A Overview Of Knowledge Management Commerce Essay Example

management (KM) should be approached both tactically and strategically. Tactically, it helps in understanding market demands and opportunities, while strategically, it helps in achieving long-term goals in the macro environment (Prusak, 2001).

KM Process

The organization should learn to share knowledge and be innovative to remain competitive in the market. They should also prioritize transparency and organization. Knowledge management not only affects explicit and tacit knowledge, but also has an impact on innovation and various aspects of an organization.

The above text highlights the significance of Knowledge Management (KM) as a valuable asset for a learning organization. It emphasizes the importance of an organization learning from both its successes and failures in order to facilitate growth. In order to effectively implement KM, it is essential for an organization to measure and maintain best practices, as well as develop a policy to adhere to. The key reasons why KM is deemed necessary include the management of implicit and explicit knowledge, preservation of an organization's intellectual heritage, the need for innovation and creativity in order to thrive in the current economic climate, and the measurement of intangible and tangible benefits. According to the OECD (2004), the process of learning is continuous.

It is important for organizations to learn from both their successes and failures. Changes in time often trigger the recollection of these success stories or failures, highlighting the repetitive mistakes that occur within an organization. For example, the Challenger and Columbia crashes were a result of persistent errors by engineers and management at NASA, as well as a disregard for continuous learning. Therefore, it is crucial for organizations to document and develop an approach for managing the information and knowledge

gained at each stage, in order to facilitate future growth.

(Boisot, 1998)

Difference between IM and KM

According to Saint Onge (2002), information agencies information and cognition means the truth (absolute). Butcher and Rowley (1998) define Information Management as the formation, planning policy, maintenance & development of integrated systems & services, optimizing the flow of information and undertaking engineering for consumer demands. Davenport et al. (2000) state that Information Management can be used to make decisions, automate processes and retrieve encoded information. According to Terra and Angeloni (2003), KM is more focused on the human perspective as individuals can transfer their own knowledge into books and journals. IM is solely about information and its handling, while KM involves the processes of acquisition, validation, encoding, and sharing knowledge on a broader level.

Information, also known as expressed cognition, is easily handled but lacks understanding. Knowledge, on the other hand, can be converted into documented information and presented in the form of documents. However, according to Krogh et al (2000), effectively managing knowledge is crucial.

Cognition, as a justified true belief, can be influenced by managerial actions and decisions, impacting an individual's creative thinking. Knowledge management (KM) is commonly employed to support the human perspective.

Advantages of incorporating Information Management (IM) and KM in an enterprise

Many organizations incorporate IM and KM into their processes as essential components to achieve excellence and meet strategic needs. Managing information within an organization helps provide data for decision-making, adds value to alliances, enhances business communications, fosters good customer relations, improves return on investment (ROI), promotes knowledge sharing and facilitates the development of innovative products through supportive business processes

(Synaptica, 2008). It is crucial for every organization to have an effective learning process for effective market leadership. Prusak (2001) explains that various knowledge management practices have been implemented by organizations such as McKinsey, HP, General Motors and IBM through the creation of human networking platforms for information sharing and the transfer of tacit knowledge.

The process of transferring encoded knowledge from an individual to a group of people is known as Knowledge transportation, specifically in the IT industry. It is a quality process that aims to maintain transparency and improve employee efficiency. KM is a crucial procedure in the consulting industry, where managing statutory and personalized knowledge is essential. As mentioned earlier, knowledge is stored in a database and this encoded knowledge management approach is widely used in major IT companies like Accenture. On the other hand, McKinsey adopts a personalized approach to create strategic knowledge that offers solutions to current problems and challenges.

The right approach for knowledge management (KM) depends on the organization. The Knowledge Management Model describes four essential ways of KM - innovative, exploratory, stabilized, and reclaimable. These ways are crucial for organizational services. IT also plays a critical role in KM, with information storage, data mining, artificial intelligence, and knowledge creation systems being widely used IT applications. (Kim and Trimi, 2007)

Introduction to Business Intelligence (BI)

Business Intelligence is vital for effective decision making and strategic development in an organization. In today's globalized organization, it is necessary to meet customer expectations, economic downturns, technological advancements, and challenging competition.

This can be effectively achieved using Business Intelligence. The different processes in BI are explained below.

Fast and improved decision making

BI assists in

analyzing and making decisions that are typically based on experience, organizational procedures, and processes. It adds value to stakeholders and businesses with this strategic approach.

Converting data into knowledge

Data collected should be effectively transformed into information that is used for decision making. It has been observed that a gap exists between the collected data and the required information, which can be referred to as a knowledge gap.

In order to address the gap, organizations must employ IT tools such as information mining and information warehousing for analyzing business intelligence.

Intellectual approach to management

This approach should involve advanced strategies aimed at achieving the organization's long-term goals, by understanding business requirements, culture, and employees' input in decision-making. Data storage assists managers and executives in making better decisions using their corporate technologies. (Jarke et al.)

2000)

Introduction to Celltech

Celltech, established in 1980, initially focused on contract-based manufacturing and development, with limited investments in R & D. Despite having manufactured drugs for osteoporosis treatment, their stakeholders were not pleased. In 1990, under new management led by Dr. Peter Fellner as CEO, Celltech shifted its focus to therapeutics.

His new plan was to make Celltech successful by advancing and developing drugs for oncology, inflammation, and immune response. Instead of simply being proficient in creating various complex chemical compounds for contracts, they needed to analyze and improve their R&D skills. As a result, the company adopted a structured organizational approach with employees possessing diverse skill sets. This approach helped Celltech develop its business and economic system, eventually becoming one of the industry leaders in therapeutic development with a strong brand image

and reputation.

Challenges faced by Celltech

Celltech encountered difficulties in the form of contract disputes and financial hardship. The company was solely focused on developing drugs as part of contractual agreements. There was immense pressure on Celltech to recover invested capital. As a result of production delays and deviations from the original plan, the company's stock value dropped.

Dr. Fellner, who assumed the role of CEO at Celltech in 1990, aimed to improve the company's strategic and innovative efforts. Along with his interest in research and development (R&D), he chose to prioritize drug development as a means to generate substantial profits. This decision garnered widespread acceptance and support from the management.

Celltech's main focus was on reducing cash burn and satisfying stakeholders, leading them to develop a new strategic plan. This involved investing in research and development and creating new drugs that could be patented. To achieve this, they restructured the company and set short-term goals to minimize cash burn. They also worked on enhancing the skillset of their staff. The organization was divided into two divisions, one focusing on Biologics and the other on Therapeutics. Despite having technological expertise, it was primarily used for component blending and contract manufacturing.

Dr. Bloxman sought to transform Celltech into a more advanced development company, a necessary change in order to meet the demands of stakeholders for capital and increased market capitalization. The company began by developing products and medications for asthma, oncology, and anti-TNF treatments. Additionally, it is important to highlight the effective communication within the team, which was comprised of highly skilled individuals with diverse expertise.

The team was highly focused on their goal. They chose to prioritize drug manufacturing, and this

reorganization allowed them to assign specialized tasks. The hierarchical structure of Celltech was transformed into a flat structure as a result. As a result, scientists and researchers were able to collaborate in an interdisciplinary team.

The reorganisation was supported by the management, who also demonstrated their commitment to learning new skills and improving their knowledge in biology. This enabled them to develop new drugs for effective human use. The diverse management team brought different cultural backgrounds and skill sets, which contributed to their learning and exploration of their talents. In order to gain the confidence of shareholders and increase market share, Celltech collaborated with Bayer, a leading pharmaceutical company, to launch their anti-TNF product in the market. They also formed partnerships with other firms such as Merck, Zeneca, and Schering-Big Dipper to enhance their research and development capabilities, which provided a strong platform for Celltech's growth. The collaboration with Bayer not only brought success to Celltech but also helped them become financially stronger.

Celltech focused solely on drug development and financed their own production of drugs. They also developed a procedure for their proposal, known as the Product Development Proposal (PDP). This proposal outlined the lifecycle of the product to be developed, including various stages such as clinical data, trial runs, milestones, and endpoints. However, Celltech faced failure in CDP 571 - trial II and announced that they would not be able to proceed with any further developments. Despite this setback, it did not have an impact on their market capitalization compared to 1993.

Hence, Celltech successfully withdrew from Bayer without incurring any loss. Analyzing the effective certification of the contract, it is evident that Celltech was able

to end their agreement with Bayer without facing any legal complications. Therefore, it is crucial for every organization to learn from both their successes and failures and continuously update their knowledge in order to stay competitive and meet market demand. The rejuvenation of Celltech was achieved through the implementation of the following strategic concepts.

The initial one focused on reclamation, while the other revolved around researching theoretical models for financial growth. The successfulness of Celltech was attributed to its emphasis on level construction. It is evident that Celltech possessed information dynamics prior to 1990. Their main focus was contract drug manufacturing, involving the blending of components. This process required a substantial amount of information, which was codified, abstracted, and distributed through agents into the market (Namara and Fuller 1999). The information dynamics took the form of abstraction, where the manufacturing instructions for the drug were diffused into the product and passed on to the agents.

The captive information was transmitted again to develop the drug and improve it. Celltech learned from its success and failure, specifically with Bayer. Despite not meeting Bayer's expectations, the project was terminated as there was a clear contract which did not affect the financial aspect. After 1990, the knowledge dynamics are discussed in figure 5, which includes the social learning cycle (SLC) in product development. SLC is further explained in appendix 1. This demonstrates that Celltech implemented appropriate KM and IM policies, enabling them to become a strategic and continuous learning company.

Knowledge and Information Management Policy

Organizations are increasingly adapting to the dynamic and disruptive market tendencies by exploring their core capabilities in various business sectors. The utilization of Intellectual Capital (IC), which

refers to people's knowledge, has become a crucial factor for organizations. The main focus of the KM policy should be on effectively managing IC for the benefit of the organization. Implementing this policy is essential for successfully navigating information dynamics.

It is beneficial to analyze and create a process using the model and methods, such as the Earl's 7 schools of taxonomy (2001) and Jordan and Jones (1997), to explain the policy. The KM procedure is compared to Celltech. The researchers utilize external or internal methods to obtain knowledge. Internally, knowledge is shared, but if they need specific information for a particular problem, they must acquire it externally. Internally, knowledge is shared and accumulated for the future, as seen in the case of Socialization (Seci Ba).

The problem resolution can be divided into four sections: location, process, activity, and range. In terms of location, it can be tackled either individually or as part of a team. When working in a team, the problem can be resolved by collaborating with a group of people. On the other hand, an individual can use their expertise to address the problem on their own. The process of finding a solution can be approached either through trial and error or through lateral thinking. Lastly, the activity involved in resolving the problem depends on whether it is tackled by using abstract techniques or through experimentation.

Finally, range describes the focal point on the solution, which can be either incremental or drastic. This can be compared to the acquisition of a single or double cringle. Drastic changes would involve advanced thinking, whereas incremental changes would improve existing drug development criteria. Airing refers to the process

and extent of information sharing. Procedure defines how information is shared, and Celltech has shared it both formally and informally. The depth of knowledge explored focuses on learning the solution or problem.

Owning cognition is equivalent to owning ownership. When cognition is associated with an individual, it is considered as individuality. However, some may perceive cognition as a personal attribute. Nonetheless, the ability to share cognition relies on the rating systems within an organization. Organizations can motivate individuals who desire to share and improve their knowledge. Celltech possesses knowledge as rational assets, with specialized knowledge available among experts. Typically, knowledge is stored in memory.

The concept of knowledge can be categorized into two forms: explicit and codified, which can be stored in a database, or un-codified, which is stored in the encephalon. Earl (2001) developed a taxonomy of Knowledge Management (KM) to better understand the challenges in codification and diffusion. KM patterns originated in 1990 as a resource and later came to be known as Intellectual Capital (IC).

Research should be encouraged to use the appropriate KM model, and the Chief Knowledge Officer (CKO) can implement it. Celltech, a learning organization, would have used similar models to manage their intellectual capital (IC). Earl has explained seven taxonomies for effective KM, also known as 'Schools of KM', which are used to create effective KM strategies in organizations. Celltech would use Jordan and Jones' framework (1997) and Earl's taxonomy policies (2001) to create their own policy because they have a significant amount of intellectual capital. The business strategy can be linked with KM, and the KM process can be initiated when the organizational goal aligns with the value of

knowledge within the organization.

Celltech would face deficiencies in areas such as the driving factors, product development issues, and quality assurance. These gaps can be examined using various tools and models like SWOT analysis. Afterwards, they should identify ways to address these gaps by managing knowledge. The CFOs should comprehend the process and implement it to achieve a new business objective. The framework for knowledge management strategy is provided below:

1. Knowledge Business Vision
2. Business Performance Gap
3. How Could Knowledge
4. Make a Difference?
5. Alternate Knowledge
6. Management initiatives
7. Degree of Fit and Feasibility
8. Knowledge Management Plan

Once the organizational goal is achieved, the gap is then analyzed, and subsequently the acquired knowledge has to be assessed.

The organization should determine how cognition can assist with making a change. They should start by developing KM patterns, where both the strategy and the schools have a significant role. They should also decide which KM processes would best fit their needs. Proper models can help the organization solve their problems and improve the implementation of KM and IM policies. Celltech faced challenges in developing a policy, particularly regarding workforce and intellectual capital (IC).

Thus, the process of level construction has enabled them to transform significantly through creativity and advanced thinking. Models such as SWOT, Porter's five forces, McKinsey 7's, and Force field analysis can be utilized strategically to identify opportunities and factors contributing to

success. By effectively managing knowledge, they can handle policies and store knowledge and learned experiences for future use.

Decision

The Business Intelligence module has facilitated the understanding of knowledge management concepts. It has enhanced comprehension of Knowledge management and Information management. The module has also offered critical analysis of various models through interactive sessions with deliverables.

Additionally, it aided in making connections with Celltech and comprehending the case study effectively. By reading various journals and articles from Pursak and Davenport, the connection between business intelligence and policies was understood, which helped in gaining a solid understanding of KM concepts and the need for the organization to establish a KM policy. It was also recognized that a KM process is an effective and necessary one for any organization, specifically for a company like Celltech. Additionally, the concepts learned were correlated to determine the KM policy for Celltech.