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Knowledge value chain
Ching Chyi Lee and Jie Yang
The Chinese University of Hong Kong, Hong Kong
Keywords Knowledge management, Tacit knowledge, Explicit knowledge, Knowledge-based value systems, Competitive advantage
Abstract Introduces the knowledge value chain model as a knowledge management (KM) framework. The model consists of knowledge infrastructure (knowledge worker recruitment, knowledge storage capacity, customer/supplier relationship and CKO and management), the process of KM (knowledge acquisition, knowledge innovation, knowledge protection, knowledge integration, and knowledge dissemination), and the interaction among those components resulting in knowledge performance. Further to the discussion of knowledge value chain (KVC), the following viewpoint was proposed: KM guides the way a corporation performs individual knowledge activities and organizes its entire KVC. It was suggested that competitive advantage grows out of the way corporations organize and perform discrete activities in knowledge value chain which should be measured by the core competence of corporation. This article also provides a cross-reference for e-commerce researchers and practitioners.
Knowledge and knowledge management
Knowledge vs information
Knowledge refers to an observer's distinction of ``objects'' through which he brings forth from the background of experience a coherent and self-consistent set of coordinated actions (Zeleny, 1987). Through the process of distinction, individual pieces of data and information become connected with one another in a network of relations. Knowledge then is contained in the overall organizational pattern of the network and not in any of the components. Knowledge is more than information. Information is data organized into meaningful patterns. Information is transformed into knowledge when a person reads, understands, interprets, and applies the information to a specific work function. Knowledge becomes visible when experienced persons put into practice lessons learned over time.
One person's knowledge can be another person's information. If a person cannot understand and apply the information to anything, it remains just information. However, another individual can take that same information, understand it and interpret it in the context of previous experience, and apply the newly acquired knowledge to make business decisions or redefine a laboratory procedure. Yet a third person may take the same pieces of information, and through his unique personal experiences or lessons learned, apply knowledge in ways that the second person may never have even considered. Information is a component part but not the whole of knowledge (Machlup, 1982). Knowledge itself is a much more all-encompassing term that incorporates the concept of beliefs based on information (Dretske, 1981). It also depends on the commitment and understanding of the individual holding these beliefs, which are affected by people's interaction and the development of judgement, behavior and attitude (Berger and Luckmann, 1967).
Journal of Management Development,
Vol. 19 No. 9, 2000, pp. 783-793.
# MCB University Press, 0262-1711
Tacit vs explicit
Tacit knowledge is that knowledge which cannot be explicated fully even by an expert and can be transferred from one person to another only through a long process of apprenticeship (Polany, 1962). Polany's famous dictum, ``We know more than we can tell'', points to the phenomenon in which much that constitutes human skill remains unarticulated and known only to the person who has that skill. Tacit knowledge is the skills and ``know-how'' we have inside each of us that cannot be easily...
...Valuechain and globalization
The process of corporate life is always a sea change and sometimes there are high tides and sometimes are quiet times. Day to day companies are faced with new challenges, whether it be a consolidated organization or a small business just starting, always emerging issues that affect their behavior and their performance. Owing to the consequences of an impressive development of technology and globalization that we are living in this age.
Nowadays are faster changes, new challenges threaten seriously survival of organizations, new foreign competitors, mobilization of capitals, difficulties in retaining human capital and changing technologies are elements that require managers to be prepared for change and have ability to motivate employees in order to have continuous renewal. “Micro and small enterprise dominated industries have been both threatened and provided with advantages as a result of dynamic trends related to globalization” (Kula et al., 2006). Valuechain is not only to implement new management models that ultimately prove to be only uncertain. However, management of change consists of take advantage of changes in business environment for the interest of the organization. That is why companies should not only be flexible, but also managers should develop a keen sense to anticipate change; therefore companies will be able to achieve to be at the forefront. According...
...ValueChain Analysis-Costco Corporation
Brief on the Organization
Costco is among the leading global retailers which provide customers a wide range of merchandise, ranging from small to well-known brands. The company began operations in 1983. Over the years, Costco has been a retailer in low cost membership-only leader, in warehouse club of merchandise. Moreover, Costco does not offer frills warehouse business models as its competitors do. Costco’s major competitors are BJ’s Wholesale Club and Sam Club (Costco, 2010).
Applying the tools presented in this SSP, Costco provides a detailed analysis for transforming business operations relative to industry rivals. This is done in order to create profits and attain maximum shareholder’s value. A close examination of Costco’s Valuechain suggests that the company uses a utilitarian approach, which maximizes the benefits for all stakeholders.
The Concept of ValueChain and Information Technology Impact
Nowadays, competitive advantage mainly derives itself through information technology in business models. Therefore, such supportive activities as information systems, R&D or general management are usually the most important source of differentiation advantage. Technology innovations continue to shape Costco’s valuechain. Through information technology, Costco obtains...
...ValueChain as a Company Strategy
Now a day, many companies are trying to improve their valuechain in order to use the valuechain as a strategy in the manner of meeting the customers need and satisfaction. One of the strategies they are using with valuechain is to gain competitive advantages for rival among their competitors. Valuechain actually can discover and fulfil what customers want and the identification of customer needs will hence become one of the ways to surpass their competitors in term of competitive advantages. Customers can have the best satisfaction of the things that they really want, at an acceptable price level. In other words, a company overall competitive advantage derives from the difference between the values that offers to customers and its cost of creating that customer value.
Important of the Concept
The concepts presented can is important to all organizations that produce and sell a product or provide a service. This concept may help companies to understand the valuechain approach for assessing competitive advantage associate with the comprehension of the strategic frameworks for valuechain analysis which is useful and it may link the valuechain analysis to organizational...
...bringing value to them and ensuring their needs, wants, expectations, and requirements are met consistently. This is especially true in every interaction with the customers. Organizations can bring added value by lowering prices, providing superior quality, shipping deliveries faster, and improving overall service. This is done through the effective management of both the supply chain and valuechain. For organizations dealing with operations and suppliers in various countries, they need to expand their management to the global level and ensure their global supply chains and global valueschains are set to run effectively and efficiently.
A global valuechain refers to the distribution of production on a global level. Declining costs in transportation, lower barriers for trade and investment, and improvements in information and communications technology have made it easier for organizations to operate separate parts of their businesses in many nations worldwide. A company can shift various functions to the location where efficiency is greatest for that specific function (CanadaExport, 2007).
The dispersion of activities in several nations globally helps an organization obtain a comparative advantage in terms of cost and quality. In turn, organizations must increase their attention to global supply chain management. With...
...ValueChain as Competitive Advantage
Unit 3 Assignment
GB570 Managing the ValueChain
September 25, 2012
ValueChain as Competitive Advantage
Customer-centric businesses focus on consistently delivering a differentiated experience designed to satisfy the customer. The ultimate goal is to sustain competitive advantage in the marketplace. The purpose of this paper is to demonstrate why an effective valuechain creates competitive advantage.
Review of Concepts
The valuechain is a concept developed by recognized Harvard business management expert Michael Porter in his book "Competitive Advantage (1985)." It breaks up the various elements of producing and delivery value to customers into key components. The development of value for the customer begins with inbound logistics, with subsequent components that include operations, outbound logistics, marketing and sales, and customer service. The culmination of optimizing performance in each of these key elements is the establishment of product margin, which is the difference between what the market will pay for a product and the cost basis for the provider (Iyas et all, 2007). Porter (1985) identified firm infrastructure, human resources management,...
...The valuechain was a concept initially proposed by McKinsey and later developed and made public by Harvard strategy guru Michael Porter. According to Porter, the valuechain is defined as the complete flow of products from the suppliers to the customers and management of the information flow in a way that maximizes the consumer satisfaction with the increase in the profit margins of the company. Simply, it includes a series ofvalue-adding activities connecting a company's supply side (raw materials, inbound logistics, and production processes) with its demand side (outbound logistics, marketing, and sales). And these activities are supported by the infrastructure of the firm, human resource management, technology and development, procurement.
The valuechain model is a useful analysis tool for defining a firm’s core competencies and the activities in which it can pursue a competitive advantage.
Firstly, we mention about cost advantage. A firm may create a cost advantage either by reducing the cost of the individual valuechain of activities or as what have been said before reconfiguring the valuechain to suit lower production costs. Once the valuechain is defined, a cost analysis can be performed by assigning costs to the valuechain activities. The...
...INTERGRATED ESSAY: VALUECHAIN ANALYSIS
Delisa C. Fryer
The purpose of the first week’s assignment is to analyze the valuechain and the strengths and weakness of Achievability a local nonprofit in Philadelphia. I will evaluate the strengths and weakness of Achievability, using Porter’s Exhibit I business model. Afterward I will come up with a strategy and a business model for In Loving Arms Family Resource Center my future business. I will also evaluate my skills sets/ social responsibilities and consider whether to increase or decrease my involvement, and determining the strengths and weakness.
Creating a valuechain analysis is a helpful tool for working out how you will create the greatest possible value for your business and customers (Mindtools, 2013). If you are in business for yourself you certainly want to add value to your business; no matter what your business is.
A manufacturer of pulp can easy add value to his business by turning pulp into paper for sale. A nonprofit is a much harder business to add value to. Since nonprofit means no profit, it will be harder to add value; but it is possible. If you own a nonprofit you can add services,...
...customers someone else will »
ECCO A/S – Global valuechain management case study
Wednesday, August 31st, 2011 at 8:27 am
My operations management coursework was based on the ECCO A/S – Global ValueChain Management case study which is an interesting paper on ECCO A/S (ECCO) who have been very successful in the footwear industry by focusing on production technology and assuring quality by maintaining full control of the entirevaluechain from “cow to shoe.”.
ECCO follow a differentiation business strategy producing the highest quality shoes and they use their operations as one of their main points of competitive advantage.
ECCO’s operations strategy is top-down (i.e. formed in pursuit of its business strategy) and operations-led (i.e. based on the resources and capabilities within its operations). They prioritise quality and reliability; the supply chain is configured to produce in accordance with specification and without error.
ECCO has a very atypical operations strategy compared with their industry peers. Unlike their “branded marketer” competitors they produce their own materials and manufacture 80% of their own products in factories around the world. Owning and controlling the entire valuechain gives them huge flexibility and allows them to maintain the highest levels of quality.
The following is a paper from my...