The Impact Of Knowledge Management On The Productivity Of Firms

Knowledge is considered as one of the most important and competitive resource for sustenance of the organisation (Zack, 1999). It can be compared to the strategic resource that can be used and applied in various frames of the organisation. Experienced managers in the organisations believe that company can receive strategic advantage through knowledge and not the strategies or actions implemented by competitors. Knowledge can be regarded as a strong approach that opens numerous ways of success. It is that weapon that help organisation to evaluate solutions in financial and other professional difficulties.

In today 's high competitive business world, success is dependent on how efficiently and effectively an organization can develop and utilize its information and knowledge resources(Carlsson etc, 2002). Therefore, there are many dispute on information and knowledge management. The purpose of this essay is to discuss the relationship between Information management(IM) and knowledge management(KM), then argument about whether KM is important for an organization. In order to make sure essay have a clear structure, this essay main divided into four parts (from Part 2 to Part5 ): Part 2 will introduce what is IM and KM, the benefits of IM and KM, the relationships amongst data, information and knowledge, and then this paper will introduce the relationship between IM and KM; Part 3 will analysis case study of good knowledge management in Xerox company; Part 4 will analysis case study of bad knowledge management in NASA; Part 5, this essay will give an argument result to you in conclusion.

To get sustainable competitive advantage, the significant role of knowledge management has been explored. Knowledge management causes companies’ core competencies to become stronger. Therefore, competitive advantage has been more sustainable. Knowledge management is perceived as the development of organizing the intangible asset of a firm. The economic and production level of a company relies more on its brainpower, human capital and invisible competences than its physical assets. The function of each business relies upon the knowledge of its human capital.

Nevertheless, other researchers propose a more detailed view of factors constituting a knowledge intensive organization. Such includes the employment of a large proportion of employees trading primarily in knowledge, through the creative generation and usage of knowledge to deliver complex and unique products and/or services(Blackler, 1995; Karreman et al., 2002). Physical manifestations of knowledge intensiveness has also been observed in firms, through increased decentralization and flatter organizational structures(Grey and Sturdy,

The acquisition of technological capabilities from external sources, as well as how these capabilities are then used effectively in the firm are two trends which are becoming increasingly important for the management of knowledge technology in the firm. Powell (1998, p229), focuses on a firm’s capability for learning both “how and when organizations are able to combine their existing competencies with the abilities of others.” Knowledge management is the concept of identifying, and assess the capabilities of a company, to decide what needs to be sourced externally, which in turn creates this competitive advantage for the firm (Gupta et al., 2000).

Knowledge management can be considered to be an essential strategic function in any organisation today. As the world becomes more globalised, and traditional structures of intermediation are removed whilst new ones are created, it is clear that knowledge, and consequently a learning organisation is one that is more likely to find unique sources of competitive advantage, and be able to develop sustainable competitive strategies in the long term. A number of different processes and sub-processes have been identified with knowledge management, such as knowledge generation, knowledge codification, and knowledge transfer or

When it comes to disadvantages of inter-firms chains for knowledge transfer, the poor management can be a reason of productivity reduction through the irrational knowledge interflows beyond organization (Teece, 1998 cited in Huggins, 2010:340).

Now intangible assets such as knowledge rather than tangible financial assets are a measure of a company’s value. Knowledge is the one of the important resource that increases the value of organizations and gives them an edge over competitors. Therefore various attempts to measure organizational performance in knowledge management have been conducted accordingly.

In a knowledge-based economy, horizontal and vertical transfer of knowledge can be said to be a common feature. This may be attributed to the recent spate of mergers and acquisitions, a highly mobile workforce, and the increased interdependency between firms and industries. It might thus be timely for future research to focus on the impact of innovation in such a climate, vastly different from that in the 1980s.

In an organization of any size or complexity, employees ' responsibilities typically are defined by what they do, who they report to, and for managers, who reports to them. Over time these definitions are assigned to positions in the organization rather than to specific individuals. The relationships among these positions are illustrated graphically in an organizational chart (see Figures 1a and 1b). The best organizational structure for any organization depends on many factors including the work it does; its size in terms of employees, revenue, and the geographic dispersion of its facilities; and the range of its businesses (the degree to which it is diversified across markets).

Innovation is inter related to competitiveness and productivity. Although some may equate the three but they are quite distinguished factors on their own.

Abstract: It is well known that knowledge economy is mainly based on intellectual capital. Intellectual capital plays a key role in enterprise’s value promotion. In fact, the good intellectual capital control system can bring the positive influence to the enterprise achievements. It is important to make empirical research on the relationship between intellectual capital and company performance to create value and enhance the enterprise achievements.

KS amongst employees in organizations are widely recognized as an important aspect for its potential towards developing the performance of the organizations and its competitive advantages . Therefore, the study of KS is dominated by those focusing on KS activity within the business organizations. Obviously, the ultimate goal of organizational knowledge sharing in these institutions is profit-motivated. However, the issue of KS is equally important for a knowledge -based institution, such as a university, where knowledge production, distribution and

Belderbos, R., Faems, D., Leten, B. and Looy, B. V. (2010) “Technological Activities and Their Impact on the Financial Performance of the Firm: Exploitation and Exploration within and between Firms”, Journal of Product Innovation Management, vol. 27, no. 6, pp. 869–882.

Many organizations in the public sectors now understand the significance of knowledge management in optimizing their operations. This realization comes from the fact that organizations have to rely on people’s ability (mental and physical) and technology in establishing itself for a new economy. Organizations in the public sector are knowledge-intensive organizations and poor knowledge management practices eventually leads to high operational cost, as a result of lost institutional knowledge, knowledge gaps and poor decision making. (Luen and Al-Hawamdeh, 2001).