Knowledge Management and Organizational Learning

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Knowledge Management and Organizational Learning
CE 726

• Group Members
• Handan GÜNDOGAN
• Çagdas MUTLU

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OUTLINE

• Introduction
• Definitions
• Knowledge Management
• Organizational Learning
• Drivers
• Applications in UK, US and TR
• Barriers
• Models Developed
• Conclusion
• Further Studies

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To define the knowledge,
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Definitions

• DATA represents
• Facts,
• Observations,
• Values of Results,
• Quantitave,
• Has not been processed,
• It is obtained from Observations (input).

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Definitions

• INFORMATION relates to,
• structured data
• meaningful data
• describe a particular situation or condition
• It gives us definitions.
• (what,who,when,where)

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Definitions

• KNOWLEDGE consists of
• know-how,
• truths,
• perpectives,
• concepts,
• judgements,
• methodologies,
• It is about action and decision-making
  capability.

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Types of Knowledge

• Tacit Knowledge (informal or soft)-knowing how
• obtained from experience
• stored in peoples head
• difficult to document
• difficult to communicate or share with other
  people
• Explicit Knowledge (formal or hard)-knowing that
• explained and recorded
• easily documented and transferred
• physically stored in either paper or electronic
  format

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Knowledge Management

• KM can be defined as a systematic process that
  creates, captures, shares, and analyzes knowledge
  in ways that directly improve performance. It is
  about helping people to communicate and share
  information. (Parlby, D. 1998)
• The aim of Knowledge Management is to support
  Organizational Learning (Lehner and Maier, 2000)

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Central concept of KM

• Putting individuals in touch with one another to
  share their tacit knowledge.
• Transforming individuals tacit knowledge into
  explicit knowledge, which can be used by the
  entire organization.
• So, Knowledge Management can be interpreted
  as the ability to get the right information to
  the right people at the right time, and in the
  right place.

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Four Processes of Knowledge Management

• Creating of knowledge
• Distributing knowledge
• Sharing knowledge
• Capturing and Codifying knowledge

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Information Technology

• IT is the general term that specifies
  computer-based tools used to gather, code,
  process, store, transfer and apply data between
  machines, people and organizations.
• Laudon and Laudon (1998) classify information
  systems for knowledge management into four main
  categories

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Why Knowledge Management?

• It creates value, and gain and sustain
  competitive advantage.
• Saves money by not reinventing the wheel for each
  new project.
• Reduces costs by decreasing and achieving
  economies of scale in obtaining information from
  external providers.
• Increases productivity by making knowledge
  avaible more quickly and easily.
• Provides workers with a more democratic place to
  work by allowing everyone access to knowledge.
• Learning faster to stay competitive.

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Organizational Learning

• Dodgson (1993) explains OL as
• the way firms build,
• supplement,
• organize knowledge,
• routines around their activities,
• within their cultures,
• adapt and develop organizational efficiency by
  improving the use of the broad skills of their
  workforces.

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Organizational Learning

• Kullunga (2001) defined OL as encouraging a
  learning curve within an organization such that
  employees at all levels, individually and
  collectively, continually increase their capacity
  to improve their level of performance.
• From these definitions, OL can be summarized as
  the set of actions to acquire, share and
  interpret knowledge among the members whose main
  objective is to increase company performance
  through improved quality of decision-making in
  the organization.

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Organizational Learning

• The most important point is,
• the existence of a knowledge management
  infrastructure within the organization whose
  mandate is to identify, analyze, manage, maintain
  and disseminate knowledge to appropriate
  individuals within the organization and
  externally to others (Liebowitz et al., 1999).
  This can be only be achieved through the proper
  combination of relevant systems and skills that
  are influential in the learning process of an
  organization.

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According to Peter Senge, five learning skills
are
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Levels of Learning

• Jeffries et al. (2003) developed a
  perspective by defining the levels of OL as three
  phases beginning at the individual level by
  interpreting and reflection, maturing at group
  level by integration and conceptualization and
  finally reaching the organization level by
  institutionalizing and experimentation.
• Individual Learning
• Group/Team Learning
• Organizational Learning

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Levels of Learning

• Individual Learning is the foundation for
  the existence of organizations learning and it
  should be enhanced to lead to more effective OL.
• Group/Team Learning is an inseparable step
  of OL since teams provide new approaches to the
  learning process, cause fundamental
  organizational changes by functioning as a bridge
  between the individuals and the organization
  (Marquardt,1996).
• Organizational Learning requires the crucial
  step of the transformation of individual learning
  into OL.

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So, OL necessitates four main events defined by
Crossan et al.s (1990),

• The preconscious recognition of the possibilities
  inherent in a personal experience
• Intepreting, the explanation of an idea to
  oneself and to others.
• Integrating, the developing of a shared
  understanding and coordinated action among
  individuals.
• Institutionalizing, the process of ensuring that
  actions are made routine.

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Types of Learning

• Single-loop learning involves an organization to
  respond to changes in its environment by
  detecting errors and correcting them, but
  maintaning its existing organizational norms.
• Double loop learning, on the other hand,
  involves the revision of organizational culture,
  assumptions, guidelines, objectives, strategies
  and structure of an organization. It is a process
  of creative renewal and rediscovery of an
  organization to remain competitive (Senge 1990).

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Organizational Transformation

• As Huber(1991) states, organizations whose
  structures, processes and technologies are not
  well suited to deal with the increasing
  enironmental complexity and knowledge are
  unlikely to survive. Around the shared vision and
  culture, organization should develop new
  strategies and structures so as to become a
  learning organization (Marquardt, 1996). For an
  organization,
• Vision
• Culture
• Structure
• Strategy

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Organizations

• Vision The vision of the organization is
  represented by the commitment for a certain goal,
  direction or hope for the future of the
  organization. According to Marquardt(1996), the
  first and the most important step in becoming a
  learning organization is to build a solid
  foundation of shared vision about learning.
• Culture Walsh and Ungson (1991) define culture
  as the conscious patterns of assumptions, values,
  and beliefs shared by a collective (cited in
  Berthon et al., 2001). Culture acts as a kind of
  knowledge filter it specifies what information
  is of value,influences the interpretation of
  information and coordinates collective action
  taking (Weick, 1994 cited in Berthon et al.,
  2001).

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Organizations

• Structure The key charasteristic of the
  structure of the organization is that, it links
  the various elements of the organization through
  the transformation of information. As emphasized
  by Salaman and Butler (1994), the organizational
  structures surrounding a project appear to
  centrally influence a projects tendency to
  perform learning activities and to contribute to
  the knowledge of the permanent organization
  (cited in Kasvi et al., 2003).
• Strategy Identification, capture and transfer of
  knowledge within the firm are expected to be in
  alignment with the organizations strategic
  objectives. Strategy influences learning by
  providing a boundary to decision-making and a
  context for the perception and interpretation of
  the environment.

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Organizational Learning Processes

• Knowledge Acquisition
• Information Distribution
• Information Interpretation
• Organizational Memory

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Organizational Learning ProcessesKnowledge
Acquisition

• External
• monitoring the environment
• Internal
• information systems
• manage and retrieve information
• research
• development
• education
• training
• patent watching

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Organizational Learning ProcessesInformation
Distribution

• Informal
• Tacit know-how
• Letters
• Memos
• Conversations
• Stories by employees
• Formal
• Seminar
• Reports
• Information systems

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Organizational Learning ProcessesInformation
Interpretation

• Huber (1991) states that individuals and groups
  have prior belief structures that shape their
  interpretation of information and thus the
  formation of meaning.
• So, to share the information firstly, it should
  be interpreted.

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Organizational Learning ProcessesOrganizational
Memory

• Hard information
• Data
• Intranet/internet systems
• Warehousing
• Soft information
• Experiences
• Tacit know-how
• List of contacts

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Drivers for KM and OL in Construction Industry
A learning organization is skilled at creating,
acquiring, sharing, and applying knowledge, and
embracing (fostering) change and innovation at
all levels, resulting in optimum performance and
maximum competitive advantage.
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Drivers for KM and OL in Construction Industry

• To share valuable tacit knowledge
• To develop new products
• To become more innovative
• To increase client satisfaction(faster response
  etc.)
• To eliminate reworks

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Drivers for KM and OL in Construction Industry
(Contd)

• To disseminate (spread) best practices
• To encourage continuous improvement
• To improve business performance (better bid
  preparation skills etc.)
• To enable employees to understand and apply
  knowledge to different scenarios

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Situation in UK in Terms of KM and OL Applications

• 40 of construction organizations have KM
  strategy.
• 41 plan to have a strategy within one year.
• 90.5 use intranet to support KM activities.
• A number of public funded researches investigate
  how KM could be utilized in construction sector.
• Also, universities collaborate, with the industry
  in numerous other projects.

Carrillo,2006
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Situation in US in Terms of KM and OL Applications

• Research on 30 construction organizations
• 50 of the companies utilize an ad hoc process
  to capture lessons learned.
• 50 do not employ communities of practice (CoP).
• 37 do not have a software to support KM
  activities.
• 67 has a reactive attitude towards KM.

Carrillo,2006
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Situation in Turkey in Terms of KM and OL
Applications

• Research on 8 leading construction companies
• TCA members
• 5 of them listed in top 225 ENR list in 2005
• Ages range from 41 to 53
• Total revenues in 2005 range from 135 to 895 M

Kivrak, Arslan, Dikmen, Birgönül, 2006
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Situation in Turkey in Terms of KM and OL
Applications

• Capturing Knowledge
• 6 companies who do not have a KM strategy
  consider 41-60 of the knowledge as tacit.
• Companies who have a KM strategy considers 20 of
  knowledge as tacit.
• Colleagues, companys experience, personal
  experience, documentation and team meetings are
  seen as the major knowledge sources.
• Internet is not considered as a major knowledge
  source.

Kivrak, Arslan, Dikmen, Birgönül, 2006
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Situation in Turkey in Terms of KM and OL
Applications

• Storing Knowledge
• 5 companies evaluate projects after completion.
• 2 of them stores these evaluations digitally.
• Cost control and bid preperation data are
  recorded digitally and reused when required.
• 6 companies do not have a database to combine all
  documents and records.
• Data stored in reports, computer files, personal
  archives and heads of individuals

Kivrak, Arslan, Dikmen, Birgönül, 2008
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Situation in Turkey in Terms of KM and OL
Applications

• Reuising and Sharing Knowledge
• On-the-job training, intranet, meetings and face
  to face interactions and e-mail are the major
  means to share knowledge.
• Companies generally rely on the individuals
  experiences and use stored data in emergency
  cases.
• Knowledge Management Strategies
• 2 companies have KM strategies and 2 of them plan
  to implement a strategy in the future.

Kivrak, Arslan, Dikmen, Birgönül, 2008
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Situation in Turkey in Terms of KM and OL
Applications

• Research on 8 construction companies
• Learning from other companies experiences
• Monitoring competitors performance bid prices
• Strategies of competitors
• Use of web to learn practices of foreign
  companies
• Learning from foreign joint venture partners
• Quality
• Health and Safety Assurance
• Disagreement whether practices of companies from
  other industries can be useful or not

Özorhon, Dikmen, Birgönül, 2005
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Situation in Turkey in Terms of KM and OL
Applications

• Research on 8 construction companies
• Learning from external sources
• Management consultancy firms
• Universities
• Foreign organizations (World Bank, etc.)
• Professional associations (TCA, etc.)
• Training consultancy firms
• Governmental bodies (Chamber of Civil
  Engineers...)

Özorhon, Dikmen, Birgönül, 2005
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Situation in Turkey in Terms of KM and OL
Applications
Shares of knowledge sources in organizational
memory
Composition of organizational memory in terms
of knowledge type
Özorhon, Dikmen, Birgönül, 2005
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Barriers to KM and OL Implementations
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Barriers to KM and OL Implementations
A business development manager of Company E
indicated that ...experience gained through
a project cannot be transferred to another
engineer via paper new employees cannot
always show the same performance by reviewing
the previous experiences of their pioneers...
Özorhon, Dikmen, Birgönül, 2005
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Barriers to KM and OL Implementations

• Difficulties in measuring the value added
• Focus on projects instead of organizations
• Traditions and conservative company culture
• Cultural differences due geographical diversity
• Instable workforce (high employee turnover)

Chinowsky, 2007
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Barriers to KM and OL Implementations

• Inappropriate IT Infrastructure
• Insufficient time
• Insufficient funding
• Lack of executive support
• Lack of standard work processes

Chinowsky, 2007
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A Case Study on KM and OL Practices

• - US based engineering design
  company
• of employees 6100
• Annual Revenue (2004) 720.5 M
• ENR Ranking (2004) 12
• KM activites since 1997
• Main focus on people since 1999
• Knowledge communities
• Knowledge bases
• Major investments on IT infrastructure
• Increase in winning projects attributed to KM and
  OL

Carrillo, 2006
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Models Developed

• To assist organizations in implementing KM and to
  measure their learning skills, several models are
  developed
• Learning organization maturity model(1)
• STEPS Model(2)
• LEONARDO(1)
• Knowledge Platform for Contractors(3)

1. Chinowsky, Molenaar, Realph, 2007
2. Chinowsky, Carrillo, 2007
3. Kivrak, Arslan, Dikmen, Birgönül, 2008

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Knowledge Platform for Contractors

• A web-based system to capture data reuse in
  future
• Tacit Knowledge

face to face interactions
coaching and mentoring
brainstorming
communities of practice

• Explicit Knowledge

documents
reports
standards
specifications
Kivrak, Arslan, Dikmen, Birgönül, 2008
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Kivrak, Arslan, Dikmen, Birgönül, 2008
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Conclusions

• Mixed awareness of knowledge and KM
• Increasing importance
• Transformation from KM to OL should be done in
  time.
• Continuous improvement and personal advancement
  must become fundamental to achieve OL.
• Inefficient KM is widespread in TR, especially
  due to the lack of KM strategy.
• In TR, organizational memory mainly depends on
  own experiences rather than other companies or
  external sources.
• Researches in this topic have the risk to include
  bias.

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Further Studies

• STEPS Model helps organizations to implement KM

Chinowsky, Carrillo 2007
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Further Studies

• Learning Organization Maturity Model defines 5
  levels to achieve a learning organization

Chinowsky, Molenaar, Realph, 2007
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References

• 1. Özorhon, B., Dikmen, I., and Birgönül, T.
  (2005). Organizational memory formation and its
  use in construction. Building Research
  Information, 33(1), 67-79.
• 2. Carrillo, P., and Chinowsky, P. (2006).
  Exploiting knowledge management the engineering
  and construction perspective. Journal of
  Management in Engineering, 22(1), 2-10.
• 3. Chinowsky, P., and Carrillo, P. (2007).
  Knowledge management to learning organization
  connection. Journal of Management in
  Engineering, 23(3), 122-130.
• 4. Chinowsky, P., Molenaar, K., and Realph, A.
  (2007). Learning organizations in construction.
  Journal of Management in Engineering, 23(1),
  27-34.
• 5. Kivrak, S., Gökhan, A., Dikmen, I., and
  Birgönül, T. (2008). Capturing knowledge in
  construction projects knowledge platform for
  contractors. Journal of Management in
  Engineering, 24(2), 87-95.
• 6. Knowledge Management Strategy For
  Construction Key I.T. And Contextual Issues,
• Patricia M. Carrillo, Chimay J. Anumba, John M.
  Kamara,
• 7. http//www.adb.org/documents/studies/auditing-l
  essons architecture/ala2.asp

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Thank You !