Innovation and creativity will be the essence for k-economy to be realized in order for organization to stay competitive. The mind-set of workers in an organization as well as the nation as a whole must be changed. This will be the biggest challenge for organizations to manage since innovation and creativity will demand for knowledge- driven employees or knowledge-workers. Organization knowledge capital (tacit and explicit) must be managed.
Knowledge management is not about building a computerized systems of human capital but it is about the planning and implementation of activities designed to continuously identify, acquire, apply, share, develop, create, preserve and audit(measure) organization knowledge assets.
Knowledge management is about sharing best practices, upgrading employees competencies and organization productivity. The information age, facilitated by the development of information communication technology, leads to an emergence of a new type of economy called knowledge economy.
As the world becomes borderless, Malaysia will have to face an insurmountable global competitiveness. The challenge of competitiveness and productivity that Malaysia has to face is substantially higher.
Therefore a quantum pep in total factor productivity is needed and every factor of production must be made to work smarter. Thus, to be able to work smarter for sustainability, Malaysia has to move to knowledge economy as soon as possible. Prime Minister , Dry.
Mathis Mohamed, in Vision 2020 states: By the year 2020, Malaysia can be a united nation, with a confident Malaysian society, infused by strong moral and ethical values, living in a society that is democratic, liberal and tolerant, caring, economically Just and equitable, progressive and prosperous, and in full possession of an economy that is competitive, dynamic, robust ND resilient.
In the early days of independence, Malaysia economy relied heavily and extensively on the export of two commodities that are rubber and tin. During this period, the economic is based on agriculture production.
The main activity is farming and Malaysia became one of the biggest producers of rubber. As more productivity is sought, the economics turn to industrial based as the manufacturing sectors started to grow. Although agriculture remains as an important economic sector, manufacturing sectors also emerges as the most important sector to the country. The transformation from agricultural to manufacturing sectors took place during the years of 1970 to 1980. This period also witnessed a significant change in Malaysia economy in term of its greater integration into the world economy.
Malaysia adopted more liberal trade policies as to lure trade and foreign investors to the country. It is believed that open economy policy will encourage higher productivity and returns. Manufacturing sector contribution to Gross Domestic Product will peak by year 2005. By then, when the economy become global, and as the competition for new market come stiffer, more innovation and creation are needed. As such, there is a need to have a networking or connectivity of people in the global economy to share expertise and knowledge to the creation of new product.
Thus, the new factor that will influence the economy will be knowledge. The World Development Report in 1999 states that knowledge has become perhaps the most important factor determining the standard of living more than land, than tools, than labor. Today most technologically advanced economies are truly knowledge-based. (Change Mining Juju, 2001)Knowledge based economy is an economy here knowledge intensify and its application to production and to productive sectors of any country economy can bring about quantum leaps in growth. David Abdullah, 2001) The main player in knowledge-based economy will be the knowledge workers. Knowledge workers are symbolic analyst workers who manipulate symbols rather than machines, such as architects, bank workers, fashion designers, researchers, teachers and policy analysts. United States, which has an advanced economy, 60% of workers, is knowledge workers. Knowledge workers will make up a knowledge organization. Knowledge organizations practice knowledge management.
Unfortunately, there is no universal definition for knowledge management. In the broadest context, knowledge management is the process through which organizations generate values from their intellectual and knowledge-based asset either in the form of tacit or explicit. Often, generation values from such asset mentioned above involve sharing them among employees, departments and even other companies in an effort to devise best practices. (Santos, M and Surname,J, 2001) Some of the indicators for a knowledge organization are:
Existence of high knowledge investments Efficient knowledge distribution which leads to innovation Employment of high-skilled workers Effective system in production, transmission and transfer of knowledge Therefore, Malaysia who is going to knowledge economy will have to produce by training or retraining its workers to become knowledge workers. The greatest impact will be the change in work pattern among the workers. From a secure and monotonous, daily routine, the work pattern should be directing the careers towards innovative and have all the characteristics of a knowledge worker.
Government, organizations, private or non-profit organization have a role to play to make this a reality in Malaysia. As Dry David Abdullah (2001) in his book, Malaysia and the k-economy, states: At the end of the day, Malaysian workers, the government, the private sector and non-profit organizations should be aware the knowledge-based economy does not have permanent friends, and hence it will only reward countries and workers who effectively take advantage of it. What is knowledge management?
To define knowledge management, first we need to understand what is the difference between data, information and knowledge. Data is unprocessed information(raw), which includes facts and figures collected and stored. Information is the processed data that is arranged and presented in a meaningful form. According to Webb (1998), information is the potential for knowledge. Knowledge is actionable information that can be used across the entire organization. The more knowledge an organization possesses, the more it can reduce uncertainties.
Davenport and Prussia (1997), refers knowledge as fluid mix of framed experience, values, contextual information, expert insight and grounded intuition that provides n environment and framework for evaluating and incorporating new experiences and information? In organizations, knowledge is embedded not only in documents or repositories but also in organizational routines, processes, practices and norms. Therefore to gain competitive advantage, workers must be knowledge driven by appreciating the power of knowledge and leveraging on that knowledge capital.
Knowledge management is not about building a computerized systems of human capital but it is about the planning and implementation of activities designed to continuously identify, acquire, apply, share, develop, create, preserve and assure(audit) organization knowledge assets. Knowledge management is about unifying organization knowledge. It is about developing the value of knowledge from time to time. It is the ultimate resource that can be applied to implement organization strategy as well as to achieve our strategic focus.
The central activity of knowledge management is about moving organization knowledge capital so that it can be used to improve productivity. Knowledge management practices involve activities such as knowledge-identification, knowledge-acquisition, knowledge-application, knowledge-sharing, knowledge- velveteen, knowledge-creation, knowledge-preservation and knowledge measurement. Knowledge identification is the process of identifying the existing knowledge in a company does not even realize the existing knowledge in the company.
Valuable knowledge might go unnoticed and unused. The usage of technology helps to access vast amount of information, but the process of identifying which and where to get relevant knowledge is often the problem faced by the managers in a company. In identifying the knowledge in a company, each organization must be aware of their own abilities, such as their expertise and competencies. Any internal knowledge should be made visible within the organization, such as identifying best practices in the organization.
There are a number of ways to identify the external knowledge, such as by comparing with the knowledge of the competitors, learning from the experts of other companies and also having cooperation with the competitors. Identifying the gaps in a company knowledge and skill is an effective catalyst in learning process. Once the gap between knowledge possessed and knowledge needed by a company is identifies, efforts to narrow down the gap will trigger earning process in acquiring the needed knowledge.
Acquiring knowledge to narrow down the gap can be done by importing outside knowledge or developing it internally. Acquiring knowledge is an important activity in knowledge management. Knowledge acquisition is the process of importing knowledge from various sources and using as many strategies as possible. In the business world, acquiring knowledge is very important, as it will determine the sustainability of a company. Among the external knowledge market: Knowledge of external experts Knowledge of other firms Knowledge of stakeholders Knowledge products
Among the ways to acquire knowledge are: Keeping track of knowledge within the organization and import the knowledge into new products Strategic alliance with other organization with the objective of mutual learning and knowledge acquisition Use of consultants for external knowledge There are also many channels for bringing knowledge into a company such as getting knowledge/feedbacks from customers, studying the habits or purchasing pattern of process of sharing knowledge. What matter most is how fast we can share knowledge to help solve a problem.
It is directed towards local problem global solution. Problem by someone might attract solution from various people who contributed their knowledge towards solving the problem. For knowledge sharing to happen, the critical condition is the presence of knowledge, either internally or externally. The next process will be the distribution of the existing knowledge. Distributing knowledge means transferring knowledge either from one individual to another, or from a particular group to another group.
Usage of knowledge tools can also help in knowledge sharing. Sharing knowledge will involve group works and cooperation among the individuals or companies. Sharing knowledge will only be meaningful if it is made within certain limits, as not all knowledge is useful for every individual. Sharing and distribution of knowledge involve cultural and individual limitation such as power and trust, with which the knowledge is shared. Organizations should also have knowledge policy as to enhance the sharing of knowledge especially in tagging of knowledge.
The recent development of information and communication technology creates a good opportunity of knowledge sharing and distribution, such as the existence of intranet in a company will help to promote knowledge sharing. Knowledge development is the most important part of knowledge management. This is the phase where the activities of developing new skills, products and ideas. Traditionally, knowledge development only focuses on research and experiment done in the laboratories, but the paradigm has change to developing new competencies either by collaboration with other companies or within the internal of the companies.
In a company, the daily activities can contribute to the development of knowledge. Among the barriers faced by knowledge development are innovations do not come in a relaxed, planned environment. New ideas are generated through conflicts, changes or improvement from existing products, and the need of freedom to pursue the new ideas. Thus, all the ways of generating knowledge management involve change for an individual and the company, therefore conflict, misunderstanding, internal competition and other unhealthy activities may happen in the organization.
Acquiring, developing and accumulation of knowledge has no meaning unless the knowledge acquired, developed and gathered is used. Knowledge is of no value if it is not applied. People in an organization must be encouraged to use knowledge. A inductive working environment that supports application of new knowledge and allows individuals or group to access company intellectual asset, helps in the encouragement to knowledge application. Studies have shown that individuals make use of knowledge based on convenience.
Therefore there is a need to have a simple knowledge infrastructure that is easy to use, provide knowledge in time and have connectivity. Among the barriers that the routine work that they do not feel there is a need of new ways to improve their routine. Applying new knowledge could also lead to the misunderstanding of a leader Ewing incompetence rather than willingness to learn and accept changes. The usage of new knowledge depends on the quality of the knowledge that is the benefits of using it.
However, by integrating knowledge management methods into the immediate working environment encourages employees to use knowledge. User-friendly working conditions, translating relationship that involves communicating and exchanging knowledge in a shortest physical distances between individuals, by having more open and flexible layouts and the present of a global information board that attracts people to look and later discusses the information, will help encourages the use of knowledge.
There are four patterns of knowledge creation: From tacit to tacit From tacit to explicit From explicit to tacit From explicit to explicit Tacit knowledge are unpublished knowledge, normally knowledge that resides in an individual, where as explicit knowledge is published knowledge, or knowledge that is documented. Tacit to tacit refers to the transfer of knowledge from one individual to another. For transfer of knowledge to happen, the enter level of both individual must be the same.
Knowledge transfer can be done through the colonization process between individuals. Tacit to explicit is the process of documenting the knowledge in an individual. Explicit knowledge can be circulated and will allow many other individuals to access the knowledge. With the development of computer technologies, the process of articulation of knowledge can be done in a larger scale. Explicit to explicit is the process of improving knowledge gained from a documented knowledge to a better idea.
It can also be the combination of ideas from the documented knowledge to a creation of a new knowledge. This is a refinement process of knowledge . Explicit to tacit is a process of transferring a documented knowledge to individuals. A customer using a product developed by a company is an example of transferring explicit knowledge to tacit knowledge. The product is the result of documented ideas and the customer using it is a transfer of explicit to tacit. For knowledge creation to happen, identification of the concentrated knowledge in to another individuals.
Later the knowledge should be published as to make sure that knowledge creation would happen. Tacit knowledge in the organizations, that are knowledge from the individuals in the organization should be made visible, as each of the tacit knowledge can be used and developed or at least be transform into explicit knowledge. Interactions among individual in the organization, though each of them is doing their daily own work, must exit as to promote creativity and ability to solve problems in the organization.
All the knowledge existed in the organization must be interacted, communicated and integrated within the organization. In general knowledge preservation can be described as a system of knowledge and skills that preserves and stores perceptions and experiences beyond the moment hey occur, so that they can be retrieved at a later time. This system will also serve as reference for new experience. However, companies often underestimate and rarely value the knowledge preserve during reorganization.
Experience of a long serving employee also can be a reference for future direction of a company and failure to preserve the knowledge of the long serving employee can lead irreversible losses. The main processes in knowledge preservation are select, store and update. Selecting involves the process of deciding which knowledge is to be documented. Only valuable experience, information and skills need to be identified and transferred into organizational system. The important thing is to concentrate on the knowledge around certain key factors, and to relate it clearly to special problems.
Only knowledge that is useful to other people worth preserving. Storing knowledge involve three medium that is individual employees, groups and computers. Individual valuable employees can be kept in a company through an incentive systems, systematic transfer of skills by training successors and also selective explication where knowledge vital to organization should be made explicit ND documented before leaving. Collective knowledge from a group of individual is more powerful than an individual knowledge.
Collective knowledge can be preserved through minutes taking, group discussions and collective development of language. The advancement of computer development contributed to storing materials electronically. Digitization is a way of preserving knowledge electronically, and since there is no limitation of storage capacity, much information can be stored electronically. Structured information can be stored in data banks. Storing alone will be of no benefit to knowledge preservation. The ability for information to be retrieved and the information quality is important.
All information stored need to be updated as knowledge is usable in a time frame. Knowledge measurement is important in assessing whether knowledge management activities are being carried out successfully. Knowledge can be quantified through objectifying it by separating it from particular situation, time and people. Knowledge can only be controlled indirectly by controlling the context in which it develops. Also, knowledge can only be recorded indirectly and not precisely. Therefore, to quantify precisely knowledge is not possible.
It must be measured periodically so that An approach to measure knowledge is to measure the indicators of knowledge for example: Number of best practices that are documented within 3 months Number of mistakes made within 3 months Number of ideas generated within 3 months Time taken for an action to be made when problem being posted on the Intranet The implementation of knowledge management practices will lead to quicker problem solving and better decision-making. Best practices can be shared across the organization.
Through knowledge preservation practices, organizations could reduce heir cost of retraining new employees every time when knowledge walkout happen. Some of the significant impacts when adopting knowledge management: Knowledge management promotes knowledge sharing. Employees can improve their performance by sharing their knowledge through various activities like research, training, or from day-to-day colonization process. By sharing their current and specialized knowledge they can upgrade their competencies and at the same time will improve organization productivity.
Knowledge that is embedded in every individual can be unified and be applied by there in their day-to-day operation or for strategic used. Knowledge workers can help each other in solving organization problems. This will be an opportunity for employees to know and learn the best practices from those who have the specialized knowledge. Organization knowledge capital must be preserved because it helps company to sustain its competitive advantage. Employees acquire knowledge from various sources when they are working on whatever task given to them.
The accumulated knowledge must be retained to avoid knowledge walkout. Knowledge management encourages knowledge sharing, development, acquisition, ND creation. These practices will transform the behavior of employees to be more innovative and creative. Moving towards knowledge-based organization will end the labor intensive manufacturing and leaves us with organizations which receive their added value from knowledge and creativity they put in rather than the muscle power (Handy, 1994).
Organizations that know how to leverage knowledge will succeed. Organization. They will be able to track changes in the marketplace, which will reduce the surprises that arise by uncertainties. Transforming the culture of an organization, from what they are doing now and emplacement with it, to a culture which is foreign to them will be a very difficult Job. However, knowledge is power therefore, Knowledge management should be the foundation in every part organization in the era of k-economy.