Knowledge Management One of the Challenges of

Knowledge Management One of the challenges of knowledge management is deciding on a working definition of what the discipline covers. Levinson defines knowledge management (KM) as the process by which organizations generate value from their intellectual and knowledge-based assets. Her definition goes on to say that generating value from such assets typically involves codifying what employees, partners and customers know, and sharing that information among employees, departments, and even with other companies in an effort to develop best practices (Levinson, 2010).

Whether the goal of implementing a KM system is to minimize loss and risk, to improve organizational efficiency, or to embrace innovation, knowledge management efforts and initiatives add significant value to an organization. Some of the benefits of KM include the following: Facilitating better, more informed decisions Growing the organization's intellectual capital Encouraging the free flow of ideas, leading to insight and innovation Eliminating redundant processes, streamlining operations, and enhancing employee retention rates Improving customer service and efficiency Increasing productivity (Knowledge management -- why important, 2011).

The topic of knowledge management has taken on greater urgency in American business in recent years as millions of baby boomers prepare to retire over the coming decade. Tens of millions of baby boomers turned 60 in 2005, and that those who aren't already retired must certainly be planning to do so soon. With their departure, the knowledge they gleaned about their jobs, companies, and industries over the course of their long careers leaves with them, unless companies take measures to retain their insights.

Along with imminent mass retirement, the outsourcing trend also requires companies to address the issue of transferring knowledge from their employees (Levinson, 2010). Choi and Lee discuss additional justification for implementing knowledge management strategies. They argue that knowledge has come to be considered a valuable strategic asset that can provide proprietary competitive advantages. Without constant creation of knowledge, a business is condemned to poor performance. They argue that managing knowledge is important because "knowledge is one of the most strategic weapons that can lead to sustained increase in profits." (p. 173).

KM practitioners describe intellectual and knowledge-based assets as falling into one of two categories: explicit or tacit. Explicit assets are typically easier to define, including such items as patents, trademarks, business plans, marketing research and customer lists. Generally speaking, explicit knowledge consists of anything that can be documented, archived or codified, often with the help of IT (Levinson, 2010). On the other hand, tacit knowledge is a much harder concept to grasp. The challenge of managing tacit knowledge is figuring out how to recognize, generate, share, and manage it.

Identifying tacit knowledge is a significant hurdle for most organizations (Levinson, 2010). Having once defined or identified the intellectual assets that make up knowledge management, the firm must then be able to effectively implement a knowledge management system.

According to Kanagasabapathy, Radhakrishnan, and Balasubramanian, knowledge management is not so much about managing knowledge as it is about "managing and creating a corporate culture that facilitates and encourages the sharing, appropriate utilization, and creation of knowledge that enables a corporate strategic competitive advantage." They argue that a critical issue in adoption of knowledge management initiatives is the preliminary preparation.