ACCA P3考试：Knowledge Management

　　THE ORGANISATION, ITS COMPETITIVE ADVANTAGE, AND KNOWLEDGE

　　The basis of competition is shifting from having a unique raw material or production system in manufacturing, to differentiation though the building of knowledge. 'Having knowledge can be regarded as even more important than possessing the other means of production - land, buildings, labour, and capital - because all the other sources are readily available in an advanced global society, while the right leading-edge knowledge is distinctly hard to obtain.' (1)

　　Companies have already moved from being labour intensive to process intensive, to carry out tasks most efficiently, effectively, economically and productively as possible while all the time introducing new techniques or elements to the process, product or service.

　　A company's success is dependent on adding value. This requires creativity based on the current knowledge position of the company. Organisations should not have to relearn on a regular basis but should be in a position to retain the knowledge they already have in their possession. They should then reinforce the use of this knowledge in processes and approach to the management of this knowledge. This is done by maintaining what is already known and then continue to maintain their position based on this unique knowledge, and finally renew and update the knowledge continuously.

　　This is a transparent approach to the handling of knowledge, which is the approach needed across the entire organisation so everyone can contribute.

　　With reference to knowledge management, the challenge (in the context of adding value) is that organisations have to reorganise themselves around the scarce resource of talented human capital and manage the constraining elements and strategic resources of information, knowledge and expertise (2). Obtaining this talented human capital is another task that requires human resource management and the involvement of the wider organisation.

　　HUMAN RESOURCES AND KNOWLEDGE MANAGEMENT

　　As organisations have changed, downsized or expanded, there has been an increase in technology and in redundancies. In knowledge management terms, a reduction in employee numbers implies that those remaining have to demonstrate their value. Employee turnover of, or the rise of the free agent implies that long-term contracts are on the way out. Loyalty is much reduced or, as suggested, 'loyalty is dead - commitment and drive are lost, on the way out or gone' (3) both from the organisational and employee perspective, as neither can afford loyalty in rapid dynamic markets. Organisations affected by such changes, through the loss of people and then talent, can't keep relearning all the knowledge lost when people leave the company.

　　One such approach, which considers the individual rather than the process, is social network analysis. This helps identify and manage the hidden networks within an organisation.

　　According to Karen Stephenson, social network analysis is increasingly recognised as a means of leveraging organisational learning, retaining key workers, planning succession, harvesting innovative ideas, and managing both the rate and quality of change. This collective capability, Stephenson argues, depends on trusted relationships between individuals and has more power to influence the success or failure of an organisation than any managerial hierarchy (3)。

　　In this approach, employees are a key consideration, with individual requirements which should be acknowledged. Employees want freedom, autonomy, space, and flexibility enables intellectual capital to be assessed. By offering these, the opportunity for knowledge growth and retention can be developed.

　　THE CREATIVE ORGANISATION AND KNOWLEDGE MANAGEMENT

　　The organisational cultural change required to facilitate the focus, development and application of organisational knowledge should include the development of an environment where innovation and creativity operate together.

　　While these two are somewhat intangible, a recent illustration of culture development is the way creativity is part of the culture at Google: ‘Is creativity fun or should it be? … fun works and work is more productive when it is fun … as a result, companies that integrate fun, creativity, and work are best able to attract and retain peak performers in an economy that promotes and rewards the rapid and constant changing of jobs.’ (7)

　　Companies are driving towards creativity and innovation. Trends suggest that the knowledge economy is rapidly being transformed into the creativity economy. As more high-level knowledge work is outsourced to less developed countries, companies in the US, Europe, and Japan are at the next level of generating economic value from creativity, imagination, and innovation.

　　Organisations are facing the need to change quickly and dramatically in order to survive, recognising ‘the need for greater product and service innovation to keep pace with technological and societal advances and compete with the growing power of companies in China and other developing countries, rather than focusing on ways to improve efficiency and cut costs. Today’s companies are rewiring for creativity.’ (8)

　　The characteristics of creative organisations correspond to those of individuals. Creative organisations are loosely structured. People find themselves in a situation of ambiguity, where assignments are vague, jobs and roles overlap, tasks can be poorly defined, and much work is done through teams.

　　Variety is important, and managers strive to involve employees in a varied range of projects, so that people are not stuck in the rhythm of routine jobs, and they drive out the fear of making mistakes that can inhibit creative thinking.

　　Creative organisations have an internal culture of playfulness, freedom, challenge, and grassroots participation. They harness all potential sources of new ideas as sources for knowledge management (9). These strategies allow the freedom to discuss ideas, and as projects are seen as long term, resources are allocated without immediate payoff.

　　This creative approach, as with any other policy around new product development, has to be incorporated into the overall company/business strategy. It must also be aligned with a knowledge management strategy, which a company should have in order to gain the value evolving within the idea generating process, as well as the knowledge that emerges. This allows creativity to lead to innovation and, in addition, to product or service development and delivery.

　　In terms of the value to be gained, the strategy also needs to include the process of valuation, and the valuation methods and perspectives used to evaluate need to be considered.

　　As accountants, you will need to understand that knowledge – its management, optimisation and valuation – requires focus if it is to be the basis of market success or failure. It is already an area that is being measured in terms of its contribution to the existence of an organisation, and it is therefore a critical success factor, if not already an unrecognised core competence. Talent and knowledge are an organisation’s capabilities and abilities. Talent as capability and knowledge as ability, requires management.