Knowledge Management Information System Commerce Essay

Published: Last Edited:

This essay has been submitted by a student. This is not an example of the work written by our professional essay writers.

The definition of knowledge should be understood when relating to knowledge management (Jantti, 2010). Knowledge is the circumstance of understanding something from organized data and information, which is reasoned and validated. This information is combined with exclusive talent, perception, capability, clues and analytical reasoning arranged in individual minds. This information cannot be expressed in recorded or unrecorded form (Aurum et al., 2007). There are two types of knowledge. Firstly, recorded knowledge or explicit knowledge. Recorded or explicit knowledge is a part of the knowledge form that can be accessed by other people ([Liyanage et al., 2009], [Nordin et al., 2009], [Ponelis and Fairer-Wessels, 1998, and [Smith, 2001]). The recorded knowledge is more useful than information that focuses on specific situation because it gathers from people with similar experience, perception, and ability of the knower ([Bates, 2005], [Bouthillier and Shearer, 2002], and [Todd, 1999]. Secondly, unrecorded knowledge or tacit knowledge. Unrecorded form or tacit form is a non-expressed knowledge ([Liyanage et al., 2009], [McInernet, 2002], [Nordin et al., 2009] and [Yates-Mencer and Bawden, 2002]).  

Moreover, Saribia (2007) believes that knowledge in business can be defined by a lifecycle. The first one is create. Knowledge should be created inside or outside the company. Repetitive tacit and explicit knowledge compose in this step before it distribute to external creating team. The second one is store. Tacit and explicit knowledge will be stored some places to make other people easy to access the knowledge. The third one is find. Find in this case means the user who wants the particular knowledge can find it in correct places. The fourth step is acquired. After the user find correct knowledge, they will acquire the knowledge. In this step, the user can gain the knowledge from other people or any sources. The fifth step is use. The knowledge is ready to use for specific purpose. The final step is learn. A result can be worked well, but also can work not well. Therefore, the user can learn the result of gaining knowledge. The important part to make this knowledge effective is learning. Lack of knowledge will be appeared without proper learning concept.

2.2 The concept of Knowledge Management

There are several different definition According to Ouintas et al. (2007), knowledge management is to learn, expand, utilize, send, and absorb knowledge from organization into a proper management process to satisfy common and future requirement. Allee, Davenport, and Alavi and Leidner believe that the definition of knowledge management is managing the organizations knowledge through methodically and organizationally described task for gaining, arranging, sustaining, using, sharing, and renovating tacit knowledge and explicit knowledge of workers to improve company implementation. Gupta et al. say that knowledge management is a process which support organizations find, choose, arrange, publish and relocate essential information and knowledge for business activities. According to Bhatt, Knowledge management is steps of create, validate, present, distribute, and apply the knowledge. Thus, Holm said that knowledge management is choosing related information to related people at related time, helping the related people develop knowledge and sharing information. Horwitch and Armacost believed that knowledge management is the production, extraction, revolution and storage of the right information and knowledge to make effective policy, change action, and send results.

As a summary of many authors, knowledge management is the practices of enabling entire organizations to manage the knowledge cycles which are create, store, find, acquire, use and learn knowledge to make optimal performance and achieve their goal. The definition of knowledge management is not saying about technology even though IT facilitates knowledge management. The purpose of knowledge management is making sure that the knowledge cycle is more effective and more efficient. The main focus on knowledge management is managing the tacit knowledge. This is due to much harder to take the tacit knowledge, which is contained people's mind.

Moreover, Knowledge Management can be seen in two methods. The first method is viewed in terms of people, processes, and technology. Knowledge management should know how to increase individual skill in organization to determine their knowledge. Its way varies from one organization to other organization because there is no limitation for the number of processes. After all knowledge management's requirement has been created, technology needs to be chosen. The second method is seen in terms of culture, structure, and technology. The installation of knowledge that focused on culture is the biggest driver of organization to become success. Knowledge sharing is facilitated by business methods and organizational structures. Technology is a critical enabler instead of the answer of the problem.

Knowledge Management designs from comprehensive rules and technologies. They are intellectual science, expert systems, artificial intelligence, knowledge base management systems (KBMS), professional writing, document guidelines, decision support systems, acceptable networks, relational and object databases, simulation, organizational science, modeling of object oriented information, and performance support systems.

2.3 History of Knowledge Management

Knowledge management has a long history. It was began in 1960, when knowledge worker phase is designed by Peter Druck. Then, in 1980s, Journals and books began writing the articles that related to knowledge management. The knowledge management is also done in term of artificial intelligence and expert systems. Moreover, the phase of personal knowledge management was determined as the guidance of knowledge at human being level in 1999.

2.4 Recent Knowledge Management

There is high expansion in today's knowledge management especially in business organizations. As the implementations metrics of the first users are recording the actual advantages of knowledge management, many organizations know the benefit of managing knowledge of organizations. In the end, high demand occurs in knowledge management advising usage and technologies.

Moreover, there are several drivers supporting knowledge management success. Firstly is knowledge depreciation. Voluntary worker transition keeps high even though there is an economic downturn. The global consulting firms latest survey announced a standard voluntary worker transition ratio of 21 percent with 80 percent of organizations quoting worker transition as a serious case. Estimated annual costs of workers transition were a surprising $120 million for each of organizations. Much of this expense is caused by knowledge depreciation that can be reduced by knowledge management systems. Next is knowledge merging. The latest madness of company mergers combined with raised requirement to combine global company communications need to joining of different and often opposing knowledge representation. Third one is content management. As the number of digital information increased, the demand for its rational organization is essential for aim of information renewal, sharing, and rework. The final one is e-learning. It can be a successful method for knowledge management production.

2.5 The Structure of Knowledge Management

The wide ranging economy has moved from a business manufacturing adapted economy to one component on knowledge and services, where the essential products is information or knowledge. A crucial topic in worldwide economy is effective management of academic capital. In fact, knowledge management is not only about managing knowledge. However, it managing and developing an organization culture that supports and innovates the sharing, relevant operation, and making of knowledge that permits an organizations strategic competitive benefit. Getting a "knowledge culture" needs managerial priority in three sectors: arranging the organization, organizing knowledge resources, and supporting knowledge for competitive benefit (Abell and Oxbrow, 1997). The implementation and services of organizational knowledge culture is supported by knowledge, which is based on management system.

2.5.1 Knowledge Management Structure

Figure 2 shows that traditional organization management hierarchy. There are two ways to transfer the knowledge. They are vertical way and horizontal way. Vertical way transfers knowledge through standard chain of command. On the other hand, Horizontal way should transfer cross organization's barriers. The better movement of knowledge across organizational barriers is required for maximizing competition and minimizing rates of technological change (Gopalakrishnan and Santoro, 2004).

The implementation of knowledge groups consisted of knowledge employees from cross-functional sectors of organization is a first method on the way to implementing an allocated vertical and horizontal knowledge relocate system within the organization. Cross-functional sector group members give knowledge sharing from their knowledge employee back to actual functional sectors.

On the other hand, the scope of groups is controlled to the organizational difficulty assigned to the group and effects in controlled knowledge sharing across the organization. The concept of groups and knowledge sharing should be increased to involve all parts of the company. Figure 3 shows knowledge group-based organizational pattern. The knowledge structure is consisted of knowledge groups that are consisted of knowledge teams that are created from knowledge employees determined for contribution on a knowledge team because of their tacit knowledge and ability. In theory, the knowledge employees on a part of knowledge team appear from varying organizational patterns and will lead to mix of tacit knowledge and ability to them.

Selection of a new organizational from or managerial process faces refusal within the organizations (Goh, 2003;Zamutto et al., 2000). Decreasing the awareness of transform for the stockholders. In fact, the knowledge group management process may be adjusted to latest hierarchical management process by adjusting the knowledge groups with latest functional sectors of the organizations consist of: marketing, production, accounting, and research like the concept of community practices. Then, Knowledge teams of knowledge communities are adjusted with the category within each functional sector.

3. Factors Impact Knowledge Management

There are several positive and negative factors that affect to knowledge management implementation. Quinn et al. (1996) assert that these factors support an essential definition through the verification of basis operations that are critical to success in knowledge management performance.

Moreover, there are many authors that identify the success factors of knowledge management. For example, Davenport believes that knowledge management has eight factors that can impact on achieving success knowledge management. They are technology arrangement, organizational arrangement, balance of flexibility, modification, and ease of convenience to knowledge, allocated knowledge, familiar culture, supported the knowledge staffs that improve, share, and apply knowledge, process of knowledge move using different information technology substructure, and expert management help and commitment. However, Ryan and Prybutok (2001) declared five success knowledge management implementation factors such as an organizational culture, expert management control, staff participation, teamwork, and information system substructure. In addition, Moffet et al. (2003) present ten key parts successful knowledge management is communicative organizational culture, expert management influence and commitment, staff participation, staff training, honorable teamwork, staff empowerment, information system substructure, performance evaluation, benchmarking, and knowledge organization.

In summary, the best key success factors for knowledge management are workers training, workers participation, open and honorable attitude of teamwork, workers empowerment, top management control and commitment, information systems substructure, performance evaluation, familiar culture, knowledge organization, and elimination of organizational limitation.

3.1 Workers Training

An organization will become a totally knowledge-based company if they begin the implementation of knowledge management with high quality tutoring. This is because customers in the market need high quality, cheaper expense, and more quick cycle times. Thus, organizations should develop their organizational performance. The essential aspects that help the business face this problem are quick advances and technology. On the other hand, the most important competitive benefit for many organizations is its human resources. In tutoring session, staffs and managers get the abilities and information to perform their jobs. Moreover, today's organization wants to become learning organizations. This is because the non-fulfillment in successful work actions would be caused incomplete tutoring to maintain knowledge management concepts.

3.2 Workers Participation

The important thing to make good decision is workers participation. Workers participation illustrates how workers can present productively to satisfy the company's purpose. It related to the level that workers could distribute information, skill, gift, and authority in every part of company. High company participation requires building alternative about organizational plan that designs an area in which workers understand more, perform more, and submit more. There is an assumption for tacit knowledge workers that effective implementation development may not only rely on how job is structured, and the ability of employee. However, this is because on the desire of the workers to change tacit knowledge of the job process into everlasting process development and revolution.

3.3 Open and Honorable Attitude of Teamwork

Teams are many individuals that enter and relate allocated knowledge efficiently. The critical success development of knowledge management is a good-staffed group. This is because knowledge that workers have, may be hard to expressive because it is so extremely implanted in procedures and implementation. Making teams let companies to use various abilities and knowledge concerning its procedures and difficulty solving. Overall, knowledge management approach is on giving a condition in which knowledge employee of many rules can enter together and make latest knowledge.

3.4 Workers Empowerment

The quality of regulation and self-control that appears when individual are set authority in earlier ineffective circumstances. This means removing the bureaucratic rules and making an understanding of freedom, therefore that people can execute all their skills and spirits to fulfill their shared purposes. Many authors said that workers empowerment is one of success factor of knowledge management. Workers will require knowledge, which will allow them to understand and submit to the execution of the companies. This situation occur because the workers will take duties to find a solution for the problem by studying new skills in their work that will finally lead to them being more expert, when they are empowered. Ineffective production and knowledge sharing will not succeed if workers do not have an understanding of authority in the general purpose of the organizational knowledge management practices (Martinez, 1998).

3.5 Top Management Control and Commitment

In knowledge making and culture sharing actions, top management control and commitment are the most crucial factor for success knowledge management. Top management is progressively identifying that the knowledge structural in a company is especially useful asset, and that it is not enough to quit it not managed. In fact, one of threat to knowledge management success is poor leadership. Only powerful leadership could give the required direction, where an enterprise will need to develop and efficiently use a knowledge management plan.

3.6 Information System Infrastructure

Without information system control, useful knowledge management is unbelievable and unthinkable. Many managers from many organizations believe that the success of implementation knowledge management is energy of computers and communication technologies. According to survey managed by "Information Week" shows that the audiences believe knowledge management method to their business and the popular information technology equipments are relational databases, text, and document search engones, groupware, data warehouses and data sharing tools (Davis and Riggs, 1999). The implementation of knowledge managements needs a useful information systems substructure. This is because information technology can give an advantage in collecting knowledge (Bhatt, 2001). Information systems have supported a company to control and influence its knowledge systematically and actively. The knowledge will disable if there is no information technology and computer.

3.7 Performance evaluation

Performance evaluation is connected to the key sectors of the organization such as enlargement, revolution, and efficiency, which is crucial o the implementation of well being organization. According to Ellis, there is a confusing in a development organization if the classic management and measurement techniques only focus on financial operation. Pearson (1999) believe that searching the good system of measurement, as well as better processes of making and sending the good information to the right people at the right time. American Society of Training and Development Working Group that develop intellectual capital measurement model declare two perspectives. One is basic set of quantity to specify the intellectual capital stocks, which are familiar to many organizations. Secondly, set of solution measures of financial operation is to analyze effectiveness.

3.8 Friendly Culture

Culture is a group of theory that gives organization identification. The set of theory involves company aim, specification of performance, the place of authority, permitted support of power, decision-making orientation, style of leadership, acceptance and assessment and inspiration. Culture operation show how the company see and promote both learning and revolution, including how it influence staffs to create organizational knowledge base in ways that increase values of customer. American Productivity and Quality Center shows that 40 companies are realized to have corporate culture that can support knowledge sharing. A survey from company that used knowledge management is in 500 companies displays that 80 percent of respondents said that a major barrier tin developing knowledge management system exists organizational culture.

3.9 Knowledge Structure

In fact, many organizations guided suppliers and customers into company group to share ideas for their product implementation an refinement options and to come up with new, creative products and services. Realizing the significance of customers and suppliers, there must be a good-established knowledge structure that contains internal knowledge about internal and external customer, supplier as well as organizational work teams to execute success knowledge management.

3.10 Elimination of organizational constraint

Knowledge Management Success will not achieve, if there is no organizational constraints elimination. This situations is caused by organizational constraint have negative impact that can affect negative perception and behaviors in relation to successful in knowledge management. Bonaventura argue that rigid restrictions, lack of motivation to be more creative, lack of responsibility in allocating and maintaining would be troubles for knowledge management development. Thus, organizations should delete all constraint in organization to success in knowledge management implementation.