Globalization on the Strategic Components

¶ … globalization on the strategic components of Knowledge Management Processes

As the world evolved, so did the necessities of the business community. In a context of liberalized markets, rapidly advancing technologies and increased competition for not just customers, but also the best skilled and trained staff members, economic agents were forced to implement new concepts and tools that increased their capabilities and as such secured their competitive position. One of these concepts was that of knowledge management.

The knowledge management process is defined in several instances by the specialized literature. Rebecca O. Barclay and Philip C. Murray (1997) for instance promote the concept of knowledge management as "a business activity with two primary aspects:

Treating the knowledge component of business activities as an explicit concern of business reflected in strategy, policy, and practice at all levels of the organization.

Making a direct connection between an organization's intellectual assets -- both explicit [recorded] and tacit [personal know-how] -- and positive business results."

In other words, the specific aim of knowledge management translates into the usage of knowledge in a means that creates organizational strategies which bring the company closer to reaching its pre-established goals. Dimitris Karagiannis and Ulrich Reimer (2002) explain that "knowledge management aims at the support and augment of knowledge process inside an organization. Its role is to build strategic assets and core competencies with respect to strategic business fields." Extrapolating, it can easily be concluded that the knowledge management processes have strategic components and applications at virtually all organizational levels. They for instance integrate efforts in the direction of improved customer relations, operational efficiency, staff member training, administrative efficiency and so on.

Today's buzz word is that of the internationalized economic crisis, but at the beginning of the century, the buzz word was that of globalization. The term refers to a process by which economic, political, cultural, social or environmental values transcend the boundaries of one country and impact the values in another global region. Globalization has generated countless impacts on the every day life, on the technological developments, on the cultural manifestations and so on.

It has also created numerous effects within the business community. A noteworthy set of impacts is revealed by those manifested upon knowledge management. On the one hand, globalization allowed for the propagation of knowledge management and its strategic components at an international level. On the other hand, globalization created the need for more strategic applications of knowledge management, necessary for the survival of companies in the new dynamic and extremely competitive international market.

An interesting impact is observed at a cultural level. Hamid Etemad and Richard W. Wright (2003) note that even before the forces of globalization emerged, the more developed countries created elites, and that these national elites would better interact with the elites in other countries, rather than with the less socio-economically developed classes in their own country. Today, the national elites, still existent, interact globe wide through knowledge. These knowledge based interactions have led to the creation of an "intercontinental techno-culture that transcends national boundaries" (Etemad and Wright). And this new technological culture is present not only at the level of the national elites, but also at the level of economic agents. The more powerful an economic agent, the more intense his efforts will be in the direction of using technology to transform knowledge into core competencies and competitive advantages.

Another interesting aspect of the strategic components of knowledge management is that they could only be promoted through the advances brought about by the forces of globalization. There are two most relevant examples in this direction. The first is the indubitable role played by information technology and communications. With the aid of these advancements, information could easily be transferred from one global location to the other. This increased access to information then created more opportunities for individuals as well as economic agents across the globe to seize new opportunities.

The second component of globalization which promoted knowledge management was the creation of a new infrastructure. Through the new and improved roads, bridges, airports, telecommunications lines and so on, economic agents were better able to expand their operations globe wide, without encountering geographic barriers. This situation led to the social and economic development of several regions. Within the organizational context, this new knowledge, generated by globalization can be used to further improve the outcome of the company, but also to support the future development of the region (Tkach, 2003).