Mankind from the days of their evolution has recognized the importance of managing knowledge.
The systematic study of KM, as a management and scientific discipline, began in the year 1994, with the Annual Report of leading Swedish Financial Services Firm, Skandia, who attempted to quantify the value of the company’s intellectual capital.
The effort, begun in 1991, represented an early attempt to provide a methodology to determine the value of knowledge to a corporation.
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The important conclusion of this study was that the Intellectual Capital (IC) of an organization is equally important in providing truly sustainable earnings as the traditional financial capital.
Knowledge is the full utilization of information and data, coupled with the potential of people’s skills, competencies, ideas, intuitions, commitments and motivations. In today’s economy, knowledge is people, money, leverage, learning, flexibility, power, and competitive advantage. Knowledge is more relevant to sustained business than capital, labor or land.
Nevertheless, it remains the most neglected asset. It is more than justified true belief and is essential for action, performance and adoption. Knowledge provides the ability to respond to novel situations.
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A holistic view considers knowledge to be present in ideas, judgments, talents, root causes, relationships, perspectives, and concepts. Knowledge is stored in the individual brain or encoded in organizational processes, documents, products, services, facilities and systems. Knowledge is the basis for, and the driver of our post-industrial economy.
Knowledge is the result of learning which provides the only sustainable competitive advantage. Knowledge is the next paradigm shift in computing following the evolution of data processing (1945-1965) and information management (1966-1995).
Knowledge is synonymous with, focused innovation, pooled expertise, special relationships and alliances. Knowledge is value-added behavior and activities. For knowledge to be of value it must be focused, current, tested and shared.