The Impact of Knowledge Management on Achieving Organizational Excellence

Knowledge management is a systematic approach used by organizations to retrieve, store, create, and share knowledge. It is an essential capability for most organizations irrespective of their size or field of specialization. It has been recognized as an important tool for sustaining competitive advantage, improving organizational performance, and achieving excellence owing to its positive significant relationship with most key performance indicators and other metrics that are used for performance measurement in organizations.

Knowledge management entails people, technology, and processes that are required to manage and share vital information and knowledge that the staff needs by creating a knowledge archive or database which can be referenced by staff whenever they seek specific information or want the right answer to a question.

Organizations gather their knowledge from different internal and external sources. The two main sources of knowledge management are:

  • Tacit Knowledge. The organization’s human capital skills, competencies, know-how, and contextual knowledge.
  • Explicit Knowledge. The organization’s structured capital that is codified in its tools, processes, systems, and directories.

The Common Knowledge Management Tools are:

  • Content repositories such as content management systems, document management systems, search engines, big data, cloud content systems, and management of multimedia files.
  • Artificial intelligence technology such as expert systems and learning systems.
  • Communication and collaboration tools such as social networks, communities of practice, mentoring, collaborative activities, peer assistance, e-mail, instant messaging, teleconference, video conference, groupware calendar, whiteboards, decision support systems, intranet and extranet, CRM, and ERP systems.
  • Learning systems such as distance learning, e-learning, and online training.
  • Knowledge analysis tools such as knowledge mapping tools, HR Skills inventory systems, knowledge process charts, and maturity assessment models.

The Role of Knowledge Management in Achieving Organizational Excellence

It is often believed that organizational excellence requires speed in performing work activities and change initiatives, management of complexities, organizational flexibility, a sense of history within a suitable context, and effective judgment based on reliable information and knowledge. Below are some examples of how knowledge management impacts organizational excellence:

  • Better customer service: By setting up a better knowledge platform to store and retrieve information, organizations can significantly reduce response time to customers, identify the needs of customers and the market, and create new and improved services.
  • Exchange of ideas: knowledge management enhances the exchange of ideas between staff which often encourages innovation. When we allow information sharing, we allow staff to learn and engage in open dialog which inspires creative thinking and problem-solving.
  • Improved relationships: The avenue provided by knowledge management to share and transfer information amongst staff can breed an amicable working environment which facilitate collaboration and teamwork.
  • Cost reduction: Good knowledge management acts as a collective memory. Knowledge management allows staff to share ideas, suggestions, and expertise which saves time and reduces the costs of projects. When the process is complete, or a document is created, it can be saved in a database to refer to whenever needed, which saves time and cost of repeated efforts. The exchange of information helps to highlight the improvement needed which means avoiding potentially costly mistakes. Additionally, organization utilize their internal expertise, which saves the cost of bringing external expertise.
  • Improved Quality: It has been proved that knowledge management reduce the occurrences of repeated mistakes. Knowledge sharing ensures that all staff are accountable for the quality of their work and share and use same information to produce goods or services.
  • Increased Sales: Knowledge sharing can help organizations grow sales. When dealing with a client, any member of staff would be able to access the right information, respond immediately to the client which shorten sales cycle, increase customer satisfaction and ensures continued business.
Dr. Nasreddin Dhafr
Strategy and business Excellence Consultants
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