Knowledge Management in Modern Business
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Item 20: Current Trends in Company Management
20.1 Introduction
In business, there are tangible and intangible activities. An important part of the intangible activities is shaped by the knowledge that the organization and the people who own and integrate this knowledge. This is part of the company's strategy, since it is an integral element in the process of creating value for organizations, whether public or private.
20.2 Knowledge Management
The traditional productive resources (time, labor, and capital), along with information technologies, are transferred by an element that enhances the innovative activity of individuals and organizations: knowledge. Knowledge aims to drive and enhance. Drucker says that the basic productive resource in this age is knowledge and talent, and the dominant social class will be the one that holds it, i.e., knowledge workers.
Characteristics of the Knowledge Society
- The knowledge economy is composed of enterprises and workers who produce, share, store, and consume knowledge, i.e., agents acting with the intellect.
- The products today are based mainly on a set of services and applications of an intellectual or intangible nature.
- The knowledge economy is based on the incorporation of knowledge into the assets of enterprises and the national economic system itself through any public or private organization.
- The knowledge economy is becoming a new approach to determining the competitiveness of an organization or social space (nation, region, city).
Data, Information, and Knowledge
Data
Davenport and Prusak define data as the minimal semantic unit, corresponding to the primary elements of information. By itself, it is irrelevant to decision-making. It is a discrete computation of values that says nothing about why things are and is not indicative of action.
Data can be stored in a physical place, such as paper or electronic media, or in a person's mind.
Information
Information can be defined as a set of processed data that has meaning and is therefore useful for those who must make decisions by reducing uncertainty. Data can be converted into value-added information by:
- Framing: Knowing the context and the purpose for which it is generated.
- Categorizing
- Calculating
- Correcting
- Condensing
Knowledge
Knowledge is a mixture of experience, values, information, and know-how that serves as a framework for incorporating new experiences and is useful for action. It originates and is applied in the minds of connoisseurs. In organizations, it is often found not only within documents but also in organizational routines, processes, and practices. Knowledge is derived from data, so that information becomes knowledge through actions such as comparison with other elements, predicting consequences, searching for connections, and discussion with other knowledge holders.
Nonaka and Takeuchi define knowledge as a justified true belief. They consider knowledge as a human process, dynamic, justifying personal belief regarding the truth, as does Sveiby.
Characteristics of Knowledge
- It is implied: Because concepts change or adapt in light of the experience of individuals.
- Oriented to action: It has the dynamic quality to generate new knowledge and overcome the old.
- It's underpinned by rules: The creation of patterns in the brain over time allows us to act quickly and effectively in situations automatically.
- It is in constant change: Because it can be distributed, criticized, and augmented.
Types of Knowledge
- Explicit knowledge: Represents codified knowledge, systematic and transferable through personal language.
- Tacit knowledge: Personal knowledge that is not articulated, subjective, implicit, and difficult to formalize and communicate, including experience, action, values, emotions, etc.