Knowledge Management

As the foundation of today’s global economy moves away from natural resources to intellectual assets, knowledge has increasingly become the only basis for a competitive advantage that can be sustained. Rather than land, labor or capital it is knowledge that is the key factor of production in many industries. In this “third wave”, the wealth system is increasingly based on thinking,  knowing and serving customers  in the way of providing them a unique experience. Companies need superior knowledge to leverage their traditional resources and capabilities in new and distinctive ways to serve their customers. And they must do this more effectively compared to competitors. As a result, Knowledge Management (KM) is being taken seriously by companies across industries.

A major driver of KM in recent times has been Information Technology (IT). But KM should not be equated with IT. It is human beings who think, experiment and learn to create knowledge. Much of the valuable knowledge that lies in the brains and minds of people can be best shared through human interaction. IT is only an enabler, though  in the words of famous journalist, Thomas A Stewart ,’it is one hell of an enabler’. Without IT, would be quite difficult to replicate and distribute knowledge related documents in a cost effective way across an organization that is largely geographically dispersed. As Stewart mentions , “KM is knowing what we know, capturing and organizing it and using it to produce returns. Nothing in that definition says anything about computers but modern knowledge management is inconceivable without using them and in some sense they created it.” 

A final point before we get into more details is that KM should not be looked upon as a new mantra that can produce a magical impact on the functioning of an organization. Organizations need to take a practical hard-nosed perspective when it comes to managing knowledge. Like any other initiative, KM activities will build momentum, only if they generate business value. That in turn is possible only if KM helps the organization to cut costs by improving efficiency or to innovate and come up with new products/services.

MZA