Knowledge management in a BSC project

Experience of GIG
Razieh Halimi
Software Engineer, Expert of Business Excellence of GIG, Iran
Razieh_h@yahoo.com
&
Nafiseh Mottaghian
System Engineer, Manager of Business Excellence of GIG, Iran
excellence@excellence.ir

Abstract
This paper is qualitative, aiming at describing issues that we have identified during knowledge sharing among
BSC projects in Golrang Industrial Group ( GIG). The work is based on literature review and case
studies in an Iranian Holding company. We found out that knowledge sharing of the projects could be
improved by training and improving culture of knowledge sharing and reserving time for the knowledge
sharing. Organizations today, being knowledge-intensive and knowledge-aware, have tried to manage
knowledge; many different viewpoints and approaches have been implemented. Depending on knowledge
needs of particular process, proper KMS should integrate different information sources and tools. BSC
Process in GIG, is considered in order to discover and explain possibilities of KM support and introduction.
Knowledge Management
There are a lot of differences between data, information and knowledge. We summarized it in table 1.

Table1. The relationships between data, information, and knowledge

Data Knowledge Information

Simple observations Data with relevance Valuable information
of the world: and purpose: from the human mind:
•Easily captured •Requires unit of includes reflection,
•Easily structured analysis synthesis, context
•Easily transferred •Needs consensus on •Hard to capture
meaning electronically
•Compact,
quantifiable •Human mediation •Hard to structure
necessary •Often tacit
•Often garbled in •Hard to transfer
transmission •Highly personal to
the source
More human contribution
Greater value

KM comprises a range of practices used by organizations to identify, create, represent, and distribute
knowledge. It has been an established discipline since 1995 with a body of university courses and both
professional and academic journals dedicated to it. Many large companies have resources dedicated to KM,
often as a part of 'Information Technology' or 'Human Resource Management' departments. KM is a multi-
billion dollar world wide market.i
In the Table 2 has been described the information processing paradigm. The base of all of them is the same
but different viewpoints drive more applications.

Table 2. The Information Processing Paradigmii

The process of collecting, organizing, classifying and disseminating information throughout an
organization, so as to make it purposeful to those who need it. (Midrange Systems: Albert, 1998)
Policies, procedures and technologies employed for operating a continuously updated linked pair of
networked databases. (Computerworld:Anthes, 1991)
Partly as a reaction to downsizing, some organizations are now trying to use technology to capture the
knowledge residing in the minds of their employees so it can be easily shared across the enterprise. KM
aims to capture the knowledge that employees really need in a central repository and filter out the surplus.
(Forbes: Bair, 1997)
 Ensuring a complete development and implementation environment designed for use in a specific function
requiring expert systems support. (International Journal of Bank Marketing: Chorafas, 1987)
KM IT concerns organizing and analyzing information in a company's computer databases so this
knowledge can be readily shared throughout a company, instead of languishing in the department where it
was created, inaccessible to other employees. (CPA Journal, 1998)
Identification of categories of knowledge needed to support the overall business strategy, assessment of
current state of the firm's knowledge and transformation of the current knowledge base into a new and
more powerful knowledge base by filling knowledge gaps. (Computerworld: Gopal & Gagnon, 1995)
Combining indexing, searching, and push technology to help companies organize data stored in multiple
sources and deliver only relevant information to users. (Information Week: Hibbard, 1997)
KM in general tries to organize and make available important know-how, wherever and whenever it's
needed. This includes processes, procedures, patents, reference works, formulas, "best practices," forecasts
and fixes. Technologically, intranets, groupware, data warehouses, networks, bulletin boards
videoconferencing are key tools for storing and distributing this intelligence. (Computerworld: Maglitta,
1996)
Mapping knowledge and information resources both on-line and off-line; Training, guiding and equipping
users with knowledge access tools; Monitoring outside news and information. (Computerworld: Maglitta,
1995)
KM incorporates intelligent searching, categorization and accessing of data from disparate databases, E-
mail and files. (Computer Reseller News: Willett & Copeland, 1998)
Understanding the relationships of data; Identifying and documenting rules for managing data; and
Assuring that data are accurate and maintain integrity. (Software Magazine: Strapko, 1990)
Facilitation of autonomous coordinability of decentralized subsystems that can state and adapt their own
objectives. (Human Systems Management, Zeleny, 1987)
KM programs are typically tied to organizational objectives such as improved performance, competitive
advantage, innovation, developmental processes, lessons learnt transfer for example between projects and the
general development of collaborative practices. KM is KM programs are typically tied to organizational
objectives such as improved performance, competitive advantage, innovation, developmental processes,
lessons learnt transfer for example between projects and the general development of collaborative practices.
KM is frequently linked and related to what has become known as the learning organization, lifelong learning
and continuous improvement. KM may be distinguished from Organizational Learning by a greater focus on
the management of knowledge as an asset and the development and cultivation of the channels through which
knowledge, information and signal flow.
There is a broad range of thought on KM with no unanimous definition. The approaches vary by author and
school. KM may be viewed from each of the following perspectives:
• Techno-centric: A focus on technology, ideally those that enhance knowledge sharing/growth.
• Organizational: How does the organization need to be designed to facilitate knowledge processes?
Which organizations work best with what processes?
• Ecological: Seeing the interaction of people, identity, knowledge and environmental factors as a
complex adaptive system.iii
A key distinction made by the majority of KM practitioners is Nonaka's reformulation of Polanyi's distinction
between tacit and explicit knowledge. The former is often subconscious, internalized, and the individual may
or may not be aware of what he or she knows and how he or she accomplishes particular results. At the
opposite end of the spectrum is conscious or explicit knowledge, knowledge that the individual holds
explicitly and consciously in mental focus, and may communicate to others. In the popular form of the
distinction, tacit knowledge is what is in heads and explicit knowledge is what we have codified (Table 2).

Table2. Tacit and Explicit Knowledge

 Tacit knowledge Explicit knowledge
easily collected, organized and
Specification

context-specific
transferred
Personal Can be codified
Objective
hard to formalize and communicate
Theoretical
Knowing how to identify the key issues necessary to solve a
Procedures listed in a manual
problem
Example

Applying similar experiences from past situations Books and articles

News reports and financial
Estimating work required based on intuition & experience
statements
Information left over from past
Deciding on an appropriate course of action
projects
Nonaka and Takeuchi (1995) argued that a successful KM program needs, on the one hand, to convert
internalized tacit knowledge into explicit codified knowledge in order to share it, but, on the other hand, it
also must permit individuals and groups to internalize and make personally meaningful codified knowledge
they have retrieved from the KM system.(Table 3) The focus upon codification and management of explicit
knowledge has allowed KM practitioners to appropriate prior work in information management, leading to the
frequent accusation that KM is simply a repackaged form of information management. Critics have argued
that Nonaka and Takeuchi's distinction between tacit and explicit knowledge is oversimplified and that the
notion of explicit knowledge is self-contradictory. Specifically, for knowledge to be made explicit, it must be
translated into information (i.e., symbols outside of our heads).

Table3. Conversation process of Tacit and Explicit Knowledgeiv

From to Tacit Knowledge Explicit Knowledge
Externalization
Tacit Socialization
Use of metaphors, analogies and
Knowledge Shared experiences Water cooler Apprenticeship
models
Internalization Combination
Explicit
Learning by doing Studying previously captured Exchange and synthesis from
Knowledge
knowledge (manuals, documentation) existing explicit knowledge
Historically, there have been a number of technologies 'enabling' or facilitating KM practices in the
organization, including expert systems, knowledge bases, various types of Information Management, software
help desk tools, document management systems and other IT systems supporting organizational knowledge
flows.
KM activities can be a discrete function or a part of an existing departmental function, such as Information
Technology or Human Resources. Organization can also be project based, using cross-functional teams
incorporating specialist skills.
Knowledge Sharing
One of the challenges of KM is that of getting people to share their knowledge. Why should people give up
their hard-won knowledge, when it is one of their key sources of personal advantage? In some organizations,
sharing is natural. In others the old dictum "knowledge is power" reigns.v Why Don't People Share? Some of
the common reasons arevi:

"Knowledge is power" but how true is this really? Citing this reason is often a cop out by managers
or change agents who are not adequately addressing the human factors or motivational aspects. In
today's enterprise, where so much depends on teamwork and collective knowledge, it is only a
handful of people who have knowledge for which they can hold their peers and bosses to ransom. It
might be the owner-manager of a small company not wanting to lose trade secrets; it may be a
particular specialist who has been in the organization many years and built up his or her own unique
 way of achieving success without perhaps even understanding the deep tacit knowledge of how they
do it.

"Not invented here" syndrome - this is more common. People have pride in not having to seek advice
from others and in wanting to discover new ways for themselves.

Not realizing how useful particular knowledge is to others - an individual may have knowledge used
in one situation but be unaware that other people at other times and places might face similar
situations. Additionally, knowledge derived for one need may be helpful in totally different contexts;
or it may be a trigger for innovation - many innovative developments come from making knowledge
connections across different disciplines and organizational boundaries.

Lack of trust - if I share some of my knowledge, will you use it out of context, mis-apply it and then
blame me!, or pass it off as your own without giving any acknowledgement or recognition to me as
the source?

Lack of time - There is pressure on productivity, on deadlines, and it's a general rule that the more
knowledgeable you are, the more there are people waiting to collar you for the next task. How can
you possibly find time to add your lessons learnt to the knowledge database or have a knowledge
sharing session with your colleagues?
For Knowledge Sharing we have to change culture. Culture change is never easy and takes time. But cultures
can be changed. Culture is defined in many ways, such as "commonly held beliefs, attitudes and values"vii,
"the collective programming of the mind that distinguished one group from another"viii. There is a simple but
effective definition "the way we do things around here". There is no one place to start, but most interventions
are based on a simple layered model that portrays how people's observable actions and behaviors are
influenced by reportable attitudes and values based on more deep-rooted beliefs. Therefore to change people's
actions you have to address the more fundamental underlying layers. Remember that culture goes hand in
hand with structure it means roles and responsibilities. At every level within the organization, there must be
congruence between objectives, structures, processes, people and supporting infrastructure.
Commitment to knowledge sharing must be demonstrated throughout the organization. It is apparent through
what the leaders of the organization say and do. It is shown by commitment in the organizations' processes,
reward systems, development programs etc. It is, above all, shown by individual throughout the organization
being committed to share their knowledge with others even if it is not formally part of their 'day job'.ix
It has been cited seven incentives for sharing:

Hire people who will share

Develop trust

Vary motivations

Show public recognition

Reorganize for sharing

Create communities

Develop leaders.
Exploring KM for a group in organization can provide by:

Identify types of experts

For one of these types of experts describe
 tacit knowledge they have
 explicit knowledge related to their jobs and places where this knowledge can be found
 benefits derived from capturing their tacit knowledge and making it explicit
 problems in capturing their tacit knowledge
 suggestions for how to capture their tacit knowledge

GIG Experience
GIG introduce
GIG is a holding company with about 30 subsidiaries. Its foundation corporation Pakshoo Chemical &
Manufacturing Co. was established in1959 and is extremely successful producer and distributor of bath, body
and home care products. In addition, it produces and distributes under the license of Peter & George UK,
AVE, Home Plus and Do-Tell brands. The holding company was established in 2003. Now it has about 1600
direct employees and 5000 indirect ones. Its turnover (PPP) in 2006 was about 300million $ and the rate of its
growth in five past years has been 70%. Some of GIG businesses are E-commerce, IT, import and export,
industrial kitchen instruments, raw materials, construction, distribution and food industry. Existing sites are
located in Iran, UAE, England, China, Afghanistan, Uzbekistan, and Kyrgyzstan. This holding company is
going to be a multinational organization.

Balanced scorecard behaviorsx xi

Dr. Robert Kaplan and Dr. David Norton developed the balanced scorecard as an approach to strategic
management in the early 1990s. The difference between this and other approaches is that it is not only about
measurement, but also about the ability to translate vision and strategy into action. When it works well, the
approach has the ability to transform strategic planning from an academic exercise into a core part of the
business. When organizations measure financial performance they tend to focus on the past. However, this
does not provide all the information needed to help guide long-term investment decisions and demonstrate
how they can create future value. The balanced scorecard requires a more holistic approach to thinking
through issues and to the way information is gathered. It recognizes the importance of customers, suppliers,
employees, processes, technology, and innovation in helping organizations to deliver the future, and builds on
other management ideas such as total quality management (TQM). Most importantly, the approach
incorporates a system of feedback loops— centered on both internal business process outputs and the
outcomes of business strategies—that act as a means of identifying and understanding any problems.

How KM about BSC implement in GIG?

Information about strategic in GIG is too vast that GIG has been forced to use KM. In strategic meetings
knowledge worker started to recording all the conversations. The received information categorized in 2 types.
1: Information about strategies
i. GIG designs forms that named balance score cards that shows each perspective include: Strategic
objectives, scale, indicators, targets, evaluation periods, initiatives and owners.(picture 1)
ii. Implementation of strategies with Goal1 software.
iii. Documentation the Goal software information. GIG started with designs forms. (pictures 2 & 3)
Why GIG documented?
1. The information is too vast so if it didn't document, it would be lost and nobody can use it.
2. Some settings in this software will be lost after each installation of new version so with this
documentation, we can do things faster and carefully.
3. Share the knowledge with other staff of the team.
4. Returning and finding the information is too easy.
Picture1. BSC Sample

GOlrang ALliance 1
 Picture2. Form of GOAL diagnosis

Picture3. Form of GOAL documentation

2: Managers' experience
Conversation of strategic meetings has been recorded and has been analyzed and categorized in some types of
experiences. This segment of knowledge contains both management and technical knowledge. It can be useful
for new arrival engineers in organization.
Benefits of KM in GIG
1. Explicit Knowledge Benefits -

Knowing who 's doing what

Better sharing

Reduce redundancy & Reinvention

Decrease costs and Increase productivity

Improved customer service
2. Tacit Knowledge Benefits

Access to best / latest thinking

Faster problem solving

Increase persuasion of developers

Better decision making

Creation new opportunities for business

References
i
http://en.wikipedia.org/wiki/Wiki
ii Knowledge Management & New Organization Forms: A Framework for Business Model Innovation
iii http://en.wikipedia.org/wiki/Wiki
iv
http://xp123.com/xplor/xp0402/index.shtml
v The 3Cs of Knowledge Sharing: Culture, Co-opetition and Commitment
vi
The 3Cs of Knowledge Sharing: Culture, Co-opetition and Commitment
vii
Institute of Personnel Development
viii
http://www.geert-hofstede.com/
ix The 3Cs of Knowledge Sharing: Culture, Co-opetition and Commitment
x www.balanced.scorecard.org
xi http://oamweb.osec.doc.gov/bsc/guide.htm