Organizational ManagementKnowledge Management and Decision MakingBBUS 507Professor Vandra L. Huber, DBA

Session 1: Course Introduction

AgendaAdministrative matters and course objectiveCourse RequirementsExercise: BARNGATodays topic: Definitions & Knowledge Management Models

Administrative MattersContact information on syllabusOffice hours: By appointmentCourse materials:- Course pack available from Kinkos, Bothell-Everett Highway- Additional materials distributed by meHonor code issue

Honor CodePrepared and on time for all simulations Do not show your confidential case instructions to the other parties.Do not make up facts or information that materially change the power distribution of the exerciseDo not borrow notes or discuss roles outside of class.Class discussion stays in class

Attendance/Participation PolicyYou will be penalized one letter grade on final course grade, if you: Fail to participate in more than one exercise or case discussion Arrive after 10 minutes of the beginning of class; Are unprepared or not present to obtain simulation assignments for the next class (don't ask me to email them to you)Must inform me of absence 48 hours in advance.

GradingClass Participation 20%Professionalism 5%On timeNo complaining or whiningEthical behaviorRespect for othersOut of Class Project Participation 10%Qualitative Team Project Survey 5%Team Project 40%Project outline 5%Oral presentation 10%Final Written Report 25%2 Individual Assignments 40%Knowledge debriefingsCase Analyses

Knowledge Management Basics

Origins ofKnowledge Management

What is knowledge?Knowledge is the combination of data and information to which is added expert opinion, skills and experience, to result in a valuable asset which can be used to aid decision making.

Four Stages of LearningStage 1 Data + Relevance + Purpose

Stage 2 Information + Application

Stage 3 Knowledge + Intuition

Stage 4 Wisdom (Tacit Knowledge)

Hierarchy of KnowledgeSkillAbility to act according to rules which depend on feedback from a non-social environment.Know-HowIncludes skill and is the ability to act in social contexts.Knowledge Includes know-how + the ability of reflection. Implies the ability of know-how within a certain domain and the ability not only to submit to the rules but also by reflection influence the rules of the domain or the tradition.

Test Your Tacit KnowledgeShut your eyes. Then try to touch the tip of your nose with your index finger. At the same time, concentrate hard on what you are doing and on where your arm is at all times. Do the exercise slowly. Allow a minimum 20 seconds for it.

Test Your Tacit KnowledgeNow, explain to the person sitting next to you exactly how you did the exercise, describe how you held your index finger, every movement your arm was doing, all different angles, all the way up to your nose. Was it easy to describe in words how you did the exercise? Why or why not

Two Types of KnowledgeExplicit Knowledge is articulated in formal languageGrammatical StatementsMathematical equationsSpecificationsManualsTacit Knowledge is personal knowledge embedded in individual experiencePersonal beliefsEmotionPerspectiveExperienceIntuition

Item 2 represents tacit knowledge

What is knowledge management?"Knowledge Management embodies organizational processes that seek synergistic combination of data and information processing capacity of information technologies, and the creative and innovative capacity of human beings to improve organizational capabilities

Why Knowledge ManagementBecause we want superior performance and competitive advantage For innovation and to avoid decline To improve quality and customer relationsTo increase our ability to manage change For energized committed work force To expand boundaries and to engage in community

Competitive Advantage Of the FirmLies in its Ability to create, transfer, assemble, integrate and exploit knowledge assetsKnowing-Doing GapDifficulties arise not in accessing knowledgeBut in utilizing knowledge

Knowledge Economy In WAProgressive Policy Institute, Washington, D.C. 2002

Knowledge Versus ServiceKnowledgeProblem solving non routine problemsSmallerCreativeAdhocracyHigh EducationNo economies of scaleEconomy of scope in intangible assetsServiceServicing Routine ProblemsBiggerProductiveHierarchyPeople IntensiveLow EducationEconomies of ScaleHigh Customer Adaptation Low

Tangible and IntangibleAssets of Knowledge OrganizationCash

Accounts Receivable

Computers, Offices

Human Capital

Information Capital

Organizational CapitalTangibleIntangible

Models of Knowledge Management

Human CapitalInformation CapitalOrganizational CapitalOrganizational SystemsTransformationsInputsStakeholder Expectations Strategy/Vision, Mission, ValuesInformation

OutputsSatisfied Stakeholders (Customers, Public, Policy Makers)ProfitabilitySystem Effectiveness Employee Satisfaction /PerformanceExternal Environ mentKnowledge Management ProcessesBusiness & Economic EnvironmentCompetitorsSocial Values/ Community EnvironmentLegal/ Public Policy EnvironmentConstraints and OpportunitiesTechnology

ROCECustomerLoyaltyQualityQuantityEmployeeSkillsBalanced ScorecardsExplore Cause-and-Effect Relationships

Financial

Customer

InternalBusinessProcess

IntangibleAssets

SourcesFormal and informal NetworksInternal and External AcquisitionsUsesQuality of Problem Solving/Decision MakingOutcomesInnovationMarket/ FinancialPerformanceIndividual and organizationsability to absorb information and turn it into know howNew organizational knowledge flows from activities and decisionsProcess of KnowledgeCreation and InnovationWhich Firm Operates

Total Systems ModelStrategy

Human Capital

InformationCapital

Organizational Capital

Vision

Leadership

Human Capital KnowledgeProfessional KnowledgeRulesProgramsManuals

Organizational KnowledgeStrategy MakingMarketingHuman ResourcesAccounting

Personal MasteryTo learn, grow, and achieve personal mastery that fuels and provides substance to all learning organizations is the basic human need.No organization can truly be a learning organization without its individual members being free to learn.

Human CapitalHigh

LowLow Organizational Knowledge High Professional Knowledge

Informational CapitalSystemsCollecting knowledgeOrganizing knowledgeDistributing knowledgeSecuring/Protecting knowledgeDatabasesHarvesting DataStoring DataDivergent Free to allConvergent Reviewed by expertsNetworksIntranetInternetGlobal

Informational CapitalDatabase SubsystemsAllows managers and employees to share the right information in a timely and efficient mannerOrganizational Language SubsystemAllows understanding of the meaning of thingsDecoding & Codifying into usable data for othersSystematic language that allows people to recognize the deeper meaningNetworksRetrieve and acquire information and knowledge from internal and external sourcesTransfer SubsystemTransfers information between individuals or creates new knowledge

Four Fold FocusGeneratingIdentifying desired content proactivelyGetting people to contribute ideas.Evaluating based on contributions OrganizingSelection and refinement of materialDistillation of material Chunking data into knowledge objects7 plus or minus 2 tidbits of informationSME review, certify & bless material

Four Fold FocusDevelopingOrganized so it can be represented, retrieved and usedNavigational tools, user interfaces, Position and linkages among elements Divergent versus convergent processesDifusing and Distributing Insuring its use internally and externallyTraining and rewardingChoice between push or pull systems

Organization CapitalThe capacity to manage human intellect -- and to transform intellectual output into a service or a group of services embodied in a product is fast becoming the critical executive skill of this eraJames Brian Quinn

Organizational CapitalCorporate BrandImageReputationCultureOrganizationalGlobalLeadershipDevelopmentStrategic FocusTeamwork IntegrationKnowledge Sharing

CultureA shared set of enduring meanings, values and beliefs that characterize an organization, national, ethnic, and other groups and orient behavior.Includes:Behavior PatternsValues and NormsRules, Concepts and Assumptions

Process of Knowledge CreationKnowledgeIndividual SocialCare High LowGeorge von Krogh, California Mgt Review, 1998

LeadershipHaving a definitive leadership brandEmbedding formal and informal leaders through the organization (Up, down and across)Establishing development programs for leaders

AlignmentIndividual actions are directed towards achieving high level objectives Understanding of strategySense of urgencyClear line of sight between vision and behavior and rewardEmpowerment

Teamwork (knowledge sharing)Development of communities of practiceEnsuring communication of best practicesCommon global system of knowledge sharingIntegration of employees

Concluding Thoughts

Knowledge NuggetsAll organizational learning (knowledge) is leveraged in delivering business advantage to the customerKnowledge Management focuses on Intangible Assets:Human CapitalInformational CapitalOrganizational Capital

Learn Once, Use Anywhere!

Knowledge NuggetsTacit Knowledge is critical and resides most often in the heads of individuals. Knowledge is enmeshed with its use. The flow of knowledge is as important as the stock of knowledge.

Knowledge NuggetsExperimentation is pivotal to knowledge generationTechnological should not be substituted for human interactionA fundamental intermediate purpose of knowledge management is to create a shared context

Knowledge NuggetsKnowledge management requires organizational commitment. Planning and decision-makingInternal customer serviceTechnologyFinancialTime The knowledge life cycle consists of multiple stages: Knowledge GenerationKnowledge OrganizingKnowledge GeneratingKnowledge DiffusingKnowledge Reusing

HmmmDo You Agree or Disagree? Knowledge never can be transferred. We can only transfer information.