Business Processes and Knowledge Management

Business Processes and Knowledge Management

John S. Edwards
DOI: 10.4018/978-1-60566-026-4.ch078
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Knowledge has been a subject of interest and inquiry for thousands of years since at least the time of the ancient Greeks, and no doubt even before that. “What is knowledge” continues to be an important topic of discussion in philosophy. More recently, interest in managing knowledge has grown in step with the perception that increasingly we live in a knowledge-based economy. Drucker (1969) is usually credited as being the first to popularize the knowledge-based economy concept by linking the importance of knowledge with rapid technological change in Drucker (1969). Karl Wiig coined the term knowledge management (hereafter KM) for a NATO seminar in 1986, and its popularity took off following the publication of Nonaka and Takeuchi’s book “The Knowledge Creating Company” (Nonaka & Takeuchi, 1995). Knowledge creation is in fact just one of many activities involved in KM. Others include sharing, retaining, refining, and using knowledge. There are many such lists of activities (Holsapple & Joshi, 2000; Probst, Raub, & Romhardt, 1999; Skyrme, 1999; Wiig, De Hoog, & Van der Spek, 1997). Both academic and practical interest in KM has continued to increase throughout the last decade. In this article, first the different types of knowledge are outlined, then comes a discussion of various routes by which knowledge management can be implemented, advocating a process-based route. An explanation follows of how people, processes, and technology need to fit together for effective KM, and some examples of this route in use are given. Finally, there is a look towards the future.
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Types of Knowledge: Tacit and Explicit

Nonaka et al.’s book (1995) popularized the concepts of tacit and explicit knowledge, as well as KM more generally. They based their thinking on that of Michael Polanyi (1966), expressed most memorably in his phrase “we know more than we can tell.”

It is, however, most important to realize that tacit and explicit knowledge are not mutually exclusive concepts. Rather, any piece of knowledge has both tacit and explicit elements, as shown in Figure 1. The size of the inner circle represents the proportion of tacit knowledge: the tacit core at the heart of the knowledge that we “cannot tell.” Figure 1(a) shows a case where the knowledge is almost entirely tacit, as in riding a bicycle. Figure 1(b) shows mainly explicit knowledge where the tacit core is very small, for example how to process a claim for travel expenses in an organization. Figure 1(c) shows an intermediate case such as making a piece of furniture where substantial amounts of both tacit and explicit knowledge are involved.

Figure 1.

The relationship between tacit and explicit knowledge


KM Strategies

Hansen, Nohria, and Tierney (1999) identified that there are two fundamental KM strategies, codification and personalization. Codification concentrates more on explicit knowledge (often relying very heavily on information technology), personalization more on tacit knowledge. Again, it is important to realize that these are not mutually exclusive, and that a strategy combining elements of both is likely to be the most successful.


Routes To Implementing Km

Many organizations have found it difficult to implement knowledge management systems successfully. Identifying who is involved in knowledge management, what knowledge is being managed, and why is it being managed can be problematic. The routes they have attempted to follow can be put into five generic categories, which will now be described.

Key Terms in this Chapter

Business Process Reengineering: The fundamental rethinking and radical redesign of business processes to achieve dramatic improvements in critical, contemporary measures of performance, such as cost, quality, service, and speed. ( Hammer & Champy, 1993 , p. 32)

Knowledge Management: Supporting and achieving the creation, sharing, retention, refinement, and use of knowledge (generally in an organizational context).

Tacit Knowledge: Knowledge that is difficult or impossible to express, except by demonstrating its application.

Knowledge Management System: A combination of people, processes and technology whose purpose is to perform knowledge management in an organization.

Explicit Knowledge: Knowledge that has been (or can be) codified and shared with others.

Business Process: A structured, measured set of activities designed to produce a specified output for a particular customer or market. ( Davenport, 1993 , p.5)

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