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According (Kohlbacher, 2009) one of the essential streams in organizational strategic management is the resource-based view of the firm. This view constitutes the important relation between knowledge management and strategy within an organization. Kohlbacher (2009), states that in recent years, knowledge has been acknowledged as a critical strategic resource and asset among organizations. The development or creation of knowledge is a fundamental element of business strategy and the ability to manage the strategic knowledge effectively is essential. According to (Kohlbacher 2009), the development of knowledge and its strategic management create a competitive advantage for companies. As a result, knowledge management is currently considered a dominant area in strategic management and it has increasingly been adapted to the global context.
Strategic knowledge is essential to an organization and it is a necessity to measure the level of strategic knowledge in the organization. Therefore, it is very crucial to understand what constitutes strategic knowledge in organizational setups before it is measured. This essay looks to support the view that it is necessary to ask if we understand something before, we measure it. The essay will focus on the measurement of strategic knowledge at Sunshine Private School in Windhoek, my employer, with an aim understanding the effective development of the strategic knowledge base in the organization. The method of investigation used for this essay is observation.
Knowledge Management/Environment
According to Bolisani and Bratianu (2018), knowledge is defined as a justified true belief. Johnson et al (2011) further defined knowledge as awareness, consciousness or familiarity gained by experience or learning. According to Dasgupta and Gupta (2009), a general evaluation of past literature indicates that knowledge, although a very strategic resource, is not easy to manage. Explicit^ knowledge^ can^ be^ stored^ in databases or documents but tacit knowledge resides in peoples’ brains. Explicit knowledge is more basic as compared to tacit knowledge and is easy to transfer as it can be codified, recorded, communicated, written down, stored and is accessible. As a result, it can be transferred using information technology systems (Arnett and Wittmann 2013).
According to (Arnett and Wittmann 2013), tacit knowledge is possessed by human beings and is gathered from personal experience and situations. Tacit knowledge is most difficult to write down, articulate, or present in a tangible form. It can only be transferred by means of processes that enable participates to grow an understanding of difficulties involved in a situation over time. According to (Arnett and Wittmann 2013), tacit knowledge use enables organizations to apply important knowledge in operational activities which results in improved efficiency, value creation and better financial performance.
Arnett and Wittmann (2013), indicated that tacit knowledge is a source of competitive advantage therefore it is essential for organizations to understand how it is exchanged. Therefore; according to Dasgupta and Gupta (2009), it is the management of this knowledge which poses a bigger challenge for most organizations.
its staff. The organization measures the level of know-how, tacit knowledge, dispersed knowledge, situated knowledge, organizational culture, generalist knowledge and information in order to measure the level of knowledge in the organization.
Intellectual Capital and Social Networks
According to (Rastogi 2002), an enterprise constitutes a creation of human knowledge. The process of managing an enterprise is suffused with knowledge. Rastogi (2002) indicated that information is the feedstock of knowledge as implicitly organized information establishes knowledge. Management of knowledge for intellectual capital can lead to the growth of an enterprise in terms of profitability (Rastogi, 2002). Constant learning, cultivation, and creative use of knowledge is very essential in an organization as it allows people to improve and innovate. It also helps them develop and improve their capacity to survive the challenge of continuous change.
According to (Rastogi, 2002) an organizational competitive edge results from what it knows, how it uses what it knows, and how fast it can know something new. In this case, the ideas of knowledge management and intellectual capital are a natural, and not a new paradigm of business management. Rastogi (2002), also stated that a solid dynamic relationship of social capital, human capital and knowledge management results into a rm’s intellectual capital.
Social capital of an organization signifies the position of its people to cooperate spontaneously and with obligation in support of the organization’s goals (Rastogi 2002). According to (Wohlgezogen,2019) social capital denotes the value that individuals can get from interrelationships within an organization. The interaction results in the formation
of social networks that contribute to intellectual capital of the organization Its strength stems from the trusting relations built on an ethics of help and care, and a prevailing sense of shared destiny (Rastogi 2002). Those are grounded in the^ rm’s values and vision. Wohlgezogen (2019), stated that social networks result in knowledge and information exchange as it is easy to trust one another in the network and also because networks are a convenience filter in terms of searching for knowledge. Social Networks are present at Sunshine Private School in all levels all the organization and have played a vital role in knowledge and information sharing for the creation and development of intellectual capital.
Human Capital is also a merger component of intellectual capital that is evident at Sunshine Private School. Rastogi (2002) stated that it signifies individuals who continuously improve and develop their knowledge and skills, both individually and collectively, for value creation. According to (Rastogi,2002) it represents one of the three components of intellectual capital and is shaped by, and shapes, both social capital and knowledge management. Rastogi (2002) stated that if any of these three elements and the links among them, are weak, or inoperative, the idea of intellectual capital cannot exist. Therefore, intellectual capital signifies an organization’s meta-capability to overcoming trials and taking advantage of opportunities in its constant quest of value creation.
According to (Edvinsson 1997), intellectual capital can also be referred to as hidden value. Edvinsson (1997), also indicated that Skandia, a multinational organization with its headquarters located in Sweden adopted the concept of intellectual capital. According to (Edvinsson 1997), one of the five divisions of Skandia known as the
values. As intellectual capital is vital to Sunshine Private School on the development of its understanding, the Human Resources Department generated a list of key indicators that help us define intellectual capital at Sunshine Private School. Factors such as qualifications, training, skills, experience and other structural capital factors are part of a balanced score card generated by the human resources department in order to measure the level of intellectual capital in an organization. Measurement of intellectual capital helps the school to come up with new ideas on how it can be improving its strategic knowledge base, it is usually measured to see if the organization has progressing in terms of intellectual capital.
Communities of Practice/Interest
According to (Wenger and Trayner, 2015), communities of practice are defined as groups of individuals who share a concern or a passion for something they do and learn how to do it better as they interact frequently. In order to form a community of practice, people should be able to engage in a process of collective learning in a shared field of human endeavor (Wenger and Trayner, 2015). According to (Wenger, 2011), communities of practice involve three elements namely the domain, the community and the practice. The parallel development of these three elements enables the cultivation of such a community.
Wenger (2011) defines the domain by stating that a community of practice is not merely a club of friends or a network of associations between people. This is because its identity is defined by a common field of interest. Members involved continuously show commitment to the domain, and this results in a shared competence that differentiates members from other individuals. Basically, in this case, the domain is not necessarily
something known as expertise outside the community. According to (Wenger and Trayner, 2015) the community is defined in the actions of the members. This involves engaging in joint activities and discussions in order to help each other and sharing information. In this case, the community builds relationships that allow them to learn from one another. In terms of practice, (Wenger 2011) highlights a community of practice as not merely a community of interest as members of a community of practice are practitioners. They develop a shared collection of resources: experiences, stories, tools, ways of addressing repeated difficulties. The practice perspective takes time and continuous communication. The development of a shared practice may be more or less self-conscious.
Stemke (2004) explained the decision made by ChevronTexaco, a large multinational company with about 53000 employees in 180 countries. According to (Stemke,2004), ChevronTexaco decided to develop a more formal tactic to community development, in turn outlining some of the achievement stories that have helped to validate the central role networks now play. As indicated by (Stemke 2004), operational excellence in safety was one of ChevronTexaco’s central business strategies. Therefore, networks where created to help connect the employees within the large organization. Sunshine Private School as an organization with almost 210 employees located in Windhoek also values communities of practice. Communities of practice is one of the central elements in the school’s strategic knowledge base. Stemke (2004) highlighted that networks are vital components for connecting people in the organization, processes and culture to achieve objectives. This is the case with Sunshine Private School, which is continuously promoting the creation of networks
culture, the type and number of measures to use, the balance between the merits and costs of introducing these measures, and how to deploy the measures so that the results are used and acted upon. According to (BPIR 2019),^ performance measurement is fundamental to organizational improvement as it involves a regular measurement of outcomes and results, which leads to the generation of on the effectiveness and efficiency of programs. The importance of performance measurement has improved with the understanding that for businesses to be successful in the long-term, there is need to meet all stakeholders' needs. In order to achieve organizational improvement, performance measurement plays a central role. Therefore, performance measurement is considered an essential prerequisite for benchmarking and business excellence (BPIR 2019).
Sunshine Private School uses performance measurement in order to assess and improve its operations. Due to the dynamic nature of the business world, performance measurement has revolutionized and has seen a move away from the glitches of past measurement systems. The common performance measurement systems previously used by the school were not effective as they focused on dominant financial and other traditional indicators. The systems also failed to quantify all the factors that create value and had less focus on asset creation and growth. There was also little or poor measurement of innovation, learning and change.
According to (BPIR 2019), there are a number of trials that are faced when designing an effective performance measurement system, these include the measurement of non- financial or non-material items, the measurement of non-financial performance, the type of measures to choose and so on. As stated by (Marr and Creelman, 2015) in their case
study on Essex Police, indicated that Essex Police decided to build and implement a strategic performance management system called ‘Plan on a Page’ in 2013. This performance measurement system proved helpful in improving efficiency within the organization.
As Sunshine Private School values performance measurement as a key strategic tool in the development of its strategic knowledge base, it managed to implement the performance measurement as stipulated by (Worth 2016). According to (Worth 2016), an organization needs to select key performance indicators through identifying the corporate goals and the activities that lead directly to realizing them. The management at Sunshine Private School managed to come up with the relevant key performance indicators to be measured and the time period has been locked for each one to be measured. The Human Resources Department is responsible for monitoring changes as close to real time as possible and hold people answerable for enhancements. As part of the development of its strategic knowledge base, the school constantly define and measure performance measurement activities in an organization and makes improvements where necessary.
However, the idea indicated by (Gray et al, 2015) that understanding what something is before we measure it is essential may not work in some instances. Some concepts such as Knowledge Management, Intellectual Capital, Communities of Practice and Performance Measurement are broad therefore it is difficult to select the appropriate key performance indicators that can be used to measure them, Moreover, there is no standard for measuring therefore their measurement is subjective as different organization may use different approaches of measuring them hence the reliability of the
References
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