International Journal of Production Research

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Knowledge management in 21st

century manufacturing
a b
A. Gunasekaran & E. W. T. Ngai
a
Department of Management , University of
Massachusetts—Dartmouth , North Dartmouth, MA 02747-2300,
USA
b
Department of Management and Marketing , The Hong Kong
Polytechnic University , Hung Hom, Kowloon, Hong Kong, PR China
Published online: 18 Apr 2007.
To cite this article: A. Gunasekaran & E. W. T. Ngai (2007) Knowledge management in 21st
century manufacturing, International Journal of Production Research, 45:11, 2391-2418, DOI:
10.1080/00207540601020429
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International Journal of Production Research,
Vol. 45, No. 11, 1 June 2007, 2391–2418
Knowledge management in 21st century manufacturing
A. GUNASEKARANy and E. W. T. NGAI*z
yDepartment of Management, University of Massachusetts—Dartmouth,

North Dartmouth, MA 02747-2300, USA
zDepartment of Management and Marketing, The Hong Kong Polytechnic University,
Hung Hom, Kowloon, Hong Kong, PR China
(Revision received November 2006)
As markets have become global, more and more manufacturing companies

achieve global operations through various strategic business alliances including
joint ventures and outsourcing, etc. Since manufacturing has become global to
address the needs of the global market, companies take advantage of advanced
information technologies in achieving their global supply chain. It is not enough
to just establish an integrated information system such as enterprise resource
planning (ERP); it is also important to see to what extent this has been used to
facilitate innovation and knowledge diffusion along the supply chain for an
ultimate improvement of productivity and quality and in turn manufacturing
organizational competitiveness. Without the integration of people and informa-
tion technology/information systems (IT/IS), it is very hard to achieve any
significant improvement in organizational performance. However, there are not
many articles or reports that deal with knowledge management in advanced
manufacturing organizations. Advanced manufacturing enterprises are charac-
terized by a physically distributed enterprise environment, outsourcing and
IT-enabled supply chain management (SCM). This paper makes an attempt to
review the literature available on knowledge management (KM) in manufacturing
with the objective of identifying the gap between theory and practice, strategies
and techniques for KM systems in advanced manufacturing environments. The
literature on KM in manufacturing has been reviewed using a suitable
classification scheme with the objective of developing a framework for managing
knowledge in manufacturing and suggesting some future research directions.
Keywords: Knowledge management; Literature review and framework
1. Introduction
In recent years, information technology/information systems (IT/IS) have been given

due attention in global manufacturing operations and this in large part can be
attributed to the total quality management, re-engineering business process and
supply chain management (Gunasekaran and Ngai 2004a). The performance of an
organization, whether it is manufacturing or services, depends upon the interaction
between business functions and stakeholders both within and outside of the company
such as partnering firms and customers. Gustin et al. (1994) and Akers and
*Corresponding author. Email: mswtngai@inet.polyu.edu.hk
International Journal of Production Research

ISSN 0020–7543 print/ISSN 1366–588X online ß 2007 Taylor & Francis
http://www.tandf.co.uk/journals
DOI: 10.1080/00207540601020429
2392 A. Gunasekaran and E. W. T. Ngai
Porter (1995) believe that computers and information are critical to achieving
integration and are increasingly viewed as resources to be used by the firm in gaining
a competitive advantage in the marketplace. At the highest echelons of an
organization, critical information is crucial to successful strategic planning.
However, information at all levels of decision-making (strategic, tactical and
operational) plays a major role in developing cooperative-supported work
manufacturing enterprise environments, including supply chain.
The major competitive advantage for a corporation lies in the corporation’s
knowledge and therefore ‘knowledge management’ has become a critical issue
(Lai and Chu 2002). These authors first reviewed theoretical frameworks in detail
and then unified them into a single framework. Based on this, they examined what
has been done in practice and thus produce a clear picture of what and how KM has
been performed in various industries. They have analysed eight cases and the results
offer insights into what and how knowledge management has been performed in
these industries. They discussed KM in software companies mostly, which is perhaps
consistent with a high-tech nature. On the other hand, services such as education,
healthcare and tourism, etc., provide opportunities for KM. However, limited
research has been reported about KM in manufacturing. While there is an
automated nature of the process in manufacturing, the so-called global supply
chain wherein a network of firms collaboratively manufacture products still poses
a great challenge for KM.
High-performance organizations are characterized by: (i) core competence,
networks and cooperations, (ii) process orientation, (iii) free margins, (iv) learning
organizational structures and (v) knowledge management and information
technology. Knowledge management has now been established as a competitive
strategy that can give multiple advantages to a company. One of the advantages of
KM in manufacturing is training. Training in both the short- and long-term can have
positive effects on the performance of a company. Knowledge server allows access
to information at all levels of an organization and provides a vehicle for people to
improve themselves in a formal and informal way. It can reduce the amount of
structure required, eliminate excuses and de-politicize the organization while
empowering people to learn on their own (Muscatello 2003).
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 fulfil organizational objectives. Knowledge assets are
the knowledge regarding markets, products, technologies and organizations that
a business owns or needs to own and which enable its business processes to generate
profits (Civi 2000). There are four kinds of knowledge management: (1) creating
knowledge repositories in which knowledge can be retrieved easily, (2) improving
knowledge access to facilitate its transfer between individuals, (3) enhancing
a knowledge environment to conduct more effective knowledge creation, transfer
and use, and (4) managing knowledge as an asset and concern about how to increase
the effective use of knowledge assets over time (Davenport et al. 1998).
Manufacturing has become more of a service industry, which means KM plays a
major role in the so-called global supply chain, based on strategic alliances based on
core competencies and the application of IT/IS. Reviewing the selected literature
indicates that the majority of them deal with general KM issues and are not specific
to KM in manufacturing. Considering the growing importance of manufacturing, it
21st century manufacturing 2393
is appropriate to discuss the characteristics of manufacturing competitiveness and

the implications of KM. The following were the overall objectives of this study:
(i) understand the importance of KM in 21st century manufacturing; (ii) identify the
major criteria for the development and application of KM in manufacturing;
(iii) identify strategies, tactics and tools used for KM in manufacturing; and
(iv) examine the implementation issues and future research directions on IT in 21st
century manufacturing. The paper has been organized into six sections. Section 2
presents some definitions of KM in manufacturing. The classification of the
literature available on KM in manufacturing and related topics is discussed in
section 3. Section 4 briefly reviews the selected papers with the objective of
identifying the issues related to KM in manufacturing industry. A framework for
KM in manufacturing is presented in section 5. Section 6 concludes the paper with
some suggestions for future research directions.
2. Knowledge management (KM) and manufacturing
Since the beginning of the 1990s, the business world has been talking about
knowledge management. Recent advances in information technology have had a
profound impact on the latest emergence of knowledge management. Now the
real challenge for companies is not simply to have a sophisticated information
technology/system, but more importantly to discover how to employ such resources
for enabling knowledge creation and exchange among people in organizations.
Nowadays, most companies have IT/IS, but the real difference comes from how
these have been utilized by them for their organizational competitiveness and to
survive and prosper in a knowledge economy-based industrial world and market.
Two important areas have accelerated the emergence of modern knowledge
management systems: network technologies and local databases. The rise of
networking computers has made it possible to codify, store and share certain
kinds of knowledge easier and cheaper than ever before (Civi 2000). IT/IS is an
integral component of KM systems, but the question is how different is its role in
KM in manufacturing. We will try to address this question in this paper.
2.1 Knowledge management

Knowledge management can be defined as the set of activities that enable
the creation, storage, distribution, and application of knowledge in organizations
(Chow et al. 2005). Knowledge management is a business process. It is the process
through which firms create and use their institutional or collective knowledge
(Civi 2000). According to Davenport and Prusak (1998), ‘‘Knowledge management
is a fluid mix of framed experience, values, contextual information and expert insight
that provides a framework for evaluating and incorporating new experiences and
information’’. KM refers to identifying and leveraging the collective knowledge in an
organization to help the organization compete (von Krogh 1998). Essentially, KM
embodies organizational processes that seek a synergistic combination of data and
information processing capacity of information technologies, with the creative and
innovative capacity of human beings (Malhotra 1997).
KM is supposed to increase innovativeness and responsiveness (Hackbarth 1998).

Civi (2000) discusses different approaches for building a knowledge management
system: bottom–up, decentralized knowledge management systems; top–down,
centralized knowledge management systems and middle–up–down (Nonaka and
Takeuchi 1995). Civi (2000) also lists five steps that are needed to be successful in the
knowledge management processes: (1) identify the business problems and develop a
clear set of goals and objectives for knowledge activities, (2) create a knowledge crew,
(3) adapt all level managers to the process, (4) help the companies to change their
organizational culture to implement knowledge activities, and (5) provide access to
knowledge using various networks and technologies. This approach can also be used
in managing knowledge in manufacturing companies. The various definitions of KM
differ mostly because of the different perspectives to which it has been treated.
For example, most of the existing literature presents the definition of KM from
process perspectives. In the current paper, we discuss the KM in manufacturing from
functional, technology and strategic perspectives.
KM involves distinct but interdependent processes of knowledge creation,
knowledge storage and retrieval, knowledge transfer, and knowledge application
(Alavi and Leidner 2001). IT can lead to a greater breadth and depth of knowledge
creation, storage, transfer, and application in organizations. As with most
information systems, the success of knowledge management systems partially
depends upon the extent of its use, which itself is tied to system quality, information
quality, and usefulness. System quality is influenced by attributes such as ease of use,
characteristics of human–computer interface, and flexibility and effectiveness of
search mechanisms (Delone and McLean 1992).
IT professionals are brokers of organizational knowledge in which shared IS
plays a key roles as a boundary objects. Brokering is a critical element in facilitating
the ongoing convergence between shared systems and the practices that they connect
(Pawlowski and Robey 2004). By connecting isolated units with shared systems,
IT professionals play a potentially key role in transferring knowledge across
organizational boundaries. They are in a strategic position to transfer knowledge
among user communities that were historically isolated from each other. Glisby
and Holden (2005) describe the experience of a Danish company which achieved
a breakthrough in Japan by applying knowledge management concepts to the
supply chain.
Lai and Chu (2002) unify previous knowledge management frameworks into a
single framework to serve as a basis to examine the gap between theory and practice
and also provide a picture of how the knowledge management has been performed in
some selected industries. Knowledge resources include human capital, structure
capital and customer capital. Knowledge management activities include initiation,
generation, modeling, repository, distribution and transfer, use, and retrospect.
Knowledge management is influenced by (1) culture, (2) leadership, (3) measure-
ment, (4) education, (5) reward and incentive systems, (6) organizational
adaptability, (7) values and norms, and (8) technology (Lai and Chu 2002).
2.2 Managing knowledge in manufacturing

Organizations are redesigning their internal structure and their external
relationships, creating knowledge networks to facilitate communication of data,
information and knowledge, while improving coordination, decision-making and

planning. The study by Lin et al. (2002) examines the types of knowledge flow in a
collaborative supply chain, and proposes knowledge management architecture to
facilitate knowledge management in collaborative supply chain. They explained how
different industries build their e-business model under different architectures.
Different network type of supply chain, the amount of transaction, and the main
collaborative function in the supply chain will lead to different types of knowledge
flow and the tools adopted, and ultimately different knowledge management systems
(Lin et al. 2002). The ability to manage and exploit knowledge will be the main
source of competitive advantage for the manufacturing industry of the future.
In their article, Berawi and Woodhead (2005) deal with the improvement of
production management theory, in the manufacturing context, through the

application of some core principles. They develop a knowledge management
perspective in production management appropriate for the manufacturing industry.
Wilson (2003) examines the information requirements of certain features of
modern manufacturing enterprises—local control, skills, knowledge and training,
function allocation and team communications. The author then assesses the
utilization of three broad types of information display—Personal Digital
Assistants (PDAs), Multimedia/Closed-circuit Television (CCTV) and Virtual
Environments (VEs)—for shopfloor systems. Knowledge management is a function
by which decision-making can be automated, in particular for managing enterprise
operations. Because of the large volume of information to be handled, the critical
information idea is very important to develop an effective management system.
Soliman and Youssef (2003) proposed a new technique to identify critical
information for use in knowledge processing using an example from the
manufacturing industry. While comparing services and manufacturing, manufactur-
ing is more concerned about their technological and process confidentiality as
compared to services. This is an interesting proposition as to why manufacturing is
more careful about the open platform IT/IS for KM as compared to services.
Traditional manufacturing has a focus on managing physical assets, but current
manufacturing environments focus on managing knowledge assets.
Filos and Banahan (2001) consider technologies and trends towards
inter-operable tools for organizational agility and flexibility based on distributed
business operations. This shift in paradigm in manufacturing from corporate internal
and protected environments to open networks is giving rise to new types of
inter-networked organizations. These organizations are virtual in concept, highly
flexible, dynamic, and capable of leveraging the power of network technologies to
meet customer demands for high added-value products and services in a global market
(Filos and Banahan 2001). This indicates that the knowledge is not just confined
internally, but it crosses the boundary of the manufacturing organization, which
means to the extended enterprises in the network of partnering firms and customers.
IT/IS and education facilitate open communication in order to develop knowledge
networks which will eventually lead to diffusion of innovation for improving
manufacturing competitiveness. Again, open communication and networks pose
a great challenge in protecting commercial interests. Moreover, open networks
permit a large volume of data and information and this requires determining a suitable
data warehousing and data mining system for KM in manufacturing.
By making available the right information to the right people, disseminating

knowledge will significantly contribute to manufacturing productivity.
KM in manufacturing has not received adequate attention from researchers
as well as practitioners. Although there is a lot of research articles on KM in selected
companies, mostly they are of services generic in nature (Soliman and Youssef 2003,
Gunasekaran and Ngai 2004a, b). This is exactly what the manufacturing industry is
focused on nowadays, namely, achieving agility in their operations. Considering the
importance of KM in manufacturing, an attempt has been made in this paper to
study the design, development and implementation of a KM system in manufactur-
ing. A literature survey was employed as the research methodology. The literature
review focused on articles in scholarly journals published over the last 10 years. In
addition to this, we developed a framework for KM in manufacturing.
3. Classification of the literature on KM in manufacturing
There are some literature review articles on KM and they mostly focus on
definitions, industrial case studies and strategies. For example, Chauvel and Despres
(2002) reviewed the survey research in KM and identified 59 surveys that were
conducted between 1997 and 2001. They thematically analysed 23 and concluded
that each has embellished a view of KM that turns around six dichotomous
dimensions: phenomena, action, level, knowledge, technology and outcomes.
Since our review is focused on KM in manufacturing, we look at the characteristics
of advanced manufacturing and then determine how the KM can be developed
and implemented for improving overall organizational competitiveness.
The classification of the literature is based upon the basic and core functions in
manufacturing that include: Design, Engineering, Production, Distribution, and
Information Systems. Since we are discussing KM in 21st century manufacturing
which is characterized by supply chains, physically distributed manufacturing
environments, enterprise resource planning, e-commerce, virtual enterprise and
third-party logistics, these aspects will be included while reviewing the KM strategies,
tactics and tools in the basic and core functions of manufacturing. A summary
of the literature based on the major and sub-classification criteria is presented
in table 1.
The reason for the above classification is to determine the need for KM in these
areas, identify the critical success factors for the successful implementation of
knowledge management strategies and techniques and suitable tools. In the end, we
also attempt to propose a set of performance measures and metrics for measuring the
performance of KM in manufacturing. We choose not to base our discussion simply
on the major characteristics of advanced manufacturing environment such as supply
chain management, virtual enterprise, e-commerce, enterprise resource planning,
3PL and outsourcing. Instead, we have embedded these characteristics in different
functional areas to reflect the nature of 21st century manufacturing.
In the following section, the available literature on KM has been reviewed with
the objective of determining a framework for management of knowledge in
21st century manufacturing.
Table 1. Summary of literature on KM in manufacturing.
Major classification criteria Sub-classification criteria References
Design and engineering System design Vecchio and Towill (2003), Platts (2004)
Product design Chandra and Kamrani (2003),
Corso et al. (2003), Roller et al. (2004)
Process design MacPherson (1997), Cascini and Rissone (2004),
Li (2005)
Production Aggregate planning McDaniel et al. (1991)
Purchasing Lau et al. (2005)
Scheduling Belz and Meterns (1996), Pflughoeft et al. (1996),
Wilson (2003), Karayel et al. (2004)
Inventory control Reyes and Raisinghani (2002)
Quality control Muthu et al. (2001)
Distribution 3PL, Warehouse Management, Arlbjorn and Halldorsson (2002), Chow et al. (2005)
and Order Control
21st century manufacturing
Information Strategic information systems Paiva et al. (2002), Kalling (2003), Soliman and
technology/systems Youssef (2003), Buyukozkan (2004)
Material requirements planning and ERP Newell et al. (2004), Jones (2005), Ko et al. (2005)
E-Commerce, EDI and E-Procurement Wickramasinghe and Mills (2002), Hou et al. (2004),
Oppong et al. (2005)
Customer relationship management Davenport and Klahr (1998), Cox (2000),
Massey et al. (2001), Garcia-Murillo and Annabi (2002)
2397
4. Review of previous research on KM in manufacturing
The literature available on KM has been reviewed based on the

classification scheme discussed in the previous section with the following specific
objectives:
. identify the major areas of application of KM;
. determine the scope of the paper in terms of aims and objectives;
. identify the major contributions to the literature and practice;
. pick up some key strategies, tactics, techniques and tools that would be useful
in 21st century manufacturing;
. translate these into suitable input to develop a framework for the KM in
advanced manufacturing; and

. highlight the gaps between theory and practice from their analysis and
suggest some future research directions.
In this paper, we review the literature available on KM in manufacturing or closely
related fields along the major functional areas such as (i) design and engineering,
(ii) production, (iii) distribution, and (iv) information systems.
4.1 Design and engineering

Design and engineering is the front end of manufacturing. It has been widely
discussed in the literature that design plays a major role in reaching the
market/customers in a timely manner with the right products and services fulfilling
customer demand, and at the same time reducing the overall cost of production
along the downstream side of the supply chain. There have been several design
strategies and tools which have been employed in manufacturing with the objective
of designing a production system or supply chain and products. Some of them
include concurrent engineering (CE), design for quality (DfQ), design for
manufacturing (DfM), computer-aided design (CAD), quality function deployment
(QFD), and Taguchi’s robust design (TQD). All these design strategies and tools
emphasize the cross-functional design team and overlapping of activities in design
products and systems with a view to minimizing the new product and system design
cycle time and proactively designing these to minimize the cost of production and
investment and have the agility to compete in the so-called global market. In recent
years, SCM and VE have been widely employed in integrated business processes
which are primarily based on outsourcing and physically distributed operations
environments. Moreover, in this environment, suppliers’ early involvement in the
design of products and systems is encouraged with their input regarding the facility,
and materials used in the product. The KM team should include suppliers and
customers together with an interdisciplinary team for the design of products or
systems. This implies the importance of knowledge management in design and
engineering which include sub-functions such as system design, product design and
process design.
4.1.1 System design. The system design involves developing a system for
manufacturing function. This includes location, facilities design, capacity planning
and work design. Again, knowledge management and information technology is a

major part of this exercise taking into account that these design issues have a
significant impact on organizational performance both in long- and short-term
interests considering the capital investment and the quality of the system design.
Pemberton et al. (2002) present a case study focusing on the knowledge
environment at Black and Decker’s European Design Centre (EDC), responsible for
the design and introduction of new global products. Through a questionnaire-based
knowledge audit, it was revealed that the EDC is well served in terms of
technological infrastructure. At the same time, there is evidence that knowledge
creation and management could be enhanced by developments in the organization’s
human and cultural infrastructure, leadership and communications (sharing and
creation of knowledge) that promote the development of a knowledge-centric
organization. However, a framework for the management of knowledge for the

manufacturing system design integrating appropriate IT/IS tools, education and
training would be helpful.
The paper by Platts (2004) discusses the knowledge and skill requirements for
manufacturing system design and describes an innovative ‘learning laboratory’
approach to educating graduate-level manufacturing engineers. The laboratory
provides a mechanism that gives engineers a wide range of knowledge and skills in
design and implementation, much of which cannot be taught by traditional teaching
methods. Platts argues that engineers designing manufacturing systems need a
thorough grounding in technical aspects; they need to understand manufacturing
processes, automation, robotics and control, etc. Engineers can use more interactive
simulation models such as WITNESS for an effective manufacturing system design.
However, they also need to acquire the skills of synthesis to enable them to put the
technical building blocks together in a way that will meet the constraints imposed by
a whole host of stakeholders: markets, workers, shareholders, local community and
legislation, etc.
Vecchio and Towill (2003) present a knowledge-based simulation framework for
production–distribution system design. They outline how the traditional industrial
dynamics modeling approach, expert design knowledge and design evaluation
based on interactive management performance objectives are incorporated into a
knowledge-based simulation framework. This system can be used to evaluate the
performance of production–distribution system design. However, the educational
background and training for the design engineers are not spelled out.
The KM team for making long-term strategic decisions should include mid and
top level management.
4.1.2 Product design. As we discussed earlier, the product design occupies a major
portion of manufacturing cycle time and therefore, due attention needs to be given
to reduce this time so that companies can be agile to meet the changing
market/customer requirements. Although we talk about the outsourcing of different
activities, design function is generally managed by the original equipment
manufacturer (OEM), and therefore innovation is the key to success in product
design.
The automotive industry relies on shorter product development time and
overall reduction of manufacturing cost and better quality for competing in the
global auto-market. To meet these requirements, current trends in car body

development such as parametric–associative modeling and knowledge integration
offer particularly high potentials. Mbang and Haasis (2004) discuss the require-
ments, solution principles and realization perspectives of a revised information
technology (feature technology integration with CAD–CAQ process chain) that can
support design and inspection process planning activities and improve change
management. It deals with the knowledge which is available in the form of experience
and usage in the minds of experts. Furthermore, they discuss the automation of this
process, starting with the instantiation of a design feature and moving through the
automatic mapping of inspection features with respect to the integrated and suitable
measuring strategy as a function of the geometrical parameters. Web-based design
tools as well as collaborative design tools would facilitate knowledge diffusion in
manufacturing. However, the implications of behavioural issues of the design and

manufacturing engineers and product life cycle need to be integrated to arrive at a
judicious product design.
Rapid Product Development (RPD), a technique for new product design and
development processes, is characterized by evolutionary, iterative work of developer
teams targeted to reduce the development time and costs while maximizing the
quality. The paper by Roller et al. (2004) develops a knowledge-based support of a
rapid product development system. It provides a new knowledge-based mechanism
to adapt conventional database functionalities to the particular requirements of
modern cooperative product designs. Besides the enhancement of database structures
to richer presentation schemata, knowledge- and rule-based approaches are usually
internal to provide new approaches to situation detection, semantic integrity
enforcement, concurrency control, and collaboration support and storage manage-
ment. The communication and coordination of tasks and processes as well as the
requirements for knowledge integration on a common workspace led to the creation
of the active semantic network (ASN). This shared knowledge base for RPD is the
object. However, this approach may not be effective unless the model is automated
with object-oriented modelling and programming.
Chandra and Kamrani (2003) offer insights into a KM approach that enables the
implementation of a consumer-focused product design philosophy by integrating
capabilities for intelligent information support and group decision-making utilizing a
common enterprise network model and knowledge interface through shared
ontologies. Small and medium enterprises (SMEs) still compete on efficiency/
flexibility in manufacturing by providing quick and easy access to external sources of
knowledge, new information and communication technologies (ICT). The role of
SMEs in virtual enterprises and supply chains has been widely studied. Considering
this trend, knowledge management in SMEs would certainly contribute to the
manufacturing competitiveness. In the area of product innovation (PI) the use
of Internet based applications, product data management (PDM), virtual
prototyping, and CAD, is expected to substantially reshape the overall KM process
(Corso et al. 2003).
4.1.3 Process design. Process decisions deal with the proper mix of human skills,
technology, and capacity utilization to fulfil customer orders. Process design deals
with how the products are manufactured. This includes making decisions about
make/buy, continuous processing, discrete-batch processing (semi-continuous),

intermittent processing, and projects (unique products) which are based on volume
and variety. KM will play an important role particularly in deciding about what type
of processes would be suitable for the given type of products and market
characteristics. Make/buy decisions involve comparing the costs and benefits (both
tangibles and intangibles) of making in-house or purchasing from outside/suppliers.
For this, managers need to collect data and suitably process them enabling diffusion
of knowledge and subsequently making more informed decisions, which would lead
to enhanced quality process design. MacPherson (1997) examines the contribution of
external inputs to the innovation performance of small manufacturing firms.
The author has studied the recent patterns of external spending on technological,
management and information services with the objective of promoting KM in SMEs.
However, the role of government and universities cannot be underestimated in

facilitating KM in SMEs.
Li (2005) develops a strategic operations management model that links
intermediate infrastructural operations decisions and market performance given
process choice as a structural constraint for manufacturing firms. The results of the
model highlight the effects of manufacturing control and staff skill and knowledge
development on a firm’s market performance. The author suggests manufacturing
control, human resource development and technology application are capabilities
a manufacturing firm needs to achieve better market performance. Nevertheless,
a model for determining an optimal infrastructure that will facilitate KM in meeting
the organizational goals would be beneficial for practitioners in designing process.
Cascini and Rissone (2004) apply typical knowledge management tools to enrich
the design capabilities of an engineering or a design team. The development of a
knowledge portal to the design with plastics is explained, paying particular attention
to the criteria adopted to allow an automatic update of the knowledge base and to
the effectiveness of such a tool. They show how the integration of modern design
tools with creativity supporting software, integrated with the prototyping capabilities
offered by computer-aided engineering systems, to guide the development of modern
design tools with creative management techniques constitutes an effective procedure
to enhance the capability of developing innovative products. Success with KM
depends upon the extent of people’s involvement, which in turn depends on the
behavioural issues. This could be influenced by suitable incentives such as process
ownership, better salary and promotion. Therefore, behavioural issues should be
given due consideration in process design.
4.2 Production
Production of goods is the central function of manufacturing where the so-called
value-added activities to materials as well as customers are carried out. In the present
day manufacturing enterprise, most of the production activities including parts and
components manufacturing are outsourced. This particular shift in production
paradigm changes the scope and function of various production planning and
control activities. Therefore, the purchasing or procuring of resources has been
considered as part of the production function. From operational perspectives,
various related tasks such as aggregate planning, purchasing, scheduling, inventory
control, and quality control are discussed with reference to KM in those areas.
The focus of many articles is the KM process and IT management. However, the
application of KM embedded with IT needs to be discussed.
Crowder et al. (1999) discuss some of the benefits from using an open hypermedia
system to deliver the diverse range of information found within the manufacturing
environment. The open hypermedia approach to information management and
delivery allows a single multimedia resource base to be used for a range of
applications, and permits a user to have controlled access to the required
information, in an easily accessible and structured manner. However, at some
point along the process design, human interaction is essential for diffusion of
knowledge about the process design. Zaremba and Morel (2003) present a unified
framework for integrating the methods and techniques related to intelligent systems
in the context of design and control of modern manufacturing systems. Since
manufacturing can be fairly automated as compared to services, AI and expert

systems can be used as part of the KMS to facilitate the effectiveness in production
function.
4.2.1 Aggregate planning. Aggregate planning involves making decisions regarding

the long-term capacity and material requirements planning based on the aggregate
demand for products. The objective of aggregate planning is to balance the long-term
demand and capacity. The KM team should include senior level and middle level
managers, and the corresponding data/information/KM framework needs to be
developed. Now the question is the process of developing KM for this particular
task, aggregate planning.
McDaniel et al. (1991) describe the documentation effort undertaken by the
Danish CIM/GEMS (computer-integrated manufacturing; general methods for
specific solutions) project to drive, direct and support its CIM-technology
development and transfer activities. This paper describes how the CIM/GEMS
project formalized and supported documentation production and used it to direct
and manage technical development. This particular development of CIM is limited to
personal-computer technology and was aimed at supporting small- and medium-
sized manufacturing companies; the documentation is planned and written to
support the project’s goal of developing and transferring technology simultaneously.
Aggregate planning requires knowledge of the business plan and the capacity of
the manufacturing system. Traditional information systems such as electronic data
interchange (EDI) and manufacturing requirements planning (MRPII) had limited
application in the so-called physically distributed environment. Hence the emergence
of ERP provided the support for integration of a network of enterprises. KM in
aggregate planning with the help of ERP provides more accurate input to enable a
realistic output from planning processes. Again, the people involved in aggregate
planning like senior managers should be trained in the application of ERP combined
with meetings to develop a knowledge base for aggregate planning.
4.2.2 Purchasing. Purchasing has become an integral part of supply chain

management in 21st century manufacturing. However, most manufacturing firms
rely heavily on the purchasers’ expertise and personal networks to make decisions on
the selection of vendors. Indeed, it is critical for manufacturers to maintain and
exploit the purchaser’s knowledge and expertise for the long-term benefit of the
corporation (Lau et al. 2005). Lau et al. (2005) proposed a system which
encompasses hybrid intelligence technologies, online analytical processing (OLAP)
applications and neural networks. This system obtains information related to the
trend of sales demand in terms of customer preference and expected requirement
using the OLAP module and then based on this information; the neural network
provides recommendations related to the supported suppliers that are capable of
fulfilling the requirements. There is a need for further research on KM in purchasing
highlighting the relationship between buyers and suppliers, and the information
exchange through data mining, and diffusion of knowledge in improving the
effectiveness of purchasing function.
4.2.3 Scheduling. Scheduling within and outside organizations in a supply chain

environment needs to be carefully studied. The information available online through
material requirements planning (MRP)/ERP together with artificial intelligence
(AI) and expert systems (ES) for making decisions about scheduling provides
opportunities to have the right information available about the capacity, work-in-
process and orders released. These assist development of the schedule for production
and purchasing based on the demand for products in manufacturing. Performance
measures and metrics are to be developed regarding the scheduling so that this could
be stored in the database and utilized for disseminating knowledge about the
problems in scheduling and suppliers’ delivery performance, etc. Simulation can also
be used to determine the optimal scheduling policies together with input from
appropriate people responsible for production and purchasing activities.
Belz and Mertens (1996) discuss how expert or knowledge-based systems could
serve as intelligent front-ends to interface between computer-based simulations and
the user. Their studies include a decision support system (DSS) for short-term
scheduling in manufacturing which when coupled with expert systems and simulation
can assist the production manager in handling production disturbances. However,
the interface between people and IT should be given due attention in developing
a successful KM system for scheduling in manufacturing. Pflughoeft et al. (1996)
describe architecture of an intelligent knowledge-base simulator (KBSim) that
provides a systematic research capability for flexible manufacturing systems (FMS).
The KBSim is applied to a FMS scheduling problem to reduce mean flow time and
tardiness. Kant and Sridharan (1998) developed a scheduling information system in
MRP used to help inventory performance. These systems are mostly IT/IS oriented,
but lack integration of behavioural and cultural issues in the decision making of
scheduling functions.
Karayel et al. (2004) deal with the application of knowledge management in the
mechatronic system. They developed a knowledge management model for the
internet-based CNC machining centre. The system developed consists of KM model
(PC), mechatronic system (CNC machining centre), user unit (PC, SMS, etc.) and
data, information converter unit. The KM model consists of knowledge bank,
compare, internet and network connection, commentary and management units.
This model can be used for monitoring the machining performance of the
manufacturing system.
A suitable scheduling information module (which could be part of ERP) could be
used to effectively manage the knowledge required for productive scheduling
together with appropriate training of middle-level managers and managers of

production and purchasing units.
4.2.4 Inventory control. Most experts believe that regardless of the level of
technological tools—MRPII, just-in-time (JIT), total quality management (TQM)
and ERP—the integration of information technologies such as knowledge-based
systems, intelligent decision-support systems, and solver technologies is a key to
improving production and inventory control (Reyes and Raisinghani 2002). Reyes
and Raisinghani (2002) discuss the integration of IT and KM and the future trends in
KM that are likely to impact production and inventory control. Nevertheless, further
research is required to develop a KM framework for inventory management utilizing
the ERP system and real-time data collection. Also, attending workshops and
conferences and having access to latest developments in inventory management is a
further requirement.
4.2.5 Quality control. Muthu et al. (2001) emphasize the need of incorporating
quality systems and its monitoring to enhance maintenance quality. They point out
the need for QS 9000 standards to be a future quality system model in enterprises.
Their paper describes the design features of a maintenance quality system model that
has been developed based on QS 9000 standards. They cite the need of using
continuous and economical knowledge which is possible through the careful
exploitation of information technology. They present the design of a knowledge base
system and the development and performance of its pre-auditing module.
However, this approach is limited to QS 9000, but a quality system should have
much more enlarged scope for KM incorporating TQM and quality function
deployment (QFD).
4.3 Distribution
Nowadays, companies compete based on multiple competitive performance
objectives: flexibility, quality, dependability, speed and price. This with a
combination of a global market and competition, place a tremendous pressure on
companies to be agile so that they can meet the customers’ demand as soon as
possible and that too in a most cost-effective manner. Looking at the supply chain,
the logistics chain play a major role in reaching the customers with the right
products, especially when companies aim to sell their products and services in a
global market through global operations. When considering the role of third-party
logsistics (3PL) in current manufacturing companies, we included the major
components of distribution functions along with other major logistics activities
including warehouse management, transportation, and order control, etc. 3PL
enables technology and knowledge transfer through an integrated information and
networked organization.
Logistics has developed from single-party logistics (self-managed) to 3PL
(contractual). The reasons behind the 3PL are to reduce operating costs; to meet
fluctuations in demand; and to reduce capital investment (Ta et al. 2000). So in
today’s fast-paced and customer-oriented environment, reliable and superior 3PL

is a prerequisite to becoming and staying competitive in the global market.
The increased attention placed on warehouse and fulfilment operations in the last
few years yielded a harvest of improvement in technology and functionality
in warehouse management systems. Warehouse management systems run the day-
to-day operations of a warehouse and keep track of inventories in a warehouse that
provides fast, accurate and efficient material handling, sorting and order-picking
solutions for the warehouse and distribution markets. Customer relationship
management (CRM) and web-based logistic information system in 3PL will help
to generate the knowledge required to manage the customer wants and needs, and
the resources of clients and suppliers of various logistic services. As said earlier,
innovation is the key to the success of 21st century manufacturing and this
encourages knowledge diffusion through an integrated information system.
Chow et al. (2005) design a knowledge-based logistics strategy system (KLSS) to
support the logistics strategy development stage by retrieving and analysing useful
knowledge and solutions in a timely and cost-effective manner. This system seems to
integrate techniques such as data warehousing, OLAP, multi-dimensional database
management systems and case-based reasoning. However, this system is rather
limited in its scope as it is based on strategic performance, not on the operational
perspectives. Moreover, data mining and warehousing for distribution KM should
include data about demand for products, 3PL service providers, clients and suppliers.
Order fulfilment goes well beyond simply picking and shipping products.
Nowadays, some of the suppliers integrate customer teams for managing knowledge
into the order fulfilment process. Manufacturers and suppliers have one mutual
objective which is to satisfy the final consumer as best as they can. The order
fulfilment process provides the benefits that bring value to business organizations
including real-time visibility of inventory, reductions of order error rates, and
increases on-time delivery performance. CRM and order fulfilment should go
together and this requires a KM module integrating their functions through an
application interface for developing and exchanging knowledge on various
distribution-related activities and customer requirements in terms of quality and
cost effective services.
4.4 Information systems

Information systems have been added as a major functional area of manufacturing in
the 21st century. IT/IS is a backbone of the knowledge management system. Without
information systems, it is unlikely any company can succeed with knowledge
management in particular, in a global market embedded e-commerce and physically
distributed operations environments. For such a manufacturing environment,
strategic information systems, MRPII, ERP and EDI, EC and EP play a major
role in enhancing the communication among the constituents of the manufacturing
supply chain. This will be followed by smooth flow of materials along the
manufacturing supply chain. The main focus of the discussions here is how
information technology and systems will facilitate knowledge management in
Montaldo et al. (2003) highlight one of the major shortcomings of manufacturing

information systems as being their inability to integrate and to enhance
different information and related functionalities, such as those found in workflow
management. They discuss adding an agent-based software layer to an existing
workflow management system in order to manage new functionalities, e.g. CRM
e-commerce. Nevertheless, this approach falls short of developing a KM system by
making it more interactive and flexible for people to learn and improve the
performance of IT/IS.
Considering the dynamic nature of markets, companies need to be agile with the
objective of meeting customer/market requirements. The agility of an organization
requires the system and the people also to be agile in terms of reconfiguring their
resources and skills. This can be achieved by developing a KM system that supports
the dynamics of an organization in terms of innovative solutions and that too in a

timely manner. IT/IS systems such as ERP and WWW can be used to facilitate data
collection, training and education for data analysis to obtain useful information and
then implementation.
4.4.1 Strategic information systems. The current manufacturing enterprises operate

in a highly competitive and dynamic market. This places a pressure on organizations
to be agile in order to respond to dynamic and global markets. Agility requires an
integrated information system for the effective management of operational functions
and customer/supplier relationships. Information systems (IS) and technology (IT)
are the most important strategic tools supporting information management (IM) in
order to increase corporate responsiveness and enhanced performance (Buyukozkan
2004). Buyukozkan (2004) provides a conceptual framework which is a business
rather than a technical context, for an information-based responsive organizational
network to support efficient management of company-wide functions and
customer/supplier relationships. However, testing of such a model would lead to a
better understanding of managerial implications of KM system in strategic
management.
Paiva et al. (2002) answer how companies choose the information that is
considered more important for the management of manufacturing process. They
analyse empirically from a strategic approach, how different types and sources of
information may influence information characteristics like accuracy, access, and
timing. Since companies are looking for dramatic improvements by innovative and
sometimes radical changes in the so-called global market, this demands a knowledge
base consisting of IT/IS and senior managers with suitable education and experience
through constant training will be essential for identifying suitable strategies which
are aimed at improving manufacturing competitiveness. In addition, they evaluate
how information is related to manufacturing competencies and performance. Their
findings suggest that customer-focused information and information technologies
are the most important aspects that influence information characteristics and the
results of KM in formulating appropriate strategies. Nevertheless, data mining and
warehousing require privacy and protection of the data stored to keep the
confidential nature of strategic information.
Kalling (2003) describes the processes that firms and managers go through in their
quests to create and sustain competitive advantages based on so-called ERP systems.
It is based on resource-based theory, combined with the strategy process perspective

and with existing literature on IT and ERP. The proposed framework describes
cognitive and cultural factors that support or hamper progress, including uncertainty,
knowledge gaps, knowledge transfer issues and the problems of ensuring that ERP
usage is converted into competitive advantage. ERP systems have advanced planning
modules which can be used by senior executives while formulating strategies at
different decision making levels of a manufacturing supply chain.
Benchmarking supported by IT/IS will support senior managers to develop a
knowledge base and to have the right information through regular meetings to
formulate strategies such as those for corporate, business and operational which will
collaboratively support the goals and objectives of an organization.
4.4.2 Material requirements planning and enterprise resource planning. Enterprise

resource planning (ERP) is an extension of manufacturing resource planning
(MRPII). Nowadays, the latest generation of ERP systems are more advanced and
more effective in dealing with multiple business units including sales and operations
planning, inventory/materials management, manufacturing, purchasing, order
processing, accounting and finance, human resources, customer relationship
management, as well as other factors. A well-developed ERP system can facilitate
a supply chain management system and can share production plans along the supply
chain in real time using the internet. Sharing of information is the foundation for
KM in manufacturing. This sharing of information can be through technology
and people.
ERP systems and other complex information systems represent critical
organizational resources. Companies generally employ consultants to help in the
implementation process. Ko et al. (2005) discuss that clients’ firms expect consultants
to transfer their implementation knowledge to their employees so that they can
contribute to successful implementation and learn to maintain the systems
independent of the consultants. Drawing from the knowledge transfer, information
systems, and communication literature, an integrated theoretical model is developed
that posits that knowledge transfer is influenced by knowledge-related, motivational,
and communication-related factors. The behavioural issue has been given due
attention in this knowledge transfer. Newell et al. (2004) suggest that there needs to
be an understanding of the relationship between social capital and knowledge
integration within a project team of ERP. They argue that for the effective
mobilization of a ‘weak’ social capital bridge for collective purposes, there is first a
need to create ‘strong’ social capital bonds within the project team so that it becomes
a cohesive social unit that will be able to effectively integrate knowledge that is
acquired through members’ bridging activity. This paper deals with KM within an
ERP team, but it could span out across the supply chain.
People in manufacturing organizations should understand what an ERP system
can do for manufacturing organizations. Jones (2005) has pointed out that there is
often a large gap in knowledge among ERP implementation personnel because of
ERP’s cross-functional nature. The author’s study presents the findings about
facilitators of tacit knowledge sharing three firms that have implemented ERP.
However, a framework for the KM embedded ERP system will be an asset for the
supply chain.
Wickramasinghe and Mills (2002) present the case example of medical automated
record system (MARS), the automated medical record system at Kaiser Permanente-
Ohio. They show that the true advantage of this system is that it functions as a
knowledge management system (KMS) simultaneously enabling and facilitating
convergence and knowledge pertaining to health case delivery. KM has become
increasingly critical for the success of companies in this emerging era of e-commerce.
Oppong et al. (2005) deal with the problems with KM and its technologies by tracing
the evolution of KM in e-commerce and identifying strategies that are currently in
application. KM is the critical success factor for the success with e-commerce and
supply chain. For example, data mining and warehousing facilitate the diffusion of
knowledge effectively. Moreover, suitable training and education modules need to be
developed for KM in MRP and ERP.
4.4.3 Customer relationship management. CRM can be defined as a strategy to

achieve higher customer loyalty and retention and it is a system that integrates
marketing, sales and customer service. A CRM system collects data about customers
from many different customer touch points such as telephone, fax, email, and the
Internet. The information is then stored in a centralized database that can be
analysed by various users within the enterprise. CRM system can integrate customer
information from across the enterprise, e.g. current status within the sales cycle,
and post-sale interactions with customer service. Management can access a
comprehensive overview of the customer, marketing, and sales service relationships
so that the CRM system can increase profitability and boost market share through
increased revenues and reduced costs and increased customer satisfaction and
responsiveness. Garcia-Murillo and Annabi (2002) highlight the importance of the
customer knowledge management for the following reasons:
. better and more timely design of new products and services;
. early warning and competitive intelligence;
. customer commitment and loyalty; and
. the synergy of collaboration.
Davenport and Klahr (1998) describe why managing customer support knowl-
edge is important to organizations and gives several examples of clear benefits that
have already been achieved. They have pointed out that knowledge of how to
address and solve complex problems was not easily managed. Customer support
knowledge changes rapidly and it is both broad and deep. New projects or new
models come out every day and the breadth and depth of product and services often
leads to a tremendous volume of knowledge to manage it. They list some of
the major technologies used in KM: (i) rule-based expert systems, (ii) probability
networks, (iii) rule induction, (iv) decision trees, (v) case-based reasoning,
(vi) knowledge representation standards, and (vii) customer support technology
integration. Technology alone cannot facilitate KM, but can when combined with
suitable rewards, education and training. Massey et al. (2001) describe a four-year
initiative undertaken by IBM to re-engineer its CRM process and capitalize on its
knowledge-based resources. They offer several guidelines on how to successfully
combine the disciplines of CRM and KM: (1) focus on critical issues that will align
the strategies, (2) obtain top management support, (3) consider knowledge as a
process, (4) treat IT as an enabler, (5) reduce time to develop products/systems,

(6) differentiation by knowledge, and (7) apply project management approach.
These are generic guidelines, but need to be tailored to individual organizations
taking into account the nature of the business, culture, and infrastructure, etc.
CRM is clearly much more than a software application. It is a whole
organizational approach to your customers. The IT system is simply an enabler.
Cox (2000) discusses the UK manufacturers’ attitude to customer relationship
management and its implications of KM. However, there is a lack of integration of
consumer behaviour and the technology.
5. A framework for KM in manufacturing

In this section, a framework based on the literature review and its analysis for the
KM in manufacturing is presented. This framework is based on four major
dimensions which are the same as the core functions in manufacturing: (i) design
and engineering, (ii) production, (iii) distribution, and (iv) information
technology/systems. Since the process of KM has been widely discussed and
researched in both operations management and information systems journals, we
believe more or less the same process for KM can be utilized for manufacturing
systems as well. The framework is summarized in table 2.
The process of innovation depends heavily on knowledge, and the management
of knowledge and human capital should be an essential element of running any type
of business. Recent developments are being driven predominantly within an IT or
humanist framework, with little or any overlap. Gloet and Terziovski (2004) explore
the relationship between KM approaches and innovation performance through a
study focusing on manufacturing industry. Their findings suggest that the managers
in manufacturing firms should place emphasis on human resource management
(HRM) practices when developing strategies for product and process innovations.
Also, it shows that KM contributes to innovation performance when a simultaneous
approach of ‘soft HRM practices’ and ‘hard IT practices’ are implemented.
Evaluating the knowledge capabilities is one of the key management tasks as
it will inform an organization where it stands in meeting customers/market
requirements in a competitive manner. Also, it will help to identify the gap in the
performance and benchmarking its performance against the best-in-class performing
companies. Denrell et al. (2004) reports an empirical study of capabilities central to
knowledge management efforts in large leading multinational companies.
Raisinghani and Meade (2005) develop a framework for measuring the relative
importance of a particular dimension based on the application of theoretical
concepts from the information systems and management science literature to the
digital, knowledge economy. Since contextual factors play a critical role in the design
of effective KMSs, technical and process solutions need to be customized to fit the
organization performance criteria, dimensions of agility and supply chain drivers.
The purpose of their paper is to investigate linkage between organization
performance criteria and the dimensions of agility, e-supply chain drivers and
knowledge management using analytic network process. Kidd (2003) explains the
issues of KM in supply chains from the perspectives of global financial drivers and
human issues. These articles discuss generally the KM systems taking into account
2410
Table 2. A framework for knowledge management in 21st century manufacturing.
Major functions in manufacturing Sub-functions Strategies/techniques/tools
Design and engineering Strategies Concurrent engineering, design for quality,

design for manufacturing
Techniques Quality function deployment, Taguchi’s robust design,
product data management
Tools CAD, rapid prototyping, virtual prototyping
Production Strategies Supply chain, just-in-time, virtual manufacturing, TQM
Techniques MRP, ERP, DSS, KBS, FMS, CIM, QS 9000
Tools PDAs, CCTV, multimedia, internet-based CNC, PC, SMS
Distribution Strategies 3PL, web-based logistics information system
Techniques MRPII, ERP, EDI, EC, EP
Tools RFID, PDA, Palm
Information technology/systems Strategies B2B, B2C, B2A, RFID, internet-enabled SC, CRM
A. Gunasekaran and E. W. T. Ngai
Techniques Internet, EDI, ERP, WWW

Tools Internet, WWW, groupware, shareware, PDA
the organizational objectives in terms of various competitive factors and the

corresponding characteristics of KMSs.
5.1 Design and engineering

KM plays a major role particularly in the design and engineering functions of
manufacturing industries. The reason for this is most of the decisions taken in this
area have long-term implications involving a huge investment. Also, the performance
of downstream side of the supply chain depends upon the performance in these two
functional areas. Achieving improvements by new innovative design of products and
services take time. Knowledge and technology transfer and diffusion are the key
factors for the success in design and engineering. There are several strategies that
have been employed over the years for facilitating knowledge management. These
include: concurrent engineering, design for quality and design for manufacturing.
Basically, these strategies bring the people together from different functional areas
including customers to participate in the design and engineering processes. Several
techniques can be used for data collection, information processing and knowledge
diffusion which include: quality function deployment, house of quality, ISO 14000,
Taguchi’s robust design (TQD), and product data management. Tools such as CAD
(ProEngineer, 3D Modeling), virtual prototyping and rapid prototyping, and
web-based design platforms can be used to encourage knowledge diffusion for the
design of products and processes.
5.2 Production
KM primarily focuses on the areas of design and engineering, but little has been
discussed regarding the implications on production. Now the production has been
transformed into a service-based function wherein parts and components production
has been outsourced and mostly assembly tasks are carried out. In this production
environment together with the traditional production system, the supply chain
management has become essential in order to make sure the right components and
parts are made available at the right time so that final products are delivered to
customers on time or reduce the time to reach the global market. Supply chain
management is based on integrating various production activities by bringing the
people to the same platform using a computerized information system such as ERP.
ERP facilitates the knowledge diffusion among supply chain stakeholders. Also, JIT
is based on physically distributed enterprise environments and developing suppliers.
This requires a proactive management approach based on effective communication
among stakeholders. Some of the elements of JIT such as zero inventory, continuous
improvement, tight production schedule and inventory control make people work
diligently and in an innovative manner. The other strategies that could be employed
for facilitating KM include: virtual manufacturing (network of enterprises), and
TQM. Techniques such as Kanban, CIM, MRP, ERP and FMS can be employed for
facilitating the KIMT in production. There are several tools available for this
purpose, some of which are PDAs, CCTV, multimedia, internet, EDI, CNC, robots,
AGVSs, and WWW.
5.3 Distribution
In physical distribution, most of the innovation developed is in the areas
of warehouse management, inventory control, and transportation management.
The following strategies could be employed for knowledge management in
distribution:
. Third-party logistics. This provides opportunities to develop more informed
knowledge management efforts in distribution. While making decisions
about 3PL, companies have to analyse the costs and benefits of alternative
3PL companies and select the company that serves the purpose and their best
interests. This plus the information technology that accompanies the
integration will facilitate a knowledge management process which ultimately
enhances the decision-making process and in turn an improved performance.

. Warehouse management. This requires knowledge on how to manage
warehouses including the space, loading and unloading facilities and
consolidation. Benchmarking exercises may prove to be a good alternative
for knowledge management in warehouse management wherein people from
these areas can interact and learn the best practices from other best-in-class
performing companies in warehouse operations.
. Transportation management. Knowledge management should primarily help
in providing useful information for making decisions about the schedule of
transport fleets and load management, as well as tracking the location of the
goods along transport value chains. Various information technologies such
as RFID, wireless technology and web-based information systems can be
used for making decisions based on the customer service requirements.
5.4 Information systems

IT/IS are the backbone of KM. Knowledge management relies on the data available,
the quality of the information processing and the knowledge accrued from using
the information obtained. Therefore, KM and IT management should go together
in order to facilitate an effective and productive KM system. Strategies such as
e-commerce, internet-enabled supply chain management, web-based logistics
information, customer relationship management and virtual enterprise will promote
integrated IT/IS combined with supply chain activities. This will demand companies
to develop integrated computerized information systems such as ERP embedded
internet and WWW including RFID and wireless technologies with the objective of
developing a shared information system. This will help the companies in knowledge
diffusion and transfer. Techniques such as data mining and warehousing will help to
encourage knowledge management in the modern organizations. There are many
tools that could be used for KM. For example, the internet, wireless technologies,
groupware/shareware, PDA, RFID and WWW.
6. Concluding remarks
In this paper, an attempt has been made to review the literature available on
knowledge management in manufacturing in the 21st century. Manufacturing has
received limited attention regarding the implementation of KM in particular in

emerging manufacturing enterprise environments that are characterized by supply
chain management, e-commerce, virtual enterprise, outsourcing and enterprise
resource planning. Companies realized the importance of timely and shared
information being available for making more informed and right decisions.
This would proactively contribute to improving organizational productivity and
competitiveness in the 21st century. Considering the core functions of manufacturing
and incorporating the modern profiles such as SCM, ERP, VE and EC, we develop
a framework for KM in advanced manufacturing. The research methodology
employed for this study was a literature survey. By using a suitable literature
classification scheme based on the nature of manufacturing functions and its
sub-functions, the relevance and application of KM in those functions, we discovered

a framework that could be useful for managing KIT in manufacturing. It must be
said that we focused on factors only closely associated with major manufacturing
functions excluding functions such as maintenance and other support services.
Though we discussed KM in manufacturing from traditional functional perspectives,
the characteristics of 21st century manufacturing are incorporated to reflect the role
of KM and strategies and tools for managing knowledge. Moreover, suggestions for
future research and applications are presented. In concluding this article,
manufacturing is important to generate jobs and even develop services; therefore,
KM is essential for the productive and competitive management of manufacturing
industries.
At their core, most successful enterprises today can be considered ‘intelligent
enterprises’, converting intellectual resources into a chain of service outputs and
integrating these into a form most useful for certain customers. However, materials
manufactured without human inputs have little intrinsic value, and—as analysis will
demonstrate—most of the processes which add value to materials derive from
knowledge-based service activities. Quinn (1992) argues that the organization of
enterprises and effective strategies will depend more on the development and
deployment of intellectual resources than on the management of physical assets. The
author discusses the concept of disaggregating corporate activities into manageable
intellectual clusters called service activities.
The following are the some of the future research directions in the areas of KM in
. Identify the specifics of knowledge requirements to develop and operate an
advanced manufacturing enterprise that includes an e-commerce enabled
supply chain (B2B), virtual enterprise, and build-to-order supply chain
management.
. Develop a model for KM system for the advanced manufacturing
environment.
. Develop a framework and architecture for KM in manufacturing.
In particular attention should be given to major functional areas such as
design and engineering, production, distribution and information systems.
. Develop a human-centred KM in manufacturing that should include the type
of teams, training and education required to support knowledge development
and diffusion.
. Conduct empirical case studies on KM in manufacturing.
. Develop a framework for the implementation of KM model in

manufacturing.
. Study the implications of emerging information and communication
technologies in KM in 21st century manufacturing.
As discussed in the earlier part of the paper, various implementation approaches
to KM can be used for managing knowledge in manufacturing. Hence, we have not
devoted much space for the discussion on the implementation of KM in
manufacturing.
Acknowledgments
The authors are grateful to three anonymous reviewers for their constructive and
helpful comments which helped to improve the presentation of the paper
considerably. The research was supported in part by The Hong Kong Polytechnic
University under grant number G-YF02 and the University of Massachusetts,
Dartmouth.
Appendix
Acronyms
ACN active semantic network

AGVS automated-guided vehicle systems
AI artificial intelligence
B2A business-to-administration
B2B business-to-business
B2C business-to-consumer
CAD computer-aided design
CAQ computer-aided quality
CCTV closed-circuit television
CE concurrent engineering
CIM computer-integrated manufacturing
GEMS general methods for specific solutions
CNC computer numerical control
CRM customer relationship management
DfM design for manufacturing
DSS decision support system
EC E-Commerce
EDC European design center
EDI electronic data interchange
EP E-procurement
ERP enterprise resource planning
ES expert systems
FMS flexible manufacturing systems
ICT information communication technologies
IM information management
IT information technology
IS information system
JIT just-in-time
KBS/KBSim knowledge-based simulator
KMS knowledge management system
KLSS knowledge-based logistics strategy system
KM knowledge management
KMIT knowledge and information technology management
MRP material requirements planning
MRPII manufacturing requirements planning
OEM original equipment manufacturer
OLAP online analytical processing

PC personal computers
PDA personal digital assistants
PDM product data management
PI product innovation
QFD quality function deployment
QS quality system
RPD rapid product development
3PL third-party logistics
RFID radio frequency identification
SC supply chain
SMEs small and medium enterprise(s)
SCM supply chain management
SMS short message service
TQD Taguchi’s robust design
TQM total quality management
VE virtual enterprise
WWW world wide web
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On: 11 December 2013, At: 07:21

International Journal of Production

Knowledge management in 21st

To link to this article: http://dx.doi.org/10.1080/00207540601020429

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Knowledge management in 21st century manufacturing

A. GUNASEKARANy and E. W. T. NGAI*z

yDepartment of Management, University of Massachusetts—Dartmouth,

(Revision received November 2006)

As markets have become global, more and more manufacturing companies

Keywords: Knowledge management; Literature review and framework

In recent years, information technology/information systems (IT/IS) have been given

*Corresponding author. Email: mswtngai@inet.polyu.edu.hk

International Journal of Production Research

is appropriate to discuss the characteristics of manufacturing competitiveness and

some suggestions for future research directions.

2. Knowledge management (KM) and manufacturing

2.1 Knowledge management

KM is supposed to increase innovativeness and responsiveness (Hackbarth 1998).

2.2 Managing knowledge in manufacturing

information and knowledge, while improving coordination, decision-making and

production management theory, in the manufacturing context, through the

By making available the right information to the right people, disseminating

addition to this, we developed a framework for KM in manufacturing.

3. Classification of the literature on KM in manufacturing

Table 1. Summary of literature on KM in manufacturing.

Major classification criteria Sub-classification criteria References

4. Review of previous research on KM in manufacturing

The literature available on KM has been reviewed based on the

advanced manufacturing; and

4.1 Design and engineering

and work design. Again, knowledge management and information technology is a

organization. However, a framework for the management of knowledge for the

global auto-market. To meet these requirements, current trends in car body

manufacturing. However, the implications of behavioural issues of the design and

make/buy, continuous processing, discrete-batch processing (semi-continuous),

However, the role of government and universities cannot be underestimated in

manufacturing can be fairly automated as compared to services, AI and expert

4.2.1 Aggregate planning. Aggregate planning involves making decisions regarding

4.2.2 Purchasing. Purchasing has become an integral part of supply chain

4.2.3 Scheduling. Scheduling within and outside organizations in a supply chain

together with appropriate training of middle-level managers and managers of

today’s fast-paced and customer-oriented environment, reliable and superior 3PL

4.4 Information systems

Montaldo et al. (2003) highlight one of the major shortcomings of manufacturing

the dynamics of an organization in terms of innovative solutions and that too in a

4.4.1 Strategic information systems. The current manufacturing enterprises operate

It is based on resource-based theory, combined with the strategy process perspective

4.4.2 Material requirements planning and enterprise resource planning. Enterprise

4.4.3 Customer relationship management. CRM can be defined as a strategy to

process, (4) treat IT as an enabler, (5) reduce time to develop products/systems,

5. A framework for KM in manufacturing

Table 2. A framework for knowledge management in 21st century manufacturing.

Major functions in manufacturing Sub-functions Strategies/techniques/tools

Design and engineering Strategies Concurrent engineering, design for quality,

Techniques Internet, EDI, ERP, WWW

the organizational objectives in terms of various competitive factors and the

5.1 Design and engineering

enhances the decision-making process and in turn an improved performance.

5.4 Information systems

received limited attention regarding the implementation of KM in particular in

sub-functions, the relevance and application of KM in those functions, we discovered