Knowledge management and intellectual capital Essay

experience is something that comes from t separatelying neat by using data. It includes experience, cling tos, insights, and contextual in nameation and helps in evaluation and internalisation of spick-and-span experiences and launching of new association. People workout their cognition in making decisions as well as many otherwise actions. In the last few years, many organizations realize they own a great amount of intimacy and that this familiarity needs to be get awayd in frame to be useful.cognition way (KM) system is a phrase that is use to describe the creation of fellowship repositories, improvement of intimacy access and overlap as well as communication through collaboration, enhancing the knowl distinctness surroundings and managing companionship as an asset for an organization. ingenious dandy is considered as a make out influencer of innovation and agonistical advantage in todays cognition based economy. Knowledge trouble helps in obtaining, r ipening and sustaining noetic gravid in organisations. This paper focuses on how knowledge circumspection and clever heavy(p) helps the organization to achieve their goals and as well as the congener between these two concepts. Key words knowledge guidance, intellect slap-up, organisational goals, benefits IntroductionKnowledge is something that comes from information processed by using data. It includes experience, values, insights, and contextual information and helps in evaluation and incorporation of new experiences and creation of new knowledge. Knowledge originates from, and is applied by knowledge workers who are necessitated in a particular job or task. People use their knowledge in making decisions as well as many other actions. In the last few years, many organizations realize they own a vast amount of knowledge and that this knowledge needs to be managed in club to be useful.Knowledge vigilance is not one angiotensin-converting enzyme field of force. Rath er, it an integration of numerous endeavours and fields of study. Knowledge management is a go over that seeks to improve the performance of individuals and organizations by respecting and leverage the present and future value of knowledge assets. Knowledge management systems encompass both human and modify activities and their associated artifacts. So, what is Knowledge?Knowledge is a fluid mix of framed experience, values, contextual information, expert insight and institution that volunteers an environment and framework for evaluating and incorporating new experiences and information. From this perspective, knowledge management is not so much a new arrange as it is an integrating practice. It offers a framework for balancing the numerous of technologies and snugglees that provide value, tying them together into a seamless whole. It helps analysts and builders better address the interests of stakeholders crosswise inter connect knowledge flows and, by doing so, better en sa tisfactorys individuals, systems and organizations to exhibit truly healthy behaviour in multiple contexts.The reasons why companies invest in KM are that it either gives them a temporal effectiveness or dexterity advantage over their competitors, or they do it to try to negate the competitive advantage of others. For the purpose of this research, KM is defined to include the five implicit in(p) processes of (1) Knowledge acquisition (KA)(2) Knowledge creation (KC)(3) Knowledge documentation (KD)(4) Knowledge transfer (KT) and(5) Knowledge application (KAP)These five KM processes are not needfully sequential but rather iterative and overlap. The effective management of knowledge necessitates a thorough understanding of the relationships not only among the KM processes themselves but in like manner between the KM processes and the intellectual assets of an organization. dexterous capital (IC)Intellectual capital basin include the skills and knowledge that a troupe has growed ab out how to make its goods and services. It also includes insight about information pertaining to the companys history guests vendors processes stakeholders and all other information that skill be possessed of value for a competitor that, perhaps, is not common knowledge. Intellectual capital is therefore, not only organizational knowledge, it is also industry knowledge. It is the conspiracy of both cognitive knowledge and intuitive/experience-related knowledge.Intellectual capital is know for creating innovation and competitive advantage in this knowledge based era. only if knowledge management plays a dominant role in obtaining, growing and sustaining intellectual capital in organizations which implies that the successful implementation and usage of KM ensures the acquisition and growth of Intellectual capital.Organizations should deploy and manage their IC resources in order to maximize value creation. The IC term was first introduced by Galbraith (1969) as a form of Knowledg e, intellect, and brainpower exercise that uses knowledge to stimulate value. Since then, unalike views of IC have been emerged. For instance, view IC as a knowledge that can be converted into value. IC as the accrual of all knowledge and competencies of employees that enable an organization to achieve competitive advantages. In addition, IC is defined to include all non-tangible assets and resources in an organization, including its processes, innovation capacity, and patents as well as the mum knowledge of its members and their network of collaborators and contact. In foulness of its multidimensionality, this research conceptualizes IC as consisting of three basic interrelated dimensions humankind capital (HC)Organizational (or structural) capital (OC), comparative (or customer) capital (OR) Human capital encompasses attitudes, skills, and competences of the members of an organization. Organizational great includes elements such as organizational culture, routines and pra ctices, and intellectual property. Relational Capital, however, includes relationships with customers, partners, and other stakeholders. The investments in Human Capital, Organizational Capital, and Relational Capital are expected to increase the value of an organization.The management of intellectual capital involvesIdentifying severalize IC which drive the strategic performance of an organisation. Visualizing the value creation pathways and transformations of list IC measure performance and in particular the dynamic transformations. Cultivating the key IC using KM processesThe internal and external reporting of performanceKnowledge management and Intellectual capitalIC and KM servicing dissentent purposes and include the whole range of intellectual activities from knowledge creation to knowledge leverage. IC and KM as a set of managerial activities aiming at identifying and valuing the knowledge assets of an organization as well as leveraging these assets through the creation a nd sacramental manduction of new knowledge. KM and IC are believed to be closely coupled.When KM activities are used to develop and maintain IC, it becomes a resource of sustainable competitive advantage. On the other hand, when IC is properly utilized and exploited, it increases the absorptive capacity of the organization, which, in turn, facilitates its KM processes. Knowledge can add value to organizations through intangible assets such as Intellectual capital. Conceivably, the socialization, exteriorisation, combination, and internalization (SECI) model is a much fitting hypothetic keister for understanding the KM-IC relationship. The SECI model outlines different interactive spaces (Ba), in which tacit knowledge can be make Explicit.The IC components (e.g. HC, OC and RC) represent the arousal for the knowledge creation process in the SECI model, and its main output takes the form of commercially exploitable intangibles. The cardinal processes of the SECI model involve not only knowledge creation and utilization but also the other KM components including knowledge transfer, knowledge documentation, and knowledge acquisition. Knowledge transfer (sharing) is the common factor of the four processes of the SECI model. Socialization facilitates the conversion of new tacit knowledge through divided up experience, which allows the less communicated knowledge to be communicated.Therefore, the socialization processes involve knowledge transfer. In addition, externalization is the process of articulating tacit knowledge into explicit knowledge, which can be shared by others. In the combination and internalization processes, knowledge is transfer and reconfigured through documents, meetings, or communication networks. Effective execution of the SECI processes can stick different types of IC.Socialization involves the accumulation of HC, OC, and RC by sharing and transferring experiences through formulate activities. Also, the conversion of tacit knowledge i nto explicit knowledge through externalization make outs and accumulates OC. Combination creates knowledge structures in the form of systemic, institutionalized knowledge (i.e. OC) that can be directly disseminated and distributed. Internalization, on the other hand, accumulates HC and RC through learning by doing.Review of LiteratureFrancis Bacon has emphasized on wideness of knowledge management in organizations with his famous phrase knowledge is power (Muller-Merbach, H. 2005). The strategy that considers knowledge along with other resources such as land, work and capital as an asset is knowledge management (Nonaka and Takouchi, 1995). Dell (1996) believes that knowledge management is a systematic approach for finding, understanding and applying of knowledge in order to create knowledge.According to Simon (1999) knowledge management is intelligent planning of processes, tools, structures and etc with the purpose of increasing, restructuring, sharing or improving of knowledge a pplication that is apparent in each of three elements of mental capital, i.e. structural, human and social. Some of the clear-sighted believe that knowledge management is not a technology (Clair Guy, 2002 Lang, 2001 DiMatta, 1997 Koenig,2002 McInerey, 2002). This process helps organizations to be able to use their assets, work faster and more wisely and obtain more capital (Shawarswalder, 1999). An increased attention is focused on KM and IC management in the organisation.In the last decade there has been a shift in management focus from traditional accountancy practices where financial capital is paramount, to growing realisation that intangible assets are of greater import in our knowledge-based economy (Egbu et al 2000, 2001). Knowledge can be a valuable resource for competitive advantage and harnessing its value is one of the pre-eminent challenges of management. Identifying and exploiting knowledge assets, or intellectual capital (IC), has been vastly documented. There are di fferent types of knowledge in an organisation from the tacit knowledge of individuals, which is unarticulated and intuitive, to explicit knowledge that is codified and easily transmitted (Nonaka and Takeuchi, 1995). Further distinctions have been made by academics and practitioners involved in the IC debate. Three components of IC have been identified comprising human, structural and customer capital (Edvinsson, 2000 Bontis, 1998 Bontis et al., 2000).However, it is asserted that the human capital in an organisation is the most important intangible asset, e specially in terms of innovation (Edvinsson, 2000 Stewart, 1997 Brooking, 1996). Marr et al. (2003) argue that KM is a fundamental activity for growing and sustaining IC in organizations. Bontis (1999) posits that managing organizational knowledge encompasses two related issues organizational learning flows and intellectual capital stocks. Organizational learning, as a part of KM (Rastogi, 2000), reflects the managements effort to managing knowledge and ensures that IC is continually developed, accumulated, and exploited. A thorough review of the relevant literature and discussions with targeted researchers in the field would suggest that the development of successful knowledge management programmes involve due cognisance of many factors.Compilation of dataKnowledge heed consists of managerial activities that focus on the development and control of knowledge in an organization to fulfil organizational objectives. The knowledge sharing takes place in the organizations in two ways, explicit and tacit. The knowledge management seem to in two tracks as dynamic process or nonmoving object. Depends on how individuals understand what knowledge is and their aims both intellectual capital and knowledge management actors thus emphasize either the static or the dynamic properties of knowledge.Measuring the knowledge management is growing area of interest in the knowledge management field. The metrics are being develo ped and applied by the some organizations, but limitation of current measures is that they do not necessarily address the knowledge level and the types of value added knowledge that individuals obtain. The intellectual capital is most valuable asset it brings intellectual capital firmly on to the management agenda.The sum of everything everybody in organization knows that gives a competitive edge in the market place. The individual intellect effect more judge of an organization. The intellectual capital characterizing as Intellectual material that has been formalized, captured and leveraged to produce the static properties of knowledge are inventions, ideas, computer programs, patents, etc., as Intellectual Capital also include human resources, Human Capital, but emphasize that it is clearly to the advantage of the knowledge firm to transform the innovations produced by its human resource into intellectual assets, to which the firm can assert rights of ownership. The measures for i ntellectual capital in use1. appreciate extraction2. Customer capital3. Structural capital4. Value creation5. Human capitalComponents of intellectual capitalHuman capital indicatorsStructural capital indicatorsThe knowledge management community needs to be responsive to the needs management in the organization by assay to adequately measure the intellectual capital and assess the worthiness of the knowledge management initiatives. underdeveloped metrics and studies for measuring intellectual capital willing help to consolidate the knowledge management field and give the discipline further credibility. Applying of knowledge is very important to the supplement chain design and operation. Intellectual capital and knowledge management principle helps to endeavor supply chains. Knowledge management is formalizes approaches to understanding and benefiting knowledge assets at the firm level. The drivers which maximizes the enterprise supply chains Operational efficiencyOpportunities to better service customer and stakeholders need A spring board for innovation A foundation concept in the field of intangible assets that is important for practice in that there are two dimension of knowledge, explicit and tacit. Next we develop these ideas further by interleaving intangible and traditional firm assets. Later we indentify the special characteristicspriorities for the four generic supply chain models The intellectual capital approachIntellectual capital comprises all the nonmonetary and nonphysical resources that are fully or partially controlled by the organization and contribute to the value creation. Three categories of intellectual assets are organizational, relationship and human. Strategies to manage knowledge1. Operational excellence2. fig excellenceConclusionHence we would like to conclude that this paper has considered the importance of knowledge management and intellectual capital to organisations. Knowledge management practices differ from organisation t o organisation. Organisations are at different stages in the knowledge management trajectory. Organisations learn at different rates and apply different techniques (formal and informal) in managing knowledge. In the study on which this paper is based, there is a common consensus that the management of knowledge assets is vital for business.Knowledge Management and Intellectual Capital should be integrated to maximize organizational effectiveness. However, the relationship between KM and IC is complex and so is its management. In order to effectively manage such a relationship, it is imperative to understand where and how the accumulated IC is reflected in managing KM activities in organizations. The management of knowledge and intellectual capital provides opportunities for support creativity and innovation. However, the effective implementation of knowledge management in organisations depends on many factors, which includes people, culture, structure, leadership, people and the e nvironment.In most organisations, there is a neglect of appropriate formal measuring constructs for the measurement of the benefits of knowledge assets to organisational performance. Managers operating in the knowledge economy are required to be knowledge leaders, who must be aware of the relationship between knowledge and those who possess it in order to successfully fulfil their leadership responsibilities. Based on the findings of this research, managers in the organizations are expected to develop strategies, adopt structures, and construct systems that effectively form and integrate the efforts aiming at managing knowledge, human resource, and customer relationship in order to enhance knowledge flows, accumulate IC, and create and sustain business values.ReferencesIntellectual capital and knowledge management A new era of management thinking?- Jodee Allanson Reconfiguring knowledge management combining intellectual capital, intangible assets and knowledge creation Tomi Hus si Intellectual capital and Knowledge management effectivenessBernard Marr, Oliver Gupta, Stephen Pike, Goran Roos.Developing knowledge management metrics for measuring intellectual capital Jay Liebowitz form of KM and Intellectual capital on organisational innovations Charles Egbu, Katherine Botte rill and Mike Bates