Leading management and organization theorists have popularized the concept of treating organizational knowledge as a valuable strategic asset.1 They advise that to remain competitive, an organization must efficiently and effectively create, locate, capture, and share knowledge and expertise in order to apply that knowledge to solve problems and exploit opportunities. As more firms begin to incorporate knowledge management into their overall business strategy, many are showing tremendous interest in implementing knowledge management processes and technologies.
Although knowledge management is gaining wider acceptance, few organizations today are fully capable of developing and leveraging critical organizational knowledge to improve their performance.2 Many organizations are so complex that knowledge is fragmented, difficult to locate and share, and therefore redundant, inconsistent, or not used at all. In today’s environment of rapid change and technological discontinuity, even knowledge and expertise that can be shared often quickly becomes obsolete. However, while the popular press calls for effectively managing knowledge, almost no research has been done regarding how to do it.
This article focuses on how to configure a firm’s resources and capabilities to leverage its codified knowledge. I refer to this broadly as a knowledge management architecture. I based this framework on research that was motivated by several questions:
- What are the characteristics of explicitly codified knowledge and how should organizations think about managing it?
- What role should information technology play?
- How are organizational capabilities and information technology best integrated and applied to managing knowledge?
- What lessons have companies learned in these endeavors?
To address these questions, I first describe the characteristics of explicit knowledge and its relationship to competitive advantage. Building on research and knowledge about the design of information products,3 I describe an architecture for managing explicit knowledge. I use that framework to derive two fundamental and complementary approaches, each of which is illustrated by a case study. I conclude with a summary of key issues and the lessons learned.
What Is Knowledge?
Knowledge is commonly distinguished from data and information. Data represent observations or facts out of context that are, therefore, not directly meaningful. Information results from placing data within some meaningful context, often in the form of a message. Knowledge is that which we come to believe and value on the basis of the meaningfully organized accumulation of information (messages) through experience, communication, or inference.
1. For example, see:
J.S. Brown and P. Duguid, “Organizational Learning and Communities-of-Practice: Toward a Unified View of Working, Learning and Innovation,” Organization Science, volume 2, February 1991, pp. 40–57;
T. Davenport, S. Jarvenpaa, and M. Beers, “Improving Knowledge Work Processes,” Sloan Management Review, volume 37, Summer 1996, pp. 53–66;
P.F. Drucker, “The New Productivity Challenge,” Harvard Business Review, volume 69, November–December 1991, pp. 69–76;
B. Kogut and U. Zander, “Knowledge of the Firm, Combinative Capabilities, and the Replication of Technology, Organization Science, volume 3, August 1992, pp. 383–397;
I. Nonaka, “A Dynamic Theory of Organizational Knowledge Creation,” Organization Science, volume 5, February 1994, pp. 14–37;
J.B. Quinn, P. Anderson, and S. Finkelstein, “Managing Professional Intellect: Making the Most of the Best,” Harvard Business Review, volume 74, March 1996, pp. 71–82; and
S.G. Winter, “Knowledge and Competence as Strategic Assets,” in D.J. Teece, ed., The Competitive Challenge: Strategies for Industrial Innovation and Renewal (Cambridge, Massachusetts: Ballinger, 1987), pp. 159–184.
2. R.J. Heibeler, “Benchmarking Knowledge Management,” Strategy & Leadership, volume 24, March–April 1996, pp. 22–29; and
L.W. Payne, “Unlocking an Organization’s Ultimate Potential Through Knowledge Management,”Knowledge Management in Practice (American Productivity & Quality Center), volume 1, April–May 1996).
3. M.H. Meyer and M.H. Zack, “The Design of Information Products,” Sloan Management Review, volume 37, Spring 1996, pp. 43–59;
M.H. Zack, “Electronic Publishing: A Product Architecture Perspective,” Information & Management, volume 31, 1996, pp. 75–86; and
M.H. Zack and M.H. Meyer, “Product Architecture and Strategic Positioning in Information Products Firms,” in M.K. Ahuja, D.F. Galletta, and H.J. Watson, eds., Proceedings of the First Americas Conference on Information Systems (Pittsburgh: Association for Information Systems, August 1995), pp. 199–201.
4. D.G. Bobrow and A. Collins, eds., Representation and Understanding: Studies in Cognitive Science (New York: Academic Press, 1975);
J.S. Bruner, Beyond the Information Given, J.M. Anglin, ed. (New York: Norton, 1973);
C.W. Churchman, The Design of Inquiring Systems: Basic Concepts of Systems and Organization (New York: Basic Books, 1971);
F.I. Dretske, Knowledge and the Flow of Information (Cambridge, Massachusetts: MIT Press, 1981);
F. Matchlup, Knowledge: Its Creation, Distribution and Economic Significance. Volume 1: Knowledge and Knowledge Production (Princeton, New Jersey: Princeton University Press, 1980); and
D.M. MacKay, Information, Mechanism and Meaning (Cambridge, Massachusetts: MIT Press, 1969).
5. F. Blackler, “Knowledge, Knowledge Work and Organizations: An Overview and Interpretation,” Organization Studies, volume 16, number 6, 1995, pp. 1021–1046;
Kogut and Zander (1992); Dretske (1981); and J. Lave, Cognition in Practice (Cambridge, England: Cambridge University Press, 1988).
6. Brown and Duguid (1991);
J. Lave and E. Wenger, Situated Learning: Legitimate Peripheral Participation (Cambridge, England: Cambridge University Press, 1991);
Nonaka (1994); M. Polyani, The Tacit Dimension (Garden City, New York: Doubleday, 1966); and
P. Romer, “Beyond the Knowledge Worker,” World Link, January–February 1995, pp. 56–60.
7. J.R. Anderson, Cognitive Psychology and Its Implications (New York: Freeman, 1985); and
R.C. Schank, “The Structure of Episodes in Memory,” in D.G. Bobrow and A. Collins, eds., Representation and Understanding: Studies in Cognitive Science(New York: Academic Press, 1975), pp. 237–272.
8. H. Demsetz, “The Theory of the Firm Revisited,”Journal of Law, Economics and Organization, volume 4, Spring 1988, pp. 141–161; and
R.M. Grant, “Toward a Knowledge-Based Theory of the Firm,” Strategic Management Journal, volume 17, Winter 1996, pp. 109–122.
9. See, for example, Zack (1996).
10. This line of reasoning is addressed in: Demsetz (1988); R.M. Grant, “Prospering in Dynamically Competitive Environments: Organizational Capability as Knowledge Integration,” Organization Science, volume 7, number 4, July 1996, pp. 375–387;
Kogut and Zander (1992); and E.T. Penrose, The Theory of the Growth of the Firm New York: Wiley, 1959).
11. C. Argyris and D.A. Schon, Organizational Learning: A Theory of Action Perspective (Reading, Massachusetts: Addison-Wesley, 1978);
T.H. Davenport, R.G. Eccles, and L. Prusak, “Information Politics,” Sloan Management Review, volume 34, Fall 1992, pp. 53–65;
E.H. Schein, Organizational Culture and Leadership San Francisco: Jossey-Bass, 1992);
C.J.G. Gersick, “Habitual Routines in Task-Performing Groups,” Organizational Behavior and Human Decision Processes, volume 47, October 1990, pp. 65–97; and
R. Nelson and S. Winter, An Evolutionary Theory of Economic Change Cambridge, Massachusetts: Belknap, 1982).
12. R.E. Bohn, An Informal Note on Knowledge and How to Manage It Boston: Harvard Business School, 1986); and
J. Schember, “Mrs. Fields’ Secret Weapon,” Personnel Journal, volume 70, September 1991, pp. 56–58.
13. For an extended discussion of information product architectures, see:
Meyer and Zack (1996); and, for an extended discussion of the refinery aspect, see:
M.H. Zack, “An Information Infrastructure Model for Systems Planning,” Journal of Systems Management, volume 43, August 1992, pp. 16–19 and 38–40.
14. MacKay (1969).
15. Meyer and Zack (1996).
16. M.H. Zack, “Electronic Messaging and Communication Effectiveness in an Ongoing Work Group,” Information & Management, volume 26, April 1994, pp. 231–241.
17. Although distributed learning applications are typically supplemented with electronically published course materials and assignments (an integrative application), distributed learning refers primarily to the student/instructor interaction (an interactive application).
18. While these approaches are conceptually distinct, they could be implemented within the same software platform, and, in fact, common technology will enable smoother integration.
19. I obtained this information during twelve hours of interviews with the senior vice president responsible for information and consulting services, the director of information systems strategy responsible for the electronic-publishing project, the lead application architect, and a senior analyst/consultant to the project. I also reviewed archival documentation that included design documents, a discussion database used to support the project team, and related e-mail messages.
20. I obtained this information during approximately 100 hours of interviews and focus-group sessions with senior executives and managers of various departments at Buckman Labs.
21. This company name is a pseudonym.
22. Buckman Labs has won several awards for its knowledge management infrastructure, including the 1996 Arthur Andersen Enterprise Award for Sharing Knowledge and, in 1997, the ComputerWorld/ Smithsonian Award – Manufacturing Section.
23. Buckman Labs produces a version of the Tech Forum for Latin America called Foro Latinumber and is translating its forums, Web pages, and other knowledge repositories into several languages.
24. Zack (1994).
25. M.H. Zack, “Developing a Knowledge Strategy,” California Management Review, volume 41, Spring 1999, pp. 127–145.
26. Nonaka (1994); and
M.H. Zack and J.L. McKenney, “Social Context and Interaction In Ongoing Computer-Supported Management Groups,” Organization Science, volume 6, July–August 1995, pp. 394–422.
27. C.C. Marshall, F.M. Shipman III, R.J. McCall, “Making Large-Scale Information Resources Serve Communities of Practice,” Journal of Management Information Systems, volume 11, Spring 1995, pp. 65–86.
28. Nonaka (1994).