SUMMATIVE ASSIGNMENT 2

Name : Mary Nambao

Student ID Number: R2002D10464027
Course name: UU-MBA-717-ZM-18929
Tutor: Marieta Efthymiou
Date: 12th October 2020

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1.0Contents
2.0 STRATEGIC RATIONALE......................................................................................................2
2.1 Introduction...........................................................................................................................2
2.2 Learning and Knowledge Management.................................................................................2
2.3 Knowledge creation...............................................................................................................2
3.0 Tools and techniques for knowledge management....................................................................5
3.1 Strategic development............................................................................................................5
3.2 Strategic marketing.............................................................................................................6
Strategic marketing requires market insights where the firm understands what customers value. An
article on design firms calls attention to the importance of having updated information, “ Inefficient
flows of information result in reworking follows wherever design has proceeded on basis of
outdated versions of other designers' drawings because newer information was not forthcoming and
overall project durations are extended and increasing costs.” Donin, C., Rizzatti, E., Geiger, K., &
Sartori, T. (2016). This implies that neglecting efforts to have updated information would cost an
organization its competitive advantage as it would not provide what the clients want at that time.
RRL does regular marketing audits which utilizes the stored and extracted knowledge from both
workers and information technology and this also enables the firm to do SWOT analysis whenever
necessary. To convert this knowledge into a successful marketing strategy, the firm needs updated
information to keep ahead of its competitors. Gâdău, (2017) mentions that the marketing mix which
are Price, Place, Product and Promotion should be analyzed during a marketing audit. Under
promotion RRL develops adverts which are culture sensitive and this has made the locals
comfortable with the firm’s product. It has information on the preferred way of accessing the
product and this information has been converted to distribution tactics............................................6
3.3 Sustainability of business.......................................................................................................6
When developing a deliberate strategy RRL, uses tools such as PESTLE which analyses external
factors that can affect the business. PESTLE refers to political, economical, social, technology,
legal and environmental factors that the firm has no control over. (Nelke & Ray,2011). In order to
assess how these factors will impact the business, the right intelligence is needed, and this is found
in workers and technology.................................................................................................................6
3.4 Competitive advantage..........................................................................................................6
Some scholars bring to light a Knowledge based strategy and defines this as business strategy
which uses knowledge to maintain the firm’s competitive advantage (Luchian, Florescu & Luchian,
2016).RRL has cultivated a culture which supports socialization and externalization resulting in
knowledge being stored in the firm’s extranet. The firm collects competitive intelligence and
studies the new entrants to the business and what technological expertise are in the market. RRL
continuously uses the benchmarking tool to compare its product and services with the national
utility company. Mittelstaedt (1992) defines benchmarking as a,’ continuous process of measuring
our products, services and practices against our toughest competitors….’. RRL depends on the
explicit knowledge to use the benchmarking tool. It analyses data from its processes and outcomes
and compares that analyzed information with what the national utility company has achieved. The
intelligence collected by its workers makes this analysis possible. The firm has realized that the
human assets and intellectual capital gives it a competitive advantage over the others because it has
invested in a learning organization. However achieving a learning organization includes clashing of
opinions by individuals (Nonaka &Toyama, 2003). RRL has considered these inevitable

ii
 contradictions and has put in place a responsive organizational structure, incentive system and
organizational culture........................................................................................................................6
3.5 Corporate Change..................................................................................................................7
Corporate change is brought about by either external or internal factors. External factors include
new technologies and change in client’s preferences. Internal factors such as new customer service
ideas and need for training can also result into corporate change. Organizational culture at any of
the following layers can be a hindrance to change; Values beliefs, behaviors and taken-for-granted
assumptions. Without sharing knowledge with the workers to explain why there is need for a
corporate change, management finds it very difficult to effect corporate change. For effective
communication to occur to an extent as to address the concerns the workers have regarding their
organization culture, there should be adequate knowledge, explaining the factors that have
necessitated the corporate change. Yet corporate change might also result in loss of tacit knowledge
especially if it involves downsizing. This does not only deprive the company of the rich intellectual
capital, but it also exposes it to competition. Therefore, knowledge management is key to
encourage externalization coupled with the use of technology to ensure storage of this knowledge
for future use. (Martensson, 2000).....................................................................................................7
4.0 Conclusion.................................................................................................................................7
In conclusion , RRL has incorporated knowledge in every area of its operation. The firm’s way of
handling knowledge has substantiated the school of thought by scholars who believe knowledge
creation should be integrated in the daily routines of an organization. The literature reviewed supports
the strategy of investing in intellectual capital which RRL has done even as it develops corporate and
marketing strategies. The organisation uses knowledge to asses its sustainability, competitive
advantage even as it manages corporate change. The limitation is that it cannot measure tacit
knowledge and that makes it difficult to evaluate whether it is utilizing enough of this knowledge......7

iii
1
2.0 STRATEGIC RATIONALE
2.1 Introduction
The global business environment has become exceedingly competitive and firms need to
develop learning organizations if they are to maintain their competitive advantage. The
turbulent environment created by the ever-changing technologies and client’s needs has
placed knowledge management in the center of a corporate strategy formulation (Snyman &
Kruger, 2004). The two theories with emphasis on intangible assets are the Result-based view
(RBV) and the Knowledge based view. The RBV promotes the analysis of internal resources
of which intangible assets are part of. The Knowledge based view emphasizes the sustained
competitive advantage brought about by knowledge and promotes investing in knowledge
management (Martensson,2000) Scholars refer to the use of already acquired knowledge
as ,’Productivity’ whereas the application of new knowledge is called ,’ innovation’, both of
which are needed to stay ahead of competition (Kristen & Jackson, 2001).This write up sets
out to discuss a company Resource Renew limited (RRL)which owns a renewable biomass
plant. The focus will be its approach to strategic management of knowledge and
organizational learning
2.2 Learning and Knowledge Management

Nonaka (1991) says,” ‘inventing new knowledge is not a specialized activity...it is a way of
behaving, indeed a way of being, in which everyone is a knowledge worker’. In order to
understand how this statement aligns with the RRL strategic management, the definition of
what knowledge is in this context will be clarified. Organizational knowledge refers to
strategic capabilities and can either be explicit or tacit. When knowledge is articulated or
documented, it is called explicit and when it is not communicated by the person with the
knowledge it is called tacit (Bo, 2005; Stover, 2004). This critical resource needs to be
acquired, created, transferred, shared and reused and when acquired by an organization it is
referred to as,’ organizational learning’(Essam, 2017). Understanding organizational learning
has not been straight forward as some authors point out that understanding individual
learning cannot be interpreted as understanding the organization learning in that these two are
different. The individuals create knowledge which the organization then apply in its
production. The firm also puts in place measures to reduce on this knowledge reaching the
competition as creating knowledge without protecting it, is not enough to sustain competitive
advantage (Bo, 2005 ; Chiva & Alegre,2005). Martensson (2000) argues that not all
knowledge is useful and as such the firm takes time to research to ensure the usefulness of the
knowledge it is storing and using. RRL is a learning organization and this has been
demonstrated through the following activities: team spirit, virtual learning, capacity building,
and job rotation( Essam,2017). The firm understands the argument brought up by scholars
that organisational learning is not simply an aggregation of learning individuals but analysis
of ideas, processes and strategies as a team (Thomas & Vohra, 2015).Apart from adaptive
learning which exposes employees to only standard processes , RRL encourages employees
to learn by doing . This generative learning allows workers to query standard procedures
they are not clear about and make suggestions on how best to perform the task at hand
(Kristen & Jackson, 2001). Knowledge management ensures that intellectual capital is
managed effectively. Roehl, Thomas and ITAMI (1991) in defining intellectual capital as an
invisible asset highlights the following control of distribution, organizational culture,
Consumer confidence, brand identity, and managerial competencies.

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2.3 Knowledge creation

Knowledge creation is best explained using a model called SECI (Fig. 1.1) proposed by
Ikujiro Nonaka . The name represents socialization, externalization, combination and
internalization. It illustrates the need for an organization to continuously innovate to sustain
the competitive advantage. This includes new knowledge creation from within the
organization as well as processing external information to reposition the firm ( Dubberly &
Evenson, 2011). At RRL the interaction between tacit and explicit knowledge seen through
the SECI model lens is as follows:
 Socialization (tacit to tacit) . The organization culture of RRL has respect for the
local ceremonies and encourages the workers to participate. During the preparations
for these activities there is a lot of care, love and trust shared among the workers.
Individual skills are passed on through observations without formal mentorship or
coaching . The rapport built during these passionate times continues even during the
normal work routines and tacit knowledge gets easily passed on as these workers are
at ease with each other. They stop being competitive but rather aim for the same goal
with a united front. In contrast to what Glisby and Holden, (2003) refers to as, ‘arm’s
length sharing of knowledge’ which exist in the western context, in Zambia the local
culture embraces sharing of knowledge. The firm is also alert that it needs to network
with other companies to encourage tapping of tacit knowledge externally, but this is
still in its infancy as the firm is still establishing itself (Andreeva & Ikhilchik, 2011).
Whereas measuring explicit knowledge has been easy, the firm has had challenges
tracking down tacit knowledge. Kristen and Jackson, (2001) highlights the limitations
in firms managing knowledge as there is knowledge which they may not even know
about as it resides in the workers’ minds.
 Externalization: (Tacit to explicit). Considering tacit knowledge is highly
internalized, this phase is important to knowledge creation and sharing. At this stage
the tacit knowledge is converted into explicit and usually it is documented. RRL
provides technical assistance to individuals to input in the creation of manuals and
other guidelines. Inasmuch as work has been made easier with technology, the firm
avoids falling into the trap of leaving knowledge management to the Information
Technology department. Kristen and Jackson (2001) mentions that best outcome from
planning is not dependent on technology . Therefore, RRL provides an environment
where workers submit their ideas to management before strategic documents,
guidelines or protocols are developed. Product concepts and branding is not only left
to senior management and this has seen a lot of tacit knowledge articulated. An article
in the Bingley journal emphasizes that the organizational culture which builds long
lasting trust between workers and management benefits more with converting tacit
knowledge to explicit (Kristen & Jackson, 2001). The firm invests in incentives such
as health care schemes for the workers and families and capacity building courses for
workers. This makes them appreciate management’s interest in their wellbeing and
future.
 Combination: (Explicit to explicit). At this stage, concepts are integrated into a
knowledge system. This explicit knowledge collected from both inside and outside the

3
 firm is refined to form new explicit knowledge and shared among the workers. This
has been an ongoing process at RRL and this is done biannually during the review
meetings. There are sessions during this time when management reviews the explicit
knowledge the firm has and puts it together, edits it and recirculate it as new
knowledge. The dissemination of this new knowledge is done through weekly
meetings and during periodic workshops for the workers. Nonaka and Toyama (2003)
highlights that other than the knowledge collected from outside, this phase includes
simplifying the firm’s vision, mission and goals into product concepts.

 Internalization (explicit to tacit): Explicit knowledge acquired by individuals is

sometimes converted to tacit knowledge. This is difficult to demonstrate in RRL but it
can be explained by the way workers have developed new routines and are able to
handle some difficult situations which they have never been coached through before.
During this phase, workers internalize the protocols written in the manuals and make
it part of their tacit knowledge (Nonaka & Toyama, 2003)

4
 FIG. 1.1 SECI MODEL

The SECI model (Nonaka & Takeuchi, 1995).

Knowledge creation and management has had its own challenges in RRL. The local culture
has made sharing across departments difficult. The workers are more cooperative within
departments and see other departments as competition. The other barrier is that sometimes the
workers are not comfortable enough to share tacit knowledge, especially when they do not
trust their co-workers enough. The culture of documentation is not very strong among the
workers and therefore the externalization stage in the SECI model is neglected most of the
times.

3.0 Tools and techniques for knowledge management

3.1 Strategic development
Strategy development is said to be deliberate when it has top down design and centred on an
analytical view. It involves detailed design and planning based on the mission, goal and

5
objectives of the firm. When a strategy is realized as the operations are going on, it is
called ,’emergent’ and this one is based on the lessons learnt and it is not a top down design
(Leitner, K. (2014). RRL uses both deliberate and emergent processes when developing
strategies. During the deliberate strategy development ,RRL uses the SWOT analysis tool
which looks at the firm’s internal strengths and weaknesses and external factors such as
threats and opportunities for the business (Lynore,2008). For such an analysis to be done,
there is need for the firm to have the right intelligence and to understand its operations well.
RRL has created an environment where emergent strategies are developed. This happens
when workers create knowledge from their daily practices and learning, which is stored and
shared to help develop better strategies based on the needs identified. Bolisani, Scarso and
Zieba (2015) points out that methods which are developed through learning when they work
out to be effective are then identified as the ,’ Knowledge Management approach’ of the
company.

3.2  Strategic marketing
Strategic marketing requires market insights where the firm understands what
customers value. An article on design firms calls attention to the importance of having
updated information, “ Inefficient flows of information result in reworking follows
wherever design has proceeded on basis of outdated versions of other designers'
drawings because newer information was not forthcoming and overall project durations
are extended and increasing costs.” Donin, C., Rizzatti, E., Geiger, K., & Sartori, T.
(2016). This implies that neglecting efforts to have updated information would cost an
organization its competitive advantage as it would not provide what the clients want at
that time. RRL does regular marketing audits which utilizes the stored and extracted
knowledge from both workers and information technology and this also enables the
firm to do SWOT analysis whenever necessary. To convert this knowledge into a
successful marketing strategy, the firm needs updated information to keep ahead of its
competitors. Gâdău, (2017) mentions that the marketing mix which are Price, Place,
Product and Promotion should be analyzed during a marketing audit. Under promotion
RRL develops adverts which are culture sensitive and this has made the locals
comfortable with the firm’s product. It has information on the preferred way of
accessing the product and this information has been converted to distribution tactics.
3.3 Sustainability of business
When developing a deliberate strategy RRL, uses tools such as PESTLE which
analyses external factors that can affect the business. PESTLE refers to political,
economical, social, technology, legal and environmental factors that the firm has no
control over. (Nelke & Ray,2011). In order to assess how these factors will impact the
business, the right intelligence is needed, and this is found in workers and technology.

6
3.4 Competitive advantage
Some scholars bring to light a Knowledge based strategy and defines this as business
strategy which uses knowledge to maintain the firm’s competitive advantage (Luchian,
Florescu & Luchian, 2016).RRL has cultivated a culture which supports socialization
and externalization resulting in knowledge being stored in the firm’s extranet. The firm
collects competitive intelligence and studies the new entrants to the business and what
technological expertise are in the market. RRL continuously uses the benchmarking
tool to compare its product and services with the national utility company. Mittelstaedt
(1992) defines benchmarking as a,’ continuous process of measuring our products,
services and practices against our toughest competitors….’. RRL depends on the
explicit knowledge to use the benchmarking tool. It analyses data from its processes
and outcomes and compares that analyzed information with what the national utility
company has achieved. The intelligence collected by its workers makes this analysis
possible. The firm has realized that the human assets and intellectual capital gives it a
competitive advantage over the others because it has invested in a learning
organization. However achieving a learning organization includes clashing of opinions
by individuals (Nonaka &Toyama, 2003). RRL has considered these inevitable
contradictions and has put in place a responsive organizational structure, incentive
system and organizational culture.

3.5 Corporate Change

Corporate change is brought about by either external or internal factors. External
factors include new technologies and change in client’s preferences. Internal factors
such as new customer service ideas and need for training can also result into corporate
change. Organizational culture at any of the following layers can be a hindrance to
change; Values beliefs, behaviors and taken-for-granted assumptions. Without sharing
knowledge with the workers to explain why there is need for a corporate change,
management finds it very difficult to effect corporate change. For effective
communication to occur to an extent as to address the concerns the workers have
regarding their organization culture, there should be adequate knowledge, explaining
the factors that have necessitated the corporate change. Yet corporate change might
also result in loss of tacit knowledge especially if it involves downsizing. This does not
only deprive the company of the rich intellectual capital, but it also exposes it to
competition. Therefore, knowledge management is key to encourage externalization
coupled with the use of technology to ensure storage of this knowledge for future use.
(Martensson, 2000).

4.0 Conclusion

In conclusion , RRL has incorporated knowledge in every area of its operation. The
firm’s way of handling knowledge has substantiated the school of thought by scholars
who believe knowledge creation should be integrated in the daily routines of an
organization. The literature reviewed supports the strategy of investing in intellectual
capital which RRL has done even as it develops corporate and marketing strategies. The
organisation uses knowledge to asses its sustainability, competitive advantage even as it
manages corporate change. The limitation is that it cannot measure tacit knowledge and
that makes it difficult to evaluate whether it is utilizing enough of this knowledge.

7
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The Impact of Knowledge Management Capability, Organizational Learning, and Supply
Chain Management Practices on Organizational Performance Ingy Essam Eldin Salama
College of Management and Technology

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