Information and Knowledge Management using ArcGIS ModelBuilder

Value of Knowledge Management Systems: A Review
Paper
Nelly Todorova
University of Canterbury, Christchurch, New Zealand
nelly.todorova@canterbury.ac.nz
Abstract: One of the basic knowledge management questions is how organizations can turn the knowledge that
they have into something that adds value. While there is general agreement on the importance of value creation
through knowledge generation, diffusion and utilization, the concept of value in the context of knowledge
management has not been defined. This fundamental issue is complicated by the different paradigms underlying
KM such as information management, strategic management, business process re-engineering, philosophy and
economics. Defining value in the context of KM will lead to better understanding of the potential sources of value
creation from knowledge management and better management of knowledge assets. It will inform the
measurement of knowledge and its impacts on organizations. It will lead to recognition of the contribution of
knowledge assets to organizational success. This paper provides a comprehensive literature review reporting on
prior research on value creation and how this can improve the understanding of value in the context of knowledge
management. The subject of value is very complex due to its subjective nature, multiple levels of sources and
users and a multitude of underpinning disciplines and perspectives. Current research has called for the need for
integration of these perspectives and greater understanding of the value dimensions at different levels. This
paper presents a preliminary holistic framework of value dimensions in order to gain better understanding of the
value created from KM initiatives from multiple perspectives at organizational level. This framework can be used
to map out specific value priorities for organizations and align them with measurements that are set for evaluation
of KM initiatives.
Keywords: knowledge management, evaluation, value creation, KM systems
1. Introduction
The 21st century is a knowledge economy and knowledge workers are the most valuable asset of
organizations (Drucker, 2000). Knowledge is needed to deal with complexity, to provide value-added
services and to encourage innovation. Achieving sustainable competitive advantage is only possible
through what an organization knows, how it utilizes and how fast it can learn something new (Prusak,
1997). Knowledge Management is an approach that was developed to leverage this new core
resource. Knowledge management (KM) aims to help employees effectively create, share and utilize
knowledge to enhance the organisation’s knowledge (Jashapara, 2004)
To pursue this advantage companies have invested billions of dollars in knowledge management
systems to facilitate the storage and flow of knowledge within the organization. However, it is not
enough to generate knowledge and make it available. Many organizations which have invested in KM
systems have realised that knowledge management is not a one-off investment but a continuous
process (KPMG Survey, 2003). KM systems are often perceived as “glorified information systems” as
there is a gap between their promise and what they deliver (Geisler, 2008 p 255). The important
success factor is to provide knowledge which adds value. One of the primary questions for
Knowledge Management researchers and practitioners is how organizations can transform the
knowledge that they have into something that adds value.
While there is general agreement on the importance of value creation through knowledge generation,
diffusion and utilization, the concept of value in the context of knowledge management has not been
defined. This fundamental issue is complicated by the different paradigms underlying KM such as
information management, strategic management, business process re-engineering, philosophy and
economics. The concept of value generated from knowledge management varies dependent on the
perspective. Defining value in the context of KM will lead to better understanding of the potential
sources of value creation from knowledge management and to better management of knowledge
assets. It will inform the measurement of knowledge and its impacts on organizations. It will improve
to recognition of the contribution of knowledge assets to organizational success (Boudreau, 2003 p
361). Therefore, the purpose of this paper is to investigate the sources of value creation at the
organizational level and to improve our understanding of value in the context of knowledge
management initiatives.
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