Role of Knowledge Role of Knowledge Management in the Decision Management in the Decision

Making ProcessMaking Process

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contents What is decision making?What is decision making? Knowledge managementKnowledge management Recap of KM/decision makingRecap of KM/decision making Knowledge management processKnowledge management process Knowledge activates: tacit to explicit & vice Knowledge activates: tacit to explicit & vice

versaversa Impact of KM strategies on decision makingImpact of KM strategies on decision making Technological applicationTechnological application The changing environmentThe changing environment

What is decision making?

Decision making is one of the most common thinking activities and one of the most crucial processes of any business. Other common thinking activities are analyzing, categorizing, comparing, discovering, evaluating, planning, prioritizing, and reflecting. Decision making has been explained in many different theoretical frameworks (Hammond, McClelland & Mumpower, 1980; Kaplan & Schwartz, 1975).

Cont……….Cont………. In the present environment, often referred to as

the knowledge age, more and more workers are becoming knowledge workers with productivity highly dependent on their decisions. Thus, decision support tools need to be tailored to meet the timeliness and utility of the decision information that will be required by these workers at all levels of the organization. According to Wiig (1994, p. 35), the “…lack of knowledge is a major shortcoming of important business decisions.”

Knowledge management

Knowledge Management (KM) is both a discipline and Knowledge Management (KM) is both a discipline and a managerial policy initiative that encapsulates the a managerial policy initiative that encapsulates the strategies, systems and processes that enable and strategies, systems and processes that enable and simplify creation, capture, sharing, distribution and simplify creation, capture, sharing, distribution and utilisation of an organisation’s knowledge.utilisation of an organisation’s knowledge. (Kandadi, (Kandadi, 2006)2006)

KM refers to the set of business processes developed in an organisation to create, store, transfer, and apply knowledge. (Laudon & Laudon, 2007)

Cont…..

KM involves the creation of value from an organization’s in tangible assets.

Information systems are designed to facilitate the sharing and integration of knowledge.

KM is a young discipline for which a codified, generally accepted framework has not been established.

Recap of KM / Decision Making

Concerned with the representation and processing of knowledge by humans, machines, organizations and societies

Aims to ensure the right knowledge is available in the right forms to the right entities at the right times for the right cost.

Decision making is a knowledge intensive activity with knowledge as its raw materials, work in process, by products and finished goods.

Cont…….Cont…….

Computer based DSS employ various KM techniques to represent and process knowledge of interest to decision makers, including descriptive knowledge (data, info), procedural knowledge (algorithms) and reasoning knowledge ( rules).

Proficiency in KM is increasingly important to the competitiveness of the decision makers as we rapidly move into the global knowledge society.

Knowledge management process

Knowledge Identification

Knowledge Identification

Knowledge Storage

Knowledge Storage

Knowledge Codification

Knowledge Codification

Knowledge CreationKnowledge Creation

Knowledge Diffusion & Use

Knowledge Diffusion & Use

Knowledge Activities: Tacit Knowledge Activities: Tacit to Explicit & Vice Versato Explicit & Vice Versa

Transfer of knowledge from people to physical formThrough development of reports and manuals or answering queriesUse of technologies like word processing documents, presentation tools and email

Transfer of knowledge from people to physical formThrough development of reports and manuals or answering queriesUse of technologies like word processing documents, presentation tools and email

TacitKnowledge

residing in People

TacitKnowledge

residing in People

ExplicitKnowledge in physical form

ExplicitKnowledge in physical form

Transfer of knowledge from physical form to actionable knowledge in peopleThrough video, audio or text presentations. Browsing through documentsUse of technologies like multimedia technologies, word processing and presentation tools

Transfer of knowledge from physical form to actionable knowledge in peopleThrough video, audio or text presentations. Browsing through documentsUse of technologies like multimedia technologies, word processing and presentation tools

Impact of KM strategies on decision making

Technological Application Computers will never be substitutes for humans in

complex decision situations. But they can surely lend support to decision makers in helping us to make more humane decisions.

Using e-mail and chat rooms, conduct real time interviews with stakeholders.

Gather information on stakeholders concerns via their websites and newsgroups.

The changing environment

“As globalization expands, the number of stakeholders affected by organizations will increase in size, and the widely disparate customs, laws, behaviors and environmental concerns of affected communities will further complicate strategic problems.”

References Laudon, K. and Laudon, J. (2006) “Management

Information System: Managing the Digital Firm” Pearson Prentice Hall

Gary, P. (1994) “Decision Support and Executive Information Systems” Prentice Hall International Editions

Gordon, S. R. and Gordon, J. R. (2004) “Information Systems a Management Approach” John Wiley & sons

http://www.albany.edu/~hjscholl/MSI522_2002/pdfs/Group1_1stRes.pdf[acessed 15 April 2008]

Gilligan, C., Neal, B., Murray, D. (1983) “Business decision making” Philip Allan Publishers Ltd

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