Knowledge Management and Innovation Theory
Arguably, world economy in the recent post-industrial times can be said to be an information-intensive atmosphere. A good number of scholars assert that, competition both in global and local market, distinction of the market place, as well as profitability is influenced by efficient knowledge. There are numerous definitions that have been put forward to explain the term ‘knowledge’, depending on the area in which it is applied. In this particular context or rather in the business context, the term ‘knowledge’ is used to refer to the state of being aware and able to understand specifics, truth, or information that is achieved through learning or experience.
Admittedly, to an organization or rather an enterprise, knowledge is considered as being an asset. However, unlike material assets this type of asset appreciates with time rather than depreciating, (Amrit 2002). It is evident that thoughts lead to new thoughts, and when knowledge is shared the receiver is augmented while the giver stays with it. Notably, creation of knowledge by organizations is considered to be promoting competitive advantage for firms that operate in the modern world marketplace. This is the reason why most firms concentrate most in sharpening their expertise of creating knowledge in different fields. According to the modern organizational theory, organizations are seen as systems that “process” information as well as, “solve” predicaments, (Nonaka & Takeuchi 1995). It is assumed that the elementary task for an organization is the way it handles information and decisions in a tentative shifting atmosphere.
It is argued that enthusiastically handles a shifting environment usually creates information and knowledge besides proficiently processing information. In order to understand certain features of activities of an organization, it is important to first scrutinize such organization from its design and the capability of processing information perspective, (Alavi & Leidner 2001). Arguably, contact of the organization with its environment and the way in which information is created and information distributed, plays a very crucial role in constructing an active and vibrant understanding of the organization.
Nature and process of creating knowledge
A number of scholars assert that not much is known as far as the creation of knowledge as well as management of knowledge creation process, even though there is much awareness on the significance of knowledge in management. According to Polanyi (1966), basically, there are four blueprints for creating knowledge in an organization. The first blueprint is from tacit to tacit. Generally, common sense acts as a base of tacit knowledge. In this case knowledge is learnt through observation, imitation and practicing, or by becoming assimilated into a definite way of doing. The second blueprint is from explicit to explicit. This involves the combination of separate piece of...