QUESTION 1:
a) What are the TWO strategies of KM? Describe any TWO differences of the strategies.
Two strategies of KM are information technology which is referring to its role and also competitive advantage. First strategy is about role that plays by information technology (IT). IT means information technologies that perform a wide variety of tasks that range from installing computer applications to designing widely complex computer networks and information databases. In the context of knowledge management strategies, IT helps organization in capturing the improvement of knowledge in future. IT helps organization in terms of flows of knowledge. This means that by having IT in organization practice it will help in sharing of knowledge among internal and external employees.
Besides that, gaining of the current and important knowledge that are categorized under important information in achieving organizational goals also can easily be gathered. By having IT and know on how to utilize it with effectively, IT could give information about competitors such as information on the current strategies and competitors’ products are easily can be gain. All this information assists organization to compete their competitors through creating more innovative and creative strategies in order for organization to compete with their competitors. Thus this can help organization in planning their knowledge management strategies with very efficient because all the important and needed information could be gather by the organization through searching in and using IT system.
In addition, nowadays IT is used to create direct connections among people through its application such as e-mail, chat-rooms and video conferencing. All of this can be used by organization as their medium for communications between their own employees or with external customers. By having this kind of technology all the information can be transfer and share with faster regardless of locations. IT also helps organizations to create new ideas such by having IT, organizations makes their customers become more loyal to them. This is due to organization can use IT in communicate or deliver service or products to their customers with faster. This is one of the business strategies that used by organizations through effectively used on knowledge strategies.
Second knowledge management strategies refer to competitive advantage. Competitive advantages means, an advantage over competitors gained by offering consumers greater value, either by offer lower prices or by providing greater benefits and service that justifies higher prices.
Knowledge management needs competitive advantages as one of their strategies because knowledge will enable organization to compete with their competitors. Competitive advantages are important for the organization because by possess it, organization can measure their strength and level of competitiveness. All of this will help organization to become more improve in their performance and acquisition of profit. By having knowledge, organization can use it as one of the strategies to attract their customers and compete with their competitors. When organizations use their knowledge as the strategy for them to compete with others, organizations need to do some analysis or research regarding their competitors’ strategy and strength. All of this information will help organization to create some effective strategies in order for them to leader in the market. For an example, by apply competitive advantage strategies in their knowledge management, Giant hypermarket are now can compete with TESCO.
Furthermore, to ensure that organization gain benefit from implement competitive advantages for their knowledge management strategies, organizations should fully understand on how to use on it. Based on this, organizations need to gain as much information as can in gathering information of their competitors and also customers. This is to clearly know and understand needs and their customers taste. After all are clear, it is easy for the organization to produce and provide product or services that are match with their customers’ needs. In order to ensure this entire plan is work, organization must know to manipulate and utilize their knowledge or manage their knowledge effectively.
Organizations that have high rate in competitive advantages usually are good in knowledge management. This is because they are expert in their knowledge and also manage their knowledge for the purpose that enables them to get information on strategies by their competitors and also the current needs of their customers. For an example, fast food restaurant which are KFC and McDonald are among the famous fast food restaurant. Both of these restaurants compete to each others. As we can see, in order to attract customers KFC are more focusing on fried chicken while McDonald focus on selling burger to their customers and the latest strategy done by McDonald are they make offer by giving half price to their customers if they purchase McDONALD during lunch hours from 12 P.M to 3 P.M. this means that both of this fast food restaurant, emphasize competition based on different types of products and price. Their aim is same, they only to attract more customers to come to their restaurant and also gain more profit.
b) Explain briefly with examples of company that you are familiar with: Exploration and Exploitation strategies
An exploration means organizations develop knowledge for the purpose to help in creating new products or services. According to knowledge (Benner & Tushman 2002, Rosenkopf & Nerkar 2001, Ahuja & Lampert 2001, Nerkar 2003, Katila 2003, Katila & Ahuja 2002), they said that exploration means existing activities that change into unfamiliar and involve remote in knowledge. In other words, this means that the organization wants to try something new in their business by producing new and different product or services to their customers. In order to involve in exploration, organizations needs to change their existing technology, skill, management and many more that are related with the changes in new business.
If the organization wants to do explorations in their business but they refuse to make any changes, it is difficult for the organization to successfully in their explorations or new business. This is because, when organization involve in explorations it require organization to make changes or innovation in their organization. Explorations are done by the organizations due to they see the new and more profit they can get if they change to something new. Explorations are also influence by the financial factors where in explorations organizations will need to invest a lot of money because most of their business operations or management will be change based on new business.
For an example, one of the organizations that involve in the explorations is Motorola. This company had drops the entire products lines and shift into new lines which is involve in cellular telephone market.
Then, for the exploitation it can be define as the process where organizations not makes the entire changes in their business product or service but they only focus on exploit or improve the existing product. This improvement is done due to upgrade the quality of the product and to ensure that their products are highly quality and could compete with their competitors’ products. Exploitations can happen if there is advancement of new technology in that industry. In order to be competitive advantage and market leaders, organizations always have to be alert in advancement of technology and their environment.
Exploitation involves leveraging of the existing knowledge in the organizations. Exploitation is different with explorations because exploitations only use the existing knowledge and resources that they possess. They just have to make some improvement on the existing knowledge and resources that they have. Some of the organizations, in exploit their products they do some research and development programs. This is for the purpose to find their weakness on their products and also to find out any changes that they can make. All this changes must suitable and relevant with the current market so that it can generate more profit to the organizations.
In, Malaysia the example of organizations that conduct exploitation in their business is Klang Valley. Previously, Klang Valley only focus on attracting teenagers customers but current business operations of the Klang Valley also show that it had balance their target group or customers into all levels of customers. This can be seen when most of the new product now are successfully attract all levels of customers’ age.
QUESTION 2
a) Search in the internet any TWO examples of metrics which is commonly used in KM project.
Metrics can be define as quantitative measure of the degree to which a system, entity process possesses a given attribute (IEEE 1990). There are two common metrics that are used by the organization in implementing their knowledge management project which are benchmarking and balance scorecard.
Balance scorecard technique developed by Kaplan and Norton (1996) aims to provide a technique to balance long-term and short-term objectives, financial and non-financial measures and also internal and external perspective. The basic scorecard is used for the purpose to translate vision and strategy into actual goals. After translate all the vision and mission, it then transfer into practical activities where company can measure it. Balance score also are use to support business activities.
In addition, benchmarking refer to other metrics that commonly used by the organization. It aims is to follow the ways things are done. This refers to the things that are best at anywhere, within or outside the firm, industry or sector. Benchmarking has been adopted by large company as a significant, systematic technique for measuring the company’s performance towards their strategic goals. In order to ensure the benchmarking operations, organizations provide data to ensure it is applicable to any organizations regardless their size also to any industries. Usually, benchmarking are conducting with companies that have better performance in that market. Benchmarking only involve in comparing with competitors and also imitate their best practices that can give benefit.
b) Identify any TWO advantages of having metrics in KM implementation.
By having metrics in knowledge management implementation such as benchmarking is useful for company to evaluate and improve their current performance. Benchmarking is important in implementing knowledge management because without benchmark with other companies, it is difficult to develop the company performance. Through benchmarking also, company can easily compete with their competitors. This due to the all the strategies the strength of the competitors are had been determine. In terms of quality, benchmarking affect the quality of the product and services whereby after comparing and benchmark it with other company that have better performance, that company will try to improve their quality as well.
Instead of that, benchmarking is done for the purpose of competitive advantage. By having competitive advantage, it allows other company in the same market has the equal chance to compete in the sane business. In competitions, it is important to do benchmark because all the important information are useful for generate new ideas and strategies to attract customers and increase profit.
For balance scorecard, it gives advantages such as balance scorecard enables the companies to translate or clear regarding knowledge management in their companies. By clearly understand on the vision, it can help company to identify and translate their goals and objective into any actions that can be measure and easily be seen by others including their employees. Balance scorecard also helps companies in translate vision and strategy into actual goals by measure in almost all perspective in and out of companies such as from the perspective of financial and customers. Both of this represents the two perspectives that need to be measure or evaluate by the companies in order to improve their performance. By measure the customers, company knows what customers needs and their quality in the customers’ perspective.