The Importance Of Knowledge Within Companies Commerce Essay

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Before we start discussing this topic, I would like to highlight my intention of using the terms of knowledge and ideas in an interchangeable manner. This is due to the fact that both of them are key elements within my research and represent an equally important factor within the project.

Knowledge can be defined in various ways depending on the context, but according to popular sources can be defined as Knowledge is defined as "a fluid mix of framed experience, values, contextual information, and expert insights" (Daven-port & Prusak, 1998, p. 5)[32]

The importance of knowledge within companies couldn't be more crucial in the current economic situation. In the current market environment where you have a new competitor emerging every day and where products are out of fashion within a fortnight, technology is just not enough to stay a step ahead of your competitors. Thus there is only one source of competitive advantage that companies have against each other, and that is the advantage of knowledge [13]. As Nonoka& Takeuchi state, 'successful organisations are those that constantly create new knowledge, disseminate that thought the company and quickly embody it within their products'. Companies whose sole business is to continuously innovate are known as 'knowledge-creating' companies. This is one of the reasons why Japanese companies are so successful. This view is backed up by Druker[2005], who thinks that we are entering in a knowledge based society, where the basic economic resource will be knowledge [15].

Within the context of knowledge inside companies, various key elements were recognised such as organisational knowledge creation, knowledge harvesting, knowledge management, knowledge creation and knowledge ownership. We shall go through all these elements, and then relate them to the project to highlight the importance of these.

Types of Knowledge

According to Nonoka & Takeuchi there are two main types of knowledge, those being tacit and explicit knowledge [16]. Explicit knowledge is knowledge that can been articulated, codified and documented in a certain media, knowledge that has been grounded on manuals and printed materials. And the second type is one that cannot be transferred or communicated through manuals, or theories, but is best shared through experiences or by harvesting knowledge from the company's employees. Also known as Tacit knowledge. It refers to knowledge that is found in the form of hunches, intuitions and insights, something that is context sensitive, dynamic and personal. Tacit knowledge is well encapsulated in one line by Polanyi, 'we know more than we can tell [20].

Even though over the years there have been debates to which one is more valuable, the reality is that they are not separate states of knowledge, but co-dependant. Tacit knowledge forms the background necessary for assigning structure for explicit knowledge. It is of no use for a company to have tacit knowledge that can't be distributed amongst others, and explicit knowledge quickly looses it meaning. The latter can be defined by one single phrase: 'A map is not the territory, it represents' Alfred Korzybski (1958) [10].

Now these two different types of knowledge are key to this project, and to the system that is going to be developed. One really important fact to bare in mind is that knowledge is the final product that results as a blend of tacit and explicit knowledge. These two blend together by the process of knowledge creation and innovation. It begins with the sharing or socialising of personal tacit knowledge with others or by capturing it in digital or analogous form [20]. This is then shared by other people and is internalised by them, giving birth to new knowledge. This new piece of knowledge is then shared by other people, and this circle goes on. The process of creating knowledge results in a spiral of knowledge acquisition. (Hibbard 1997)[14] called this process as INNOVATION. This is one of key elements in this paper and shall be seen later on in detail in section sharing.

(Polyani 1975) also classified knowledge as individual or collective [18]. As the name explains, individual knowledge is the one that is created and maintained within the individual. On the other hand, collective knowledge, also known as social knowledge, is created by and inherent in the collective actions of a group. More on social knowledge and social creativity shall be discussed within the section of Sharing.

Both of these classifications need to be well understood when working on Innovation, as the misunderstanding of any one of these can lead to gaps within the process and analysis of innovation within the company. More importantly this can also lead to a handicapped software system, where users lack the ability to work with knowledge as they perceive it. What needs to be realised is when a using a software systems within the context of knowledge, is that when trying to share any tacit knowledge on an electronic system, it first needs to be converted to explicit knowledge in order to represent it on an electronic platform [34].

Ownership of Ideas

Now with the wide knowledge that is available within the company, arises a key concern and that is the ownership of knowledge. As knowledge can be defined as something that is represented inside the human mind as the product of activity, this knowledge or idea could have been harvesting within an employee's mind through his/her experience and work with the company. Does that mean that the employee owns the idea? Or is it the company that provided the employee with the scenarios such that that knowledge could be harvested [17]? The reason to acknowledge this factor is because if employees believe that they have legal ownership over an idea, they may choose to keep their ideas from the company, thereby hindering the company's ability to innovate [31] (Alvesson, 1993; Empson, 2001).

This can be compared to the moral ownership of a crop being grown by a farmer. When a farmer grows his crops, he provides it with the necessary care and watering to grow them, but Mother Nature also contributes to its growing by providing the soil, sunlight and other elements such as rain. Now who owns the crop, the farmer, or nature? We are faced with the same dilemma here.

When an individual owns something, they have the legal right to that object, such as a car, house of mobile phone. But who defines ownership on intellectual rights? Employees have knowledge while at work regarding the company, how certain IT systems are developed, or how to design particular piece software. And if employees believe that they have the right to that knowledge and want to keep them away from the employers, then that affects the company's ability to innovate[17].

Research [17] suggests that companies have two ways to avoid that the knowledge and ideas generated within their company is leaked outside, and this is by using legal measures such as Assignment provisions and trade secret handling procedures. Both of them offer different approaches to companies to make their employees believe that that their knowledge and ideas gained during their time with the company, belongs to the company.

It was found that when employees were generating ideas and learning new knowledge as part of their team (R&D department for example), they were most likely to perceive that as the companies rather than their own. It was mentioned in the research that a lot of companies paid their employees to learn and gain new knowledge as well as generate new ideas, and these situations the employees had no hesitation suggesting that the ownership belonged to the company. [17]

On the other hand some employees had different views to this, and these were related to the degree of integration with the company and the knowledge / idea were related to.[17] The degree of integration was defined by the following factors:

The sources and the resources used to generate the idea

The proximity between the knowledge and the company

The degree to which the employee felt generating ideas was part of the job

Employees feel a strong sense of attachment to their companies

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All these above helped the employees decide whether the knowledge they had gained and the ideas they had generated were owned by the company or themselves.

Now even though a lot of issues that are related to ownership of the idea are going to be dealt with the organisation deploying the system, it is important to have a clear understanding of these issues. Given the fact that the users of the system and the organisation can be faced with these issues, a deep and clear analysis of these is crucial. Once a company has dealt with the legal ownership of the ideas, it needs to think about managing the ideas and knowledge available within the organisation.

Knowledge Management

The fact that wide and infinite amount of creative and innovate knowledge is available within a company is an advantage, but on the other hand a big challenge for the companies. We have seen by the research above that tacit knowledge is a key player for achieving innovative success [20], but this knowledge needs to be well nourished, managed and put into practice. This means companies and employees need to understand where to find relevant information, what are the permissions needed if any in order to alter an idea, and other different factors that we shall be discussing.

We shall also be discussing the importance of knowledge management in companies in order to achieve a smooth correlation and between tacit knowledge and innovation. The reason why KM is given such high importance is because if the ideas does not earn from the knowledge available within the company then only a partial benefit is gained. Hence, knowledge management is considered a prerequisite for higher productivity and for the private and public sector. [14]

We can define KM in various ways. DiMattia and Oder(1997) postulated that ``knowledge management'' is an attempt to cope with the explosion of information and to capitalise on increased knowledge in the workplace [14]. Davenport and Marchand suggested that: ''whilst knowledge management does involve information management, beyond that it has two distinctive tasks: to facilitate the creation of new knowledge and to manage the way people share and apply it'' (Davenport and Marchand, 1999, p. 2).[20]

According to Alavi and Leidner [18] the role of IT to support knowledge management is crucial, by the application of knowledge management systems. These are systems that allow the managing organization knowledge. Systems whose purpose is to support and enhance the organisational knowledge support.

As gathered by the narrow literature available in this field, Knowledge management can be described as the management of 'intellectual capital' by a company [14]. And when we speak about knowledge management, we refer to certain measures that management need to take in order maintain and nourish that knowledge. The reason why management felt the necessity to maintain this knowledge that led to the growth of knowledge management emerged from two fundamental shifts:

Downsizing : During the 1980, this was a strategy to reduce company overheads and increase profits. However this lead to a loss of important knowledge within the company. The reason being that employees that left took the knowledge with them that they had accumulated for years [15]. Organisations soon felt that they had lost valuable knowledge and expertise and needed to protect themselves from a recurrence.

This led companies to undertake KM strategies in order to retain the knowledge, and the most popular way by the use of technology. This means, companies use technology to store and capture the knowledge within employees and share these with their peers.

Also as DiMattia and Oder(1997) [14] say, with the technological growth, KM is an attempt to capitalize on the IT facilities and cope with the immense amount of information and capitalize on the vast knowledge available within the company. In order to use the flow/ data information stored within the technology, companies must develop effective ways to store, navigate and share data with their colleagues. This also implies that in order to store this data in a suitable manner, effective ways of data representation need to be considered in order to make it easier to process by the human mind [15]. All these are factors that I need to consider to develop a framework for the groupware solution, such that users can effectively share their ideas (the link between ideas and knowledge has been proven above) in the most effective way possible.

As such, knowledge management can be defined in to three simple steps [15], creation, management and exploitation of data. The first consists of acquisition of data, the second consists of storage of data, and the final stage is about the utilization of the data in order to make the most out of it. This can be achieved by using sharing and socialisation techniques.

Aside from technological facilities, knowledge management strategies need a lot more work in order to embed deeply within a company. As the biggest problem for companies is not the technological barriers, but a cultural one (Forbes, 1997;Koudsi,2000) [15]. If we carefully analyse the above, knowledge management is the attempt from companies that try to transform tacit knowledge to explicit in order to have a competitive advantage. Even though a lot of the literature and focus within KM is on IT and technology, there is a lot more to it. This is one of the reasons why KM strategies fail within companies or don't have the desired impact as initially expected. (Warren,1999)[15]. These techniques and strategies shall be later discussed within the section of Innovation.

Summary of Knowledge

How does knowledge link in to sharing

Once we have all the above, we now need to share it in order to capitalise on the knowledge available

Maybe add in knowledge creation?


After having discussed the types of knowledge available, and how to effectively manage it, we need to move to consider sharing in order to capitalise on this knowledge. Within this section we shall see what sharing consists of, the types of sharing, the reason why employees share and some of the issues and barriers to the same. The key elements embedded within this project are interaction, culture, process, the types of knowledge, exchange and knowledge creation.

For the purposed of this literature we shall consider three definitions of sharing. According to Hsiu-Fen Lin [9] sharing in this context can be defined as a social interaction culture, which involves the exchange of knowledge, experiences and skills throughout the entire organisation. The second being in accordance with Van Den Hoof and De Ridder's (2004)[23] conceptualization; as a process where individuals mutually exchange their tacit and explicit knowledge to create new knowledge. The final one being "knowledge sharing is the fundamental means through which employees can mutually ex-change their knowledge and contribute to knowledge application, innovation, and ultimately the competitive advantage of the organization (Wang & Noe, 2010)". Sharing can essentially be considered as a bridge between knowledge and innovation [10].

As Andreas Riege [24] states "better and purposeful sharing of useful knowledge translates into accelerated individual and organisational learning and innovation through the development of better products that are brought faster to a target market, thus enhancing market performance". [24]. The accessibility of knowledge though is still limited because most knowledge resides in the head of people or in documents or repositories that is not of easy access to other individuals. That is one of the main reasons why sharing ''tacit knowledge among multiple individuals with different backgrounds, perspectives, and motivations becomes a critical step for organisational knowledge creation to take place" (Nonaka and Takeuchi, 1995, p. 85). And so, we can consider sharing as the process where individuals mutually exchange their tacit and explicit knowledge [25].

But as we found with knowledge, sharing can be categorised in two different forms as per Nonaka[17], socialization and externalization. The former consists in involving personal experiences to be shared with others, who then incorporate the lessons from those experiences in their personal tacit knowledge. Externalization on the other hand consists of the conversion of personal tacit knowledge into explicit knowledge. This shall later on be highlighted within the section TYPES OF SHARING.

It was further found by Ardichvili et al. (2003)[25] that sharing consisted of both the supply and demand for new knowledge, that involved an individual guiding someone else through their knowledge and experience to help others understand their own situation better [24]. As such, the person sharing and distributing his or her knowledge ideally is aware of why the knowledge is needed and where is it being put into use. This implies that not all employees need to share, because it would not be applied or reused.

Now the statement above can be analysed and criticised in several ways. The implication that the author makes regarding all the employees do not need to share is one that negatively and indirectly influence one's sharing activity. This might actually lead to people not sharing due to such a hypotheses being in place. The whole point of innovation and sharing is that everyone should contribute on more or less frequency as everyone has a field where can share knowledge and ideas on. This is a culture and influence that needs to be deeply embedded within the organisation and is a motivation factor that plays a huger role within my project, as we shall see later.

Aspects of Sharing

Sharing per se can be categorised into two facets, collecting or receiving and disseminating or donating of knowledge [23]. Where knowledge donating can be defined as 'communication based upon an individual's own wish to transfer intellectual capital and knowledge collecting as 'attempting to persuade other to share what they know`. Van den Hooff and Van Weenen (2004b)[9] defined Knowledge donating as the process where employees communicate their personal knowledge and expertise to others. On the other hand knowledge collecting was defined as the process of consulting colleagues to encourage them to share their intellectual capital.

Both of these facets of sharing are active processes as one is either engaged in active communication with their colleagues in order to transfer their knowledge, of consulting others with the aim of gaining some insight to their intellectual capital. Van Den Hoof and De Ridder's (2004)[23]. As such, knowledge sharing consists of both the supply of new knowledge and the demand for new knowledge.

After having gone through several studies on how these different sharing types affect a company's capability to innovate, it was found that knowledge donation within a department itself has some significant effects on innovation within the department, however donating outside the department did not have any kinds of impact on innovation.[23]. On the other hand when dealing with knowledge collection, it had an impact on all types of innovation. Now this has been linked with various reasons such as people within a same department share a common interests, therefore donating knowledge within there has a common ground that can be shared with those people and be easily integrated with existing problems. Baring in mind that they share common values and beliefs, donation within the department I easily captured [25]. Another reason that was pointed out was the lack of attention and necessary interest with people from outside the department. Whereas knowledge collection is done by people looking for something they are already interested in, thus facilitating the integration of knowledge which in turn has an impact on innovation.[23]

This peculiar result of the lack of impact with knowledge donation outside a department was further investigated. The study was conducted across various industries, with 1000 middle to top level managers being the participants. The study structured in a survey format, with question such as "We experiment with new products and services in our local market" that had to be rated from a scale that had been extracted from further studies. The important fact to point out here are the participants, the managers. If a manager is high up within a company, then the likelihood of that person being highly qualified and successful in their respective profession is fairly high. The fact that a high post within a company attracts power and ego is a common known, and this can be established to the lack of inter department knowledge donation. Every manager would want to keep their competitive advantage to themselves and would be too proud to actually seek help from someone else in order to develop their idea. It would have been interesting to see this study carried out within the casual employees, who are the main drivers of innovation within a company.

The point of inter department and intra organisation is an important one and needs to be taken under consideration when designing a collaborative innovation system. The fact that people might have the ability to collaborate and share on an inter organisational basis makes the point above in important factor that companies need to consider in order to encourage sharing on a wider scale. But these are not the only issues sharing are faced within a large organisation. In the following section we shall go through these.

Problems and issues & Barriers

The barriers within sharing can be categorised within 3 main sections, and these are linked to individual employees, the company's systems and processes and the integrated technologies (Lee and Choi, 2003; Connelly and Kelloway, 2003; Taylor and Wright, 2004)[9]. The majority of failures within the field of sharing in companies is because companies try to adopt their organisational cultures to fit their strategy, instead of implementing them in a way that their culture isn't hindered and it's the strategy that is taileord (Connelly and Kelloway, 2003; Lin and Lee, 2004).

Employee Barriers

According to Andreas Riege [7] from the point of view of an employee the barriers to sharing are related to factors such as communication skills, networks, culture difference within colleagues, time, and trust. Just about every research on sharing and KM revealed that one of the biggest challenges in sharing is the ability to distribute the right knowledge from the appropriate person at the right time. The fact that communication between colleagues on both a written and verbal basis is well maintained is crucial for effective sharing of knowledge and ideas (e.g. Davenport and Prusak, 1998; Hendriks, 1999; Meyer, 2002).

One of the most important one was the fear amongst employees of job security and their importance within the company and the need to retain their knowledge to maintain their competitive advantage within the company (Lelic, 2001). This is where the organisation needs to support and promote it in a way that employees take it as a benefit rather than a risk. The lack of time was highlighted as an issue by O'Dell and Grayson (1998) as it is often seen as a cost rather than a benefit.

Many employees we found sharing knowledge if they found it beneficial or related to their work, to a close colleague (Wheatley, 2000), though this is something that can gradually be improved on by changing the culture within the organisation. This was one area where it was felt that an IT application could really help enhancing and broadening networks and collaboration between employees in the same company. It was found that social media can enable significantly knowledge sharing within a company [4].

And finally, the most important issue within an emplyee's barrier to share is trust. Most employees fear that their colleagues might misuse the knowledge, or claim it as their own, or even fear that the knowledge they are providing might not be accurate (DeLong and Fahey, 2000; McAllister, 1995).

Organisational Barriers

In terms of organisational issues, the most important and significant one is the organisational environment and conditions. The key topic to bare in mind is the culture of the organisation, the spirit that is found within the company Sveiby (1997). The success of a sharing strategy within a company depends on the integration of knowledge sharing within the strategy and goals from a wider perspective. Often put as simply the way things are done in a company. Therefore, a firm that can promote sharing knowledge practices within groups or organizations is likely to generate new ideas for developing new business opportunities, thus facilitating innovation activities (Lundvall & Nielsen, 2007; Michael & Nawaz, 2008).

However other elements such as the combinations of human networks are key to a company's sharing capabilities. Hence one of the keys to knowledge sharing is to support and harvest knowledge in those networks that where the culture of sharing is already established(McDermott, 1999; McDermott and O'Dell, 2001). Other factors are the misallocation of resources such as skilled personal, technology and financial aids can impact on creating and effective knowledge sharing environment. Davenport (1997) pointed out the importance of financial support to KM campaigns, which can be expensive at times. An often overlooked barrier for the company is the retention of high quality staff, as this can impose serious losses for an innovative company, given the fact that when they leave they take the individual and organisational knowledge with them. (Stauffer, 1999, p. 20)

And finally, senior management need to be on board with sharing within the organisation and need to effectively oversee and support the end to end process of sharing within the company (Ives et al., 2000). There need to be clear guidelines, training and support for employees in order to encourage sharing, by both collecting and donating knowledge. Incentives have been recognised as a possible way of encouraging employees to do so. Incentives in this case could be rewards, in the case of monetary prizes, or job security. This is a lot harder than what one thinks, and shall be discussed more thoroughly within the section of Incentives and motivations.

Information Technology

It is often found that organisations solely blame technology for the lack of sharing within a company and often ignore the ones above. Knowledge sharing is a challenge from a people, organisation and technological perspective. We use the term "hybrid solutions" that consists of a blend between technology and people in order to enable effective sharing practices (Davenport, 1996). Similarly, Ruddy (2000, p. 38) stated that in order to successfully improve sharing a ''delicate marriage of technology with a keen sense of cultural or behavioural awareness'' was needed.

Companies soon realised the benefits of IT systems such as groupware applications that can enhance the convenience and effectiveness in sharing environments. The key issue was however the lack of integration between the technology and the needs of the users. It is to understand the organisational and personal needs within a company in order to implement a successful system. Software systems should support the requirements of the users and this should be reflected within the system. If these requirements are not well understood then the technology itself can become a barrier (O'Dell and Grayson, 1998). Hence a commercial off the shelf application wouldn't be a good solution. Finally, a trouble-free, responsive and user friendly system and its operation is a key issue for many organisations. It is known that no application comes without any bugs and given that fact that sharing can be taken as a time consuming activity by employees, it can put employees off and make them not share and contribute within the company. Hence a well-supported and well-maintained system is quite an important element.

As we can observe companies need to pay attention to a lot of barriers that there are with sharing within an organisation. Managers need to look at more than just an IT system, it needs careful and strategic planning to ensure that their employees have the necessary resources (time, support, training) and that the organisations goals and strategy are well aligned with sharing. Reports (DeLong, 1996)[28] have also shown that the introduction of these systems is not always result in a significant improvement due to the fact that in many instances they are not used to their full potential. Ultimately 3 main factors were identified on which a knowledge sharing culture depends:

Organisational structures that support sharing.

Modern technology that facilities and enhances the role of sharing within the company.

The motivation, recognition and encouragement to share knowledge.

As Andreas Reige [24] highlighted, knowledge sharing has no real value to individuals and organisations unless those people who are in need of useful knowledge receive it, accept it, and also (re-)apply it. But why would an employee share any of their knowledge despite the barriers mentioned above? In the following section we shall go through these and define what the incentives are and what the motivation behind sharing is.

Incentives & Motivation

If we assume that all the barriers mentioned above have been overcome, we still face another key challenge with sharing, and these are human related factors such as motivation, commitment, rewards and hopes. Why would someone want to share their knowledge with their colleagues? The reason why we need question needs to be addressed is because if no one is willing to share their knowledge and ideas, then this project becomes redundant.

Numerous studies have been done regarding this topic and from different perspectives, the majority being done from a psychological perspective. For the scope of this research, we shall only consider the elements that are useful to this paper and elements that are required from an IT system perspective. According to Manu IPE [31] the motivation factors to sharing can be categorised as internal factors, those that can perceive power attached to the knowledge and the reciprocity that results from sharing; and external factors, those that include relationship with the recipient and rewards for sharing.

Battistella, Cinzia, and Fabio Nonino found that most people are motivated by different factors, that can be extracted from the Self-determination theory (Deci and Ryan 1980 - 1985). This theory distinguishes different motivations types based on reason and goals, the important one's being intrinsic motivations, where an individual's actions are based on pleasure or personal interest and extrinsic motivations, in the case of which an action leads to a separable result. As such, the majority of the motivations can be classified in the following manner:

Intrinsic motivation

Individual driven: These are motivations that are related to people who choose to enter the collaboration network and contribute. These are driven by the psychological-emotional sphere of an individual.

Social driven: motivations that motivations concern the collective sphere of the individual who joins a community of collaborative innovation.

Extrinsic motivations

Economic: These are motivations that lead to an economic advantage as the end result. It can be to the company, individual or both.

Professional: Motivations that lead to a professional or corporate advantage for the person contributing.

Social: These are the ones where a being part of a network obliges the individual with a set of responsibilities and which has an effect on the community. In this case the social dynamics play a crucial role.

It was also found [25] that individuals who have been working for the company for a long time or who felt and affective commitment with the company were very likely to share knowledge. This means the employee feels committed to the company and is attracted by a sense of loyalty, an emotional attachment to those organisations. It leads to a feeling of need to continue benefiting to the organisation.

Another motivation factor that was interesting was that employees felt the need to think that their contributions were worthwhile and would help create some new value. Hence Employees are motivated when they think that knowledge sharing behaviours will be worth the effort and able to help others. Wasko and Faraj (2005) suggested that this was classified as an individual factors and plays an important in increasing or decreasing the individuals desire to share [9]. (Nahapiet and Ghoshal 1998) also mentioned that individuals expected to receive some of that value for themselves, also known as personal benefits or private rewards. Thus the expectation of personal benefits can help individuals to contribute [33]. (Schultz, 2001) took this a step further and identified reciprocity, the mutual give and take of knowledge, as a key motivator to sharing. It implied that individuals could anticipate that their time spent sharing was time well spent and would prove worthwhile [31].

This was further enhanced by (Blau 1964) in his social exchange theory, stating that individuals engage with social interaction of sharing based on an expectation that it would lead to a social reward of some way. These can be approval, respect, status and awareness. This meant that the employee wanted to build their personal reputation across the company. (Constant et al. 1996) proved this to be an important asset that an individual can leverage to achieve and maintain status within their network. This then caused a ripple effect within an individual, who perceived that participation would enhance their reputation and may motivate other individuals to share their knowledge with others, hence making them more likely to contribute on a frequent manner (Stewart 2003). This can be compared to an online system, where users are motivated to contribute on a frequent manner to increase their reputation within the online community. This factor was highlighted a key pointer, as this highlights that the system being built needs to be designed in a way that it attracts user for future use. It can be compared to ranking systems used in forums where user gains reputation on every voted answer. This gives a user a sense of seniority as they escalate up within the network.

In addition to individual reputation, (Burt 1992; Putnam1995b) proposed that connections between individuals leads to a social capital, where the networks between the individual are quite dense. When networks are dense, consisting of a large proportion of strong direct ties between members, collective action is relatively easy to achieve (Krackhardt 1992) leading to a habit of cooperation and collective action between the users within the network. It was also highlighted that individuals were keen to show their level of expertise within their colleagues and prove that they had excellent knowledge within their field, and by sharing were capable of demonstrating those skills and knowledge [10]. So we can conclude that sharing as a cycle, where users share in order to build reputation and networks, and as a result of having they built that reputation and network, they share and hence engaging in the cycle of sharing.

It was also found that if people understood that as a result of sharing that were doing their jobs in a more effective manner, helps them maintain keep their job, helps them to progress in their careers and develop themselves, and makes them feel rewarded by recognition or any other reward scheme in place, then knowledge sharing will become a reality. [26]

Rewards and recognition was found as another way to make the importance of sharing visible. It highlights for the employees that the company values their time an effort spent sharing knowledge [26]. Though rewards and recognition were found to be controversial incentives, as if incorrectly implemented lead to a reduction of sharing within the company (McDermott & O'Dell, 2001; O'Dell & Grayson, 1998; Tissen, Andriessen, & Deprez, 1998). This was in reference to tangible rewards. It was found that verbal rewards and recognition in the form of positive feedback had a better influence on intrinsic motivation (Deci, Koestner, and Ryan (1999)). However they found that tangible rewards in the form of money or promotions did not provide much information on an employee's competence and actually created a competitive atmosphere within the company, and thus creating a negative atmosphere for sharing. Therefore recognition was found to be more to be more encouraging rather than monetary or tangible awards. However it was found that if tangible awards in the forms of bonuses of pay rise were incorporated widely across the entire company, where all the employees could prove they had met a certain requirement within the professional development plan, then it was found to be a viable solution [32]. This was suggested as a solution as opposed to having a bonus scheme where the top 10 highest sharing employees would be rewarded, where a competitive atmosphere was developed within the company. Thus as we saw in the case of social network rewards, and real life recognition, users are motivated to share when they feel their effort is being recognised and is visually available within the system, or done in front of a wide audience.

One of the most important motivation found was the corporate culture and organisation structure of a company (De Long & Fahey, 2000; Leonard-Barton, 1995; Pan & Scarbrough, 1999)[31]. It was pointed out that if an organisation was successful in incorporating the measurement of knowledge-sharing behaviour or indicators of successful knowledge transfer into performance appraisals, then it could enhance sharing norms [32]. As an example, companies such as Google were taken, where innovation is deeply embedded within the company's roots and is considered infectious within their employees.

And finally, the availability of an online system that promoted sharing, regardless of their specific features, proved to be a positive influence towards employees in order to share their knowledge [28]. It was actually found that barriers such as communication with an employee, who was too shy to share his ideas, were reduced as a virtual channel was put in place.

After having seen the above, it was decided that the system that would be implemented would incorporate the incentive and motivation factors mentioned above, and this was avoiding the scenario of human error, ie. If a manager has forgotten to congratulate a member of their team, the network would have a placeholder event that would state the completion of an innovation by that person, and could be recognised throughout his network electronically.

As it was seen by this section of the literature, there are various reasons to motivate employees to share knowledge and ideas within their companies. It is important that these values and factors are well understood as they are key elements that need to be deeply embedded within the system that is implemented. For instance, if we take the element of status, it has been identified that sharing knowledge in online systems is very closely linked the status a user has on that system (ex. Stack over flow) or the. So we see how important it is to properly understand these values and reflect them within the system.

Types of Sharing / Processes of sharing | What happens when knowledge is shared?

If we recall the definition of sharing mentioned above, we see that Sharing in essence is sharing one's tacit knowledge with others Nonaka (1994). As such, Nonanka identified different types of sharing, developing the spiral model of knowledge. This spiral is best understood in the process of a lifecycle, e.g. an employee who has been working with a company for a long period, has identified a gap within the production lifecycle, and draws on his experience to come with a process innovation. This employee's knowledge is then transformed to organisational knowledge, which is then spread throughout the company, and is of value to the company as a whole. This knowledge is then expanded within the company and is modified to create some new organisational knowledge. Through social and collaborative processes as well as an individual's cognitive processes (e.g., reflection), knowledge is created, shared, amplified, and enlarged in organizational settings (Nonaka 1994). This continuous spiral of knowledge was identified by Nonakaet al.(2000), called knowledge conversion, that views organisational knowledge creation as a continuous exchange between the tacit and explicit knowledge and a growing spiral flow as knowledge moves through individual, group, and organizational levels. According to this model, knowledge conversion can be identified by four modes:

Socialisation (tacit knowledge to tacit knowledge)

Externalisation (tacit knowledge to explicit knowledge)

Combination (explicit knowledge to explicit knowledge)

Internalisation (explicit knowledge to tacit knowledge).

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Fig. 1 & Fig 2 INSERT DIAGRAM HERE S E C I model Knowledge creation in multidisciplinary project teams: an empirical study of the processes and their dynamic interrelationships Patrick S.W. Fong*

Socialization: This can be defined action the action of sharing personal experience and knowledge (tacit knowledge) with others, who then incorporate and apply this knowledge into their own personal knowledge [17]. It refers to the conversion of tacit knowledge to new tacit knowledge using social interaction as a channel for sharing [18]. It is considered as a valuable mode of sharing through imitation, observation and sharing experiences face-to-face. Nonaka emphasises that socialisation is also an important way to enhance trust between partners. Saint-Onge refers to socialisation as a way of creating a sufficient level of congruence to enable individuals to understand each other and work together towards their common goals from different perspectives.

Externalisation: consists of converting tacit knowledge to new explicit knowledge (e.g. lesion learnt from a previous project). It can take place in many different forms such as explaining it in a lecture, or recording it in a physical medium such as such as writing a manual based on one's own knowledge. Externalization is can be done without the attention of the knowledge donor, for instance we can observe someone performing a certain task and that other person doesn't have to be aware of it, and as such it doesn't have to be a conscious act. However it is recommended that the knowledge owners should be aware that the knowledge is to be shared such that they can externalize their knowledge in a form (or in more forms than one) that is suitable for reconstruction by others [28].

However, in most situations where knowledge sharing is to occur, it may prove fruitful to stimulate the knowledge owners to The commonly employed tool in externalisation is dialogue, as according to Ayas K. dialogue triggers the unconscious elements of knowing and not-knowing, as well as revealing gaps in knowledge com-pared to what the community knows [36].

Combination: This mode refers to the creation of new implicit knowledge by merging, reclassifying, and synthesising existing explicit knowledge; an example could be this literature survey [18]. In most cases this mode involved an intermediate step, for e.g. an employee gains insight to some new knowledge from explicit sources (internalization) and then codes new knowledge intro an explicit form (externalization). The aim of this mode is to create a arche-type, i.e a prototype for a new product or in the case of a business procedure it can be a working model of a process [37]. In this mode is where we can highlight the involvement of IT, because given the bulk of information available, it is easier to process with IT.

Internalisation: This mode consists of creation of new tacit knowledge from explicit knowledge [18]. As opposed to externalisation that is considered as transmitting one's personal knowledge, internalisation consists of absorbing the knowledge of others, by those seeking to acquire knowledge. Internalisation can consist of the conversion of existing explicit knowledge an individual's tacit knowledge as well as the creation of new organisation knowledge when the explicit source triggers a new insight. As externalisation, it can also occur in multiple forms such as learning by doing, reading books, etc. We find that both internalisation and externalisation of knowledge have barriers that might distort their purpose such as social distance, culture and languages and differences in conceptual and mental frames [28] (Vriens, 1998). Both externalisation and the internalisation of sharing knowledge were also recognised by Davenport and Prusak's (1998)formula: Transfer (or sharing)=Transmission+Absorption [28].

What was indicated by Nonaka and Takeuchi is that organisations are not at internalising knowledge from their activities at a team level. Hence there is a strong emphasis on converting tacit knowledge to explicit knowledge, but what was less frequent was the further generation of tacit knowledge out of it [36]. Now this point is important to bare in mind as when the requirements for the system are defined, this need to be taken in mind. As we have seen above, sharing goes through different phases and we need to consider each and every one of them in order to define a sharing and innovation lifecycle. This lifecycle would define who an idea is generated from scratch, how through its life span it has been shared, and as a result of this improved or changed, up until the implementation phase of the idea. Hence the point highlighted by Nonaka clearly shows that organisations lack the ability to take the knowledge available within them and putting that into practise.

All the modes discussed above are closely linked together, as each mode relies to and contributes to and from other modes [18]. For instance, the socialization mode can result in the creation of new knowledge when an employee has obtained new knowledge by having interacted with any of the other modes. Idea-sharing can therefore be conceptualized as linking idea generation and idea exploitation through either socialization or externalization [17]. Senker (1993) also highlights that the tacit component of innovation can only evolve through practical experience (learning by doing), or personal interaction with experts who possess the relevant experience or knowledge, in or outside the organization and social networks, meaning the ''know-who'' [20]. One really important fact to bare in mind is that knowledge is the final product that results as a blend of tacit and explicit knowledge. It begins with the sharing or socialising of personal tacit knowledge with others or by capturing it in digital or analogous form [20]. This is then shared by other people and is internalised by them, giving birth to new knowledge. This new piece of knowledge is then shared by other people, and this circle goes on. Knowledge created through this spiral process can trigger a new spiral of knowledge creation, and thus creating an infinite spiral of knowledge [20]. The process of creating knowledge results in a spiral of knowledge acquisition. (Hibbard 1997)[14] called this process as Innovation. As such, we shall be looking into it in more detail in the upcoming section.

As we observe, the SECI model can help organisations build an initial framework for sharing, and what are some of the stages that needed within the context of sharing. In terms of this project, the SECI model shall be used to build a barebone for the sharing and innovation process, alongside other processes that have been observed within the section of innovation. After having conducted my case study with Allianz and determined my requirements, a final sharing process shall be determined for the project that would reflect its importance within the design and structure of the system. One thing that can be criticised about this model is the fact that it doesn't account for the fact that the modes of socialization, externalisation, internalisation and combination can be done in any order. The model proposed by Nonaka follows a rigid spiral formation, and thus limits the possibility of following the modes in different combinations. And finally, we cannot rely on this model to be true for every shingle organisation, as it was based on studies within Japanese companies, where the innovation ethic is totally diverse to the western culture, something that needs to be taken in account when working on innovation. Thus after having seen the spiral above, we can consider sharing for this project to be as a process that involved a series of modes or steps that enable innovation to take place.

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Innovation can be defined in various ways, and the definitions that have been selected are the ones that highlight the difference between creativity and innovation and highlight the different forms innovation can be considered as, an action, behaviour and culture. (Druker, 1993, p. 173) defines it as "the application of knowledge to produce new knowledge". (Thompson, 1965) however defines innovation as the generation, acceptance and implementation of new ideas, processes, products or services. Finally Amabileet al.(1996) defined innovation as "the successful implementation of creative ideas within the organization". A more comprehensive definition is provided by West and Farr (1990). They defined innovation as an "intentional introduction and application of new products, processes, procedures, or ideas that are designed to significantly benefit the individual, the group, the organization or wider society".

If we apply these definitions to the research done above regarding knowledge and the SECI spiral of knowledge, we can conclude that tacit knowledge and its application leads to innovation (Leonhard and Sensiper, 1998). As Ragna Seidler-de Alwis and Evi Hartmann[20] state, "To achieve innovation success a smooth interplay between tacit knowledge and innovation management is required." Essentially, we can consider innovation to be the evolution of tacit and explicit knowledge. Depending on the type of company, the innovation would be based on process improvements, product developments etc.

Given the current literature, innovation was commonly considered as a combination of invention and exploitation (Kikoski and Kikoski, 2004; Roberts, 1987) of knowledge. And thus it was considered that innovation could be accomplished using the strategy of exploration or exploitation. In the case of the latter existing opportunities were made use of and in the case of the former, new opportunities were seeked. (Schulzeet al.,2008; Tushman and O'Reilly, 1996; March, 1991).

After having analysed both innovation and knowledge management, close relationship was found between them, as the accumulation of new knowledge that empowered creativity was highlighted as the key element for innovation (Armbrechtet al., 2001). (Smithet al., 2005; Darroch and McNaughton, 2002; Doughertyet al., 2002; Hargadon and Sutton, 1997; Nonaka and Takeuchi, 1995; Cohen and Levinthal, 1990). Hargadon and Sutton (1997) also pointed out that with effective knowledge transfer within a organisation, existing ideas from one group may be of use to other groups and vice versa, and thus resulting in new ideas, as seen above in the spiral of knowledge. (Afuah, 2003; Storey and Kelly, 2002; Bubner, 2001; Lin, 2001; Tsai, 2001; Drucker, 1985) have gone as far as stating as knowledge the key element in innovation. They found that main hindrance to innovation in organisations is the lack of knowledge, as this is crucial to building innovating ideas. In order to deal with this barrier, knowledge sharing was mentioned as the key factor impacting upon innovation, due to their ambiguous and unique nature within the firm (Teece, 1998; Grant, 1996; Day, 1994). This can be applied with the SECI model studied above, and we can hence conclude that constantly collecting, sharing and integrating knowledge within the organisation will enhance it capacity to innovate (Subramaniam and Youndt, 2005). We can also analyse the types of innovation mentioned, and conclude that exploitative innovation is best achieved when knowledge transferred is applied to enhance the current processes, services or products within a company. On the other hand if we analyse exploratory innovation, it is knowledge that forms a platform for the generation of technologies and products (Bierly et al., 2009).

What can be argued though is the fact that a lot of studies prove the relationship and link between innovation and knowledge management, but none of them can demonstrate the impact of the relationship between the two. Hence studies show the importance of sharing tacit and explicit knowledge within innovation [27], but none of these can show its degree of importance.

In order for an organisation to successfully create a innovation culture, a sense of ambidexterity between the employees need to present (Schulzeet al., 2008; March, 1991), the former being defined as the balance between exploration and exploitation, where the latter can be considered as efficiency, production, and refinement whereas the former can be indicated by search, experimenting and discovery (He and Wong, 2004; March, 1991). It needs to be highlighted that both exploration and exploitation have different benefits being returned, where one leads to realization on a large time span and other on a shorter time range (He and Wong, 2004). And so we can conclude ambidexterity as the interaction effect of exploratory and exploitative innovation [23]

As mentioned above, an organisation culture that harnesses innovation needs to be established in order to achieve innovation and sharing within an organisation, part of this culture being an innovation process, one that a company follows in order to successfully achieve innovation. In order to establish an innovation process research on the different approaches to organisational innovation and sharing was done. One can argue that the SECI model mentioned above can be taken for an innovation process, but it is usually considered as a framework for innovation. The two papers studied had a totally different approach to innovation, one consisting of a process based approach and the other of the deployment of a groupware system within the organisation. In the next few lines we shall discuss in detail the approaches, and evaluate the two .

The first process observed was Star search, which was piloted within two organisations technology companies [7]. This process consisted of 4 steps, and these were the following:

Step1: A call for innovation. An audition group (AG) for the process would be appointed and they would announce that the company has scheduled a Star search audition, where employees would present their ideas. The AG would be the one who the employees would be presenting their ideas to.

Step 2: This is the audition phase, where an employee would present their ideas for a certain length of time. The AG evaluates the business plan of the ideas and makes it a decision whether the idea progresses to the next step or not. If it does not, then the idea is dismissed with a well-documented reason. This document is made public such the other employees do no submit a similar idea without refining it.

Step 3: Consists of the case preparation group (CPG). This consists of the further development of the idea and the preparation of a detailed business case. The idea is refined with the help of the originator, members of the AG and other additional experts. After that has been done, the AG makes a decision whether to go ahead with the idea or not, and in the case of ejection it is again well documented.

Step4: In the final step of the process, the CPG sends the refined idea to the team that would be in charge of implementing it.

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We find that this approach of pitching an idea to a designated team of individuals can lead to well refined and well though ideas as the study indicates, but lacks the sharing element within an organisation. It creates a sense of competitiveness between individuals as they all pitch for their idea to be the chosen one. It also means that the innovation period during which employees can submit their ideas is a limited one, and hence restricts innovation on a constant time scale.

The second approach to innovation was studied within an IT consulting company [11]. The company had just gone through some management changes, and the new senior manager that was appointed decided to deploy Lotus Notes within the company as an attempt to leverage the expertise of the organisation. After the system was deployed, the users were sent an email regarding it, and that was it. Surprisingly enough, this is something that a lot of companies have done, deploy a technology and hope for innovation to come with it.

In the case of this approach, there is a lot that can be analysed and learnt, in order to produce a more effective innovation process within a company. The idea of deploying Lotus notes, a groupware system, was a good one but it only addressed the barrier of technology. If we recall the barriers within sharing and innovation within a company, we find that personal and cultural barriers are equally important as technological ones. The mind-set of the users and the culture within the organisation wasn't altered with the deployment of the system, and this was a huge downfall. It was also found that users weren't trained in using from a groupware perspective, and hence used the basic features they used with previous software such as email and calendars. So we can see the that people act towards technology based on their understanding of it, and in order to make full use of the system the technological frames of people needs to be accommodated to it [11].

What we can conclude after having seen the two approaches is that they both contain elements that are beneficial within innovation, but the entire innovation process lacks key elements to make it successful. After having conducted this literature survey, and analysed elements for innovation, sharing and knowledge management it was decided that a proprietary innovation process would be developed that would address the shortcomings of the ones mentioned above and build on key elements such as the SECI model to establish an adequate process.