KNOWLEDGE MANAGEMENT - JAN 2019

BACHELOR OF BUSINESS ADMINISTRATION WITH HONOURS

SEMESTER JANUARY 2019

CBKI4103

KNOWLEDGE MANAGEMENT

MATRICULATION NO : 910216075451003

IDENTITY CARD NO. : 910216-07-5451

TELEPHONE NO. : 013-4747587

E-MAIL : DOCKK21@GMAIL.COM

LEARNING CENTRE : PULAU PINANG

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DESCRIPTION PAGE

Introduction

- Principles of the knowledge management 3

- Objectives of implementing knowledge management 4

concept of knowledge management

- Types 5-6

- Transfer modes 6-7

- Characteristics 7

- Strategics 8-9

The specific knowledge in people 9-11

The specific knowledge in process 11-12

The specific knowledge in Product 12-13

The specific knowledge in Organisation 14-15

Conclusion 15-16

References 16-17

1.0 INTRODUCTION

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Principles of the Knowledge Management (KM) in business

Knowledge management (KM) is the systematic management of an organization's knowledge

assets for the purpose of creating value and meeting tactical & strategic requirements; it
consists of the initiatives, processes, strategies, and systems that sustain and enhance the
storage, assessment, sharing, refinement, and creation of knowledge. KM involves the
understanding of:

 Where and in what forms knowledge exists; what the organization needs to know;
how to promote a culture conducive to learning, sharing, and knowledge creation;
how to make the right knowledge available to the right people at the right time; how
to best generate or acquire new relevant knowledge; how to manage all of these
factors so as to enhance performance in light of the organization's strategic goals and
short term opportunities and threats.
  Create/provide the right tools, people, knowledge, structures (teams, etc.), culture,
etc. so as to enhance learning; it must understand the value and applications of the
new knowledge created; it must store this knowledge and make it readily available for
the right people at the right time; and it must continuously assess, apply, refine, and
remove organizational knowledge in conjunction with concrete long and short term
factors.

An overview of the assignment content

The aim of this paper is to analysis a business scenario of Knowledge Management

(KM) in determine importance of managing knowledge and knowledge advantage at Protasco
Berhad (PB). PB business activities are organized into four main areas - Property
Development, Road and Highway Maintenance, R&D in Infrastructure Technology and
Education. The primary purpose of knowledge management is to approach in achieving PB’s
objectives by making the best use of the knowledge such as improved performance,
competitive advantage, innovation, the sharing of lessons learned, integration and continuous
improvement of the PB.

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1.1 THE OBJECTIVES OF IMPLEMENTING KNOWLEDGE MANAGEMENT TO

PROTASCO BERHAD (PB)

KM need to be practiced in PB to fulfils its mission, which reaches the corporate objectives
and strategies, and identifies the most valuable knowledge from the “sea of information”.
Through its operations PB acquires, creates, processes and stores a significant amount of data
and information, some of which is turned into knowledge. Since there are different
subsidiaries under PB, we can analysis how the important of managing knowledge for each
department and the details as below:

 Organizational Memory Management: the necessary conditions to identify all the

knowledge the company has accumulated and where it stores it.
 Company organizes data logically so that it can transform it into useful information to
use for knowledge development.

 Make information flow properly and be accessible to all, with the help of
technology, allowing your business to find results.

 Promote the generation of new knowledge from the dissemination of this information,
which leads to the achievement of competitive advantages.

 Increase organizational competitiveness by using this knowledge in a strategic way

that unfolds in tactical objectives and operational actions.

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2.0 Knowledge can be applied in organisation

2.1 Types:

 Dispersed knowledge
Dispersed knowledge is a situation in which information about a topic is fragmented
amongst many sources with no authoritative source of truth. It is often described with an
old folktale from the Indian subcontinent in which a group of blind men try to figure out
what an elephant is by touching different parts of the animal only to reach dramatically
different conclusions.

 Embedded Knowledge

Embedded knowledge refers to the knowledge that is locked in processes, products,

culture, routines, artifacts, or structures (Horvath 2000, Gamble & Blackwell 2001).
Knowledge is embedded either formally, such as through a management initiative to
formalize a certain beneficial routine, or informally as the organization uses and applies
the other two knowledge types.The challenges in managing embedded knowledge vary
considerably and will often differ from embodied tacit knowledge. Culture and routines
can be both difficult to understand and hard to change. Formalized routines on the other
hand may be easier to implement and management can actively try to embed the fruits of
lessons learned directly into procedures, routines, and products.

 Tacit Knowledge

This type of knowledge was originally defined by Polanyi in 1966. It is sometimes

referred to as know-how (Brown & Duguid 1998) and refers to intuitive, hard to define
knowledge that is largely experience based. Because of this, tacit knowledge is often
context dependent and personal in nature. It is hard to communicate and deeply rooted in
action, commitment, and involvement (Nonaka 1994). Tacit knowledge is also regarded
as being the most valuable source of knowledge, and the most likely to lead to

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breakthroughs in the organization (Wellman 2009). Gamble & Blackwell (2001) link the
lack of focus on tacit knowledge directly to the reduced capability for innovation and
sustained competitiveness.

2.2 Transfer modes

 knowledge value chain 

A knowledge value chain is a sequence of intellectual tasks by which knowledge

workers build their employer's unique competitive advantage or social and environmental
benefit. As an example, the components of a research and development project form a
knowledge value chain. Productivity improvements in a knowledge value chain may come
from knowledge integration in its original sense of data systems consolidation. Improvements
also flow from the knowledge integration that occurs when knowledge
management techniques are applied to the continuous improvement of a business process or
processes

 knowledge hub

knowledge hub can provide a more effective coordination of various knowledge sources.
These centralized units can coordinate several knowledge sources and promote their use
throughout the wider knowledge community. Project repositories and information
services, centralized information technology services, as well as emerging knowledge
services operate on these principles, providing the required links among people, objects
and information avenues. These services provide the necessary support required by
knowledge creators and seekers and are aimed in avoiding duplication and wastage of
resources. These units also work as communication hubs, encouraging knowledge sharing
and the capture of current initiatives.

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 knowledge web

knowledge web that enables expertise sharing between people. Each employee might
have a different network patterns, determined by their expertise, knowledge about others
and certain knowledge needs. This employee may be a node for others as an expert source
of knowledge, while also engaging others as nodes for information. Therefore, each
person on the knowledge web would assume the role of recipient and disseminator of
knowledge based on different circumstances. This type of knowledge network is based on
the building improved links with others, and is open- ended and dynamic in nature.
Communication channels in the knowledge web may evolve over time as several options
are tested for value and adopted if they are useful.

2.3 characteristics

characteristics of knowledge have been described:

 Knowledge is contextual and it can be re-used

 Benefits of knowledge obtained only if it is applied

 The values of knowledge may change over time

 Knowledge has to be renewed or maintained

 It can be difficult to transfer, capture and distribute knowledge

 It is developed through learning processes

 Depends on memory, past experience, expertise, knowledge transfer mechanisms,

opportunities

 Facilitates effectiveness and ‘sense-making’

 Knowledge enables higher learning

 Knowledge creation and utilization is enhanced with technology.

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2.4 strategic

 Motivate

To enable knowledge-related actions, it is usually necessary to provide incentives and rewards

to your targeted users to encourage the desired behaviors. Often, the first step will be a
management of change program to align the culture and values of the organization to
knowledge management. Setting goals and measurements which individuals and managers
must achieve is also important. And establishing formal incentives and rewards will reinforce
the goals and measurements.

 Network

A fundamental way for knowledge to be shared is through direct contact between people.
Connecting to others who can provide assistance or who can benefit from knowledge sharing
is a powerful way to leverage each person’s individual knowledge. Communicating across
organizational silos allows good ideas to be exchanged between groups who might otherwise
be unaware of each other. Collaborating within communities allows the members to learn
together, which is enabled by community events, threaded discussions, and team spaces.

 Supply

There must be a supply of knowledge in order for it to be reused. Supply-side knowledge

management includes collecting documents and files, capturing information and work
products, and storing these forms of explicit knowledge in repositories. Tacit knowledge can
also be captured and converted to explicit knowledge by recording conversations and
presentations, writing down what people do and say, and collecting stories.

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 Codify

After collected knowledge has been analyzed, it can be codified to produce standard
methodologies, reusable material, and repeatable processes. Data can be consolidated, content
can be collated, and processes can be integrated to yield improved business results.

3.0 THE SPECIFIC KNOWLEDGE IN , PEOPLE, PROCESS, PRODUCT &

MANAGEMENT IN PB

KM in organization such as PB is formed via unique patterns of interactions between

people, process and product. People generate, share, apply knowledge and stimulate
knowledge sharing. Process entails the methods to obtain, generate, arrange, share and
transfer knowledge. Product involves improved or create new product through KM. KM
solutions and knowledge can impacts on PB performance and the impacts can be on the
following:
1. People
2. Processes
3. Products
4. Organizational perfomance

3.1 IMPACT ON PEOPLE

.People has an important role for knowledge management in PB. The whole success in
KM depends on the willingness of people in sharing their knowledge. Trust is a necessary
element for the willingness to share knowledge. This is achieved through combination of
motivation / recognition and rewards, realignment of performance appraisal systems, and
other measurement systems. Impacts on People KM can facilitate employee learning. KM
also causes employees to become more flexible and enhances their job satisfaction. KM
impacts people through: Employee Learning, Employee Adaptability and Employee Job
Satisfaction.

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1. Impact on employees’ learning

- To better understand how PB manage and encourage knowledge creation among their
employees, we propose a model of knowledge creation that consist of four key
elements of SECI Model that together shall interact to form a knowledge spiral with
knowledge creation as an outcome. The four elements are, the SECI process
(knowledge creation through interactive transformation of tacit and explicit
knowledge)
 Socialization allows an individual to acquire tacit knowledge directly from
other workers through shared observations and experience. Example : through
joint activities such as meetings/informal chats
 Externalization involves transformation of tacit knowledge to explicit
concepts. Example: writing a report on lessons learned from a project.
 Internalization, tacit knowledge is transformed to explicit through
documentation and hands on experience and new knowledge is internalized.
Example: when employees preparing for a later project, can read it.
 Communities of Practices, it is an organic and self-organized group of
individuals who are dispersed geographically or organizationally, but
communicate regularly to discuss issues of mutual interest
2. Impact on employee adaptability
- The important element leads to adaptability regarding to change in getting the
competitive advantage and also evaluating the responsibilities on the part of employer
in order to maintaining certain steps for the betterment of his employees through
training and development, empowerment and culture.
- Berger, (1994) defined the “change” as it is a repetitive nature of practice in keeping
in the line of the organization for operating and performing the most successful
manners over its rivals. When an organization implements these manners in a true
spirit in creating the environment where an employee feels himself as a valuable
person in the organization. It can evaluate elements which lead to an organization to
adapt changes and according to that adaptability a learning based environment is
prevailed so that employees are willing to perform to that extent where the
organization is required. These elements are also lead to employee’s retention to be
remained loyal to organization’s goals and objectives.

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3. Impact on employee job satisfaction

- Job satisfaction has been defined “as the feelings a worker has about his or her job or
job experiences in relation to previous experiences, current expectations, or available
alternatives” (Balzer, Kihm, Smith, Irwin, Bachiochi, Robie, Sinar & Parra, 1997, p.
7).  In organizations employees sharing knowledge with one another, turnover rates
get reduced, affecting revenue and profit. Employees feel better because of their
knowledge acquisition and skill enhancement. Employees’ market value is enhanced
relative to other organizations’ employees KM also provides solutions to employees
for problems they encountered earlier and effectively address those. Additional
increases in employee job satisfaction derive from KM practices: 
(1) Mentoring and training are excellent motivators;
(2) Communities of Practice provide intimate and socially validated control over their
own work practices

3.2 IMPACT ON PROCESSES

- KM represent the basic operations of knowledge, enablers provide the infrastructure
necessary for PB to increase the efficiency of knowledge processes. Knowledge
Management can include activities such as creation, sharing, storage, and usage for all
departments for each subsidiary under PB such as marketing, manufacturing,
accounting, engineering and human resources. These impacts can be seen along 3
(three) major dimensions as follows:
1) Impact on process effectiveness

 Select and performing the most suitable processes and making the best
decision
 Effectiveness is described as the capability of producing a specific, desired
effect, or in other words “getting the right things done” (Druker, 2004).
Improving process effectiveness supports company performance simply by
ensuring that each process delivers the results that it needs to.
Standardization also enhances process effectiveness by ensuring that
different parts of the organization are doing the same things in the same

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way. It can smooth transitions between different systems and provide

better control over process and data quality.
2) Impact on process efficiency

 Performing the processes immediately and under low cost.

 Improving the efficiency gains in processes (example: faster, lower, cost
and less rework) are a high priority for their improvement initiatives
 Improve efficiency by eliminating duplication of work and reducing the
need for manual interventions.
3) Impact on process innovation

 As the adoption, creates, generate and implement new ideas, processes,

products or services.

 Innovation is the process that connects new ideas to new processes and
products (Aboelmaged, 2012) and requires organizations to go beyond
learning from repetition, defect correction, and a desire for reducing
process variation.
 Innovation performance can be positively impacted by process
improvement and process design. KM has been found to enable frequent
improved brainstorming, thus enhancing process innovation. KM can
enable organizations by better exploitation of new ideas. “The power of
intellectual capital is the ability to breed ideas that ignite value”

3.3 IMPACT ON PRODUCTS

- The important of knowledge management on product is gaining or sustaining product
success on market. If managed effectively, knowledge can be used to reduce NPI
(New Product Introduction) project time, improve quality and increase customer
satisfaction (Sixotte & Langley, 2000). Impact on product can be as follows:
1) Impact on value added products
 Value-added products are two of the best strategies PB can employ to
improve net profitability. Value-added products can open new markets,
and extend the marketing. KM processes can help organizations offer new

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products or improved products that provide a significant additional value

as compared with earlier products
2) Impact on knowledge based products
 KM can have a significant impact on products that are knowledge based.
Example as consulting and software development.
 Consultants can quickly access and combine the best available knowledge
and bid on proposals that would otherwise be too costly or too time –
consuming to put together. PB can place solutions to software problems of
customer in a shareable knowledge base. Let customers download software
patches based on their answer to an automated ‘wizard ‘ system that
prompts customer with a series of questions aimed at diagnosing the
customer needs.

3.4 IMPACT ON ORGANIZATIONAL

Organizational performance (OP) means to what extent the organizational goals and
objectives can be achieved. Many empirical and conceptual studies were conducted to test the
relationship between KM and OP which are summarized in Table I. Investigated the
organizational impact of knowledge management practices. The study argued that it is
expected that knowledge management practices including (communication, the ability to
create new knowledge, acquisition, policies and strategies of KM, and training) affect
organizational performance dimensions which include (financial performance, new product
success, customer satisfaction, market share) in a positive way among all the dimensions.
However, it was revealed that the highest impact was on the success of a new product, which
is one of the OP dimensions, and the training was the strongest affecting dimension on OP.

Article The study Methodology and Findings

Hypothesis
Using questionnaire survey.
KM practices and its
Kharabsheh, Data gathered from 13
impact on OP in All hypothesis
et al (2012), pharmaceutical companies
Jordanian were supported.
[4] in Jordan. 11 positive
pharmaceutical firms
hypothesis
Fattahiyan, Study of relationship Using questionnaire Some of them
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[1] and randomly others were
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Table : 1

In order to help organizations including academic ones (e.g., Universities) to correctly

choosing the strategies for investing in knowledge resources, an empirical study was
conducted in the Isfahan universities in Iran, presented that knowledge management
resources such as organizational structure and knowledge application are positively affecting
OP while other resources such as technology and knowledge conversion are not . It is likely
to address that KM strategy could include knowledge transfer concentration, open
mindedness orientation, skill sharing and integrated value knowledge. The most significant
positive relationships from the whole KM processes performance indicators are factor
strategy and leadership, among knowledge management enablers. On the other hand, other
similar studies were conducted to reveal the influence of KM resources on organizational
performance with the same dimensions. The results were supported along with organizational
structure and knowledge application and weren’t the case with as technology and knowledge
conversion. With this in mind, we can induce that not all KM resources contribute directly or
positively on OP, in other words, each resource is not linked to performance, rather as a
composed. It has been found that a non-expected percentage of employees have no interest in
knowledge sharing and retrieving, and most of them prefer to depend on their own
knowledge and intuition. Since the culture can be considered as a practice of KM beside
processes, human capital, and strategy, there is a strong need to construct the culture to ease
the process of sharing knowledge between employees. Other researchers also address that
well constructed culture will lead to support knowledge management process and thus
improving the organizational performance. Therefore, they improved the conceptual
framework under the name of PICS that aggregate the last enablers for KM effectiveness.
Many other factors were found to have heavy effects on organizational performance such as
competent competitive advantage, operation improvement, and potential growth. Knowledge
management strategy affected the last factors significantly in clothing manufacturing in
Thailand and thus it affects OP in a positive way . Although they found that, there is no
significant relationship between KM practices and financial performance, researchers has
also found that they can generalize another rule; There is an existence of a direct significant
relationship between KM practices and Organizational performance which includes the
financial performance . Fig. 1 is a similar model illustrating the idea of the study.

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CONCLUSION

Knowledge management (KM) is the systematic management of an organization's

knowledge assets for the purpose of creating value and meeting tactical & strategic
requirements; it consists of the initiatives, processes, strategies, and systems that sustain and
enhance the storage, assessment, sharing, refinement, and creation of knowledge. KM
initiatives help to improve business processes and can reduce business processing time
simply because they can share best practices. It also improves through conversations and
discussions that can generate valuable knowledge for forecast saving and cost reduction.
Organizational culture can change towards a knowledge sharing culture where employees are
driven to generate and share knowledge for the purpose of organisational improvement.
Employees are motivated to share their knowledge because they feel more valued for their
intellectual capabilities and skills when they can see their contribution towards improvements
in the organization.

KM can have impact on the organization performance and the impacts can be people,
processes and product. KM can have impacts on people based on employee learning,
employee adaptability and employee job satisfaction. Impacts on processes can be
effectiveness, efficiency and innovation. KM impacts on product also can be based on value
added product and knowledge based products.

In order to implement an effective knowledge management system, the support of senior

management in consolidation of building knowledge management and in spreading the
culture of knowledge sharing need to be taken under consideration. Furthermore, there is a
huge need to continuously train and educate the organizations’ CEOs about the importance of
KM through group works and training programs

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