HOW KNOWLEDGE CAN BE MANAGED IN AN ORGANIZATION?

As we know knowledge is the most important factor for any organization, so it is very important to manage the knowledge within the organization.In this paper i will explain some problems of knowledge processing and their solution to provide an appropriate knowledge processing capability. Some main problems of knowledge processing are :

1. Complexity
2. Uncertainty
3. Ambiguity
4. Equivocally


Complexity

Complexity means "a large number of parts that interact in a non-simple way".(Simon 1969, p.195), complex tasks have many steps and factors which effects the performance. Complex problems have many interrelated variables, solutions and methods.(Cambell 1988, Dill and Simon 1986, Simon 1962, wood 1986). The different elements and relationships which are considered simultaneously is a function of knowledge processing capacity which in turn a function of what is known and familiar to organizations and its members (Newll, Shaw and Simon 1962, Stabell 1978). Therefore having superior knowledge enables to manage greater complexity.

The response to complexity is to increase firms capacity to process or to reduce the level of complexity, richer knowledge provides a ability to process complexity. Knowledge stored in the familiar procedural routines provides to perform complex group processes (Cyert and March 1963, Nelson and Winter 1982). Therefore having appropriate knowledge and expertise helps to reduce the complexity. In the absence of knowledge and expertise, the complexity can be reduced by decomposition, i.e by breaking things into similar parts. Therefore organizations facing complexity must develop and bring appropriate knowledge, expertise and skills to solve the issues.


UNCERTAINTY

Information theory defines uncertainty as lack of enough information to choose from an exhaustive and well defined set of possible states, even if that set is not complex (Shannon 1949). According to Rumelt(1984) managing uncertainty is a must for any strategy. Events of strategies like evolution of technology, emergence of market etc can be highly unpredictable. These events provides different firms different opportunities to generate windfall rents etc. Thus firms must set themselves to capitalize on environmental uncertainty (Rumelt 1989). For example organizations deals with strategic uncertainty in such a way which portrays classical information theory.

Uncertainty can be reduced by:

1. Acquiring additional factual information or knowledge about something.

2. Improving acquiring , developing the knowledge and ability to predict, infer or estimate.

3. Organizational and technical resources to locate, refine, store and communicate knowledge reliability and meaningfully.

AMBIGUITY


Ambiguity represents a the inability to interpret or to make sense of something (Machlup 1980, Mackay 1969, Weick 1969). Deep ambiguity represents complete lack of knowledge . The solution of the ambiguity is to re frame a situation to something meaningful by acquiring knowledge from others or by learning and experience, surface ambiguity require a small mount of additional factual information to appropriate knowledge.

Deep ambiguity which means, the knowledge is not available at all it can be resolved by cycles of interpretation, explanation and social ratification. In an organization a key point is to provide rich and interactive face - to - face conversation. For example: British petroleum has done by breaking its organization into 90 autonomous business units to encourage unit interaction (Prokesch 1997). These interaction will develop the expertise and advice networks which can be available when needed.

The above three main explained problems of knowledge processing are combined, they can easily address any situation and solve the problems within organization which helps them in the development of an organization.


References

Bohn, R.E.,"An Informal note on knowledge and how to manage it", Harvard Business School Case Services, 1986.

Driver, M.J and S. Strenfert, " Integrative complexity: An approach to individual and groups as Information Processing Systems"

Aldich, H.E, Organizations and Environments (Englewood cliffs, NJ. Prentice. Hall ., INC, 1979)

Barney,J.B, "Firm Resources and Sustained Competitive Advantage", Journal of Management, vol. 17, 1991, pg 99-120.