Over promising Myths about Knowledge Management

t o Gain Compet it ive Advant age Saron K. Yef t a, Indra Gamayant o 119 The probl em wil l occur when an organizat ion got a l ot of inf ormat ion. Bef ore an organizat ion can share t he inf ormat ion, al l t he inf ormat ion has t o be sel ect ed and cl assif ied t o ease workers t o f ind inf ormat ion. To sel ect and cl assif y usef ul inf ormat ion isn’ t an easy j ob t o do. However t here are several t echnol ogies can be used t o hel p manage t he inf ormat ion, which are KMWorl d, 2002; • Inf or mat i on Management Syst em, a syst em which f acilit at es t he organizat ion, indexing, cl assif icat ion of document s, cont ent and digit al asset s such as audio and video f il es, il l ust rat ions, records et c. • Busi ness Int el l i gence, Formerl y used as decision support by many organizat ions t o manage dat a warehousing, f inancial inf ormat ion f or rout ine dat a anal ysis, st andard report writ ing and dat a mining. However, now, it is al so used t o cl assif y and arrange inf ormat ion.

15. Over promising Myths about Knowledge Management

Knowl edge management can hel p an organizat ion t o gain more benef it such as increase ef f iciency and product ivit y however it doesn’ t mean t hat knowl edge management can do everyt hing. There is a misunderst anding misguided by over promising of advant ages of knowl edge management . According t o Hil debrand Knowl edge Management Forum, 2002, t here are t hree dominant myt hs in using knowl edge management . There are: ƒ Knowl edge management t echnol ogi es can del i ver t he r i ght i nf or mat i on t o t he r i ght per son at t he r i ght t i me. In real it y, t echnol ogy is a t ool t o del iver t he inf ormat ion however it cannot ensure t hat t he right peopl e wil l get t hat inf ormat ion. Though it ’ s a f act t hat t echnol ogy can increase t he possibil it y t hat right peopl e can receive right inf ormat ion however Peopl e t end t o t hink t hat by adopt ing t he most updat ed t echnol ogy can ensure right peopl e t o receive t he rel evant inf ormat ion. ƒ Knowl edge management can st or e human i nt el l i gence and exper i ence. Technol ogies such as dat abase can st ore inf ormat ion in f orm of bit s and pixel s but it cannot st ore t he rich schemas t hat peopl e possess f or making sense of dat a bit s. The dat a ret rieved by dif f erent person can resul t dif f erent scenarios in handl ing an event . ƒ Knowl edge management can di st r i but e human i nt el l i gence. Again, organizat ion t ends t o t hink by document ing al l t he inf ormat ion, it supposes t o document t he int el l igence of a person. And by passing t he inf ormat ion, it means t hat ot her peopl e can def init el y sol ve same probl em. It ’ s a wrong percept ion. Document ed inf ormat ion onl y can be used as comparison bef ore execut ing a pl an. 120 Bef ore embarking t o use knowl edge management , an organizat ion has t o check t he purpose t hat want s t o be achieved by using knowl edge management and not t o bel ieve on t he percept ion of what knowl edge management of f ers Knowl edge Management Forum, 2002. 16. Case Study: Caterpillar Inc. Fends off Competition Cat erpil l ar Inc. CAT of Peoria, Il l inois, is a worl d l eader in manuf act uring heavy machinery. In 1982, t he company ent ered a dif f icul t period. Komat su of Japan, a maj or compet it or, was of f ering bul l dozers in t he Unit ed St at es at prices 40 percent l ower t han CAT’ s. Cat erpil l ar was f orced t o cut prices. A poor economy and a l engt hy l abor st rike worsened t he sit uat ion. By 1985, t he accumul at ed l osses amount ed t o 953 mil l ion. Cat erpil l ar, which sel l s it s product s al l over t he worl d, responded t o t he downt urn in al l t he usual ways: it cl osed pl ant s, l aid of f workers, and sl ashes expense. But t he usual did not work: market share decl ined and l oses increased. The manager of CAT decided t hat t he have t o impl ement ed a st at e-of -t he- art inf ormat ion t echnol ogy. CAT woul d not be gl obal l y compet it ive wit hout it . The f irst phase of t he inf ormat ion t echnol ogy proj ect l ast ed eight years and cost 2 bil l ion. What did it accompl ish? Comput er-int egrat ed manuf act uring CIM, a dream at many companies, is a real it y at CAT. Robot s, comput er-aided design, and comput er-aided manuf act uring are f unct ioning t hroughout t he various pl ant s. These and ot her comput erize syst ems resul t ed in in-process invent ory reduct ions of 60 percent and savings of several mil l ion dol l ars. Nonessent ial l abor was el iminat ed, product ion processes were simpl if ied, cost l y pl ant s and warehouses were cl osed, l ead t ime t o buil d a product was reduced f rom 45 days t o 10, and on-t ime del iveries t o cust omers increased by 70 percent . Modern management t echniques, such as a comput erized Mat erial s Requirement Pl anning II, were inst al l ed, and comput erized purchasing and l ogist ics syst ems were put int o operat ion. A sophist icat ed syst em f or managing repairs and providing repl acement part s t o deal ers and cust omers was inst al l ed. This syst em enabl ed deal ers t o provide part s t o t heir cl ient s quickl y yet maint ain l ow invent ories. Some ot her import ant IT appl icat ions at CAT are t hese: ƒ A global net work wit h 7, 000 t erminals connect s 50, 000 employees and 180 deal ers in 1, 000 l ocat ions Cat erpil l ar uses bot h it s f iber opt ic net work and a l eased sat el l it e services. This net work is used f or an EDI, f or t he Int ernet , f or ot her t el ecommunicat ions appl icat ions, and int ranet act ivit ies. ƒ An execut ive inf ormat ion syst em enables business unit s t o analyze dat a, ident if y t rends, and eval uat e each deal er’ s perf ormance. ƒ CAT’ s dealers and suppl iers are on an EDI syst em. ƒ The t elecommunicat ion syst em includes a “ CAT TV” link t o dealers, as wel l as audio and video t el econf erencing capabil it ies. t o Gain Compet it ive Advant age Saron K. Yef t a, Indra Gamayant o 121 ƒ Ninet y-f ive percent of t he company’ s employees can access dat a on t he company’ s ent erprisewide syst em an int ranet . ƒ A worl d-class repair and part invent ory syst em was devel oped. The IT proj ect support ed a massive reengineering of t he company. By 1993, Cat erpil l ar had become st ronger t han it s compet it ors, cont rol l ing more t han 30 percent of t he U. S. const ruct ion equipment market . The f irm was abl e t o export more t han hal f it s sal es t o f oreign buyers yet keep it s manuf act uring pl ant s and t he j obs in t he Unit ed St at es. For it s ef f ort s, CAT was a winner of Inf ormat ion Week’ s 1991 “ Excel l ence in IS” award. And what about CAT’ s chief rival : Komat su of Japan? Komat su shif t ed it s const ruct ion-equipment st rat egy away f rom bul l dozers in order t o avoid head-t o-head compet it ion wit h CAT. Source: Turban, E. , Mcl ean, E. and Wet herbe, J. 2001, Inf or mat i on Technol ogy f or Management , John Wil ey Sons, Inc. , USA.

16. 1. The Impact of Information and the New Economy