizational theory literature. This willenable us to uncover some assumptions aboutknowledge that underlie organizational knowledgemanagement processes and KMS. We will beginby considering definitions of knowledge.

The Hierarchical View of Data,Information, and Knowledge

Some authors, most notably in IT literature,address the question of defining knowledge bydistinguishing among knowledge, information, anddata. The assumption seems to be that if knowl-edge is not something that is different from data orinformation, then there is nothing new orinteresting about knowledge management (Faheyand Prusak 1998). A commonly held view withsundry minor variants is that data is raw numbersand facts, information is processed data, andknowledge is authenticated information (Dreske1981; Machlup 1983; Vance 1997). Yet the pre-sumption of a hierarchy from data to information toknowledge with each varying along some dimen-sion, such as context, usefulness, or interpre-tability, rarely survives scrupulous evaluation.What is key to effectively distinguishing betweeninformation and knowledge is not found in thecontent, structure, accuracy, or utility of the sup-posed information or knowledge. Rather, knowl-edge is information possessed in the mind ofindividuals: it is personalized information (whichmay or may not be new, unique, useful, or accu-rate) related to facts, procedures, concepts,interpretations, ideas, observations, and judg-ments.

Tuomi (1999) makes the iconoclastic argumentthat the often-assumed hierarchy from data toknowledge is actually inverse: knowledge mustexist before information can be formulated andbefore data can be measured to form information. As such, �raw data� do not exist�even the mostelementary piece of �data� has already beeninfluenced by the thought or knowledge processesthat led to its identification and collection. Tuomiargues that knowledge exists which, whenarticulated, verbalized, and structured, becomesinformation which, when assigned a fixed repre-sentation and standard interpretation, becomesdata. Critical to this argument is the fact thatknowledge does not exist outside of an agent (aknower): it is indelibly shaped by one�s needs aswell as one�s initial stock of knowledge (Faheyand Prusak 1998; Tuomi 1999). Knowledge isthus the result of cognitive processing triggered bythe inflow of new stimuli. Consistent with thisview, we posit that information is converted toknowledge once it is processed in the mind ofindividuals and knowledge becomes informationonce it is articulated and presented in the form oftext, graphics, words, or other symbolic forms. Asignificant implication of this view of knowledge isthat for individuals to arrive at the same under-standing of data or information, they must share acertain knowledge base. Another important impli-cation of this definition of knowledge is thatsystems designed to support knowledge in organi-zations may not appear radically different fromother forms of information systems, but will begeared toward enabling users to assign meaningto information and to capture some of their knowl-edge in information and/or data.

Alternative Perspectiveson Knowledge

Knowledge is defined as a justified belief thatincreases an entity�s capacity for effective action(Huber 1991; Nonaka 1994). Knowledge may beviewed from several perspectives (1) a state ofmind, (2) an object, (3) a process, (4) a conditionof having access to information, or (5) a capability.



Knowledge has been described as �a state or factof knowing� with knowing being a condition of�understanding gained through experience orstudy; the sum or range of what has been per-ceived, discovered, or learned� (Schubert et al.1998). The perspective on knowledge as a stateof mind focuses on enabling individuals to expandtheir personal knowledge and apply it to theorganization�s needs. A second view definesknowledge as an object (Carlsson et al. 1996;McQueen 1998; Zack 1998a). This perspectiveposits that knowledge can be viewed as a thing tobe stored and manipulated (i.e., an object)Alternatively, knowledge can be viewed as a pro-cess of simultaneously knowing and acting(Carlsson et al. 1996; McQueen 1998; Zack1998a). The process perspective focuses on theapplying of expertise (Zack 1998a). The fourthview of knowledge is that of a condition of accessto information (McQueen 1998). According to thisview, organizational knowledge must be organizedto facilitate access to and retrieval of content. Thisview may be thought of as an extension of theview of knowledge as an object, with a specialemphasis on the accessibility of the knowledgeobjects. Finally, knowledge can be viewed as acapability with the potential for influencing futureaction (Carlsson et al. 1996). Watson (1999)builds upon the capability view by suggesting thatknowledge is not so much a capability for specificaction, but the capacity to use information;learning and experience result in an ability to inter-pret information and to ascertain what informationis necessary in decision making.

These different views of knowledge lead todifferent perceptions of knowledge management(Carlsson et al. 1996). If knowledge is viewed asan object, or is equated with information access,then knowledge management should focus onbuilding and managing knowledge stocks. Ifknowledge is a process, then the implied knowl-edge management focus is on knowledge flowand the processes of creation, sharing, anddistribution of knowledge. The view of knowledgeas a capability suggests a knowledge manage-ment perspective centered on building corecompetencies, understanding the strategic advan-tage of know-how, and creating intellectual capital.The major implication of these various concep-tions of knowledge is that each perspectivesuggests a different strategy for managing theknowledge and a different perspective of the roleof systems in support of knowledge management.

Table 1 summarizes the various views of knowl-edge just discussed and their implications forknowledge management and knowledge manage-ment systems. The perspective relied upon mostheavily in this article is that implied in the distinc-tion of knowledge from data and information,closely related to the perspective of knowledge asa state of mind.

Summary of KnowledgePerspective

Three major points emerge from the abovediscussion: (1) A great deal of emphasis is givento understanding the difference among data,information, and knowledge and drawing implica-tions from the difference. (2) Because knowledgeis personalized, in order for an individual�s or agroup�s knowledge to be useful for others, it mustbe expressed in such a manner as to be inter-pretable by the receivers. (3) Hoards of informa-tion are of little value; only that information whichis actively processed in the mind of an individualthrough a process of reflection, enlightenment, orlearning can be useful.

Taxonomies of Knowledge

Drawing on the work of Polanyi (1962, 1967),Nonaka (1994) explicated two dimensions ofknowledge in organizations: tacit and explicit.Rooted in action, experience, and involvement ina specific context, the tacit dimension of knowl-edge (henceforth referred to as tacit knowledge)is comprised of both cognitive and technicalelements (Nonaka 1994). The cognitive elementrefers to an individual�s mental models consistingof mental maps, beliefs, paradigms, and view-points. The technical component consists ofconcrete know-how, crafts, and skills that apply toa specific context. An example of tacit knowledgeis knowledge of the best means of approaching aparticular customer�using flattery, using a hardsell, using a no-nonsense approach. The explicitdimension of knowledge (henceforth referred to asexplicit knowledge) is articulated, codified, andcommunicated in symbolic form and/or naturallanguage. An example is an owner�s manualaccompanying the purchase of an electronicproduct. The manual contains knowledge on theappropriate operation of the product.



Table 1. Knowledge Perspectives and Their Implications

Perspectives

Implications forKnowledge

Management (KM)

Implications forKnowledge Manage-ment Systems (KMS)

Knowledge vis-à-vis data andinformation

Data is facts, raw numbers.Information is processed/interpreted data.Knowledge is personalizedinformation.

KM focuses on ex-posing individuals topotentially useful infor-mation and facilitatingassimilation of informa-tion

KMS will not appearradically different fromexisting IS, but will beextended toward helpingin user assimilation ofinformation

State of mind Knowledge is the state ofknowing and understanding.

KM involves enhancingindividual�s learningand understandingthrough provision ofinformation

Role of IT is to provideaccess to sources ofknowledge rather thanknowledge itself

Object Knowledge is an object tobe stored and manipulated.

Key KM issue isbuilding and managingknowledge stocks

Role of IT involvesgathering, storing, andtransferring knowledge

Process Knowledge is a process ofapplying expertise.

KM focus is onknowledge flows andthe process ofcreation, sharing, anddistributing knowledge

Role of IT is to providelink among sources ofknowledge to createwider breadth and depthof knowledge flows

Access toinformation

Knowledge is a condition ofaccess to information.

KM focus is organizedaccess to and retrievalof content

Role of IT is to provideeffective search andretrieval mechanisms forlocating relevantinformation

Capability Knowledge is the potentialto influence action.

KM is about buildingcore competenciesand understandingstrategic know-how

Role of IT is to enhanceintellectual capital by sup-porting development ofindividual and organiza-tional competencies

Knowledge can also be viewed as existing in theindividual or the collective (Nonaka 1994). Individual knowledge is created by and exists inthe individual whereas social knowledge iscreated by and inherent in the collective actions ofa group. Both Nonaka and others (e.g., Spender1992, 1996a, 1995b) rely heavily on the tacit-explicit, individual-collective knowledge distinctionbut do not provide a comprehensive explanationas to the interrelationships among the variousknowledge-types. One potentially problematic

aspect in the interpretation of this classification isthe assumption that tacit knowledge is more valu-able than explicit knowledge; this is tantamount toequating an inability to articulate knowledge withits worth. Few, with the exception of Bohn (1994),venture to suggest that explicit knowledge is morevaluable than tacit knowledge, a viewpoint that ifaccepted might favor a technology enabled knowl-edge management process (technology beingused to aid in explicating, storing, and dissemin-ating knowledge).



Whether tacit or explicit knowledge is the morevaluable may indeed miss the point. The two arenot dichotomous states of knowledge, butmutually dependent and reinforcing qualities ofknowledge: tacit knowledge forms the back-ground necessary for assigning the structure todevelop and interpret explicit knowledge (Polyani1975). The inextricable linkage of tacit andexplicit knowledge suggests that only individualswith a requisite level of shared knowledge cantruly exchange knowledge: if tacit knowledge isnecessary to the understanding of explicit knowl-edge, then in order for Individual B to understandIndividual A�s knowledge, there must be someoverlap in their underlying knowledge bases (ashared knowledge space) (Ivari and Linger 1999;Tuomi 1999). However, it is precisely in applyingtechnology to increase �weak ties� (i.e., informaland casual contacts among individuals) in organi-zations (Pickering and King 1995), and therebyincrease the breadth of knowledge sharing, that ITholds promise. Yet, absent a shared knowledgespace, the real impact of IT on knowledgeexchange is questionable. This is a paradox thatIT researchers have somewhat eschewed, andthat organizational researchers have used toquestion the application of IT to knowledgemanagement. To add to the paradox, the veryessence of the knowledge management challengeis to amalgamate knowledge across groups forwhich IT can play a major role. What is most atissue is the amount of contextual informationnecessary for one person or group�s knowledge tobe readily understood by another.

It may be argued that the greater the sharedknowledge space, the less the context needed forindividuals to share knowledge within the groupand, hence, the higher the value of explicitknowledge and the greater the value of IT appliedto knowledge management. On the other hand,the smaller the existing shared knowledge spacein a group, the greater the need for contextualinformation, the less relevant will be explicitknowledge, and hence the less applicable will beIT to knowledge management.

Tacit knowledge has received greater interest andattention than has explicit knowledge, and yet the

former is not alone in providing both benefits andchallenges to organizations. Explicit knowledgemay pose a particular challenge related to anassumption of legitimacy by virtue of beingrecorded (Jordan and Jones 1997). This couldlead to decision makers favoring explicit knowl-edge, at the expense of contradictory tacitknowledge, because it may be viewed as morelegitimized and, hence, justifiable. Moreover,given the ephemeral nature of some knowledge,explicating knowledge may result in a rigidity andinflexibility, which would impede, rather thanimprove, performance.

The tacit-explicit knowledge classification is widelycited, although sundry other knowledge classi-fications exist that eschew the recondite subtletiesof the tacit-explicit dimension. Some refer toknowledge as declarative (know-about or knowl-edge by acquaintance [Nolan Norton 1998]),procedural (know-how), causal (know-why),conditional (know-when), and relational (know-with) (Zack 1998c). A pragmatic approach toclassifying knowledge simply attempts to identifytypes of knowledge that are useful to organiza-tions. Examples include knowledge about custo-mers, products, processes, and competitors,which can include best practices, know-how andheuristic rules, patterns, software code, businessprocesses, and models; architectures, technology,and business frameworks; project experiences(proposals, work plans, and reports); and toolsused to implement a process such as checklistsand surveys (KPMG 1998b).

An understanding of the concept of knowledgeand knowledge taxonomies is important becausetheoretical developments in the knowledgemanagement area are influenced by the distinc-tion among the different types of knowledge.Furthermore, the knowledge taxonomies dis-cussed here can inform the design of knowledgemanagement systems by calling attention to theneed for support of different types of knowledgeand the flows among these different types.Knowledge management may provide an oppor-tunity for extending the scope of IT-based knowl-edge provision to include the different knowledgetypes summarized in Table 2.



Table 2. Knowledge Taxonomies and ExamplesKnowledge Types Definitions ExamplesTacit

Cognitive tacit:

Technical tacit:

Knowledge is rooted in actions,experience, and involvement inspecific context

Mental models

Know-how applicable to specificwork

Best means of dealing with specificcustomer

Individual�s belief on cause-effect relationshipsSurgery skills

Explicit Articulated, generalized knowledge Knowledge of major customers in aregion

Individual Created by and inherent in theindividual

Insights gained from completedproject

Social Created by and inherent in collectiveactions of a group

Norms for inter-groupcommunication

Declarative Know-about What drug is appropriate for anillness

Procedural Know-how How to administer a particular drug

Causal Know-why Understanding why the drug works

Conditional Know-when Understanding when to prescribethe drug

Relational Know-with Understanding how the druginteracts with other drugs

Pragmatic Useful knowledge for anorganization

Best practices, businessframeworks, project experiences,engineering drawings, marketreports

Knowledge Managementin Organizations

The recent interest in organizational knowledgehas prompted the issue of managing the knowl-edge to the organization�s benefit. Knowledgemanagement refers to identifying and leveragingthe collective knowledge in an organization to helpthe organization compete (von Krogh 1998).Knowledge management is purported to increaseinnovativeness and responsiveness (Hackbarth1998). A recent survey of European firms byKPMG Peat Marwick (1998b) found that almosthalf of the companies reported having suffered asignificant setback from losing key staff with 43%experiencing impaired client or supplier relations

and 13% facing a loss of income because of thedeparture of a single employee. In another sur-vey, the majority of organizations believed thatmuch of the knowledge they needed existedinside the organization, but that identifying that itexisted, finding it, and leveraging it remainedproblematic (Cranfield University 1998). Suchproblems maintaining, locating, and applyingknowledge have led to systematic attempts tomanage knowledge.

According to Davenport and Prusak (1998), mostknowledge management projects have one ofthree aims: (1) to make knowledge visible andshow the role of knowledge in an organization,mainly through maps, yellow pages, and hypertext



tools; (2) to develop a knowledge-intensive cultureby encouraging and aggregating behaviors suchas knowledge sharing (as opposed to hoarding)and proactively seeking and offering knowledge;(3) to build a knowledge infrastructure�not only atechnical system, but a web of connections amongpeople given space, time, tools, and encourage-ment to interact and collaborate.

Knowledge management is largely regarded as aprocess involving various activities. Slight discre-pancies in the delineation of the processes appearin the literature, namely in terms of the numberand labeling of processes rather than the under-lying concepts. At a minimum, one considers thefour basic processes of creating, storing/retrieving,transferring, and applying knowledge. Thesemajor processes can be subdivided, for example,into creating internal knowledge, acquiring exter-nal knowledge, storing knowledge in documentsversus storing in routines (Teece 1998) as well asupdating the knowledge and sharing knowledgeinternally and externally. We will return to theknowledge management processes in the frame-work section and consider the role of IT withineach process.

Knowledge Management Systems

Knowledge management systems (KMS) refer toa class of information systems applied tomanaging organizational knowledge. That is, theyare IT-based systems developed to support andenhance the organizational processes of knowl-edge creation, storage/retrieval, transfer, andapplication. While not all KM initiatives involve animplementation of IT, and admonitions against anemphasis on IT at the expense of the social andcultural facets of KM are not uncommon (Daven-port and Prusak 1998; Malhotra 1999; O�Dell andGrayson 1998), many KM initiatives rely on IT asan important enabler. While IT does not apply toall of the issues of knowledge management, it cansupport KM in sundry ways. Examples includefinding an expert or a recorded source of knowl-edge using online directories and searchingdatabases; sharing knowledge and workingtogether in virtual teams; access to information onpast projects; and learning about customer needs

and behavior by analyzing transaction data(KPMG 1998a), among others. Indeed, there isno single role of IT in knowledge management justas there is no single technology comprising KMS.

Reviewing the literature discussing applications ofIT to organizational knowledge managementinitiatives reveals three common applications:(1) the coding and sharing of best practices,(2) the creation of corporate knowledge direc-tories, and (3) the creation of knowledge net-works. One of the most common applications isinternal benchmarking with the aim of transferringinternal best practices (KPMG 1998a; O�Dell andGrayson 1998). For example, an insurance com-pany was faced with the commoditization of itsmarket and declining profits. The company foundthat applying the best decision making expertisevia a new underwriting process supported by aknowledge management system enabled it tomove into profitable niche markets and, hence, toincrease income (Davenport and Prusak 1998).

Another common application of knowledgemanagement is the creation of corporate direc-tories, also referred to as the mapping of internalexpertise. Because much knowledge in an organi-zation remains uncodified, mapping the internalexpertise is a potentially useful application ofknowledge management (Ruggles 1998). Onesurvey found that 74% of respondents believedthat their organization�s best knowledge wasinaccessible and 68% thought that mistakes werereproduced several times (Gazeau 1998). Suchperception of the failure to apply existing knowl-edge is an incentive for mapping internalexpertise.

A third common application of knowledge man-agement systems is the creation of knowledgenetworks (Ruggles 1998). For example, whenChrysler reorganized from functional to platform-based organizational units, they realized quicklythat unless the suspension specialists couldcommunicate easily with each other across plat-form types, expertise would deteriorate. Chryslerformed Tech Cul, bringing people togethervirtually and face-to-face to exchange and buildtheir collective knowledge in each of the specialtyareas. In this case, the knowledge management



effort was less focused on mapping expertise orbenchmarking than it was on bringing the expertstogether so that important knowledge was sharedand amplified. Providing online forums for com-munication and discussion may form knowledgenetworks. Buckman Laboratories uses an onlineinteractive forum where user comments arethreaded in conversational sequence and indexedby topic, author, and date. This has reportedlyenabled Buckman to respond to the changingbasis of competition that has evolved from merelyselling products to solving customers� chemicaltreatment problems (Zack 1998a). In anothercase, Ford found that just by sharing knowledge,the development time for cars was reduced from36 to 24 months, and through knowledge sharingwith dealers, the delivery delay reduced from 50 to15 days (Gazeau 1998).

Summary: Knowledge and the Firm

Information systems designed to support and aug-ment organizational knowledge managementneed to complement and enhance the knowledgemanagement activities of individuals and thecollectivity. To achieve this, the design of infor-mation systems should be rooted in and guided byan understanding of the nature and types oforganizational knowledge. Different perspectiveson knowledge and various knowledge taxonomieswere discussed earlier. These discussions high-light the importance of assessing and under-standing an organization�s knowledge position andits existing intellectual resources. Such an under-standing is needed for formulating a knowledgemanagement strategy and in analyzing the role ofinformation technology in facilitating knowledgemanagement (discussed in the next section). Inthe information systems (IS) field, it has beencommon to design systems primarily focused onthe codified knowledge (that is, explicit organiza-tional knowledge). Management reporting sys-tems, decision support systems, and executivesupport systems have all focused on the collectionand dissemination of this knowledge type.Knowledge management systems may provide anopportunity for extending the scope of IT-basedknowledge provision to include the differentknowledge forms and types shown in Table 2. We

are not suggesting that IT applied to the KMefforts of a given organization must provide themeans of capturing all types of knowledge men-tioned; the specific types of knowledge formingthe substance of an IT will depend upon anorganization�s context. We are suggesting, how-ever, that IT as applied to KM need not beconstrained to certain types of knowledge,because the advances in communication andinformation technologies enable greater possi-bilities than existed with previous classes ofinformation systems.

While the preponderance of knowledge manage-ment theory stems from strategy and organiza-tional theory research, the majority of knowledgemanagement initiatives involve at least in part, ifnot to a significant degree, information technology.Yet little IT research exists on the design, use, orsuccess of systems to support knowledgemanagement. The next section will examine thefour basic knowledge management processes andthe role that IT may play in each process.

Organizational KnowledgeManagement Processes:A Framework for Analysisof the Role of anInformation System

In this section, we develop a systematic frame-work that will be used to further analyze anddiscuss the potential role of information techno-logies in organizational knowledge management.This framework is grounded in the sociology ofknowledge (Berger and Luckman 1967; Gurvitch1971; Holzner and Marx 1979) and is based onthe view of organizations as social collectives and�knowledge systems.� According to this frame-work, organizations as knowledge systems consistof four sets of socially enacted �knowledgeprocesses�: (1) creation (also referred to asconstruction), (2) storage/retrieval, (3) transfer,and (4) application (Holzner and Marx 1979;Pentland 1995). This view of organizations asknowledge systems represents both the cognitiveand social nature of organizational knowledge and



its embodiment in the individual�s cognition andpractices as well as the collective (i.e., organiza-tional) practices and culture. These processes donot represent a monolithic set of activities, but aninterconnected and intertwined set of activities, asexplained later in this section.

Knowledge Creation

Organizational knowledge creation involves devel-oping new content or replacing existing contentwithin the organization�s tacit and explicit knowl-edge (Pentland 1995). Through social andcollaborative processes as well as an individual�scognitive processes (e.g., reflection), knowledgeis created, shared, amplified, enlarged, andjustified in organizational settings (Nonaka 1994).This model views organizational knowledge crea-tion as involving a continual interplay between thetacit and explicit dimensions of knowledge and agrowing spiral flow as knowledge moves throughindividual, group, and organizational levels. Fourmodes of knowledge creation have been iden-tified: socialization, externalization, internaliza-tion, and combination (Nonaka 1994). The sociali-zation mode refers to conversion of tacitknowledge to new tacit knowledge through socialinteractions and shared experience amongorganizational members (e.g., apprenticeship).The combination mode refers to the creation ofnew explicit knowledge by merging, categorizing,reclassifying, and synthesizing existing explicitknowledge (e.g., literature survey reports). Theother two modes involve interactions and con-version between tacit and explicit knowledge.Externalization refers to converting tacit knowl-edge to new explicit knowledge (e.g., articulationof best practices or lessons learned). Internali-zation refers to creation of new tacit knowledgefrom explicit knowledge (e.g., the learning andunderstanding that results from reading ordiscussion).

The four knowledge creation modes are not pure,but highly interdependent and intertwined. Thatis, each mode relies on, contributes to, andbenefits from other modes. For example, thesocialization mode can result in creation of newknowledge when an individual obtains a newinsight triggered by interaction with another. On

the other hand, the socialization mode mayinvolve transferring existing tacit knowledge fromone member to another through discussion ofideas. New organizational knowledge per se maynot be created, but only knowledge that is new tothe recipient. The combination mode in mostcases involves an intermediate step�that of anindividual drawing insight from explicit sources(i.e., internalization) and then coding the newknowledge into an explicit form (externalization). Finally, internalization may consist of the simpleconversion of existing explicit knowledge to anindividual�s tacit knowledge as well as creation ofnew organizational knowledge when the explicitsource triggers a new insight.

Figure 1 illustrates the interplay among Nonaka�sknowledge creation modes, and hence may beuseful in interpreting relationships between thefour modes.

In Figure 1, each arrow represents a form ofknowledge creation. The arrows labeled Arepresent externalization; the arrows labeled Brepresent internalization; the arrows labeled Crepresent socialization; and the arrows labeled Drepresent combination.

It may be useful to consider the conditions andenvironments that facilitate new knowledge crea-tion. Nonaka and Konno (1998) suggest that theessential question of knowledge creation isestablishing an organization�s �ba� (defined as acommon place or space for creating knowledge).Four types of ba corresponding to the four modesof knowledge creation discussed above areidentified: (1) originating ba, (2) interacting ba,(3) cyber ba, and (4) exercising ba (Nonaka andKonno 1998). Originating ba entails the sociali-zation mode of knowledge creation and is the bafrom which the organizational knowledge creationprocess begins. Originating ba is a common placein which individuals share experiences primarilythrough face-to-face interactions and by being atthe same place at the same time. Interacting bais associated with the externalization mode ofknowledge creation and refers to a space wheretacit knowledge is converted to explicit knowledgeand shared among individuals through the pro-cess of dialogue and collaboration. Cyber barefers to a virtual space of interaction and corres-



Storage (document,e-mail, intranet�)

Individual A�sTacit Knowledge

Individual B�sTacit Knowledge

C

A

B

Individual A�sExplicit Knowledge


Individual B�sExplicit Knowledge

A

B

Legend: Each arrow represents a form of knowledge creation.

A

B

D

A�Externalization; B�Internalization; C�Socialization;D�Combination

A

B


Individual A�sTacit Knowledge

Individual B�sTacit Knowledge

C

A

B




A

B

Legend: Each arrow represents a form of knowledge creation.

A

B

D

A�Externalization; B�Internalization; C�Socialization;D�Combination

A

B

Figure 1. Knowledge Creation Modes

ponds to the combination mode of knowledgecreation. Finally, exercising ba involves theconversion of explicit to tacit knowledge throughthe internalization process. Thus, exercising baentails a space for active and continuous indivi-dual learning. Understanding the characteristicsof various ba and the relationship with the modesof knowledge creation is important to enhancingorganizational knowledge creation. For example,the use of IT capabilities in cyber ba is advocatedto enhance the efficiency of the combination modeof knowledge creation (Nonaka and Konno 1998).Data warehousing and data mining, documentsrepositories, and software agents, for example,may be of great value in cyber ba.

We further suggest that considering the flexibilityof modern IT, other forms of organizational ba andthe corresponding modes of knowledge creation

can be enhanced through the use of various formsof information systems. For example, informationsystems designed for support of collaboration,coordination, and communication processes, as acomponent of the interacting ba, can facilitateteamwork and thereby increase an individual�scontact with other individuals. Electronic mail andgroup support systems have been shown toincrease the number of weak ties in organizations.This in turn can accelerate the growth of knowl-edge creation (Nonaka 1994). Intranets enableexposure to greater amounts of on-line organiza-tional information, both horizontally and vertically,than may previously have been the case. As thelevel of information exposure increases, the inter-nalization mode of knowledge creation, whereinindividuals make observations and interpretationsof information that result in new individual tacitknowledge, may increase. In this role, an intranet



can support individual learning (conversion ofexplicit knowledge to personal tacit knowledge)through provision of capabilities such as computersimulation (to support learning-by-doing) andsmart software tutors.

Computer-mediated communication may increasethe quality of knowledge creation by enabling aforum for constructing and sharing beliefs, forconfirming consensual interpretation, and forallowing expression of new ideas (Henderson andSussman 1997). By providing an extended fieldfor interaction among organizational members forsharing ideas and perspectives, and for esta-blishing dialog, information systems may enableindividuals to arrive at new insights and/or moreaccurate interpretations than if left to decipherinformation on their own. Boland et al. (1994)provide a specific example of an informationsystem called Spider that provides an environ-ment for representing, exchanging, and debatingdifferent individual perspectives. The systemactualizes an extended field in which �assump-tions are surfaced and questioned, new constructsemerge and dialog among different perspectivesis supported� (Boland et al. 1994, pp. 467). Assuch, the quality and frequency of the knowledgecreation is improved.

Knowledge Storage/Retrieval

Empirical studies have shown that while organi-zations create knowledge and learn, they alsoforget (i.e., do not remember or lose track of theacquired knowledge) (Argote et al. 1990; Darr etal. 1995). Thus, the storage, organization, and re-trieval of organizational knowledge, also referredto as organizational memory (Stein and Zwass1995; Walsh and Ungson 1991), constitute animportant aspect of effective organizational knowl-edge management. Organizational memoryincludes knowledge residing in various componentforms, including written documentation, structuredinformation stored in electronic databases, codi-fied human knowledge stored in expert systems,documented organizational procedures and pro-cesses and tacit knowledge acquired by indivi-duals and networks of individuals (Tan et al.1999).

Similar to the knowledge creation processdescribed in the previous section, a distinctionbetween individual and organizational memoryhas been made in the literature. Individual mem-ory is developed based on a person�s observa-tions, experiences, and actions (Argyris andSchön 1978; Nystrom and Starbuck 1981;Sanderlands and Stablein 1987). Collective ororganizational memory is defined as �the meansby which knowledge from the past, experience,and events influence present organizationalactivities� (Stein and Zwass 1995, p. 85). Organi-zational memory extends beyond the individual�smemory to include other components such asorganizational culture, transformations (productionprocesses and work procedures), structure (formalorganizational roles), ecology (physical worksetting) and information archives (both internaland external to the organization) (Walsh andUngson 1991).

Organizational memory is classified as semanticor episodic (El Sawy et al. 1996; Stein and Zwass1995). Semantic memory refers to general, explicitand articulated knowledge (e.g., organizationalarchives of annual reports), whereas episodicmemory refers to context-specific and situatedknowledge (e.g., specific circumstances of organi-zational decisions and their outcomes, place, andtime). Memory may have both positive and nega-tive potential influences on behavior and perfor-mance. On the positive side, basing and relatingorganizational change in past experience facili-tates implementation of the change (Wilkins andBristow 1987). Memory also helps in storing andreapplying workable solutions in the form of stan-dards and procedures, which in turn avoid thewaste of organizational resources in replicatingprevious work.

On the other hand, memory has a potential nega-tive influence on individual and organizationalperformance. At the individual level, memory canresult in decision-making bias (Starbuck and Hed-berg 1977). At the organizational level, memorymay lead to maintaining the status quo by rein-forcing single loop learning (defined as a processof detecting and correcting errors) (Argyris andSchön 1978). This could in turn lead to stable,consistent organizational cultures that are resis-tant to change (Denison and Mishra 1995).



Despite the concerns about the potential con-straining role of organizational memory, there is apositive perspective on the influence of IT-enabledorganizational memory on the behavior andperformance of individuals and organizations.

Advanced computer storage technology andsophisticated retrieval techniques, such as querylanguages, multimedia databases, and databasemanagement systems, can be effective tools inenhancing organizational memory. These toolsincrease the speed at which organizationalmemory can be accessed. Weiser and Morrison(1998) give the example of AI-STARS, a projectmemory system at DEC (Digital EquipmentCorporation) that combines such information asbulletin board postings, product release state-ments, service manuals, and e-mail messages toenable rapid access to product information forassisting customer problems. Product memorycan be facilitated with corporate intranets, so thatproduct and pricing changes can be immediatelynoted in the system instead of having brochuresreprinted. This in turn avoids the lag time resultingfrom the time a change occurs to the time whenthe sales personnel become aware of the change(Leidner 1998).

Groupware enables organizations to create intra-organizational memory in the form of both struc-tured and unstructured information and to sharethis memory across time and space (Vanden-bosch and Ginzberg 1996). For example, McKin-nsey�s Practice Development Network places coreproject documentation online for the purposes ofpromoting memory and learning organization-wide(Stein and Zwass 1995). IT can play an importantrole in the enhancement and expansion of bothsemantic and episodic organizational memory.Document management technology allows knowl-edge of an organization�s past, often dispersedamong a variety of retention facilities, to be effec-tively stored and made accessible (Stein andZwass 1995). Drawing on these technologies,most consulting firms have created semanticmemories by developing vast repositories ofknowledge about customers, projects, compe-tition, and the industries they serve (Alavi 1997).

Knowledge Transfer

Having discussed knowledge creation andstorage/retrieval, we now expand Figure 1 intoFigure 2 and consider the important issue ofknowledge transfer. The arrows from Figure 1 arenow represented as two-way arrows.

In Figure 2, the arrows labeled D represent theprocess of knowledge application and thoselabeled E represent the learning, or new knowl-edge creation, that occurs when individuals applyknowledge and observe the results. The arrowslabeled F represent the transfer of an individual�sexplicit knowledge to group semantic memory(which can occur, for instance, when individualsplace reports they have prepared on a groupserver for others to view). The arrows labeled Grepresent the possible transfer from individual tacitknowledge to group episodic memory. Individualsmay likewise learn from the group semantic andepisodic memories, reflected in arrows F and G.Indeed, the group episodic memory is critical inhelping an individual interpret and learn from thegroup semantic memory.

As the figure illustrates, an important process inknowledge management is that of knowledgetransfer, with each transfer of knowledge repre-sented by an arrow. Transfer occurs at variouslevels: transfer of knowledge between individuals,from individuals to explicit sources, from indivi-duals to groups, between groups, across groups,and from the group to the organization.

Considering the distributed nature of organi-zational cognition, an important process of knowl-edge management in organizational settings is thetransfer of knowledge to locations where it isneeded and can be used. However, this is not asimple process in that organizations often do notknow what they know and have weak systems forlocating and retrieving knowledge that resides inthem (Huber 1991). Communication processesand information flows drive knowledge transfer inorganizations. Gupta and Govindarajan (2000)have conceptualized knowledge transfer (knowl-edge flows in their terminology) in terms of five



Individual A�s Individual B�s

Storage (documents,email)

Tacit Knowledge Tacit Knowledge




KnowledgeApplication


Group 1�s Episodic Memory

Group 1�s semantic memory

EE

D

D

F

G G

Legend:D--The Process of Knowledge ApplicationE--The Process of Learning F--The Transfer of Individual Explicit Knowledge to Group Semantic Memory and vice versaG--The Transfer of Individual Tacit Knowledge to Group Episodic Memory and vice versa

F











EE

D

D

F

G G

Legend:D--The Process of Knowledge ApplicationE--The Process of Learning F--The Transfer of Individual Explicit Knowledge to Group Semantic Memory and vice versaG--The Transfer of Individual Tacit Knowledge to Group Episodic Memory and vice versa

F

Figure 2. Knowledge Transfer among Individuals in a Group

elements: (1) perceived value of the source unit�sknowledge, (2) motivational disposition of thesource (i.e., their willingness to share knowledge),(3) existence and richness of transmission chan-nels, (4) motivational disposition of the receivingunit (i.e., their willingness to acquire knowledgefrom the source), and (5) the absorptive capacityof the receiving unit, defined as the ability not onlyto acquire and assimilate but also to use knowl-edge (Cohen and Levinthal 1990). The least con-trollable element is the fifth: knowledge must gothrough a recreation process in the mind of thereceiver (El Sawy et al. 1998). This recreationdepends on the recipient�s cognitive capacity toprocess the incoming stimuli (Vance and Eynon1998).

The majority of the literature focuses on the thirdelement, that of the knowledge transfer channels.Knowledge transfer channels can be informal orformal, personal or impersonal (Holtham andCourtney 1998). Informal mechanisms, such asunscheduled meetings, informal seminars, orcoffee break conversations, may be effective inpromoting socialization but may preclude widedissemination (Holtham and Courtney 1998).Such mechanisms may also be more effective insmall organizations (Fahey and Prusak 1998).However, such mechanisms may involve certainamounts of knowledge atrophy in that, absent aformal coding of the knowledge, there is noguarantee that the knowledge will be passed



accurately from one member to others. Thisparallels problems with the recipient�s ability toprocess the knowledge. Learning problems caninvolve recipients filtering the knowledge theyexchange, interpreting the knowledge from theirown frame of reference, or learning from only aselect group of knowledge holders (Huysam et al.1998). Formal transfer mechanisms, such astraining sessions and plant tours, may ensuregreater distribution of knowledge but may inhibitcreativity. Personal channels, such as appren-ticeships or personnel transfers, may be moreeffective for distributing highly context specificknowledge whereas impersonal channels, such asknowledge repositories, may be most effective forknowledge that can be readily generalized to othercontexts. Personnel transfer is a formal, personalmechanism of knowledge transfer. Such trans-fers, common in Japan, immerse team membersin the routines of other members, thereby allowingaccess to the partner�s stock of tacit knowledge(Fahey and Prusak 1998). A benefit is thatlearning takes place without the need to firstconvert tacit knowledge to explicit, saving timeand resources and preserving the original knowl-edge base (Fahey and Prusak 1998). The mosteffective transfer mechanism depends upon thetype of knowledge being transferred (Inkpen andDinur 1998). Much as the existence of �care� maybe important to knowledge transfer betweenindividuals, the existence of a close, tight interfaceis critical at the organizational level. A narrow anddistant interface has been found to be an obstacleto learning and knowledge sharing (Inkpen andDikur 1998).

IT can support all four forms of knowledgetransfer, but has mostly been applied to informal,impersonal means (through such venues as LotusNotes discussion databases) and formal, imper-sonal means (such as knowledge maps or corpor-ate directories). An innovative use of technologyfor transfer is the use of intelligent agent softwareto develop interest profiles of organizational mem-bers in order to determine which members mightbe interested recipients of point-to-point electronicmessages exchanged among other members(O�Dell and Grayson 1998). Employing video

technologies can also enhance transfer. Forexample, offshore drilling knowledge is madeavailable globally at British Petroleum by desktopvideo conferencing in which a screen will includeimages of the participants, windows of technicaldata, video clips of the physical issue under consi-deration, specifications, contractual data, andplans (Cranfield University 1998).

IT can increase knowledge transfer by extendingthe individual�s reach beyond the formal communi-cation lines. The search for knowledge sources isusually limited to immediate coworkers in regularand routine contact with the individual. However,individuals are unlikely to encounter new knowl-edge through their close-knit work networksbecause individuals in the same clique tend topossess similar information (Robertson et al.1996). Moreover, studies show that individualsare decidedly unaware of what their cohorts aredoing (Kogut and Zander 1996). Thus, expandingthe individual�s network to more extended,although perhaps weaker, connections is centralto the knowledge diffusion process because suchnetworks expose individuals to more new ideas(Robertson et al. 1996). Computer networks andelectronic bulletin boards and discussion groupscreate a forum that facilitates contact between theperson seeking knowledge and those who mayhave access to the knowledge. For example, thismay be accomplished by posting a question in theform of �does anybody know� or a �request forhelp� to the discussion group. Corporate direc-tories may enable individuals to rapidly locate theindividual who has the knowledge that might helpthem solve a current problem. At Hewlett-Packard, the primary content of one system is aset of expert profiles containing a directory of thebackgrounds, skills, and expertise of individualswho are knowledgeable on various topics. Oftensuch metadata (knowledge about where theknowledge resides) proves to be as important asthe original knowledge itself (Andreu and Ciborra1997). Providing taxonomies or organizationalknowledge maps enables individuals to rapidlylocate either the knowledge or the individual whohas the needed knowledge, more rapidly thanwould be possible without such IT-based support(Offsey 1997).



Knowledge Application

An important aspect of the knowledge-basedtheory of the firm is that the source of competitiveadvantage resides in the application of theknowledge rather than in the knowledge itself.Grant (1996b) identifies three primary mechan-isms for the integration of knowledge to createorganizational capability: directives, organizationalroutines, and self-contained task teams. Directivesrefer to the specific set of rules, standards, pro-cedures, and instructions developed through theconversion of specialists� tacit knowledge to expli-cit and integrated knowledge for efficient commun-ication to non-specialists (Demsetz 1991).Examples include directives for hazardous wastedisposal or airplane safety checks and main-tenance. Organizational routines refer to thedevelopment of task performance and coordi-nation patterns, interaction protocols, and processspecifications that allow individuals to apply andintegrate their specialized knowledge without theneed to articulate and communicate what theyknow to others. Routines may be relatively simple(e.g., organizing activities based on time-patterned sequences such as an assembly line),or highly complex (e.g., a cockpit crew flying alarge passenger airplane). The third knowledgeintegration mechanism is the creation of self-contained task teams. In situations in which taskuncertainty and complexity prevent the speci-fication of directives and organizational routines,teams of individuals with prerequisite knowledgeand specialty are formed for problem solving.

Technology can support knowledge application byembedding knowledge into organizational rou-tines. Procedures that are culture-bound can beembedded into IT so that the systems themselvesbecome examples of organizational norms. Anexample is Mrs. Field�s use of systems designedto assist in every decision from hiring personnel towhen to put free samples of cookies out on thetable. The system transmits the norms and beliefsheld by the head of the company to organizationalmembers (Bloodgood and Salisbury 1998). Tech-nology enforced knowledge application raises aconcern that knowledge will continue to be appliedafter its real usefulness has declined. While theinstitutionalization of �best practices� by em-

bedding them into IT might facilitate efficienthandling of routine, �linear,� and predictable situa-tions during stable or incrementally changingenvironments, when change is radical and dis-continuous, there is a persistent need for con-tinual renewal of the basic premises underlyingthe practices archived in the knowledge reposi-tories (Malhotra 1999). This underscores the needfor organizational members to remain attuned tocontextual factors and explicitly consider thespecific circumstances of the current environ-ment. A second problem may be deciding uponthe rules and routines to apply to a problem, giventhat over time, the organization has learned andcodified a large number of rules and routines, sothat choosing which rules to activate for a specificchoice making scenario is itself problematic.Shared meanings and understandings about thenature and needs of a particular situation can beused to guide rule activation (Nolan Norton 1998).

Although there are challenges with applyingexisting knowledge, IT can have a positiveinfluence on knowledge application. IT canenhance knowledge integration and application byfacilitating the capture, updating, and accessibilityof organizational directives. For example, manyorganizations are enhancing the ease of accessand maintenance of their directives (repairmanuals, policies, and standards) by making themavailable on corporate intranets. This increasesthe speed at which changes can be applied. Also,organizational units can follow a faster learningcurve by accessing the knowledge of other unitshaving gone through similar experiences. More-over, by increasing the size of individuals� internalsocial networks and by increasing the amount oforganizational memory available, information tech-nologies allow for organizational knowledge to beapplied across time and space. IT can alsoenhance the speed of knowledge integration andapplication by codifying and automating organi-zational routines. Workflow automation systemsare examples of IT applications that reduce theneed for communication and coordination andenable more efficient use of organizationalroutines through timely and automatic routing ofwork-related documents, information, rules, andactivities. Rule based expert systems are anothermeans of capturing and enforcing well specifiedorganizational procedures.












Group 2�s semantic memoryGroup 3�s semantic memory



Individual C�sTacit Knowledge




Individual D�sTacit Knowledge

Individual C�sExplicit Knowledge

Individual D�sExplicit Knowledge

H

J

H

H H

J JI I

I I

Legend:H--An individual drawing upon group memory and applying the knowledge to a situation.I-- The learning derived from an individual in applying knowledge that becomes part of the group�s episodic memory.J--The sharing of knowledge across group systems, such as the sharing of best practices.










Group 2�s semantic memoryGroup 3�s semantic memory



Individual C�sTacit Knowledge




Individual D�sTacit Knowledge

Individual C�sExplicit Knowledge

Individual D�sExplicit Knowledge

H

J

H

H H

J JI I

I I



Figure 2. Knowledge Transfer among Individuals in a Group

Summary: Organizational KnowledgeManagement Processes

To summarize, this section has described andelaborated on a knowledge management frame-work based on the view of organizations asknowledge systems. One of the important impli-cations of this framework is that knowledgemanagement consists of a dynamic and con-tinuous set of processes and practices embeddedin individuals, as well as in groups and physicalstructures. At any point in time and in any part ofa given organization, individuals and groups maybe engaged in several different aspects andprocesses of knowledge management. Thus,knowledge management is not a discrete, inde-pendent, and monolithic organizational pheno-

menon. Figure 3 builds upon Figure 2 to illustratethe �web� of knowledge management activities inorganizational settings. The figure introduces twonew groups�Groups 2 and 3�to illustrate thepotential knowledge transfer across groups. Forsimplicity purposes, only one member is repre-sented in Groups 2 and 3.

Figure 3 depicts the transfer of knowledge amongindividuals and groups. Once individual A shares(transfers) some knowledge with individual B,individual B�s knowledge processes may havebeen triggered. For example, A�s knowledgetransfer may lead to B�s knowledge creation. Bmay chose to apply the knowledge, consult withother members, or record the knowledge.Knowledge hence flows between individuals and



a major challenge of KM is to facilitate these flowsso that the maximum amount of transfer occurs(assuming that the knowledge individuals createhas value and can improve performance).Individuals in a group or community of practicethen develop a group knowledge (the collectivityof their stored memory, be it organized informallyin e-mail communications or formally in aknowledge repository). The individual is con-nected to the group processes through transfer(an individual may share knowledge with thegroup during a decision-making meeting, forexample) or through a centralized storagemechanism (e.g., computer files or regularmeetings). Individuals can then call on thecentralized memory to make decisions, if needed(arrows H). Individuals learn from the applicationof knowledge and their learning becomesembedded into their tacit knowledge space andthe group�s episodic memory (arrows I). Organi-zational knowledge processes would then consistof the summation of the individual and groupknowledge processes. In this case, one groupmay have acquired and applied knowledge to agiven situation and coded this knowledge in theform of a certain routine. This �best practice� maythen be shared with other groups by allowingaccess to group memory systems (arrows J) or byfacilitating intergroup dialogue.

Figure 3 can elucidate some of the major chal-lenges of knowledge management at the indivi-dual, group, and the organizational (i.e., inter-groups) levels. One primary challenge is to makeindividual knowledge available, and meaningful, toothers (Ackerman and Halverson 1999). At thegroup level, this means enabling a group�sepisodic memory to be accessible to other groups,implying an overlap in group membership. Thecodification of knowledge into semantic memoryneither guarantees efficient dissemination noreffective storage (Jordan and Jones 1997).Transfer among groups may be challenged notonly by the lack of shared episodic memory, butby the practical issue of informing groups of whenthe semantic memory of a group has been modi-fied (say, a new important document summarizinga flaw in product design is now available on thegroup intranet of an overseas R&D unit). Even ifone group is aware of, and chooses to access,

another�s semantic memory, how does thereceiving group validate the information anddetermine whether to apply it? Group gate-keepers (internal boundary spanners) may act aslinks between the episodic memory of two groupsand, hence, increase the relevance of knowledgetransfer. Do certain individuals act as such inter-nal boundary spanners, searching within anextended network for practices that might improvetheir unit? In short, to improve knowledge man-agement, utilizing information technology impliesattention not only to improving the individual andgroup level processes of knowledge creation andstorage, but also to improving the linkages amongindividuals and between groups.

Another implication of this framework is that thefour knowledge processes of creation, storage/retrieval, transfer, and application are essential toeffective organizational knowledge management.We contend that the application of informationtechnologies can create an infrastructure andenvironment that contribute to organizationalknowledge management by actualizing, sup-porting, augmenting, and reinforcing knowledgeprocesses at a deep level through enhancing theirunderlying dynamics, scope, timing, and overallsynergy. Table 3 summarizes the four processesand the potential role of IT in facilitating eachprocess. While the four processes are presentedas discrete, it is important to realize that we arenot implying a linear sequence, as evident in theFigures 1, 2 and 3. An individual may create newknowledge (have a new insight) and immediatelyapply this knowledge (use it as the basis of adecision, for example) without either storing it(except in his/her internal memory) or transferringit to others. The application of the knowledge maylead to additional new knowledge (perhapsconcerning how best to apply the knowledge),which may or may not be coded or transferred.Knowledge that has been applied might be codedafter application (e.g., incorporated into an organi-zational routine). The objective of Table 3 is not toprovide an exhaustive set of IT tools for KM, but toillustrate that a variety of IT tools may be drawnupon for support of different KM processes inorganizations.

Table 3. Knowledge Management Processes and the Potential Role of ITKnowledgeManagementProcesses

KnowledgeCreation

KnowledgeStorage/Retrieval

KnowledgeTransfer


SupportingInformationTechnologies

Data miningLearning tools

Electronic bulletin boardsKnowledge repositoriesDatabases

Electronic bulletin boardsDiscussion forumsKnowledge directories

Expert systemsWorkflow systems

IT Enables Combining new sources ofknowledgeJust in time learning

Support of individual andorganizational memoryInter-group knowledgeaccess

More extensive internalnetworkMore communicationchannels availableFaster access toknowledge sources

Knowledge can be appliedin many locationsMore rapid application ofnew knowledge throughworkflow automation

PlatformTechnologies

Groupware and communication technologies

INTRANETS



Research Issues in KnowledgeManagement

The review of the literature on knowledge, knowl-edge management, and knowledge managementsystems uncovers a broad gamut of potentialresearch streams. While much theory exists onknowledge management, little empirical work hasbeen undertaken. Hence, there are large gaps inthe body of knowledge in this area. In this sec-tion, we will briefly highlight some researchthemes that, in our view, aim at bridging the gaps.

Research Issues onKnowledge Creation

Much of the existing research on knowledgecreation focuses on the source and state of knowl-edge. Research is now needed that movesbeyond the source and state to consider the con-ditions that facilitate knowledge creation. Descrip-tive studies have identified culture as a majorcatalyst, or alternatively a major hindrance, toknowledge creation and sharing. A knowledge-friendly organizational culture has been identifiedas one of the most important conditions leading tothe success of KM initiatives in organizations(Davenport and Prusak 1998). Firm-wide KMSusually require profound cultural renovations be-cause, traditionally, organizations have rewardedtheir professionals and employees based on theirindividual performance and know-how. Culturalbarriers to KM (e.g., organizational norms that pro-mote and encourage knowledge hoarding) cannotbe effectively reduced or eliminated through ITapplications. In many organizations, a major cul-tural shift may be required to change employees�attitudes and behavior so that they willingly andconsistently share their knowledge and insights.If so, must cultural change occur before knowl-edge management initiatives can be successfullyundertaken or can knowledge management initia-tives facilitate cultural change? What culturesfoster knowledge creation? Research can exa-mine the relationships between various organi-zational cultures and knowledge creation.

Organizational design, in particular the building ofcommunities of practice and shared knowledge

creation spaces, is also considered an importantcatalyst for knowledge creation. For instance, at3M, employees can set aside 15% of their worktime to pursue personal research interests.Computer terminals are located throughout thecompany, including large open meeting areasaround which people may gather to partake indiscussions. In concert with the integration ofopen access to knowledge databases, coor-dination between production, marketing, distri-bution, and product design is improved (Grahamand Pizzo 1998). As was shown in Figure 3,individuals may benefit more from semanticmemory if they also share an episodic memory.Organizational design can be used to increase theepisodic memory and, hence, make the semanticmemory more readily interpretable.

Some argue that the close ties in a communitylimit knowledge creation because individuals areunlikely to encounter new ideas in close-knitnetworks where they tend to possess similarinformation (Robertson et al. 1996). This viewupholds the need for weak ties to expose indivi-duals to new ideas that can trigger new knowledgecreation. In terms of design, much can be done toencourage knowledge creation, storage/retrieval,and transfer. Distant, informal, spontaneous con-tact between different organizational subunitsmight be an important mechanism for knowledgecreation (Roberston et al. 1996). The alternateview argues that knowledge creation is betterserved by close ties in a community of practicesince individuals share a common language andwould be more at ease discussing ideas openlyand challenging the ideas of others. Moreover,such communities develop a shared under-standing or a �collective knowledge base� (Brownand Duguid 1998) from which knowledgeemerges. Hayduk (1998) hypothesizes thatlearning processes are more effective whenshared within or among a self-selected peergroup. Thus, one research question whether ITcan enhance knowledge creation by enablingweak ties (e.g., spontaneous e-mail exchangesamong distant members of an organization) whilereinforcing close ties (by allowing more frequentinteractions among the members of a communityof practice). Can, and if so, how do, communitiesof practice evolve rapidly through electronicconnections and interactions alone?



Table 4. Research Questions Concerning Knowledge Creation

Research Question 1: What conditions facilitate knowledge creation in organizations?

Research Question 1a: Do certain organizational cultures foster knowledge creation?

Research Question 1b: Can IT enhance knowledge creation by enabling weak ties to develop andby reinforcing existing close ties?

Research Question 1c: How is knowledge originating from outside a unit evaluated for internal use?

Research Question 1d: Does lack of a shared context inhibit the adoption of knowledge originatingfrom outside a unit?

Research is also needed to determine how tightcollaboration should be within the shared space toimprove and accelerate knowledge creation andwhether shared knowledge creation spaces canbe designed in such a manner to tighten collabor-ation (El Sawy et al. 1998). Research could alsoconsider how knowledge coming from outside theshared space is evaluated: does a lack of contextprevent the effective adoption of outside knowl-edge? Or are members able to adopt and modifyoutside knowledge to meet their needs? Answersto these questions have implications for the appro-priate scale and features of knowledge manage-ment systems. Table 4 summarizes the researchquestions concerning knowledge creation.

Research Issues on KnowledgeStorage and Retrieval

Knowledge storage involves obtaining the knowl-edge from organizational members and/or exter-nal sources, coding and indexing the knowledge(for later retrieval), and capturing it. Incentives areimportant to overcome some of the major barriersto knowledge storage success. These barriersinclude the lack of employee time to contributetheir knowledge (Cranfield University 1998; KPMG1998b) and a corporate culture that has histori-cally not rewarded contributing and sharing ofinsights (Brown and Duguid 1998; Cranfield Uni-versity 1998; KPMG 1998b). Many organizationsare relatively lean and many employees do nothave time to make knowledge available, share itwith others, teach and mentor others, use theirexpertise to innovate, or find ways of working

smarter (Glazer 1998). Instead, they are task-focused, shifting existing workloads to fight dead-lines. Moreover, in many organizations, membersfeel that their futures with the company aredependent upon the expertise they generate andnot on the extent to which they help others. Insuch situations, it is then expected that individualswill attempt to build up and defend their ownhegemonies of knowledge (von Krogh 1998).People may be unaware of what they havelearned; moreover, even if they realize what theyhave learned from a project, they may be unawareof what aspects of their learning would be relevantfor others. Without a systematic routine for cap-turing knowledge, a firm might not benefit from itsbest knowledge being captured. Research isneeded to address the issue of what types ofincentives are effective in inculcating organiza-tional members with valuable knowledge tocontribute and share their knowledge.

An important consideration with storing knowledgeis how much context to include. When the contextsurrounding knowledge creation is not shared, it isquestionable whether storing the knowledgewithout sufficient contextual detail will result ineffective uses. This could lead to the essence ofthe knowledge being lost (Zack 1998c). In addi-tion to the question of how much context tocapture is the question of how much knowledge tocode and store. The more readily available theknowledge, the more likely its reuse. On the otherhand, the more readily available, the greater thelikelihood of knowledge misuse, i.e., knowledgebeing misapplied to a different context. Further-more, today�s knowledge may be tomorrow�signorance in the sense that knowledge emerges



Table 5. Research Questions Concerning Knowledge Storage and Retrieval

Research Question 2: What incentives are effective in encouraging knowledge contribution andsharing in organizations?

Research Question 2a: How much context needs to be included in knowledge storing to ensureeffective interpretation and application?

Research Question 2b: Is stored knowledge accessed and applied by individuals who do not knowthe originator of the knowledge?

Research Question 2c: What retrieval mechanisms are most effective in enabling knowledgeretrieval.

and evolves over time and any system designedto store the knowledge must ensure that theknowledge is dynamic and updated rather thanstatic. To be useful, it should be easy to retrievethe captured knowledge. Creation of easy to useand easy to remember retrieval mechanisms (e.g.,search and retrieval commands) are importantaspects of an organizational KM strategy. Avariety of search and retrieval approaches andtools (e.g., browsers) to access organizationalknowledge captured in data warehouses andknowledge repositories exist. Two general modelsto information retrieval exist, the �pull� and the�push� models. The pull model is the traditionalmodel and involves search for and retrieval ofinformation based on specific user queries. In thepush model, information is automatically retrievedand delivered to the potential user based uponsome predetermined criteria. The challenge indesign of organizational knowledge retrieval stra-tegies is providing timely and easy access toknowledge while avoiding a condition of informa-tion overload. Thus, as summarized in Table 5,research is needed to address several importantissues regarding knowledge storage and retrieval.

Research Issues onKnowledge Transfer

The notion of knowledge transfer raises severalimportant issues: first is the question of to whatdegree knowledge needs to be, and even can be,transferred internally, which may depend upon theextent of interdependency among subgroups orindividuals (Leonard and Sensiper 1998). Giventhe ease with which individuals are able to transfer

the explicit components of their knowledge, wewould expect them to transfer more knowledgethan they would if they had to rely solely on verbalor face-to-face communication. However, thisdoes not imply that individuals will expand thenumber of other people with whom they shareknowledge. They may simply share more with thesame individuals (such as via e-mail or group-ware) by virtue of the ease and speed with whichthey are able to electronically transfer informationto their cohorts. Thus, a primary question con-cerning knowledge transfer is the degree to whichknowledge transfer is increased in an organizationas a result of applying information technology tothe knowledge management initiative.

A second major issue involves locating knowl-edge, both how to find needed knowledgedocuments and how to find the knowledge neededwithin a large collection of documents (Dworman1998). One system, Homer, sorts through col-lections of documents to find specific informationrelevant to a query as well as to identify patternsof information in a large collection of documents(Dworman 1998). A problem, similar to the infor-mation overload problem, exists when individualsare aware that the relevant knowledge exists inorganizational memory, but are discouraged fromsearching for the knowledge by the sheer volumeof available knowledge. For example, most devel-opers at Hewlett-Packard are aware that theSPaM system holds all of their past projectshistory, but rarely seek answers in SPaM becausefinding the answer would take days (Powell 1998).Thus, research on the development of effectiveorganizational and technical strategies for orga-nizing, retrieving, and transmitting knowledge areneeded to facilitate knowledge transfer.



Table 6. Research Questions Concerning Knowledge Transfer

Research Question 3: How can knowledge be effectively transferred among organizational units?

Research Question 3a: To what degree does the application of IT to knowledge transfer increasethe transfer of knowledge among individuals within a group and between groups?

Research Question 3b: What organizational and technical strategies are effective in facilitatingknowledge transfer?

Research Question 3c: What social, cultural, or technical attributes of organizational settingsencourage knowledge transfer by balancing the push and pull processes?

Research Question 3d: Does the application of IT to knowledge transfer inadvertently discourageexternal searches for knowledge?

A third important issue on knowledge transferconcerns knowledge flows between the provider(source) and the knowledge seeker. From theprovider�s perspective, flow is a selective pull pro-cess; from a seeker�s perspective, flow is a selec-tive push process (Holthouse 1998). Balancingthe pull and push processes then is an importantaspect of knowledge transfer in organizations.Research that focuses on social, cultural, andtechnical attributes of organizational settings thatencourage and facilitate knowledge flows bybalancing the push and pull processes isimportant.

Finally, a consideration with knowledge transfer isthe extent to which individuals discontinue exter-nal searches for new knowledge and rely solely oninternal knowledge, so that knowledge is trans-ferred internally but little external knowledge istransferred into the organization. A reliance on ITmay facilitate the process of coding knowledgeinto semantic memory and improving internal link-ages within a group and among groups, butindividuals may consequently spend more timefocusing on internal than external searches forknowledge. Table 6 summarizes the researchquestions concerning knowledge transfer.

Research Issues onKnowledge Application

The processes of knowledge creation, storage/retrieval, and transfer do not necessarily lead toenhanced organizational performance; effectiveknowledge application does. Organizational per-

formance often depends more on an ability to turnknowledge into effective action and less onknowledge itself. It is widely recognized that orga-nizations have gaps between what they know andwhat they do (Pfeffer and Sutton 2000). Theremay be several reasons for organizational mem-bers to access and assimilate knowledge but notapply it (i.e., act upon it). Reasons include dis-trusting the source of knowledge, lack of time oropportunity to apply knowledge, or risk aversion(particularly in organizations that punish mistakes)(Davenport and Prusak 1998). Thus, knowledgeaccess and transfer are only partial steps towardknowledge application. Learning literature pro-vides us with some important insights into thecognitive processes underlying knowledgeabsorption and its applications to problem solvingand decision making by individuals. For example,work in the area of knowledge structures hasdemonstrated that in most cases the cognitiveprocesses (problem solving and decision making)of individuals in organizational settings areenacted with little attention and through invokingpreexisting knowledge and cognitive �routines�(Gioia and Pool 1984). This approach leads toreduction in cognitive load and is, therefore, aneffective strategy in dealing with individual cogni-tive limitations. On the other hand, it creates abarrier to search, absorption, and application ofnew knowledge in organizations (Alavi 2000).

An important area of KM research consists of anidentification of these factors and the developmentof organizational practices and systems to bridgethe knowledge application gap. Table 7 sum-marizes the research questions concerning knowl-edge application.



Table 7. Research Questions Concerning Knowledge Application

Research Question 4: How can an organization encourage application of knowledge that is madeavailable?

Research Question 4a: What factors contribute to the knowing-doing gap in organizations and howcan they be reduced or eliminated?

Research Question 4b: What organizational practices can help bridge the knowledge applicationgap?

IT and the KnowledgeManagement Initiatives

The above four areas of research questionsincluded questions related to the role of IT in thefour knowledge management processes. Thereare also many broad questions related to the roleand impact of IT on knowledge managementinitiatives, several of which are highlighted in thissection.

Our analysis of the literature suggests that IT canlead to a greater breadth and depth of knowledgecreation, storage, transfer, and application in orga-nizations. While these suppositions in generalcan be applied to most IT designed to provideinformation and could form the subject of researchin themselves, an interesting line of researchwould consider the subsequent question ofwhether and how having knowledge available frommore vertical and horizontal sources in the orga-nization in a more timely manner may enhanceindividual and organizational performance. Doesan increase in the breadth and depth of knowl-edge result in greater use of a knowledgemanagement system and greater use of availableknowledge, or contrarily, does such an expandedavailability discourage usage as the potentialsearch and absorption time for needed knowledgemight simultaneously increase? Does an increasein the breadth, depth, quality, and timeliness oforganizational knowledge result in improved deci-sion making, reduced product cycles, greaterproductivity, or better customer service? Ingeneral, what are the consequences of increasingthe breadth, depth, quality, and timeliness oforganizational knowledge?

There is debate as to whether information tech-nology inhibits or facilitates knowledge creation

and use. On the one hand, some argue that cap-turing knowledge in a KMS inhibits learning (Cole1998) and may result in the same knowledgebeing applied to different situations even when itmight not be appropriate. Proponents of this viewmaintain that IT plays a limited role in knowledgecreation because IT is only helpful if an individualknows what he is looking for (the search isnecessary but the solution is obvious) (Powell1998). In this case, little new knowledge creationcan occur. Moreover, some argue that the mech-anistic and rigid nature of IT-based KM isincapable of keeping pace with dynamic needs ofknowledge creation (Malhotra 1999). However,this argument is not so much about informationtechnology as about the role of explicit knowledge.The issue is how to ensure that individuals modifyexplicit knowledge to meet their situation andthereby create new knowledge. Once individualsmodify and use knowledge from a KMS, do theythen transfer their experiences into modifiedknowledge for others to use, or is existing knowl-edge continually reused in various ways with norecord of the modifications? What level of trust doindividuals have in knowledge that resides in asystem but the originator of which they do notpersonally know? How can trust be developed toenhance the individual�s use of knowledge in aKMS?

As with most information systems, the success ofKMS partially depends upon the extent of use,which itself may be tied to system quality, infor-mation quality, and usefulness (Delone andMcLean 1992). System quality is influenced byattributes such as ease of use, characteristics ofhuman-computer interface, and flexibility andeffectiveness of search mechanisms. Researchfocusing on KMS use process, and developmentof intuitive search, retrieval, and display, is



Table 8. Research Questions Concerning the Application of IT to KnowledgeManagement

Research Question 5: What are the consequences of increasing the breadth and depth of availableknowledge, via information technology, on organizational performance?

Research Question 5a: How can an organization ensure that knowledge captured via informationtechnology is effectively modified where necessary prior to application?

Research Question 5b: How can an organization ensure that IT captures modifications toknowledge along with the original knowledge?

Research Question 5c: How do individuals develop trust in knowledge captured via IT, theoriginator of which they may not know?

Research Question 5d: What factors are related to the quality and usefulness of informationsystems applied to knowledge management initiatives?

needed to enhance KMS quality. At the level ofknowledge quality, issues pertain to what kinds ofknowledge can be usefully codified and at whatlevel of detail, how to protect coded knowledgefrom unauthorized access or copying, and how toensure that the knowledge is maintained (KPMG1998b). In terms of KMS usefulness, studies canexamine the extent to which available knowledgeis reused. Ratios of knowledge accessed toknowledge available and knowledge used toknowledge accessed could give an indication ofsystem usefulness. Equally important to considerwould be the number of searches yielding no use-ful knowledge. Table 8 summarizes the researchquestions concerning the application of IT toknowledge management initiatives.

Summary and Conclusions

In this paper, we have presented a discussion ofknowledge, knowledge management, and knowl-edge management systems based on a review,interpretation, and synthesis of a broad range ofrelevant literature. Several general conclusionsmay be drawn from our work.

1. The literature review revealed the complexityand multi-faceted nature of organizationalknowledge and knowledge management. Dif-ferent perspectives and taxonomies of knowl-edge were reviewed and discussed. For

example, knowledge may be tacit or explicit;it can refer to an object, a cognitive state, ora capability; it may reside in individuals,groups (i.e., social systems), documents, pro-cesses, policies, physical settings, or com-puter repositories. Thus, no single or opti-mum approach to organizational knowledgemanagement and knowledge managementsystems can be developed. A variety ofknowledge management approaches andsystems needs to be employed in organiza-tions to effectively deal with the diversity ofknowledge types and attributes.

2. Knowledge management involves distinct butinterdependent processes of knowledge crea-tion, knowledge storage and retrieval, knowl-edge transfer, and knowledge application. Atany point in time, an organization and itsmembers can be involved in multiple knowl-edge management process chains. As such,knowledge management is not a monolithicbut a dynamic and continuous organizationalphenomenon. Furthermore, the complexity,resource requirements, and underlying toolsand approaches of knowledge managementprocesses vary based on the type, scope,and characteristics of knowledge manage-ment processes.

3. KMS, by drawing on various IT tools andcapabilities, can play a variety of roles insupport of organizational knowledge manage-



ment processes. Specific examples of IT forsupport of the four knowledge managementprocesses delineated in the paper werepresented in the framework section. It isimportant to note that KMS, by drawing onvarious and flexible IT capabilities, can leadto various forms of KM support, extendingbeyond the traditional storage and retrieval ofcoded knowledge.

4. Research questions regarding organizationalknowledge management processes and therole of IT in these processes were presented.These questions could form the basis offuture research.

Organizational knowledge and knowledge man-agement are popular topics in several extantliteratures including strategic management andorganizational theory as well as informationsystems. It is thus important that IS researchersbe aware of, understand, and build upon thealready significant work in the large extant litera-tures. This will provide the diversity of perspec-tives and approaches that the study of such multi-faceted and complex phenomenon requires.

It is our contention that in large global firms inhypercompetitive environments, information tech-nology will be interlaced with organizational knowl-edge management strategies and processes. Thisis based on the observation that, in these firms,KM processes span time and geographic dis-tance. This, combined with the need for very shortcycle times for product/service development andinnovation, necessitates reliance on informationand communication technologies. We, therefore,believe that the role of IT in organizational knowl-edge management ought to receive considerablescholarly attention and become a focal point ofinquiry. It is our hope that the ideas, discussion,and research issues set forth in this paper willstimulate interest and future work in the knowl-edge management area by IS researchers.

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About the Authors

Maryam Alavi is the John and Lucy Cook Chair ofInformation Strategy, Goizueta Business School,Emory University. Maryam�s publications haveappeared in several academic journals, includingAcademy of Management Journal, EducationTechnology Research and Development, Infor-mation Systems Research, Management Science,and MIS Quarterly. Maryam is the twice-electedVice President of Education of Association ofInformation Systems (AIS). She was awarded theMarvin Bower Faculty Fellowship at HarvardBusiness School (1996-1997) and served as theprogram co-chair of the 1990 ICIS (InternationalConference on Information Systems), and the co-chair of the 1995 ICIS Doctoral Consortium.Maryam was elected as an AIS Fellow in 2000.

Dorothy E. Leidner is an associate professor ofinformation systems at Texas Christian Universityin Fort Worth, Texas. She is on leave of absencefrom INSEAD in Fontainebleau, France. Dorothyreceived her Ph.D. in Information Systems fromthe University of Texas at Austin, where she alsoobtained her MBA and BA. She has previouslybeen on the faculty at Baylor University and hasbeen a visiting professor at the Instituto Tecno-logico y des Estudios Superiores de Monterrey,Mexico, at the Institut d�Administration des Entre-prises at the Université de Caen, France, and atSouthern Methodist University in Dallas, Texas.Dorothy has published her research in manyjournals, including MIS Quarterly, InformationSystems Research, Organization Science, and theJournal of Management Information Systems.

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