Question

Q48

Explain how knowledge management systems can help a business gain strategic-advantages. [2 Marks]

PLEASE DO NOT WRITE THE ANSWER - USE WORD FORMAT.

Answer 1

Knowledge management and it’s benefits-

Knowledge management is process which through organizations deals with generates a wealth of knowledge and their intellectual capital. Often, creation of value requires the sharing of knowledge between employee, organizational units, or other organizations; successful managers is always used from available intellectual property in their organizations and have found it. KM is a process that supports organizations to identify, select, organize, disseminate, and transfer important information/knowledge so as to develop and exploit their knowledge-based resources, thus permitting them to be proactive and flexible to market dynamism.

Knowledge management helps solve most of the common business problems and helps companies increase their benefits by:

1. Improving business decisions thanks to facilitated access to expertise and to leading practices

2. Increasing efficiency, productivity and work smarter by reducing cases of “reinventing the wheel”

3. Improving innovation through wider and borderless collaboration

4. Reducing loss of know-how by capturing explicit and tacit knowledge

5. Speeding productivity with on-board trainings and timely access to knowledge

6. Increasing client satisfaction by delivering value insights

7. Enhancing quality and ability to collaborate by standardising ways of working and enabling discussions with leading experts

Competitive advantage is at the core of a firm’s performance in today’s challenging and rapidly changing environment. To secure the competitive advantage, firms should be able to continuously acquire, create and disseminate knowledge across various levels of the organization. Knowledge is central to strategy formulation and Implementation, KM has become a key strategic task facing managers for achieving success in today’s complex and dynamic environments. The shifting winds of change in today’s business environment, where the Market place is increasingly competitive and the rate of innovation is rising, have made Enterprises realize that knowledge is their key asset. It is pointed out that the most valuable assets of the 21st century enterprise is its knowledge and knowledge workers. It is argued that knowledge is displacing natural resources, capital and labor as the basic Economic resource in the new economy. Knowledge mostly the tacit knowledge is hard to imitate so effectively managing such type of knowledge in an organization is definitely going to lead the organization to a place which for others will be difficult to achieve. KM helps us in identifying unaccomplished goals and by having a proactive approach to address such issues is going to place an organization above all in the turbulent competitive business environment. So, every Organization should start thinking of a sound KM strategy, because in a knowledge-driven economy it’s the only source of achieving success over others.

Knowledge management for strategic business advantage-

1. KM can increase productivity of an organization by applying effective organizational KM as it will facilitate those with the desired knowledge to apply or rapidly share it, hence can reduce traditional uneconomical method of meetings and increase productivity employees and create a value advantage.

2. KM can used in an organization for knowledge creation, refining and dissemination within an organization which eventually results in more and better knowledge than the competitors, hence delivers competitive advantage.

3. Rewarding the employees who create new knowledge and/or share knowledge within the organization can ensure that all employees are trying to share their valuable knowledge.

4. It’s the KM tools that help the organization in identifying the unaccomplished goals. Having a proactive approach to deal with such situations is ultimately going to deliver an organization a competitive advantage.

5. KM also allows in identifying the niche markets and the requirements of those niche markets is going to prove one of the key attributes of organizational success.