Chapter Three

Knowledge Management
Paradigm shift of data, in-
formation management to
knowledge management
 Definitions of Data

Data is
a set of discrete, objective
facts about events.
In an organizational con-
text, it is most usefully de-
scribed as structured
records of transactions.
essential raw material for
the creation of information.
 Definitions of Information

Information is
Collection of Data
Data becomes information
when its creator adds
meaning.
is data endowed with rele-
vance and purpose.
Methods of Transforming Data into
Information
• Data will be transformed into in-
formation by adding value in var-
ious ways:
– Contextualized
• we know for what purpose
the data was gathered
– Categorized
• we know the units of analysis
or key components of the
data
 Methods cont….
– Calculated
• the data may have been ana-
lyzed mathematically or stat-
ically
– Corrected
• errors have been removed
from the data
– Condensed
• the data may have been
summarized in a more con-
cise form
 Definition of Knowledge

Knowledge is
is a fluid mix of
• framed experience,
• values,
• contextual information,
• expert insight, and
• grounded intuition
that provides an environment and
framework for evaluating and incorpo-
rating new experiences and informa-
tion.
 Definition of Knowledge

Knowledge
originates and is applied in the minds
of knowers.
In organizations,
• it often becomes embedded not
only in documents or repositories,
but also in organizational routines,
processes, practices and norms
 Knowledge cont…

• Knowledge
– guides us in the process of analyzing
data and utilizing information.
– derives from information
• Methods of information Trans-
formation into Knowledge:
– Comparison
• how does information about the
situation compare to other situ-
ations we have known?
 Knowledge cont…
– Consequences
• what implications does the in-
formation have for decisions
and actions?
– Connections
• how does this bit of knowledge
relate to others?
– Conversation
• what do other people think
about this information?
Difference Between Data, Information, and
Knowledge

Definition Example
Data is basically just
raw facts and figures.
No single piece of data
can be useful by itself, The number 37 is data.
as it does not provide
good business informa-
tion.
Information is data
which has been pro-
37% of people eat junk
cessed and has now
food every day.
got some meaning be-
hind it.
Knowledge is an un- Those 37% of people
derstanding of the in- lead a very unhealthy
Knowledge Hierarchy

Wisdom

Knowledge

Information

Data
Wisdom Is…
• Unselfish
• Enlightening
• Insightful
• Uncommon common sense
• Creative interpretation of patterns
or phenomenon
• Applying knowledge and informa-
tion for the goodness of the world
 KM Definitions (1)
Stress Systematic and Formal Aspects

• Knowledge Management is
– is a the systematic, explicit, and de-
liberate building, renewal, and ap-
plication of knowledge to maximize
an enterprises knowledge-related
effectiveness and returns from its
knowledge assets.
 KM Definitions (1)
Stress Systematic and Formal Aspects

• Knowledge Management is
– is the formalization of and access to
experience, Knowledge, and exper-
tise that create new capabilities,
enable superior performance, en-
courage innovation, and enhance
custom value.
 KM Definitions (1)
Stress Systematic and Formal Aspects

• Knowledge Management
– involves the identification and
analysis of available and required
knowledge, and the subsequent
planning and control of actions to
develop knowledge assets so as to
fulfill organization objectives.
 KM Definitions (2)
View KM as a Process

• Knowledge Management is
– the process of creating value from
an organization’s intangible as-
sets.
– a process through which organiza-
tion’s create, store and utilize
their collective knowledge.
 KM Definitions (2)
View KM as a Process

• Knowledge Management
– is the process of capturing com-
pany’s collective expertise wher-
ever it resides-in databases, on
paper, or in peoples heads-and dis-
tributing it to wherever it can help
produces the biggest profit.
 KM Definitions (3)
Focusing on Organizational Aspects

• Knowledge Management is
– getting the right knowledge to
the right people at the right time
so they can make the best deci-
sion.
– the art of creating value from an
organization’s intangible assets.
 KM Definitions (3)
Focusing on Organizational Aspects

• Knowledge Management is
– the explicit control and manage-
ment of knowledge within the or-
ganization aimed at achieving the
company’s objective.
– exactly the management of orga-
nizational knowledge of creating
greater value and generating a
competitive advantage.
 KM components (1)
From the point of view of
knowledge flow

• The flow of knowledge

• Knowledge cryptography
• Communities of knowledge
workers
• Knowledge repositories and
libraries
Knowledge Management Principles
• KM is expensive
• Effective management of knowl-
edge requires hybrid solutions of
people and technology.
• KM is highly political.
• KM requires knowledge man-
agers.
• KM benefits more from map than
models, more from markets than
from hierarchies.
• Sharing and using knowledge are
often unnatural acts.
Knowledge Management Principles

• KM means improving knowledge

work processes.
• Knowledge access is only the be-
ginning.
• KM never ends.
• KM requires a knowledge con-
tract.
• The more your share, the more
you gain.
• The knowledge acquisition
 Knowledge Management Principles

• Integration of knowledge from

multiple disciplines has the
highest probability of creating
new knowledge and value-
added.
• Knowledge valuation should be
conducted from customers’ per-
spective.
• KM focus should be on core
knowledge critical to sustaining
 Theory of Organizational Knowledge Creation
• Tacit knowledge is personal, context-specific,
and therefore hard to formalize and commu-
nicate.
• Explicit or codified knowledge is transmit-
table in formal, systematic language.
Tacit Knowledge Explicit Knowledge
(Subjective) (Objective)

Knowledge of experience Knowledge of

rationality
(body) (mind)

Simultaneous knowledge Sequential

knowledge
(here and now) (there and
then)

Analog knowledge Digital knowl-

Two Dimensions of Knowledge Creation
Epistemological
Dimension

Explicit
Knowledge Current
Focus

Tacit
Ontological
knowledge
Individual Group Organization Inter-organization Dimension

Knowledge Level
 Four Modes of Knowledge Conversion
To
Tacit knowledge Explicit knowledge

Socialization Externalization
Tacit
knowledge

From
Internalization Combination
1+1
Explicit
knowledge

3
Four Modes of Knowledge Conversion
• Socialization:
– A process of sharing experiences

– Apprenticeship through observa-

tion, imitation, and practice
• Externalization:
– A process of articulating tacit
knowledge into explicit concepts
–A quintessential(essential/typical)
knowledge-creation process involv-
ing the creation of metaphors, con-
cepts, analogies, hypothesis, or
models
– Created through dialogue or collec-
Four Modes of Knowledge Conversion
• Internalization:
– A process of embodying explicit
knowledge into tacit knowledge
– Learning by doing
– Shared mental models or technical
know-how
– Documents help individual internal-
ize what they experience
• Combination:
– A process of systemizing concepts
into a knowledge system
– Reconfiguration of existing infor-
mation and knowledge
 Knowledge Spiral
Dialogue
(Collective Reflection)

Socialization Externalization

Linking
Field Explicit
Building Knowledge

Internalization Combination

Learning by Doing
 Contents of Knowledge Created in Four Modes

To
Tacit knowledge Explicit knowledge

(Socialization) (Externalization)
Tacit
knowledge Sympathized Conceptual Knowl-
Knowledge edge

From (Internalization) (Combination)

Operational Systemic
Explicit
knowledge Knowledge Knowledge
Contents of Knowledge Created in Four Modes

• Sympathized knowledge:
• Created through socialization
• Shared mental models and
technical skills.
• Conceptual knowledge:
• Created through externaliza-
tion
• Analogies & metaphors of
products or processes.
Contents of Knowledge Created in Four Modes

• Systemic knowledge:
• Created through combination
• Prototypes or new technolo-
gies.
• Operational knowledge:
• Created through internaliza-
tion
• Project management, produc-
tion process, new product us-
age, and policy implementa-
 Knowledge management tools

• Tools for knowledge socialization

– Communication Enablers (like wa-
ter coolers, chat rooms…)
– Video conferencing
– Web conferencing
– Digital whiteboards
– Bulletin boards
 Knowledge management tools

• Tools for knowledge externaliza-

tion
– Expert system
– Yellow pages
– Knowledge maps
– Data Warehouse
– Intelligent agent based system
Knowledge management tools

• Tools for knowledge combination

– Intranet
– Groupware
– Forums
– Workflow systems
– Balanced score card
 Knowledge management tools

• Tools for knowledge internaliza-

tion
– Neural networks
– Case based reasoning
 Tools for knowledge socialization (1)

Communication en-
ablers Conversations at the water
cooler or in the company cafe-
Watercoolers teria are often occasions for
knowledge transfer

Telephone Telephone also is a form of

knowledge transfer through
conversation
Chat is another form of informal
Chat
knowledge transfer through
personal conversation to elec-
tronic conversation.
Tools for knowledge socialization (2)

Video conferencing
• Is used to see the person or
group with whom you are
working virtually
• Combine virtuality with
face-to-face collaboration.
It enables people to ex-
change both video and au-
dio across a distributed
network
• Allows people to meet face
to face in small or large
groups with colleagues
Tools for knowledge socialization (3)

Web Conferencing
• Enables virtual meetings where
users from different locations
connect, conduct meetings, and
share information as if everyone
were in the same room
• Allow participants to collaborate,
share documents, and can add
Tools for knowledge socialization (4)

Digital Whiteboards
• Permits real time dis-
play of drawings, pic-
tures or documents for
group discussion and
comment
• Can capture whatever
is drawn on regular
paper notepads, and
store as image on a
personal computer
• Can be networked to
allow multi-user col-
 Tools for knowledge socialization (5)

Bulletin boards
• Bulletin boards are used to post notices and
facilitate discussions on any topic
• Electronic bulletin boards allow users to pub-
lish live, digital content to public spaces
• Two types
– Simple bulletin boards
– Electronic bulletin boards
 Tools for knowledge externalization (1)

Expert systems
• Knowledge intensive computer pro-
grams that capture the expertise of a
human in limited domains of knowl-
edge
• Include rule-based systems, decision
trees and also case-based reasoning
systems
• Arrives at intelligent solutions to user
queries by using the rules contained in
the system’s knowledge base
Tools for knowledge externalization (2)
Yellow Pages
• Web-searchable electronic version
of skills list
• Pointers to expertise
• Helps on locating and discovering
organizational knowledge
• Sample key entries in Yellow Pages
– Persons name
– Contact information (address, e-
mail, telephone, web page)
– Professional background
– Practical experience
– Training
The idea of Yellow Pages

Findpointerto
knowledgeresource

Shareknowledge
withexpert
Tools for knowledge externalization (3)

Knowledge maps
• Graphical representation of knowl-
edge and its relation to organiza-
tional concepts
• A form for categorizing organiza-
tional knowledge systematically
mapping them
• Are designed to help people find
where they have to go to get the re-
quired knowledge
• Yellow Pages also can be organized
as a knowledge map by categorizing
and representing personal profile
data in specific manner
 Yellow Pages as a knowledge map
ITEMS OF SELECTED DOMAIN

DOMAINS OF MAP

Marketing Information Systems PERSONAL PROFILE

Finances Technician
Tools for knowledge externalization (4)
Data warehouse
• Collection of summarized data from
various sources
• Are used to hold explicit knowledge
which helps people to create new
tacit knowledge
• Helps company personnel to iden-
tify hidden business opportunities
• Improves productivity through im-
proved access to information and
knowledge
Tools for knowledge externalization (5)

Intelligent Agent-based tools

• Filtering, editing, searching, and organiz-
ing pieces of knowledge are essential
though frequently overlooked compo-
nents of successful knowledge manage-
ment
• Different types of intelligent agents
– Search agents
– Browsing agents
– E – Commerce agents
– Web mastering agents
Tools for knowledge combination (1)

Intranets
• Designed to focus on the employee, and on
improving workflow and business processes
• Useful for knowledge distribution, connec-
tivity, and publishing
• Besides information distribution and publi-
cation, intranets provide the backbone plat-
form for push delivery of information to
user’s desktops
Tools for knowledge combination (2)

Groupware
• Software that supports communication
and collaboration between people
• Groupware tools provide a document
repository, remote integration, and a
base for collaborative work
Tools for knowledge combination (3)

Forums
• In forums topics are posted to a website
for discussion and comment where par-
ticipants can follow a line of discussion
on a topic
• These discussions give rise to a library of
information on a wide variety of subjects
• New knowledge can be transmitted via
the forums to others who have similar
problems
Tools for knowledge combination (4)

Workflow management systems

• Workflow can be described simply as
the movement of documents and tasks
through a business process
• Workflow Management Systems allow
organizations to define and control the
various activities associated with a
business process
Tools for knowledge combination (5)

Balanced scorecard
• The balanced scorecard is a manage-
ment system (not only a measurement
system) that enables organizations to
clarify their vision and strategy and
translate them into action
• It provides feedback around both the
internal business processes and ex-
ternal outcomes
 Four dimensions of balanced
scorecard

[Link]
Tools for knowledge internalization (1)
Neural networks
• is a hardware and software that attempt to
emulate the processing patterns of the biolog-
ical brain
• have learning capabilities
• a computational system consisting of a set of
highly interconnected processing elements,
called neurons
• becomes immensely promising when you have
data but lack experts to make judgments
about it
• But it is necessary to spend much time train-
ing the neural network, cleaning up data, and
pre-processing
Some points how neural networks
can be used
• Neural networks can be developed
for capturing the meaning of words
relative to the context in which they
appear
• Neural networks can be used in
data mining
• Neural networks have been much
applied within the medical domain.
– For example, for clinical diagnosis, im-
age analysis and interpretation, signal
analysis and interpretation, drug devel-
opment
Tools for knowledge internalization (2)

Case-based reasoning
• allows companies to learn from previous prob-
lems or cases to solve the present problems
similar to the past ones
• The case-based reasoner solves new prob-
lems by using or adapting solutions that were
used to solve old problems
• Using past knowledge gained from several
projects reduce the task to a simple match
and cut-and-paste job
• Solving the problem by analogy make the
process of arriving at the solution faster, bet-
ter, and easier than it would have been had if
started from scratch
End of Chapter
three