In the previous year, Knowledge Management's concept seemed unfamiliar in the public, because the people didn't have full understanding about what it is and how it is useful. Nowadays, people have been researching the importance of the Knowledge Management and applying its utilization in the business, education, medico social and even policies. In this Assignment we will discuss "the value of effective Knowledge Management to the organization and on supporting managerial practices" and how it is helpful.
There are lots of definitions of Knowledge in the internet, books, but researchers still have defined exact main concept yet, because Knowledge is an abstract word, which is just described through personal understand as "a justified true beliefs about relationships among concepts relevant to the particular area(Nonaka and Takeuchi),or "Things that are held to be true in a given context and that drive us to action if there were no impediments" (Andre Boudreau) . One of the major attributes of Knowledge relates to the fact that help we understand easier, to follow analyzing data, information and knowledge.(1)
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Data: Content that is directly observable or verifiable. For example, I want to study in an International University in HCMC, so I will visit them and find out all information of Universities.
Information: Content that represents analyzed data. For example, I choose two greatest Universities as Raffles International Colleges and RMIT, to analyze educational standard of them, tuition, list of subjects, course schedule to find out which one is suitable for me.
Knowledge: that is something I can learn or understand from what I believe is right. For example, after collecting useful information I recognized Raffles International Colleges was greatest. I believed that I will get high education and good certification in Raffles, because Raffles was accepted by CaseTrust for Education in Singapore.
In my opinion, Knowledge is a physical personal understand that is what we know clearly about one thing and how we can do one thing. For instance, this is a subjective view of Knowledge as I have been in CanTho City so I can know well about CanTho's citizen's personality; what are special local foods or entertainments are where and the fastest way to come there; why we cannot visit that place because a street to go there was broken, which are my knowledge about CanTho city because I have experience in there. My experience called Tacit Knowledge which was created by experiences, practice, beliefs and backgrounds. In other way of understanding of Knowledge as objective view of knowledge, one day when I saw a Tsunami was destroying a city of Japan in TV then I was able to imagine how was extremely dangerous of Tsunami, so few days later when I heard someone told about a disaster in Japan then I knew what it is and how it occur, which is my Knowledge about Tsunami because I saw via media, information in internet and books. My understanding called Explicit Knowledge because it was created through studying, reading, researching on storing of Knowledge.
Actually, Knowledge exists in individual through their studying; practicing or their experience. Consequently, transforming individual knowledge into company asset to utilize and develop that needs the company has a process sort by receiving, storing, organizing, sharing and using of information. In deeply analyzing the Knowledge Management process, following Nonaka and Takeuchi model to more understand the management knowledge and life cycle of knowledge, the main goal of model focuses on the transformation of tacit knowledge into explicit knowledge and then reusing information as the foundation for individual, group and organizational researching and innovation. First stage, Socialization that is a process to exchange knowledge among people in an organization (tacit to tacit), because each person has special skills and accessible information then sharing knowledge in order to bring wealth of knowledge to every people in the company and an union in the production. In other hand, sharing information can reduce risks as employee's retirement will carry their knowledge when they leave. Secondly in the model that is externalization which is a process to convert tacit to explicit knowledge as transforming personal experience or creation to become tangible assets to help the researching of company, organization and society, these assets stored through internal computer system, books published or internet, etc. Combination is a process to collect pieces of information to build a new form (explicit to explicit) that is a kind of useful knowledge can assist new innovation of people. Finally, based on knowledge stored the people have created new products, new knowledge then practicing day by day they transform explicit knowledge into their own (explicit to tacit). In addition, an important goal of KM process that is the company tries to transfer tactic knowledge into explicit knowledge and measure the value of knowledge and getting feedback to contribute knowledge growth of the organization. For instance, KM was the most important applied in medicine and healthcare, before producing a new medicine so researchers collected all information such as symptoms, chemical components, how it impacts to human health, etc. All medicine's Knowledge was stored in a technology system to research and reuse when necessarily, and Knowledge is updated day by day, because it is a background for an innovation and generation of new products to protect human health
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Intangible assets are the most important contribution in the success of the company such as reputation, staff's knowledge, data, etc. For instance, Toyota, which is one of the biggest automobile corporations in the world, has been successfully applying and sharing personal practice skill to develop the company. Initially, Toyota was the first one to build abroad factories in their big market in order to ensure high quality and maintain customer trust in the brand. The way Toyota used as they bring machines, professional engineers, information to new market. The professional engineers will instruct new workers how to use machines and solve problems that KM Toyota applied to transfer Tactic knowledge form people to people in production process. Competitive advantages were created through KM that saved labor cost, training cost, transportation fee as well as reducing import and export tax. Furthermore, Toyota applies procedural Knowledge (KM) in the production through producing step by step part of car that leads to produce faster, save time and daily cost. In other example in Vietnam, Dr Thanh herbal tea produced by Tan Hiep Phat Group, the company has full knowledge about Vietnam, which stays in tropical climate area and sunny season is very hot, then catching the competitive advantage the company has produced Dr Thanh herbal tea which is the first in the herbal tea market that leads to achieve resounding success of the product, as a result after 3 months Dr Thanh herbal tea launched to the market, the daily selling turnover increase 100 percent from 300,000 bottles daily selling to 600,000 bottles daily selling.
Â Knowledge plays a vital role in success of company because it assists strongly manager in their thinking and decision making as well as employee's inspiration in their job. Example, DSS (Decision Support System) assists managers in their final decision based on solid consolidation of computer information system. CRM (Customer Relationship Management) that helps managers have strategy in long term to satisfy customer's needs and maintain the reputation of the company. MIS (Management Information System), which is a tool created by people and technology, to increase effectively productivity and support manager in management process as well as solving problem in the company. Excellent managers know how to utilize data and their staff's personal knowledge that are able to lead to a success of the company. For example, Nowadays almost large company usually has customer service department that satisfies customer's demand and receive feedbacks which helps the manager has right strategy in the development of the company in the future, as Honda corporation in Vietnam has an engineering force who will immediately solve customer's problem when they need. In addition, catching up new information and technology the manager can apply software of new machines in the production to bring more profit to the company, as BMW in 2007 built up a new manufactory in India and applying new technology in the production that have increased mount of car every year from 1,700 cars per year to 10,000 cars per year.
As a leader in the company, who has extensive knowledge and a general view of subjects in a corporation, the leader has ability to find out useful information and talented people who can bring a success to the company. The leader know how to store and share knowledge to all their employees, such transform personal knowledge into company asset. Besides that, they know how to protect company's secrets and prevent loss of gray matter in company. Innovation management skill that is ability to encourage their employee's creation, transmit inspiration and energy to the employees. Moreover, creating opportunities to company's employees to approach new technology and upgrade their knowledge
For example, I read a book about how Acecook, which is the best instant noodle in Vietnam, managed KM. After three or four year working in CEO zone, Acecook usually move their CEO to other place because they know how to manage KM, the CEO will lose their creation after few year in a position, then Acecook will replace a new CEO zone to use a new their knowledge in the company's business and they encourage the CEO more creative in new environment,.