Lecture Business management information system - Lecture 24: Knowledge management and business intelligence

Knowledge
Management and
Business Intelligence
Lecture 24


Today’s Lecture


Knowledge Management
 Types
 Definitions
 Activities
 Cycle


Today’s Lecture
•
•
•
•
•
•

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

Knowledge Management


Knowledge Management focus on how
knowledge within organisation can be
created, captured, stored, and reused
within organisation.


Introduction to KM






KM is a cross industry field involving other fields
like social science, computer science, and
management science.
There is no consensus on definition of
Knowledge Management.
However the definition could be defined by
understanding the meaning of “Knowledge”
which also lack clear-cut definition.


What is knowledge
Knowledge can be referred to as
understanding based on some learning

activities or generated from long time
experience.
 Knowledge can be categorized as:


 Know-how

knowledge
 Know-what knowledge
 Know-who knowledge


Introduction to KM…
What is Knowledge
What is knowledge


Knowledge is a fluid mix of relevant
experience, values, contextual
information, and expert insight that
provides a framework for evaluating and
incorporating new experiences and
information
[Davenport & Prusak]






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

Over 60s buying heavy metal music CDs for their grandchildren


Introduction to KM…
Types of Knowledge


There are two types of Knowledge
Explicit Knowledge
 Tacit Knowledge






Explicit knowledge can be easily captured and
codified. It is in the form of documents, reports,
video presentation, e.t.c
Tacit Knowledge is a personal knowledge and is
within the knower’s mind. It is based on the personal
beliefs, intuition and experience, and is hard to
codify.

Introduction to KM…
Organisational Knowledge


Organisational knowledge is a resource
consisting of the sum of what is known in that
organisation
[Holseapple]






About internal matters (e.g. internal processes, know how)
About external matters (e.g. competitors, customers)
About trading partners (e.g. their processes, getting things done
in partnership with them)
About not depleting the more it is used


Introduction to KM …
The spiral of knowledge (1)


The spiral of knowledge processes helps us understand
how:










Knowledge is acquired
Knowledge is transformed or converted from one knowledge
category to another
Knowledge is shared
Knowledge may be created

In the past the processes that underpinned the model
were largely informal, but now are becoming more
formalised (e.g. encouraged, required, embedded in the
way people work)
“The key to knowledge creation lies in the mobilisation
and conversion of tacit knowledge.” [Nonaka]


Introduction to KM …
The spiral of knowledge (2)
Tacit to Tacit

Tacit to Explicit

(Socialisation
Process)

(Externalisation
Process)

Explicit to Tacit

Explicit to Explicit

(Internalisation
Process)

(Combination
Process)

Nonaka


Introduction to KM …
The Knowledge Spiral (Tacit to tacit)


In the socialisation process knowledge is acquired and shared
without being made explicit (i.e. without being captured)


For example by:


One person talking to another (informal meeting)




One person talking to many (presentations)




Collaboration, Interacting and sharing experience

Seeing how things are done (no articulation)




A lecturer imparts knowledge to many

Many people talking to many (formal team meetings, informal meetings)




If one person imparts knowledge to another then both have the knowledge; and
so on

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

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

However:



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


Introduction to KM …
The Knowledge Spiral (Tacit to Explicit)


In the externalisation process tacit knowledge is
transformed into explicit knowledge


For example by:






An expert writing a document that describes an experience, a way
of doing things, what he/she knows, etc.
People producing a meeting report (sometimes), a research report,
a video of a seminar, etc.
Producing a documented list of “frequently asked questions” (with
answers!)

Strictly speaking, externalisation is the articulation of tacit
knowledge


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



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

Very hard process!


Introduction to KM …
The Knowledge Spiral (Explicit to explicit)


In the combination process various sorts of
explicit knowledge are brought together to form
more complex or more useful knowledge
 Provides

a more complete understanding
 For example:




All of the diagrams, plans, elevations (etc.) for a building
produced by architects, surveyors, air conditioning
engineers, electricians (etc.) contained in one document
All the tasks required to manufactured a passenger aircraft in
a volume of documents

 The

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


Introduction to KM …
The Knowledge Spiral (Explicit to tacit)


In the internalisation process tacit knowledge is
acquired by examining explicit knowledge from
many sources
 By

integrating this with existing tacit knowledge new
insights may present themselves


For example:




 In

As a student you acquire much of your knowledge by reading
different books covering different subjects
As a computer scientist who reads books on how the human
brain works, you can see how programs could simulate some
“brain processes”

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


Why knowledge management is
necessary (1)


Issue: organisations don’t know what they
already know
 Consequences:

Time spent on rediscovery of knowledge that is
already known
 Failure to apply existing knowledge
 Waste of time and money


 What’s



the problem?

Knowledge within the organisation is not visible


Why knowledge management is
necessary (2)


Issue: employees don’t know what their
colleagues know
 Consequences:







Inconsistent performance across different parts of the
organisation
Expertise localisation
Repeated failures
Inability to apply what is known
Competitors innovate at a faster rate

 What’s


the problem?

Knowledge is not shared rapidly within the organisation


Why knowledge management is
necessary (3)


Issue: knowledgeable employees leave the
organisation or retire
 Consequences:






Critical expertise built up over years is lost overnight
Expertise may move to competitors without being retained
within the organisation
Key customer relationships may be affected
Overall organisational knowledge is reduced

 What’s


the problem?

Tacit knowledge walks out the door (and doesn’t return)


Why knowledge management is
necessary (4)


Issue: employees closely guard their individual
knowledge
 Consequences:








Knowledge is not visible
Knowledge is not shared
“Turf wars”: “this knowledge belongs to me (or my
department) and is not yours”
A belief that the knowledge is “owned” by the individual
rather the organisation
Opportunities for in-depth collaborations are minimised

 What’s


the problem?

Knowledge hoarding by employees


What knowledge management
is


Definition:
 Knowledge

Management is a strategy,
framework or system designed to help
organizations create, capture, analyze, apply,
and reuse knowledge to achieve competitive
advantage.
 A key aspect of Knowledge Management is
that knowledge within an organisation is
treated as a key asset.


What knowledge management is


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

Knowledge management
processes

Knowledge Management Processes

Capture
Knowledge

Organise
Knowledge

Target
Knowledge

Maintain
Knowledge

Transfer
Knowledge


What knowledge management
achieves











Makes visible organisational knowledge no matter where
it is
Provides access to an organisation’s collective expertise
anywhere in the organisation
Retains the organisation’s knowledge in times of change
Exploits knowledge as a organisational asset
Helps to ensure that knowledge is up to date and
relevant
Helps the organisation to do the right thing
Embeds knowledge in the organisation’s processes
Enables the survival of the organisation
But:


Part science, part art
Based on Awad & Ghaziri


Knowledge management scope
Organisation

Business
Knowledge
Management

People

Technology

Based on Awad & Ghaziri


Ideal KM environment
External
Environment

Existing methods/
Processes
  Learning

Insights

PEOPLE
Knowledge
Creation

Knowledge
Repository

New
ideas

Conversion

• New products
• New markets
• Smarter problem­solving

•Value­added innovation
•Better quality customer
 service
•More efficient processes
•More experienced staff
Organisational
Benefits

Codified Technology
Awad & Ghaziri