A PROJECT REPORT IN

MANAGEMENT INFORMATION SYSTEM

PROJECT TITLE: “STUDY & ANALYSIS OF USE OF

KNOWLEDGE MANAGEMENT SYSTEM IN BUSINESS.”

Submitted On: 22TH OCTOBER 2012

UNDER THE AEGIS OF

Submitted To: Submitted By:

Mrs. Roma Chauhan Dilip KumarPGDFS - 2011-13

Roll No. : FT-(FS)-11-319

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CONTENTS

Sr.

No.

Particulars Page No.

1. Knowledge Management 3

2. Knowledge As An Assets 4

3. Explicit and Tactic Knowledge 5

4. What Is Knowledge Management Related To 5

5. History Of Knowledge Management 6

6. Values Of Knowledge Management 7

7. Knowledge Managements Drivers & Objectives 8

8. Present & Future State Of KM 11

9. Effect of Knowledge Management On Databases 12

10. A Model Of Strategic Knowledge Management 13

11. Phases Of Knowledge Management 15

12. Five P’s Of Strategic Knowledge Management 18

13. Knowledge Management System Components 20

14. Technology Supported By KMS 22

15. The Implication Of Knowledge Management 24

16. Bibliography 25

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PROJECT TITLE: “Study & Analysis Of Use Of Knowledge

Management System In Business.”

Knowledge is the process of translating the information (such as

data) & past experience into a meaningful set of relationship which are

understood and applied by an individual. As the values of employees and

organizational data have become more crucial to organization’s outcomes

and competitiveness, the concept of knowledge management has emerged.

Knowledge Management (KM): Knowledge Management is

the process of identifying, capturing, organizing and disseminating the

intellectual assets that are critical to the long term performances of the

organizations. It comprises a range of strategies & practices used in an

organization to identify, create, distribute & enable adoption of insights &

experiences. Such insights & experiences comprises knowledge either

embodied in individuals or embedded in organizations as processes or

practices.

Knowledge Management efforts typically focus on organizational

objectives such as improved performances, competitive advantages,

innovation, the sharing of lessons learned, integration & continuous

improvements of the organizations. Knowledge management efforts overlap

with organizational learning, and may be distinguished from that by a

greater focus on the management of knowledge as a strategic assets & a

focus on encouraging the sharing of knowledge .

Many large companies & non-profit organizations have resources

dedicated to the internal KM efforts, often as a part of their business

strategies, information technology, or HRM (Human Resources Management)

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departments. Several consulting companies also exist that provide strategies

and advice regarding KM to these organizations.

Business operations, changing organizational structures, new

workplace characteristics and the increasing globalization of the working

world have all encouraged a growing focus on the Knowledge Management.

Business have responded in a number of the way as their internal & external

environments became more dynamic, unpredictable and complex.

Knowledge Management may be viewed in terms of:

People – how do you increase the ability of an individual in the

organization to influence others with their knowledge

Processes – Its approach varies from organization to

organization. There is no limit on the number of processes

Technology – It needs to be chosen only after all the

requirements of a knowledge management initiative have been

established.

Or

Culture – The biggest enabler of successful knowledge-driven

organizations is the establishment of a knowledge-focused

culture

Structure – The business processes and organizational

structures that facilitate knowledge sharing

Technology – A crucial enabler rather than the solution.

Knowledge As An Assets: Each person possesses a unique set

of knowledge, drawn from experiences and sources encountered over the

years. Knowledge is generated as the various information sources are tested

and combined with past experience & learning. Thus knowledge is creative,

dynamic and adaptable. People possess various forms of knowledge. Some

of this is robust & well established, based on the firm principles which have

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been tested over the time and found to be true, and other knowledge may

be dynamic, constantly shaped by new experiences & insights.

Errors & misjudgments can be important sources of learning as people

evaluate the effectiveness of the initial & ongoing decisions on the final

performances or outcomes. Thus, knowledge is developed through the

adaptations and interpretations of information, past expertise, experiences,

errors and other influences. It draws on the individual’s personal construction

of reality and constantly reshaped and consolidated through the further

exposure & experiences.

Explicit and Tactic Knowledge: Explicit Knowledge is knowledge

that can be shared with others – it can be documented, categorized,

transmitted to others as information, & illustrated to others through

demonstrations, explanations and other forms of sharing. It is a key

organizational resources which is increasingly important as the nature of the

work evolves towards a knowledge focus. Tactic Knowledge is the

knowledge which draws on the accumulated experience and learning of a

person and which is hard to reproduce or share with others. Although tactic

knowledge is hard to document, categorize and share, organization depend

on it to ensure good quality choices and judgments.

What Is Knowledge Management Related To?

Knowledge management draws from a wide range of disciplines and

technologies:

Cognitive science

Expert systems, artificial intelligence and knowledge base

management systems (KBMS)

Computer-supported collaborative work (groupware)

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Library and information science

Technical writing

Document management

Decision support systems

Semantic networks

Relational and object databases

Simulation

Organizational science

Object-oriented information modeling

Electronic publishing technology, hypertext, and the World Wide

Web; help-desk technology

Full-text search and retrieval

Performance support systems

The History of Knowledge Management :

1. 70's,: A number of management theorists have contributed to the

evolution of knowledge management.

Peter Drucker: information and knowledge as organizational

resources.

Peter Senge: "learning organization".

Leonard-Barton: well-known case study of "Chaparral Steel ", a

company having knowledge management strategy.

2. 80's,

Knowledge (and its expression in professional competence) as a

competitive asset was apparent.

Managing knowledge that relied on work done in artificial

intelligence and expert systems.

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Knowledge management-related articles began appearing in

journals and books

3. 90's until now,

A number of management consulting firms had begun in-

house knowledge management programs.

Knowledge management was introduced in the popular press,

the most widely read work to date is Ikujiro Nonaka’s and

Hirotaka Takeuchi’s The Knowledge-Creating Company: How

Japanese Companies Create the Dynamics of Innovation

(1995).

The International Knowledge Management Network (IKMN)

went online in 1994.

Knowledge management has become big business for such

major international consulting firms as Ernst & Young, Arthur

Andersen, and Booz-Allen & Hamilton.

The Value of Knowledge Management

Some benefits of KM correlate directly to bottom-line savings, while

others are more difficult to quantify. In today's information-driven economy,

companies uncover the most opportunities — and ultimately derive the most

value — from intellectual rather than physical assets. To get the most value

from a company's intellectual assets, KM practitioners maintain that

knowledge must be shared and serve as the foundation for collaboration. Yet

better collaboration is not an end in itself; without an overarching business

context, KM is meaningless at best and harmful at worst. Consequently, an

effective KM program should help a company do one or more of the

following:

Foster innovation by encouraging the free flow of ideas.

Improve decision making.

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Improve customer service by streamlining response time.

Boost revenues by getting products and services to market faster.

Enhance employee retention rates by recognizing the value of

employees' knowledge and rewarding them for it.

Streamline operations and reduce costs by eliminating redundant or

unnecessary processes.

These are the most prevalent examples. A creative approach to KM can

result in improved efficiency, higher productivity and increased revenues in

practically any business function.

Knowledge Management Today

According to a recent IDC report, knowledge management is in a state

of high growth, especially among the business and legal services industries.

As the performance metrics of early adopters are documenting the

substantial benefits of knowledge management, more organizations are

recognizing the value of leveraging organizational knowledge. As a result,

knowledge management consulting services and technologies are in high

demand, and knowledge management software is rapidly evolving.

Knowledge Management Drivers

The main drivers behind knowledge management efforts are:

Knowledge Attrition: Despite the economic slowdown, voluntary

employee turnover remains high. A recent survey by the global

consulting firm Drake Beam Morin revealed an average voluntary

employee turnover rate of 20 percent with 81 percent of

organizations citing employee turnover as a critical issue. An

estimated annual cost of employee turnover was a staggering $129

million per organization. Much of this cost is due to knowledge

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attrition, which can be effectively minimized using knowledge

management techniques.

Knowledge Merging: Since 1980, the annual value of mergers has

risen 100 fold reaching a cumulative $15 trillion in 1999. Over

32,000 deals were announced, triple the number of 10 years earlier

and more than 30 times as many as in 1981. The recent frenzy of

corporate mergers coupled with the increased need to integrate

global corporate communications requires the merging of disparate

and often conflicting knowledge models.

Content Management: The explosion of digitally stored business-

critical data is widely documented. Forester Research estimates

that online storage for Global 2,500 companies will grow from an

average of 15,000 gigabytes per company in 1999 to 153,000

gigabytes by 2003, representing a compound annual growth rate of

78%. As the volume of digital information expands, the need for its

logical organization is critical for purposes of information retrieval,

sharing and reuse.

E-Learning: As the economy becomes more global and the use of

PCs more pervasive, there has been a dramatic increase in e-

learning, also known as computer based training. E-learning is

closely linked to and overlapping with, but not equal to knowledge

management. E-learning can be an effective medium for

knowledge management deliverables.

Knowledge Management Objectives : The graph below

shows the results of a recent IDC study in which corporations cited various

objectives for knowledge management efforts:

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Activities related to these objectives include: creating knowledge

sharing networks that facilitate a corporate knowledge culture, developing

knowledge leaders, optimizing intellectual capital by producing knowledge

management solutions such as codification strategies and knowledge bases,

and estimating revenue and efficiency gains resulting from knowledge

management in terms of return on investment (ROI).

Knowledge Management Return Of Investment:

Although 65% of organizations that are currently implementing KM

initiatives have not measured the impact of their performance, large revenue

gains and efficiency improvements have been recorded by numerous major

corporations. For instance: Ford Motor Company accelerated its concept-to-

production time from 36 months to 24 months. The flow on value of this has

been estimated at US $1.25 billion, The Dow Chemical Company saved $40

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million a year in the re-use of patents, Chase Manhattan, one of the largest

banks in the US, used Customer relationship management KM initiatives to

increase its annual revenue by 15%, and Pfizer credits KM practices for

discovering the hidden benefits of the Viagra drug.

Present and Future State of KM

Currently, communities of practice such as the Knowledge

Management Network and the development of standards and best practices

are in a mature stage of development. KM curricula such as certification,

corporate training and university graduate certificate programs are on the

rise. Techniques such as data mining and text mining that use KM for

competitive intelligence and innovation are in the early stages of

development. Finally, organizations are investing heavily in ad hoc KM

software that facilitates organizational knowledge. The chart below

estimates the state of their current and future KM activities.

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The Future of Knowledge Management

In the next several years ad-hoc software will develop into

comprehensive, knowledge aware enterprise management systems. KM and

E-learning will converge into knowledge collaboration portals that will

efficiently transfer knowledge in an interdisciplinary and cross functional

environment. Information systems will evolve into artificial intelligence

systems that use intelligent agents to customize and filter relevant

information. New methods and tools will be developed for KM driven E-

intelligence and innovation.

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The Effect of Knowledge Management on Databases

Multiple corporate databases will merge into large, integrated,

multidimensional knowledge bases that are designed to support competitive

intelligence and organizational memory. These centralized knowledge

repositories will optimize information collection, organization, and retrieval.

They will offer knowledge enriching features that support the seamless

interoperability and flow of information and knowledge. These features may

include: the incorporation of video and audio clips, links to external

authoritative sources, content qualifiers in the form of source or reference

metadata, and annotation capabilities to capture tacit knowledge. Content

will be in the form of small reusable learning objects and associated

metadata that provides contextual information to assist KM reasoning and

delivery systems.

A Model Of Strategic Knowledge Management

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Strategic Knowledge Management Model consist of following phases :

1. Knowledge Influences : Strategic knowledge management

explores the key principles & methods by which knowledge

management may be linked to major strategic direction of the

organizations. The knowledge leader outlines some of the

issues relating to knowledge leadership & its enhancement in the

knowledge-intensive communities. Developing & sustaining a

knowledge culture examines some of the facets of knowledge

culture & then explores challenges associated with building a

knowledge culture, particularly where this requires significant

changes to the existing values & attitude.

2. Knowledge Foundations : Effective knowledge management

relies on strong systems, structural processes & well aligned

policies & practices. Supporting Knowledge Management

through human resources management practices examines

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Knowledge Influences

Organizational ContextStrategic KnowledgeKnowledge LeadershipKnowledge Culture

Knowledge Foundations

Human Resource ManagementKnowledge System

Knowledge Applications

Core KnowledgeKnowledge RepositoriesKnowledge ServiceLearning & Development

Knowledge Enhancement &

Review

Knowledge EvaluationsKnowledge SustainabilityIssues & Researches

the concepts of a knowledge architecture, exploring how

supportive knowledge qualities & values can be nurtured through

human resource practices. Supporting Knowledge

Management through technology identifies the system &

technologies which enables effective knowledge management.

3. Knowledge Applications : Knowledge Applications focus on

various elements related to cultivating a strong & strategic

knowledge focus in the organization, & in each individual

employee. Developing core knowledge framework &

developing and managing knowledge repositories describes

the ways strategic knowledge can be identified, shared,

protected & managed. Developing an effective knowledge

service explores the ways the knowledge users may be

encouraged to integrate knowledge into core work practices & to

seek new & improved strategies through a range of supportive

services & agencies. Learning & Development in a knowledge

setting complete the review of the ways knowledge workers can

be supported in a knowledge intensive community which needs

people to learn & continually build new expertise &

competencies.

4. Knowledge Enhancement & Review : Evaluating the

effectiveness of the knowledge strategy outlines some of the

ways knowledge management can be evaluated & reviewed.

Sustainable knowledge management shifts the focus to

examine some of the issues which needs to be considered in

different context. An overall view of strategic knowledge

management provides a comprehensive & integrated view of the

factors which influences the effective knowledge management.

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Phases Of Knowledge Management :

There are five Phases of knowledge development :

1. Knowledge Sourcing : The identification of a knowledge gap

between what is known & what needs to be known is often the

stimulus for starting the Knowledge creation process. In response

to the identification of a knowledge gap, the organization

commonly reviews existing sources of guidance held by

individuals or other organizational resources. This process of

drawing together as many informed knowledge source as

possible is called Knowledge Sourcing. It is an important stages

of knowledge creation.

2. Knowledge Abstraction : After analyzing the knowledge

sources, general principles and concepts are generated to guide

the construction of knowledge. This process is called

Knowledge Abstraction. It helps to frame the insights gained

from knowledge sourcing and to extrapolate new knowledge

from the basic guidelines & issues that have emerged. Where the

knowledge seekers are highly expert, they will rely heavily on

their own knowledge, with other sources simply validating or

enriching that knowledge. Less experienced seekers will rely

more heavily on external sources.

3. Knowledge Conversion: From abstract foundations, knowledge

converts into various forms of useful applications that can be

tested & shared with others. Knowledge conversion describes

the phases during which the various ideas & principles are

refined into

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specific outcome. Knowledge can be either codified or embodied.

Codified knowledge is knowledge that can be recorded &

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Rich & Accurate Foundation for ongoing knowledge Formation

Knowledge Sourcing

Principles, Theories & Concepts to guide Ongoing Knowledge Development

Knowledge Abstraction

Abstracts Concepts which are converted into applications & outcomes

Knowledge Conversion

Shared understanding and adoption of knowledge gained

Knowledge Diffusion

Adaptable & Flexible knowledge which accomodates changing context

Knowledge Development & Refinement

Phases: Creates:

accessed by other as required. It can be developed into

artefacts, such as models, equations & guidelines. Embodied

Knowledge is the tactic knowledge of individuals. It can be

shared through stories, metaphors or personal advice as

required. Embodied knowledge is more difficult to access without

ongoing engagement with the knowledge creators.

4. Knowledge Diffusion : Knowledge Diffusion is the spread of

knowledge of once it is codified or embodied. In organizational

settings, diffusion can occur through communication media (e.g.

the internet, news-letters, meetings, seminars or videos),

modeling of news practices, and demonstrations or coaching in

specialized procedures. The success of knowledge diffusion

depends on the level of previous knowledge held by the

audience & the effectiveness of the channels available to share

the knowledge. Diffusion occurs best when the recipients can

understand & integrate the insight into their own mental

constructs. Embodied knowledge, which draws on significant

expertise, learning & experience, may be harder to transfer to

others.

5. Knowledge Development & Refinement : Knowledge is

regularly reshaped & further tested through additional

experience and feedback. This evolutionary process of

knowledge development & refinement is one of the key

features of knowledge management, ensuring the knowledge

remains current and useful. However, this also places more

challenges on organizations that seek to capture & hold

knowledge for use by others; such organizations need to ensure

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that the created knowledge is constantly reviewed & updated to

reflect any new understanding that has been acquired.

The Five P’s Of Strategic Knowledge Management :

Knowledge management is a complex process of social change & systematic

development. It relies on the alignment of five key systems to achieve full

integration into organizational setting. These are called Five P’s of

Strategic Knowledge Management. They are:

1. Planning: Strategic Knowledge Management requires

comprehensive planning. Planning should clarify the knowledge

goals & establish effective values & processes to support those

direction. Long & short terms goals need to be clearly defined.

Planning for technological infrastructure should also reflects

knowledge management goals so that plans can be effectively

implemented. Planning process takes time and perseverance,

requiring careful consideration of the whole knowledge context.

They also need ongoing monitoring & measurement to ensure

the planned strategies were successfully implemented. Equally

important is the recognition that strategic knowledge

management requires progressive review & replanning to take

into account the changing environment.

2. People : Strategic Knowledge Management is the recognition

that strategic knowledge relies on people. People have the

knowledge. They manage the systems & processes. Their

commitment to the Strategic Knowledge is important to its

overall success. They need to convinced that Strategic

Knowledge is a valuable strategic initiative. A sharing culture

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which encourages knowledge diffusion can be developed through

effective knowledge hubs, networks, CoPs & other social

community strategies. Participants need to be convinced that

there are social, economic & logistics benefits from their

knowledge participants. This implies that the knowledge

message will be strongly supported by human resource

processes & philosophies, & by the leadership provided at all

levels of the organizations.

3. Process : Knowledge Management principles need to be put into

practices via effective workplace practices. The alignment of

strategy, principles, processes & practices needs to be carefully

managed to ensure that Knowledge Management principles

donot fracture when implemented. It need to be recognized that

messages about what is important may be perceived differently

across the organizations. If there is little tangible commitment to

the knowledge principles, they will ignore the public messages in

favor of the local reality. Thus, the actual process need to be

monitored regularly to ensure it reflects knowledge priorities. If

not, it is important to recognize that the overall knowledge

philosophy is contradicted by the social context in which the

knowledge operates.

4. Products : Each organization builds its own knowledge output or

products. These mar be provided to clients, or exist as internally

shared knowledge objects. A focus on core knowledge helps to

identify the range of knowledge products which should be

cultivated, encouraging their definition, capture, management

and distribution. Sources of embodied knowledge may need to

be identified to encourage their access by others. Explicit

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knowledge should be captured & distributed in an efficient &

timely manner, so that it is readily accessible by users.

5. Performance : Knowledge Management needs to be regularly

reviewed to ensure that the financial & social investment is

positively influencing the intellectual and social capital of the

organization. Any organization must ensure its balance long &

short term priorities to enable effective financial management &

development for future. Most companies continually battled to

find the best solution for achieving efficient and cost effective

but innovative approaches to their business challenges.

Knowledge Management System Components :

A range of technologies support knowledge management in four broad

areas of activities :

1. Business Process Management : Business Process Management

describes the process that are required to support the business

practices of the organization. Various systems operates in the firm

to ensure effective business integration is achieved. Some typical

systems are those relating to finances, human resources

management & decision making. Ideally, these should be linked to

the knowledge management practices, so that members of the

firms have access to accurate & current information on which to

build their knowledge.

2. Content Management : Content Management relates to the

intellectual context of the KMS. This ensures that users can

efficiently retrieve knowledge on particular topic or theme. Content

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Management provides a range of strategies for indexing, organizing

& storing the resources that are linked to the KMS.

3. Web Content Management : Web Content Management focuses

on the building an effective web sites framework through which

users may access the KMS. It ensures the KMS architecture is

appropriate to achieve a logical & accessible management of

context & links. A particularly important element of this aspect of

knowledge system development is the construction of the client

interface, that is the communication channel through which users

interact with the knowledge system.

4. Knowledge Applications Management : Knowledge Applications

Management ensures users are provided with the application

packages & specialist tools for creating & using their knowledge.

Applications are software which helps the user with creating

knowledge. For example word processing & emails are applications.

These products also helps with workflow management, that is, the

management of various activities which contribute to a final

product. Increasingly, these are interdependent activities which

involve a number of people. Project management relies strongly on

workflow management.

The table below shows an overview of the ways these four systems

contribute to the KMS.

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Purpose Technical Components

Typical Activities

Business Process

Management

Enables access to business knowledge within the organization.Links system to corporate policy on knowledge access & priorities

Organizational processes Organizational recordsContributor knowledgeRelated knowledge system policies, access, procedures.

Decision makingCorporate CommunicationDiscussion Boards

Content Management

Ensures valued knowledge sources are indexed, retrievable, logically arranged & securely protected.

MetadataIndexesQuality Control

Knowledge repositoriesDocument managementLibraries

Web Content Management

Provides an accessible & secure platform on which the KMS can operate.Ensures knowledge users are protected & helped while accessing knowledge sources.

Server ManagementFile sharingPortal developmentBrowser ManagementUser IdentificationSecurity system upgrades

PortalsBrowsersHuman-Computer InterfaceSystem IntegrationUser Systems

Knowledge Application

Management

Helps users with knowledge creation & workflow Management,Provides access to specialized tools & services as required

Desktop PackagesSpecialized tools

Workflow ManagementProject ManagementDocument ManagementCommunication Process

Technology Supported By Knowledge Management

Systems :

The following diagram reflects the main technologies that currently

support knowledge management systems.

These technologies roughly correlate to four main stages of the KM life cycle:

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1. Knowledge is acquired or captured using intranets, extranets,

groupware, web conferencing, and document management

systems.

2. An organizational memory is formed by refining, organizing, and

storing knowledge using structured repositories such as data

warehouses.

3. Knowledge is distributed through education, training programs,

automated knowledge based systems, expert networks.

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4. Knowledge is Applied or leveraged for further learning and

innovation via mining of the organizational memory and the

application of expert systems such as decision support systems.

All of these stages are enhanced by effective workflow and project

management.

The Implications of Knowledge Management : The

Implications of Knowledge Management For...

Database Users: From business class users to the general public,

database users will enjoy a new level of interaction with the KM system

including just-in-time knowledge that delivers precise relevant

information on demand and in context. More complex, smart systems

will translate to optimal usability and less time spent searching for

relevant information. For example, data analysts will enjoy simplified

access and more powerful tools for data exploitation. The use of

knowledge bases can reduce customer service costs by providing

customers with easy access to 24/7 self service via smart systems that

reduce the need to contact customer service or technical support staff.

Database users may even create customized views of knowledge

bases that support their needs.

Database Developers: The design and development of knowledge

based systems will be considerably more complex than current

database development methods. Developers must consider the overall

technical architecture of the corporation to ensure seamless

interoperability. The use of standardized metadata and methods will

also facilitate both intra-corporate and inter-corporate interoperability.

Making effective physical storage and platform choices will be equally

more complex. Both knowledge base developers and administrators

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must understand the role of the knowledge base in the overall KM

system.

Database Administrators: Database Administrators will evolve into

Knowledge Managers. The knowledge base will store and maintain

corporate memory and Knowledge Managers will become the

gatekeepers of corporate knowledge. The lines between technical

roles such as Web Developer, Data Analyst or Systems Administrator

will blur as these systems merge into and overlap with KM systems.

DBAs will need to have some knowledge about each of these

disciplines.

General Public: Even if they are not interacting directly with a

knowledge base, the general public will benefit from the secondary

effects of improved customer service due to faster access to more

accurate information by service providers.

Bibliography :

Management Information System By James A O’Brien, Ramesh Bhel, &

George M Marakas

https://www.google.co.in/

http://en.wikipedia.org/wiki/KMS

Knowledge Management By Shelda Debowski

http://www.cioinsight.com

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