Project management chapter 4 - project integration management-1
Chapter 11 Project Management
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Transcript of Chapter 11 Project Management
Chapter 11 Knowledge Management
Jason C. H. Chen, Ph.D.Professor of MIS
School of Business AdministrationGonzaga UniversitySpokane, WA 99258
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What is Data Mining?• Data mining – the process of analyzing data to extract
information (unknown patterns) not offered by the raw data alone
• To perform data mining users need data-mining tools– Data-mining tool – uses a variety of techniques to find
patterns and relationships in large volumes of information and infers rules that predict future behavior and guide decision making
– A wide range of data mining techniques are being used by organization to gain a better understanding of their customers and their operations and to solve complex organizational problems.
• An example– Grocery Store in UK (see next slide)
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ProjectDeliveryModel
Customer Relations
Resource Management
Process Management
Project Management
Accounting and other functional areas
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_________________IT-Intensive Radical Redesign
_________________________for
“Paradigm Shifts”
Radical Rethinking of the Businessand Organization
for a “World of Re-everything”
“Old World” of Business
E-Worldof Business
___________________Streamlining Bottlenecks
__________________ Replacing humans with
machines
From “Old World” to E-World of Business: Knowledge Management for “Paradigm Shifts”
AUTOMATION
RATIONALIZATION
REENGINEERING
KNOWLEDGE MANAGEMENT
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Database vs. Datawarehouse
DBMS Database
DatawarehouseData Mining
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Learning Objectives• Understand the difference between data,
information, and knowledge.• Define how tacit knowledge differs from
explicit knowledge.• Describe why knowledge management is so
important.• Understand how knowledge is generated
and captured.• Describe a knowledge map.
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Real World Example• Harrah’s found a way to double revenues by collecting
and then analyzing customer data.• They mine their customer data completely.• They use loyalty cards to track customer behavior and to
identify high-revenue customers.• Harrah’s determined that these customers were motivated
by reduced hotel room rates and wanted quick service.• They found ways to reduce lines and wait time.• High-revenue customers rarely waited in any line.• They found ways to keep customers coming back.
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COMPETING WITH BUSINESS ANALYTICS
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Business Analytics• Business Analytics (BA) is an ________ term including
data ___________, business ____________ , enterprise information management, enterprise performance management, analytic applications, and governance, risk, and compliance.
• Business Intelligence (BI) is a set of ____________ and ___________ used to describe business performance.
• Companies find success through better use of analytics.• Many companies offer similar products and user
comparable technologies.• Business processes are among the last remaining points of
differentiation.• Focus on ____-based management to drive decision
making.
umbrellawarehousing intelligence
technologiesprocesses
fact
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What's The Difference? Business Analytics vs Business Intelligence
• Business Analytics (BA) is a close cousin of Business Intelligence (BI). Both are meant to help companies make better decisions by analyzing business data. The difference is in their methods, and in the general direction of their analysis.
• Business Intelligence, the most common form, concentrates on ______ from the present and the immediate past, and drawing conclusions from that.
• Business Analytics makes more of an effort to predict the future using more complex tools relying heavily on anything from _________ to neural nets.
http://it.toolbox.com/blogs/inside-erp/whats-the-difference-business-analytics-vs-business-intelligence-58672
data
statistics
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The Architecture of BI• A BI system has four major components:
– 1. a data _________, with its source data– 2. business ________, (or analytical environment)
a collection of tools for manipulating, mining, and analyzing the data in the data warehouse;
– 3. business __________ _________ (BPM) for monitoring and analyzing performance
– 4. a user _______ (e.g., dashboard)
warehouseanalytics
performance management
interface
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Fig. 1.3: A High-level Architecture of BI1. 2. 3.
4.
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Business Analytics (cont.)• Davenport and Harris
suggest that companies who are successful competing with business analytics have these five capabilities:– Hard to duplicate– Uniqueness– Adaptability– Better than competition– Renewability
• Characteristics of strategic resources are:– valuable, – rare, – non-imitable, – non-transferable, – non-substitutable,– combinable, and – exploitable
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COMPONENTS OF BUSINESS ANALYTICS
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Figure 11.6 Components of Business Analytics
Component
Definition Example
Data Repository
Servers and software used to store data
Software Tools Applications and processes for statistical analysis, forecasting, predictive modeling and optimization.
_________________Forecasting software package
Analytics Environment
Organizational environment that creates and sustains the use of analytics tools
________________ thatencourages the use of the analytics tools; willingness to test or experiment
Skilled Work Force
Work force that has the training, experience and capability to use the analytics tools
Harrahs and Capital One have such work forces
Data warehousesData mining process;
Reward system
To successfully build B.A. capabilities in the enterprise, companies make a significant investment in their: 1)___________, 2) _______, and 3) strategic decision-making __________
technologies peopleprocesses
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Components of Business Analytics • Data repositories - data warehouses sometimes serve
as repositories of organizational knowledge.• Software Tools – data mining is used to analyze data
in the data warehouse looking for “gems”.– Four categories of tools used:
• Statistical analysis• Forecasting/extrapolation• Predictive modeling• Optimization
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Components of Business Analytics• Analytics Environment – alignment of corporate
culture.– Incentive system– Metrics used to measure success of initiatives– Processes for using analytics
• Skilled work force – experts are needed.– Managers must set the example (CEO-level sponsorship).– Require decisions be made using analytics.
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Knowledge management vs. Information technology projects
Knowledge Management Project Information Technology Project
• Emphasizes ____________ information for users
• Support organization improvement and innovation
• Adds value to content by filtering, interpretation, and synthesis
• Require on-going user contributions
• Balanced focus on both technology and culture
• Variety of inputs often precludes automated capture of knowledge
• Emphasizes ___________ of information for users
• Support existing operations
• Delivers content only
• Emphasizes one-way transfer of information
• Primary focus on technology
• Assumes capture of all information inputs can be automated
Then, is there a general rule to determine a project is a KM project or a IT project?
valued-added accessibility
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KM Project vs. IT Project
• According to Davenport and Prusak point out in their “________ % rule,”– if more than one-third of the time and money
spent on a project is spent on technology, the project becomes an IT project rather than a KM project.
33 1/3
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Data Base
Data Warehouse/Data Mart
Online Transaction Process vs. Online Analytic Process
Business__________
OLTP
(Daily operations)Real-Time,Relational DB
OLAP
(copied to)
(Non-daily operations)(for quick and easy access)
Not Real-Time
Business__________Transactions
Intelligence
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A Generic Data Warehouse Framework
DataSources
ERP
Legacy
POS
OtherOLTP/wEB
External data
Select
Transform
Extract
Integrate
Load
ETL Process
EnterpriseData warehouse
Metadata
Replication
A P
I
/ M
iddl
ewar
e Data/text mining
Custom builtapplications
OLAP,Dashboard,Web
RoutineBusinessReporting
Applications(Visualization)
Data mart(Engineering)
Data mart(Marketing)
Data mart(Finance)
Data mart(...)
Access
No data marts option
Fig. 2.3 A Data Warehousing Framework and Views
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Discussion Question
• #3. What does it take to be a successful competitor using business analytics? What is IT’s role in helping build this competence for the enterprise? [Business Analytics]
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• Ans: Good data is at the core of business analytics. Organizations must have high quality data that can be accessed and examined very carefully and methodically.
• Data mining is key to finding the “gems” of information. Organizations must be able to quickly turn their data into valuable information that can be used for competitive advantage.
• The corporate culture need to be aligned to an analytics environment that includes: an incentive system; metrics need to be used to measure the success of initiatives; and appropriate processes for using analytics. Also, a skilled work force (experts) is needed. To be truly successful the managers must set the example (CEO-level sponsorship) and the organization must require that decisions be made using analytics. IT is key to providing the infrastructure to enable and support such a movement.
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Learning Objectives• Understand the difference between data, information,
and knowledge.• Define how tacit knowledge differs from explicit
knowledge.• Describe why knowledge management is so
important.• Understand how knowledge is generated and
captured.• Describe a knowledge map.
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Real World Examples• Harrah’s found a way to double revenues by collecting
and then analyzing customer data.• They mine their customer data completely.• They use loyalty cards to track customer behavior and
to determine high revenue customers.• Determined that these customers were motivated by
reduced hotel room rates, and wanted quick service.• They found ways to reduce lines and wait time.
– High revenue customers rarely waited in any line.• Found ways to keep customers coming back.
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Economic reliance on knowledge workers is increasing
• Knowledge _____ .• Customers and businesses want a more
integrated approach.• Best to say you are in the knowledge
business.
gap
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Working Smarter, Not Harder• Overlapping Human/Organizational/ Technological factors
in KM:
PEOPLE
TECHNOLOGY
ORGANIZATIONALPROCESSESi Knowledge
N
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Why Knowledge Management?• Business evolve from competing on , to
competing on , to competing on
.• Effectively managing knowledge as a
strategic asset will enable companies– to adapt to new ways of thinking,– to respond to change quickly and easily, and– to adopt a broader view when defining
products and services. N
costvalue
knowledge
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What is Knowledge Management? • Knowledge management is defined as the processes needed
to generate, capture, codify and transfer knowledge across the organization to achieve competitive advantage – Pearlson and Saunders.
• Knowledge management (KM) is a process of organizing and structuring institutional processes, mechanisms, and infrastructure to create, store, and reuse organizational knowledge.
• Technology plays a significant role in managing knowledge• and are essential to knowledge
management.Collaboration innovation
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Defining Knowledge Management• Intellectual capital is defined as knowledge that has been
identified, captured, and leveraged to produce higher-value goods.
• Intellectual property allows individuals to own their creativity.
• Intellectual capital is a synonym of KM• A position called “Coordinator for International Intellectual
Property Enforcement” was created by the US Department of Commerce.
• KM is related to IS in three ways:
1. IT makes up the infrastructure for KM systems2. KM systems make up the data infrastructure for many IS
applications3. KM is often referred to as an application of IS.
N
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Figure 12.1 The relationships between data, information, and knowledge.
Data
More human contribution
Greater value
Information
Data endowed with relevance and purpose
Requires unit of analysis
Needs consensus on meaning
Human mediation necessary
Often garbled in transmission
KnowledgeValuable information
from the human mind; includes reflection, synthesis, context
Hard to transfer
Often tacit
Hard to capture electronically
Hard to structure
Highly personal to the source
Data Information Knowledge
DataSimple observation of
states of the worldEasily captured
Easily structured
Easily transferred
Compact, quantifiable
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The Content of Human Mind • According to Russell Ackoff, a systems theorist
and professor of organizational change, the content of the human mind can be classified into five categories:– Data: symbols or facts– Information: data that are processed to be useful;
provides answers to "who", "what", "where", and "when" questions
– Knowledge: application of data and information; answers "how" questions
– Intelligence/Understanding: appreciation of "why“– Wisdom: evaluated understanding.
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Value Chain Data of the Enterprise
Data
Wisdom refers to our effective use of intelligence (or knowledge), intelligence refers to our effective use of knowledge.
“Knowledge is information that changes something or somebody – either by becoming grounds for actions, or by making an individual (or an institution) capable of different or more effective action” - Pete Drucker.
An organization learns what it knows by cultivating its knowledge ecosystem in which information, insights, and inspirations cross-fertilize and feed one another, free from the constraints of geography and schedule.
Information Knowledge Intelligence Wisdom
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Knowledge• Knowledge is a mix of contextual information,
experiences, rules, and values.• Richer, deeper, and more valuable.• Consider knowing –
– What? - based upon assembling information and eventually applying it.
– How? – applying knowledge leads to learning how to do something.
– Why? – casual knowledge of why something occurs.– (Figure 12.2 graphically illustrates these types of knowing).
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Figure 12.2 Taxonomy of knowledge
Know-What Know-How
Know-Why
Application
Information Procedure
Reasoning
Experience
Source:H-W Kim and S. M. Kwak, Linkage of Knowledge Management to Decision Support: A System Dynamic Approach
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Discussion Question (extra)
• #2. What is the difference between tacit and explicit knowledge? From your own experience, describe an example of each. How might an organization manage tacit knowledge?
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Tacit vs. Explicit Knowledge
• _______ knowledge is personal, context-specific and hard to formalize and communicate
• ________ knowledge can be easily collected, organized and transferred through digital means.
Tacit
Explicit
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Tacit is the knowledge we each, individually know from our experiences and our thinking. It may not be easily communicated because it may not be something we have every expressed in words, pictures or numbers ever before. Explicit knowledge, on the other hand, is the stuff we can point to, write about, or otherwise communicate easily. The trick, of course, is to make tacit knowledge explicit so we can communicate it to others. Each student should have examples of both types of knowledge.
Tacit knowledge might be how to throw a baseball, hit a tennis ball, run a marathon, solve a homework problem, etc. Explicit knowledge examples might be the formula for a chemistry project or financial calculation or the statistics of your favorite sports team, etc. An organization might manage tacit knowledge explicitly, that is by trying to get individuals to make their tacit knowledge explicit then record it in a database, or by acknowledging the difficulty and by creating communities of practice, gurus, and other people-based systems that facilitate discussions and interactions as a means of transferring knowledge.
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We know what we know
(Explicit knowledge)
We don’t know what we know(Tacit knowledge)
We know what we don’t
know
We don’t know what we don’t
know
Types of Knowledge
What w
e Know
What w
e don’t know
We Know We don’t know
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Tacit and Explicit KNOWLEDGE
Oral Communication“Tacit” Knowledge
50-95%
Information Request
“Explicit” Knowledge
Explicit Knowledge Base5 - 50%
Information Feedback
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The Four Modes of Knowledge Conversion
Tacit Knowledge
Explicit Knowledge
Tacit Knowledge
Explicit KnowledgeA. Socialization
(Sympathized Knowledge)
C. Internalization(Operational Knowledge)
B. Externalization(Conceptual Knowledge)
D. Combination(Systematic Knowledge)
Transferring tacit knowledge through shared experiences, apprenticeships, mentoring
relationships, on–the-job training, “Talking at the water cooler”
Articulating and thereby capturing tacit knowledge through use of
metaphors, analogies, and models
Converting explicit knowledge into tacit knowledge; learning by
doing; studying previously captured explicit knowledge
(manuals, documentation) to gain technical know-how
Combining existing explicit knowledge through exchange and
synthesis into new explicit knowledge
FRO
M
TO
Source: Ikujiro Nonaka and Hirotaka Takeuchi, The Knowledge-Creating Company, 1995
Which mode is the one for classroom processes? _____C
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Applying Knowledge Management
• KM is not a new concept, but one reinvigorated by IT such as collaborative systems, the Internet and intranets.
• KM is still an emerging discipline• Ultimately, an organization’s only sustainable
competitive advantage lies how its employees apply knowledge to business problems
• KM is not a magic bullet and can not solve all business problems.
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FROM MANAGING KNOWLEDGE TO BUSINESS
INTELLIGENCE
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From Managing Knowledge to BI• Managing knowledge is not a new concept, but one
reinvigorated by IT. • KM is still an emerging discipline• Business Intelligence (BI) is a set of technologies and
processes used to describe business performance.– BI is a component of KM.
• Business Analytics – use of quantitative and predictive models, and fact based management to drive decisions.
• An organization’s only sustainable competitive advantage lies with how its employees apply knowledge to business problems
• KM is not a magic bullet.
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WHY MANAGE KNOWLEDGE?
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Factors to consider in Knowledge Management
• Information and knowledge have become the fields in which businesses compete.
• Several important factors include:1. Sharing Best Practice2. Globalization3. Rapid Change4. Downsizing5. Managing Information and Communication Demand6. Knowledge Embedded in Products7. Sustainable Competitive Advantage
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1. Sharing Best Practices• Avoid “ reinventing the wheel”• Build on previous work
7. Sustainable Competitive Advantage• Shorter life-cycle of innovation• Knowledge as an infinite resource• Direct bottom-line returns
5. Managing Overload• Inability to assimilate knowledge• Data organization and storage is needed• Information and communication
4. Downsizing• Loss of knowledge• Portability of workers• Lack of time and resources for knowledge acquisition
2. Globalization• Decreased cycle times• Increased competitive pressures• Global access to knowledge• Adapting to local conditions
. 6. Embedded Knowledge• Smart products• Blurring of distinction between service and manufacturing firms• Value-added through intangibles
3. Rapid Change• Avoid obsolescence• Build on previous work• Streamline processes• Sense and respond to change
Why ManageKnowledge?
Figure 12.4 Reasons for Managing Knowledge. ©IBM Global
Services
Source: adapted from IBM Global Service.
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Sharing Best Practices• Sharing best practices means leveraging the
knowledge gained by a subset of the organization.• Increasingly important in organizations who depend
on applying their expertise such as accounting, consulting and training firms.
• KM systems capture best practices to disseminate their experience within the firm.
• Problems often arise from employees who may be reluctant to share their knowledge (managers must encourage and reward open sharing).
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Globalization
• Historically three factors, land, labor and capital were the key to economic success
• Knowledge has become a fourth factor.• Knowledge-based businesses can grow without
traditional land, labor, and capital requirements.• Key competitive factor will be how well an
organization acquires and applies knowledge.
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Other factors• Rapid change: firms must be nimble and adaptive to compete• Downsizing: sometimes the wrong people get fired when
creating a leaner organization• Managing Info and Comm Overload: data must be
categorized in some manner if it is to be useful rather than overwhelming
• Knowledge Embedded in Products: the intangibles that add the most value to goods and services are becoming increasingly knowledge-based
• Sustainable Competitive Advantage: KM is the way to do this. Shorter innovation life cycles keep companies ahead of the competition.
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KNOWLEDGE MANAGEMENT PROCESSES
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Knowledge Management• KM involves four main processes –
1. Generation – all activities that discover “new” knowledge.
2. Capture – all continuous processes of scanning, organizing, and packaging knowledge after it has been generated.
3. Codification – the representation of knowledge in a manner that can be easily accessed and transferred.
4. Transfer – transmitting knowledge from one person or group to another, and the absorption of that knowledge.
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Knowledge Generation• Concerns the intentional activities of an organization
to acquire/create new knowledge.• Two primary ways are knowledge creation
(exploration) and knowledge sharing (exploitation).• Methods include:
– Research and Development– Adaptation– Buy or Rent– Shared Problem Solving– Communities of Practice
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KNOWLEDGEGENERATION
Figure 12.5 Knowledge Generation Strategies
Buy or Rent
Adaptation
Shared Problem Solving
Creating (R&D)
Communities of Practice
a.(KC)
b.(KC)
c.(KS)
d.(KS)
e.(KS)
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Research and Development • Knowledge generated by R&D efforts frequently
arises from synthesis • Synthesis brings disparate pieces of knowledge
together, often from extremely diverse sources, then seeks interesting and useful relationships among them
• Realizing value from R&D depends largely on how effectively new knowledge is communicated and applied across the rest of the firm
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Adaptation
• Adaptation is the ability to apply existing resources in new ways when external changes make old ways of doing business prohibitive
• A firm’s ability to adapt is based on two factors: having sufficient internal resources to accomplish change and being open and willing to change
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Buy or Rent
• Knowledge may be acquired by purchasing it or by hiring individuals, either as employees or consultants, who possess the desired knowledge.
• Another technique is to support outside research in exchange for rights to the first commercial use of the results
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Shared Problem Solving
• Also called “fusion,” shared problem solving brings together people with different backgrounds and cognitive styles to work on the same problem
• The creative energy generated by problem-solving groups with diverse backgrounds has been termed “creative abrasion”
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Helping Fusion Work• Ideas that help fusion work effectively include:
– (1) fostering awareness of the value of the knowledge sought and a willingness to invest in it;
– (2) emphasizing the creative potential inherent in different styles of thinking and viewing the differences as positive;
– (3) clearly specifying the parameters of the problem to focus the group on a common goal
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Communities of Practice • Achieved by groups of workers with common
interests and objectives, but not necessarily employed in the same department or location, and who occupy different roles on the organization chart.
• Workers communicate in person, by telephone or by e-mail to solve problems together.
• Communities of practice are held together by a common sense of purpose and a need to know what other members of the network know
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Four Basic Principles of Knowledge Codification*
1. Decide what business goals the codified knowledge will serve (define strategic intent).
2. Identify existing knowledge necessary to achieve strategic intent.
3. Evaluate existing knowledge for usefulness and the ability to be codified.
4. Determine the appropriate medium for codification and distribution.
*Davenport and Prusak (1998)
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Knowledge Capture • Knowledge capture takes into account the media to
be used in the codification process. • The 3 main knowledge capture activities are:
• Scanning (gather “raw” information) – can be electronic or human.
• Organizing (move it into an acceptable form) – must be easy for all types of users to access.
• Designing knowledge maps (providing a guide for navigating the knowledge base)
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*Organizing Knowledge• Folksonomies – site for collaboratively creating and
managing tags for annotating and categorizing content.• One scheme for categorizing knowledge uses four
broad classifications (Ruggles 1997):– Process knowledge – best practices, useful for increasing efficiency.– Factual knowledge – easy to document; basic information about
people/things.– Catalog knowledge – know where things are; like directories of
expertise.– Cultural knowledge – knowing how things get done politically and
culturally.
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Designing Knowledge Maps • A knowledge map (see figure 12.6) serves as both a
guide to where knowledge exists in an organization and an inventory of the knowledge assets available.
• A knowledge map can consist of nothing more than a list of people, documents, and databases telling employees where to go when they need help.
• Provides access to resources that would otherwise be difficult or impossible to find
• Can capture tacit knowledge through narratives.– Good stories are effective for knowledge transfer.
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Figure 12.6 Contents of knowledge maps
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Knowledge Codification
• Knowledge must be used or shared to be of value.
• Codification puts the knowledge into a form (representation) that makes it easy to find and use (accessed and transferred).
• It is difficult to measure knowledge in discreet units (since it changes over time).
• Knowledge has a shelf life.
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Knowledge Transfer• Nonaka and Takeuchi’s Knowledge Transfer
describe four different modes of knowledge conversion (transfer):• Socialization: from tacit knowledge to tacit
knowledge • Externalization: from tacit knowledge to explicit
knowledge • Combination: from explicit knowledge to explicit
knowledge • Internalization: from explicit knowledge to tacit
knowledge
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Key to Success: A Learning Organization need to have four characteristics critical to successful Knowledge Management
N
S
W E
CULTURELEADERSHIP
PEOPLE AS ASSETS STRUCTURES AND PROCESSES
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How to Succeed in Knowledge Management
• A successful KM effort requires leadership with– vision, – commitment, and – an organizational culture that facilitates
collaboration.
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CoreCompetency
Technologies Knowledgederivative
InformationCommunicationIndustries
Intellectual & Intangible AssetsPartnershipPatentsData bases
Processes Explicit, Codified Knowledge Methods
Human CapitalWellspring of
Knowledge
SkillExperienceKnowledge
Learning
Learning
Manage Core Competency
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1 2
3
4
5
Information & Comm. Technology Infrastructure
Know-whatKnow-howKnow-why
QualityInformation Explicit
Knowledge
Tacit KnowledgeRaw Information
OrganizationalKnowledge
CoreCompetenceCrystallize Core Competence
Generalize Best Practice for Reuse
Produce Best Practice
Contextualize Organizational Knowledge
Create Organizational Knowledge
Improve quality of information Make tacit
knowledge explicit
Best Practice
Figure: From Organizational Knowledge to Core Competency
Knowledge HuntingKnowledge Hardening
[process knowledge]
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From Data to Knowledge:How Can Organization Gain Competitive Advantage?
(Survive and Prosper in the Digital Economy)
Data process Information Quality Information
Accessible
Organizational Knowledge
SharableCollaborative
-As a productNOT byproduct
-As core intellectual capitalNOT merely a few smart employers
DecisionMakingAvailable
Reusable
CRMAccountingFinanceOperationsManufacturing
Externalcustomers
D. B.
D.B.:Structured: R-DBMSUnstructured: Document Mgt. Systems
context,experience
automate informate innovate N
Useable
K.BD.W
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices 73
• A wise CEO will make better decisions and inspire greater loyalty and trust than just a knowledgeable CEO.
-- Schrage, 1996
• Imagination is more important than Knowledge.
-- Albert Einstein
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices 74
“Knowledge is the beginning of practice; doing is the completion of ___________.”
-- Wang Yang Ming, 1498 (one of great Chinese philosophers)
knowing
知識是實踐所做事情的開始 ;這樣做是在完成知曉
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices 75
THE WORLD OF RE-EVERYTHING
• Knowledge is productive ONLY when ______________________.
• ____________ requires decentralized intelligence.
• We need to empower _________ workers• Top performers can be a problem; they are
not the most _______.
captured in people’s mindShareability
knowledge
humble
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices 7676
Sustainable Competitive Advantages
• Any sustainable competitive advantages?• How can an organization sustain its
competitive advantage?• Firms may create/improve their competitive
advantages only if they:– have to learn,– employ approach,–
capacityrevenue management
learning to learn and learning to change (life-long learning environment)
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices 77
CAVEATS FOR MANAGING KNOWLEDGE
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices 78Copyright 2010 John Wiley & Sons, Inc.
Caveats for Managing Knowledge • KM and BI are emerging disciplines • Competitive advantage increasingly depends on
knowledge assets that are hard to reproduce, so it is sometimes in the best interests of the firm to keep knowledge tacit, hidden, and nontransferable
• Knowledge can create a shared context for thinking about the future, not to know the future, but rather to know what projections influence long-term strategy and short-term tactics
• The success of KM ultimately depends on a personal and organizational willingness to learn
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices 79
FOOD FOR THOUGHT: BUSINESS
EXPERIMENTATION
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices 80Copyright 2010 John Wiley & Sons, Inc.
Business Experimentation • Thomke discusses business experimentation as a means
of innovation.• Products and services are created and improved using
analytics through a process of experimentation.• Companies who excel are able to create new products
and services at a fraction of the cost of others.• Capital One is built around this methodology.• Ran 1,000s of experiments on their bank’s customer
database to test and develop new ideas.
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices 81
Business Experimentation
• Capital One had the following results:– Increased business savings retention by 87%– Lowered the cost of acquiring new accounts by 83%
• It is a concept of test and learn.– Projects are managed as experiments.– Projects are designed with a series of rapid iterations.
• Both Harrah’s and Capital One have built a core competency in business experimentation and analytics.
Copyright 2010 John Wiley & Sons, Inc.
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices 82
Conclusion
Literacy + Electronic Infrastructure +Social Revitalization =
Opportunity for New Societal Infrastructure
Knowledge distribution
Motivation
ã John Wiley & Sons, Inc. & Dr. Chen, Information Systems – Theory and Practices 83Copyright 2010 John Wiley & Sons, Inc.
Summary• KM is related to information systems in three
ways: IT makes up its infrastructure, KM makes up the data infrastructure for many IS and apps, and KM is often referred to as an app of IS.
• Data, information, and knowledge should not be seen as interchangeable.
• The 2 kinds of knowledge are tacit and explicit.• Manage knowledge carefully, there are many valid
and of course legal reasons.• KM projects can be measured using project-based
measures.