Some Aspects of Knowledge Management
3.16 The rise of Knowledge Management
In trying to put knowledge workers into context, the management consultant and self-styled
115 Loveridge, 1997
116 Marchand, D; 2000
117 Jashapora, 2004
118 Drucker, P; 1999 50
“social ecologist”, the “father of modern management” Peter Drucker119, in his paper about managing knowledge workers, said that although the ancient pyramids were built by thousands of men and through intense physical labour, only a few individuals had the knowledge to build them – and these men managed the entire labour force. It was still true in the pre-industrial era and even long afterwards, that people had to perform hard physical labour for survival while owners and managers (the select few) “knew everything”.
During the Great Depression of the 1920s, people were forced to start looking at other means of survival and productivity. As Nonaka120 put it “In an economy where the only certainty is uncertainty, the one sure source of a lasting competitive advantage is knowledge.” The wheels have now turned and today we have more people doing what was considered to be the job of the select few, i.e. knowledge work.
Nowadays there is a need to manage these knowledge workers just as there a need to manage physical labourers121.
The rise of KM as a field of study was fuelled by the fact that it transcends old boundaries. In this century, ideas, information as well as knowledge are mostly still contained in documents or books in every discipline, as observed by Brown122, and this repository needs to be preserved and re-used. Much of the thinking on Knowledge is based on the writings of two philosophers, Gilbert Ryle and Michael Polanyi123.
Disciplines such as business strategy, business consulting, IT, psychology, sociology and many other disciplines have their thinking about KM informed and guided by Nonakas’ book, Knowledge Creating Firm. KM has been readily accepted in many institutions because of its focus on integrating technology, organisational design and processes. Part of the rapid rise is that is believed to offer some or all of the following benefits, as listed by Wiig124:
• more, easier access to knowledge and better understanding of relevant expertise
• the potential to help in the sharing and renewal of information
• improved use of IT
• greater customer understanding
119 Drucker; P; 1999 51
120 Nonaka, 1999
121 Drucker, P; 1999
122 Brown, 1999 xi
123 Jashapora, 2004 33
124 Wiig, K.M; 2000
• exceptional market image
• healthier profit margins
• increased viability of the firm, and
• Better community and employee relations.
The following global firms are also known to have adopted KM, which has boosted its general acceptance:
• KPMG; Hewlett-Packard; Microsoft
• IBM; BP; Xerox; 3M; Skandia, etc.
Numerous management theories have come and gone; according to Dietmar, 70% to 80% of all new concepts ultimately fail125. Despite this, most companies still invest large sums of money into implementing these concepts126, possibly as a result of their prior perceived success. Some of more common of these management concepts, to mention just a few, are:
• Total Quality Management and Business Process Re-engineering
• Shareholder Value Management
• Just in Time (JIT), and
• Learning Organisation.
Learning about these management concepts alongside KM is crucial as they will assist in determining if it’s the flaw in the concept/theory that fails or if it’s something else. Most importantly, researching about the risk/s of KM actions and interventions is crucial for a balanced academic contribution to the field of Knowledge Management in the South African Petro-chemical industry. These risks will be elaborated in detail as part of knowledge-risk factors below.
Prior to erecting a petrochemical plant, an environmental impact and risk assessment is conducted and the results may determine whether to build or not. With regard to KM however, it usually gets implemented long before any of the risks that this may pose to a business are investigated. Here business managers have a critical role in leading and managing knowledge managers and workers in order to add business value.
Tsoukas et al, in their paper entitled On organisational becoming127 frequently mention that
125 Dietmar, F; 2003
126 Dietmar, F; 2003
127 Tsoukas et al; 2002
studies about organisational change often put a lot of emphasis on the item of change itself – the state. They argue that a problem – as researchers usually call the state of change – is often not the real problem, but only a manifestation or symptom of the problem. They add that what really needs to be studied is the transition period between two points: the initial manifestation of the “problem” and its eventual resolution; only then can we gain valuable insights into some of the organisational problems.
The crux of the issue, they say, and the real problem that needs to be analysed is what contemporary philosophers refer to as the “root cause”. Tsoukas et al128 argue that what really exist is not things made, but things in the making. Once made, they are dead, and an infinite number of alternative conceptual decompositions can be used in defining them. This assertion resonates well with KM management and the importance of being aware of the risks associated with it prior to and during implementation.
Knowledge management however brings with it certain risk factors which may result in organisational problems. These factors are referred to as Knowledge-risk factors and they are elaborated on below. The risk exposure in most organisations is normally reported in monetary terms. This is probably due to the fact that investors put money in the company and they are interested in fair returns of that. What most companies, including Sasol, may not realise is that they could make more by paying a particular attention to some activities in their companies - with knowledge-risk as one of areas of concern. Knowledge-risk may have the potential knock-on effect which will subsequently erode the company’s returns over time.