KM Strategies

Knowledge Based
SWOT

Overview

Business Organizations
Knowledge

resource

Must manage their intellectual resources and

capabilities.

Tacit

most valuable and strategic

Knowledge-Social relationships

Building Intellectual capital through Social

capital

Key Question

How should an organization determine

which efforts are appropriate, or which
knowledge should be managed and
developed?
Answer lies in the The Firms
Strategy

Strategy and Knowledge

Organization's strategic context helps to

identify knowledge management
initiatives

That support its purpose or mission, strengthen

its competitive position, and create shareholder
value.

Link between knowledge management

and business strategy widely ignored
in practice.

Well-developed strategic models lack

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Therefore:

A Comprehensive Knowledge
Strategy is required.
(we

will come back to this)

What is a Business Strategy?

SWOT
Firm's

internal capabilities
Relative to the opportunities and threats
of its competitive environment.

Strategy can be seen as the balancing

act between the external environment
and the internal capabilities of the
firm

Two Views:

External Centric:
Porter's

"five-forces' model-Industry

Choosing an appropriate industry and

positioning the firm within that industry
Criticism

Internal Centric:
Resources

and capabilities RBV

VRIN
CA SCA

Which is a Key Strategic Resource

Knowledge: VRIN
Superior intellectual resource
Exploit
ability to acquire, integrate, store,
share, and apply it the most
important capability for building
and sustaining competitive
advantage.

Knowledge Management Value

Preposition

It can enhance the organization's

fundamental ability to compete.
How Knowledge Management gives SCA?
Knowledge that is context Specific-Tacit
Knowledge
Embedded in complex organizations routines
or developed from experience
Tends to be unique & inimitable
Path dependency

Knowledge Bases Competitive

Advantage

Is also sustainable:
The

more a firm already knows, the more it

can learn.

Knowledge synergy
Existing

Knowledge + New learned Knowledge

Seek areas of learning and experimentation
Add value to their existing knowledge
Via synergistic combination

Knowledge has Increasing returns

"critical

learning mass"
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The Knowledge-Strategy Link

From SWOT to Knowledge Based

SWOT
Mapping

knowledge resources and

capabilities against their strategic

opportunities and threats

Better understand advantage and

weakness

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Hence:

Knowledge strategy, can be thought of

as balancing knowledge-based resources
and capabilities to the knowledge
required for providing products or
services in ways superior to those of
competitors.
Identify

which Knowledge based resources

are VRIN and how such resources support
firms products and markets positions become
essential element of knowledge strategy.
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To Link Knowledge with Strategy

An organization must:
1.

Articulate its strategic intent

2.

Identify the knowledge required to

execute its intended strategy

3.

Compare that to its actual knowledge

it has

Thus revealing its strategic

knowledge gaps.
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Linking Knowledge To Strategy

Firms compete in certain ways:

Operate

within industry and adopt a

competitive position.
Based on strategic decisions
This strategic position is linked to some set
of intellectual resources and capabilities.

That is, given what the firm believes it must

do to compete, there are some things it must
know and know how to do.

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What the firm knows it has to do vs.

What a firm actually does know puts
a limit on how it competes.
i.e.

what a business firms knows and

must know about its industry or
competitive position

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A Strategic Framework for

Mapping Knowledge

Every firm's strategic knowledge

can be categorized by its ability to
support a competitive position.
Classifying Knowledge:
1.
2.
3.

Core
Advanced
Innovative

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Mapping Competitive Position

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Remember

Knowledge is not static

What

is innovative knowledge today

Will become the core knowledge of
tomorrow

For Competitive positioning:

Continual

learning and knowledge

acquisition

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Gap Analysis

After mapping the competitive

knowledge position
The firm can perform Gap Analysis
What a firm must do to compete and
what it actually is doing represents a
strategic gap
S/W=> what firms can do
O/T => what firms must do

Strategy balancing cans & musts

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Knowledge Gap

What the firm must know to execute

its strategy and what it does know
How

much existing knowledge is in

alignment with its strategic requirements

Set of potential knowledge gaps.

Knowledge strategy must address any

possible misalignments

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Closing the Gap

Knowledge management initiatives

should be directed toward closing
this strategic knowledge gap.
Knowledge gap is directly derived
from and aligned with the strategic
gap
Simultaneous

alignment of strategy
and knowledge is a crucial element of a
firm's knowledge strategy
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Strategic- knowledge gap analysis

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Knowledge Management Strategies:

Exploration vs. Exploitation

Exploration:
If firms knowledge is below the required level for
executing a strategy high level of knowledge
processing is required to close the internal
knowledge gap.
If competitors operate at a higher level of
knowledge then knowledge processing is required
to close the external competitive knowledge gap.

Thus to keep up, firm is constantly exploring

new knowledge

It becomes a creator or acquirer of the knowledge required

to become and to remain competitive in its strategic
position.
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Knowledge Management Strategies:

Exploration vs. Exploitation

Exploitation

when knowledge resources and

capabilities significantly exceed the
requirements of a competitive position,
the organization has the opportunity to
further exploit that knowledge platform

Thus it becomes a knowledge

exploiter

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Knowledge Management Strategies:

Exploration vs. Exploitation

Exploitation and exploration are not mutually

exclusive.

Exploration

An organization may need to develop (explore) one area

of knowledge while simultaneously exploiting another.
Ideal is to maintain a balance between exploration and
exploitation
Provides the knowledge capital to propel the company
into new niches while maintaining the viability of
existing ones.

Exploitation

of that (explored) knowledge provides financial capital

to fuel successive rounds of innovation and exploration.
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Knowledge Management
Strategies

Internal vs. External

This

refers to whether the knowledge is

primarily within the organization or
outside.
Some organizations are more externallyoriented, drawing on publications,
universities, consultants, customers, etc.
Others are more internally-oriented,
building up unique knowledge and
experience which is difficult for competitors
to imitate.

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Exploration

Exploitation

Conservative
Internal

knowledge
strategy

Aggressive
External

knowledge
strategy

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KM Strategy

Choose between Two Strategies

Codification
Link is person-to-document
Extract, store and share through computers
Reuse codified knowledge across similar tasks

Personalization
Link is person-to-person
Share and apply through people networks
Channel expert advice to unique problems

Codification and Personalization

strategy

Codification

Focused on
technology that
enables storage,
indexing,
retrieval and
reuse.

Personalization

Focused on
connecting
knowledge
workers through
networks, and is
better suited to
organizations that
depend more on
tacit knowledge
and expertise.

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Table:

Home Reading
Discuss in next class

Key Question

Action

How do you want lo

plan the game?

Articulate desired or
intended strategy

What do you need to

know?

Articulate strategy
knowledge link
Create internal knowledge
map

What do you know?

What's your internal
knowledge gap?

Compare what you need to

know to what you do know

What do your
competitors know

Create external
(competitor/industry)
knowledge map

What's your external

knowledge gap?

Compare what you know to

what your competitors know

What is your learning

cycle?

Assess your dynamic

learning capabilities and
intentions
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Key Question

Action

What are your

competitors' and
industry learning
cycles and
capabilities
What is your teaming
gap?

Assess your industry's and

competitors dynamic learning
capabilities and intentions

What's your internal

strategic gap?

Compare your dynamic

learning capabilities to those
of your competitors and your
industry
Assess how your internal
knowledge gap affects your
current strategy

What's your extremal Assess how your external

strategic gap?
knowledge gap affects your
current strategy

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Key Question

Action

What's your industry

cycle strategic gap?

Assess how your dynamic

learning gap affects your
future strategy

What's your new

current and future
strategy?

Determine if and how your

knowledge and learning gaps
require a revision in strategy

What's your
knowledge strategy?

Determine how aggressive you

will be to close your
knowledge gaps
regarding exploration vs.
exploitation
regarding internal vs.
external sources

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