«Chapter VII Knowledge Networking for Collaborative Commerce Dimitris Apostolou, Planet Ernst & Young, Greece Gregory Mentzas, National Technical ...»
Knowledge Networking for Collaborative Commerce 183
Dimitris Apostolou, Planet Ernst & Young, Greece
Gregory Mentzas, National Technical University of Athens, Greece
Wolfgang Maass, University of St.Gallen, Switzerland
This chapter aims to describe interorganizational “knowledge networks”
and demonstrate how they have ushered in a new paradigm of collaborative
business by forging links between internal and external knowledge and information resources. The overall aim is to classify and review various approaches in interorganizational knowledge networking whose objectives may span a multitude of needs: from “loose” information sharing that may be not connected to financial transactions between the networking organizations to “tight” knowledge exchanges that are related to commercial transactions and enable the creation of value from leveraging the interchange of knowledge assets.
Copyright © 2004, Idea Group Inc. Copying or distributing in print or electronic forms without written permission of Idea Group Inc. is prohibited.
184 Apostolou, Mentzas & Maass Introduction In today’s hypercompetitive global marketplace, it is pivotal for enterprises to manage not only tangible resources but also to exploit their intangible knowledge assets. A consequent outcome of this realization has been the surge of interest in knowledge management. Knowledge management has been an item of strong interest in recent times in the research community (see, e.g., Alavi & Leidner, 1999; Davenport & Prusak, 1998; Nonaka, 1991, 1994; Nonaka & Takeuchi, 1995; Zack, 1999). However, research addressing the management of knowledge across organizational borders can best be described as sparse (see, e.g., Holtshouse, 1998). To date, there is yet to be a significant undertaking that looks at issues in managing knowledge across borders. This is unfortunate when looking at the increasing evidence that organizations are aware that they are part of a complex network of connections with their partners and customers. This network is not merely a supply chain or a financial connection — it is based on an increasingly intimate sharing of information and knowledge. The search for innovation and competitive advantage is increasingly focused on the cultivation and exploitation of these knowledge chains.
On the other hand, information and knowledge exchange across the organizational boundaries becomes crucial within the area of collaborative commerce.
The concept of collaborative commerce, and more generally collaborative business, has been recently introduced to encompass: all stages of collaboration between organizations from cradle to grave (initiation, management, operational life, and dissolution); all phases of extended products’ life cycle (conception, design, manufacturing, usage, maintenance, and end of life); all forms of collaboration (ad hoc, mediated, and planned); and all enterprise assets in any type of business network (people, ICT systems, processes, and knowledge assets).
The task of developing and managing knowledge assets in the collaborative business environment poses new challenges both to knowledge management theorists and practitioners. Companies at the forefront of these initiatives are extending the notion of the virtual community to include stakeholders outside the company (Ovum, 1999). This means sharing a collaborative engineering environment with suppliers and business partners or forging new relationships with customers through regular e-mail contact or user discussion forums.
This chapter aims to describe interorganizational “knowledge networks” and demonstrate how they have ushered in a new paradigm of collaborative business by forging links between internal and external knowledge and information resources. The overall aim is to classify and review various approaches in interorganizational knowledge networking whose objectives may span a multitude of needs: from “loose” information sharing that may be not connected to
financial transactions between the networking organizations, to “tight” knowledge exchanges that are related to commercial transactions and enable the creation of value from leveraging the interchange of knowledge assets.
The present chapter is organized as follows. After two sections on the importance on knowledge and knowledge management and on the issues inherent in managing knowledge within collaborative commerce efforts, it presents a typology of knowledge sharing networks and analyses the technologies for enabling the operation of knowledge networks. It then presents and analyses (using a validated knowledge management framework) two toolkits for interorganizational knowledge networking. It discusses the benefits and challenges associated with interorganizational knowledge sharing and concludes with future trends and emerging models for knowledge networks.
Knowledge Management and Knowledge Networking Knowledge and Knowledge Management The task of developing and applying knowledge management (KM) as a new discipline is a challenging endeavor. This new discipline must successfully respond to the diverse needs of companies in a timely fashion. However, despite a wealth of books, reports, and studies, neither researchers nor practitioners have an agreed definition of knowledge management. The term is used loosely to refer to a broad collection of organizational practices and approaches related to generating, capturing, and sharing knowledge that is relevant to the organization’s business. There are many different interpretations as to what it exactly means and how to best address the emerging questions about how to effectively use its potential power; see, e.g., Nonaka and Takeuchi (1995), Davenport and Prusak (1998), Edvinsson and Malone (1997), and Wiig (1995).
Some would even argue that knowledge management is a contradiction in terms, being a hangover from an industrial era when control modes of thinking were dominant.
Whatever the term and the definition employed to describe it, knowledge management is increasingly seen as signaling the development of a more organic and holistic way of understanding and exploiting the role of organizational knowledge in the processes of managing and doing work.
But what would knowledge be in an organizational setting? Debates and discussions about the definition of knowledge abound. In everyday language, it Copyright © 2004, Idea Group Inc. Copying or distributing in print or electronic forms without written permission of Idea Group Inc. is prohibited.
186 Apostolou, Mentzas & Maass has long been the practice to distinguish between information — data arranged in meaningful patterns — and knowledge — something that is believed, that is true (for pragmatic knowledge, that works), and that is reliable. The interchangeable use of information and knowledge can be confusing if it is not made clear that knowledge is being used in a new and unusual sense and can seem unscrupulous insofar as the intent is to attach the prestige of knowledge to mere information. It also tends to obscure the fact that while it can be extremely easy and quick to transfer information from one place to another, it is often very difficult and slow to transfer knowledge from person to another.
A definition that is suitable for our purposes is the one given by Davenport and
Prusak (1998), who define knowledge as:
“a fluid mix of framed experience, values, contextual information, and expert insight that provides a framework for evaluating and incorporating new experiences and information. It originates and is applied in the minds of knowers. In organizations, it often becomes embedded not only in documents or repositories but also in organizational routines, processes, practices, and norms.” This definition highlights two important types of knowledge — explicit knowledge and tacit knowledge (see also Nonaka & Takeuchi, 1995).
Tacit knowledge refers to that knowledge which is embedded in individual experience, such as perspective and inferential knowledge. Tacit knowledge includes insights, hunches, intuitions, and skills that are highly personal and hard to formalize, making them difficult to communicate or share with others. Tacit knowledge is also deeply rooted in an individual’s commitment to a specific context as a craft or profession, a particular technology or product market, or the activities of a workgroup or team. In other words, tacit knowledge is deeply ingrained into the context, i.e., the owner’s view and imagination of the world, and into his/her experience, which is previously acquired knowledge.
Explicit knowledge is knowledge that has been articulated in formal language and which can be easily transmitted among individuals. It can be expressed in scientific formulae, codified procedures, or a variety of other forms. It consists of three components: a language, information, and a carrier. The language is used to express and code knowledge. Information is coded externalized knowledge.
It is potential knowledge, which is realized when information is combined with context and experience of humans to form new tacit knowledge. The carrier is capable of incorporating coded knowledge and storing, preserving, and transporting knowledge through space and time independent of its human creators.
Both explicit knowledge and tacit knowledge are important for the organization.
Both must be recognized as providing value to the organization. It is through the conversion of tacit to explicit knowledge and explicit to tacit knowledge in the organization that creativity and innovation are released and the potential for value creation arises. The goal, then, is to leverage both explicit knowledge and tacit knowledge and to reduce the size of the organizational knowledge gaps.
A common thread running through many knowledge management initiatives is the challenge of developing and supporting new network-based communities, through which companies can improve internal collaboration and work more closely with partners and customers. Networks of people and networked organizations are emerging because the classic hierarchy of the bureaucratic model is slow to respond to the recent changes in the business environment. In the network, activities still need to be coordinated and integrated, but this integration relies on knowledge and relationships and a clear common sense of purpose. This has led to ideas about “work as a network of conversations” and the “hypertext organization” (see Nonaka & Takeuchi, 1995). Networks may take various organizational forms, ranging from communities of practice between individuals with similar experiences and/or purposes to supply chains of companies that exchange knowledge within their industry.
Knowledge networking levels correspond to what Nonaka calls the “ontological dimension” in his model of organizations as knowledge-creating mechanisms (see Nonaka, 1994). This ontological dimension refers to the social interactions, which begin at the individual level and then by communication between organizational boundaries let knowledge expand and grow up.
According to Nonaka and Ray (1993), if new knowledge is relevant to the needs of the organization, it is likely to permeate through groups and divisions and thereby extend the community of interaction dealing with that knowledge. New knowledge that has a potential to support more advantageous ways of doing things is likely to be retained as a subject for further debate within the network and may also lead to an extension of the network. For example, what eventually proves to be a successful product might emanate from an R&D department and gradually acquire a greater circle of interested parties within the organization as the dimensions of its potential impact become more clear. As news of the emerging product travels beyond the organization, the circle will grow still wider, embracing competitors, customers, firms dealing with complementary technologies, and so on. Thus the network will go beyond the original “hard core” of Copyright © 2004, Idea Group Inc. Copying or distributing in print or electronic forms without written permission of Idea Group Inc. is prohibited.
188 Apostolou, Mentzas & Maass knowledge creators to include those that are in some way affected by the exploitation of that knowledge.
However, there is no reason to suppose that there will be a linear sequence of expansion — starting from the individual, progressing to the group, and subsequently to the organization and beyond. The knowledge network could span departmental and organizational boundaries from the outset. Possible members of this community, such as suppliers, customers, and competitors, might all enter the knowledge networks at any time.
Knowledge networks are relationships among entities (individuals, teams, organizations) working on a common concern, and they embed dynamism for collective and systematic knowledge-asset creation and sharing. The structure of a knowledge network implies principles of coordination that not only enhance the individual capabilities of member entities, but themselves lead to capabilities that are not isolated to the network’s members. Cooperation can also engender capabilities in the relationship itself, such that the members develop principles of coordination that improve their joint performance. Or they might involve more complex rules governing the process by which innovations are collectively produced and shared. In this sense, the network is itself knowledge, not in the sense of providing access to distributed information and capabilities, but in representing a form of coordination guided by enduring principles of organization.