Leveraging HR and knowledge management in a challenging economy.Abstract
In today's challenging economy, organizations that optimize knowledge management--a key success factor--are leaders in their field. As a strategic business partner, HR plays an important role in fostering a workplace culture for organizational learning. From sustainability and education to workforce planning Strategic Workforce Planning involves analyzing and forecasting the talent that companies need to execute their business strategy, proactively rather than reactively, it is a critical strategic activity, enabling the organization to identify, develop and sustain the workforce and global knowledge transfer, knowledge management is essential for competitive advantage.
In an economic downturn, the collection of organizational knowledge and its application are likely to determine the next generation of industry superstars This article is about the televised sports competition. For other uses, see Superstar.
Superstars is an all-around sports competition that pits elite athletes from different sports against one another in a series of athletic challenges resembling a decathlon. . Education and learning are cornerstones of the Obama administration, and President Obama strongly urges people of all ages to continue to learn. Each individual needs to grow intellectually and prepare to contribute to society and to his or her organization. In a global marketplace, successful companies focus on the education of their current workforce as well as the next generation.
Trust, relationships and dialogue are the foundation for building organizational knowledge sharing. As a strategic business partner, HR can forward organizational success--domestic and global--through the development, retention and transfer of organizational knowledge. With knowledge management (KM), business success is achieved in a culture of learning and workplace planning. This Research Quarterly presents key factors and solutions that HR can leverage, through knowledge management, for competitive advantage in a challenging economy.
Historically, the world of work has evolved from manual labor to mechanical and technical expertise to a knowledge economy. Today, success requires agility and adaptability, largely dependent upon the quick assimilation Assimilation
The absorption of stock by the public from a new issue.
Underwriters hope to sell all of a new issue to the public.
See also: Issuer, Underwriting
Assimilation and application of knowledge to develop and respond to new technologies, new products and new services that can lead to a competitive edge. While some firms may view knowledge management as "nice to have," proactive organizations see KM as a key component of an effective business plan. Developing a knowledge management strategy aligns with business viability and sustainability.
Knowledge begins with people. Retaining the right talent in today's tough economy presents a strategic opportunity to build a stronger organization. As a source of innovation and competitive advantage, KM is an important HR and managerial tool. However, for effective collaboration of knowledge in organizations, communication and trust are essential. How organizations treat their employees, particularly during difficult economic times, speaks to how organizations truly value their employees--and will either promote or deflate (file format, compression) deflate - A compression standard derived from LZ77; it is reportedly used in zip, gzip, PKZIP, and png, among others.
Unlike LZW, deflate compression does not use patented compression algorithms. trust, performance and ethical behavior. (3)
As companies cope with the economy, HR can be instrumental in helping organizations leverage knowledge-based resources for business results. As highlighted in Creating People Advantage, critical HR challenges focus on three strategic categories, all related to knowledge management: 1) developing and retaining the best employees (talent, leadership development, work/life balance); 2) anticipating change (demographics The attributes of people in a particular geographic area. Used for marketing purposes, population, ethnic origins, religion, spoken language, income and age range are examples of demographic data. , change, cultural transformation, globalization globalization
Process by which the experience of everyday life, marked by the diffusion of commodities and ideas, is becoming standardized around the world. Factors that have contributed to globalization include increasingly sophisticated communications and transportation ); and 3) enabling the organization (becoming a learning organization). (4) As indicated in a SHRM SHRM Society for Human Resource Management
SHRM Saw Horse Roof Mount (construction) April 2009 poll of U.S.-based organizations and multinational companies, the primary focus of companies now is workforce planning. Although hiring expectations are low, talent management priorities remain high despite the economic downturn (see Figure 1).
Figure 1 | Changing Focus on Talent Management A significant/moderate Minor extent No extent extent Employee engagement 66% 19% 15% and retention (n = 321) Employee development 63% 18% 19% (n = 324) Succession planning 58% 22% 20% (n = 323) Recruitment (n = 44% 26% 30% 319) Note: Respondents who indicated "not applicable" were excluded from this figure. Source: SHRM Poll: Programs and Practices to Confront the Workplace Effects of the Downturn in the Economy (SHRM, April 2009). Note: Table made from bar graph.
[FIGURE 1 OMITTED]
Sustainability depends on effective knowledge management practices. From an organizational standpoint, sustainability refers to the business as a whole, including the employer brand, human capital, business ethics business ethics, the study and evaluation of decision making by businesses according to moral concepts and judgments. Ethical questions range from practical, narrowly defined issues, such as a company's obligation to be honest with its customers, to broader social , social responsibility and financial well-being. At the SHRM 2008 Executive Roundtable Symposium on Sustainability and Human Resource Management Strategy, senior executives from around the world discussed the opportunity for HR to provide strategic leadership in sustainability. They emphasized that sustainability is a people issue--recruiting, developing and engaging employees for maximum performance and profitability. (5)
When considering research implications of knowledge measurement, one viewpoint is to use three related themes, as described by management author and researcher John W. Boudreau. First, measures focus on aggregated units of analysis (e.g., groups of individuals, such as profit centers, alliance partners and companies, to regions and economies). Second, measures aim to explain the link between knowledge and the strategic value of the organization: the value-chain context. Third, the focus is on the role of knowledge (such as in talent pools) and pivotal roles. The concept of pivotal roles refers to individuals whose performance has a positive impact on organizational value and competitiveness. (6)
Traditional benchmarking metrics metrics Managed care A popular term for standards by which the quality of a product, service, or outcome of a particular form of Pt management is evaluated. See TQM. are often used to identify KM effectiveness. Such measures include employee turnover, employee attitude, cost reductions/savings, number of communities of practice and customer satisfaction. (7) Linking cost-per-hire to revenue per FTE FTE Full-Time Equivalent
FTE Full-Time Employee
FTE Full-Time Equivalency
FTE Full Time Employment
FTE Foundation for Teaching Economics
FTE Full Time Enrollment
FTE For the Enterprise (SQL)
FTE Fund for Theological Education is an example of KM measurement. Because revenue per FTE measures employee productivity, selecting the most qualified person who can increase revenue is a critical success factor. However, enhanced selection strategies cost more. When HR is pressured to lower recruitment costs, caution is required to balance the need for targeted selection programs against their cost to ensure that appropriate candidates are hired to contribute to organizational revenue. SHRM data show that in 2008 high-tech organizations had an average cost-per-hire of $5,748 and revenue per FTE of $446,218. (8) When the economy turns in a positive direction, organizations that have the right talent will be better positioned for competitive advantage.
Fundamentals of Knowledge Management
As a management discipline, the field of knowledge management addresses human capital needs, policies, procedures, technology, incentives and organizational culture. There are various models put forth by researchers to describe the link between HR and KM. For example, researchers David P. Lepak and Scott A. Snell Snell , George 1903-1996.
American geneticist. He shared a 1980 Nobel Prize for discoveries concerning cell structure that enhanced understanding of the immunological system, resulting in higher success rates in organ transplantation. portray por·tray
tr.v. por·trayed, por·tray·ing, por·trays
1. To depict or represent pictorially; make a picture of.
2. To depict or describe in words.
3. To represent dramatically, as on the stage. human capital management as a multilevel perspective for knowledge-based competition, with competencies and contributions at the individual, employee group and organizational levels. (9) The types of knowledge, a workplace culture of learning and the knowledge worker form the platform for KM.
Two Classes of Knowledge
Knowledge can be divided into two groups--explicit and tacit--both necessary for organizational success. Explicit knowledge Explicit knowledge is knowledge that has been or can be articulated, codified, and stored in certain media. It can be readily transmitted to others. The most common forms of explicit knowledge are manuals, documents and procedures. Knowledge also can be audio-visual. is typically visible, definable and objective. In contrast, tacit knowledge The concept of tacit knowing comes from scientist and philosopher Michael Polanyi. It is important to understand that he wrote about a process (hence tacit knowing) and not a form of . lives within individuals and their behaviors. Tacit knowledge is context-rich, often subjective and not easily transferrable. (10) Explicit knowledge is organizational knowledge found in company documents, files, policies, training, patents, procedures, etc. Tacit knowledge is the shared learning and collective wisdom of an organization, such as how things are done on the job, internal and external work experiences related to the company and the overall collective organizational experience. (11)
Culture for Organizational Learning
In today's knowledge economy, KM is increasingly essential for organizational success. Cooperation, networking and collaboration are key in knowledge management. Two major workplace shifts make knowledge management both essential and challenging--the changing nature of work itself and the changing nature of the work environment becoming increasingly global and virtual. Critical aspects of KM help to ensure effectiveness of collaboration and sharing to build a knowledge organization (see Figure 2).
Figure 2 | The Four Sides of knowledge Management
1. Culture-Encourages and supports employees to share their knowledge and collaborate with others.
2. Technology-Collaboration on products/projects requires the appropriate technology-hardware, software and connectivity.
3. Economic incentives-Bonus incentives can foster and promote collaboration and sharing of knowledge between employees.
4. Measurement-The development of indicators to gauge the success and effectiveness of knowledge management.
Source: Adapted from Lewison, J. (2001, October). Knowledge management [SHRM white paper]. Retrieved February 13, 2009, from www.shrm.org.
Organizational leaders shape the workplace environment for learning--for idea generation, innovation and ultimately for sustainability. It is within organizational culture that a learning environment is established, with the supportive dimensions of openness, continuous education, creativity and high value placed on learning. (12) A learning culture also involves risk-taking, with some tolerance for mistakes (the opposite of a "blame culture"). HR leadership of initiatives that foster knowledge development (such as career development and leadership training) emphasizes knowledge sharing and integration at the performance management level. Fundamental issues, such as adding value and increasing shareholder wealth, are important to consider when determining knowledge management pathways. (13)
By focusing on strategic learning capacities, HR can promote knowledge management as a strategic business objective. Examples include emphasizing training and development, focusing on professional development, and establishing policies and practices for employee talent retention through internal promotions, knowledge-sharing taskforces and an overall commitment to excellence. Although companies are now cutting training budgets, in a down economy HR can promote free professional development opportunities.
Research shows that many firms in nearly every industry sector now focus on knowledge management and organizational learning. A study by The Conference Board of 200 senior executives found that 1) 80% of companies are taking actions around KM, 2) 25% have a chief knowledge officer or chief learning officer, and 3) 21% have a communicated KM strategy. The findings reveal that senior management leadership is essential where learning is being inculcated into the corporate culture. Although technology is important for KM, it is informal employee networks and other workforce practices that develop effective action for KM. Ultimately, the implementation of organizational learning is a long-term investment for future success. (14)
The Knowledge Worker
As highlighted in an article "Learning to Compete in a Knowledge Economy," the effective management and retention of workers in a knowledge economy are crucial for success. (15) Knowledge workers often have organizational knowledge essential to the company. HR initiatives that connect employees, professional opportunities and accomplishments help retain knowledge workers. Participation in high-visibility projects and recognition for contributions are two examples of effective retention strategies. The working environment is also important for retention. Management practices that address a combination of personal growth, operational autonomy, task achievement and financial reward are supportive of knowledge workers. (16)
In a challenging economy, recognition for creative ideas is one KM initiative. Several organizations listed among "The 100 Best Companies to Work For" in a recent 2009 issue of Fortune reward knowledge and action. Qualcomm, a wireless-components designer in San Diego San Diego (săn dēā`gō), city (1990 pop. 1,110,549), seat of San Diego co., S Calif., on San Diego Bay; inc. 1850. San Diego includes the unincorporated communities of La Jolla and Spring Valley. Coronado is across the bay. , Calif., keeps new ideas flowing through its award-winning recruitment program. At Whole Foods, a nationwide high-end food seller, employees are encouraged to come up with creative ideas to show off the company's merchandise--and the best ideas are shared with other Whole Foods stores. At Atlantic Health System, a hospital in Morristown, N.J., employees can receive $1,000 for a new idea. (17) In today's often frenetic fre·net·ic or phre·net·ic also fre·net·i·cal or phre·net·i·cal
Wildly excited or active; frantic; frenzied.
[Middle English frenetik, from Old French frenetique pace, taking time to thoughtfully acknowledge work well done has a positive impact on talent retention.
The Right Behaviors
A 2008 SHRM survey indicates that the use of behavioral competencies is beneficial on many levels, such as increased job satisfaction, reduced turnover, increased productivity and a better pool of candidates for succession planning Management Succession Planning
In organizational development, succession planning is the process of identifying and preparing suitable employees through mentoring, training and job rotation, to replace key players — such as the chief executive officer (CEO) — (see Figure 3). When it comes to knowledge work and knowledge integration, research suggests that HR can promote effective knowledge management by focusing on four tasks: 1) identifying behaviors needed for knowledge-based competition; 2) ensuring the workforce has the required competencies; 3) ensuring the workforce is motivated to engage in the required behaviors; and 4) providing opportunities for these behaviors in the workforce. (18)
Figure 3 | Outcomes of Using Behavioral Competences in Organizations Ability to hire better qualified candidates 62% Increased employee job satisfaction 44% Reduced turnover 34% Increased productivity 31% Improved utilization of training and development budget 25% Ability to attract better qualified candidates 20% Increased incumbent pool for succession planning 20% No noticeable change 14% Increased organizational financial performance 13% Too new to measure outcome 9% Note: Percentages do not total 100% as multiple response were allowed. HR professionals whose organizations have not identified behavioral competencies were excluded from this analysis. Source: SHRM Weekly Online Poll (January 2008) Note: Table made from bar graph.
[FIGURE 3 OMITTED]
Mini-case study #1 illustrates team behavior in engineering in a high-tech industry. While problem-solving is an essential part of engineering work, collaboration to achieve quality can be difficult with different expert opinions. A key learning from this study, for HR and managers, is a heightened awareness of barriers to knowledge sharing and collaboration in situations where team boundaries can contribute to the difficulty of making informed decisions.
Mini-Case Study #1: Managing Knowledge Work: Specialization A career option pursued by some attorneys that entails the acquisition of detailed knowledge of, and proficiency in, a particular area of law.
As the law in the United States becomes increasingly complex and covers a greater number of subjects, more and more attorneys are and Collaboration of Engineering Problem-Solving (19)
This study explored the tacit dimension of knowledge creation and knowledge sharing practices of three semiconductor manufacturers in Japan and Korea to examine the social processes of expert teams (design, process and process integration) and how they cooperate across team boundaries, with various viewpoints from team specialization. These teams were responsible for trouble management in the production of an integrated circuit integrated circuit (IC), electronic circuit built on a semiconductor substrate, usually one of single-crystal silicon. The circuit, often called a chip, is packaged in a hermetically sealed case or a nonhermetic plastic capsule, with leads extending from it for semiconductor device. The study revealed that the primary challenges to the development of a successful knowledge management process were not the strategies for collecting and identifying the problem. Rather, the challenge was the management of the political process regarding the behaviors of different teams of engineers, each influenced by their respective areas of expertise.
Knowledge Management Tools for HR
The following four KM practices are tools that foster learning, knowledge sharing, retention and transfer: communities of practice, storytelling Storytelling
semi-legendary fabulist of ancient Greece. [Gk. Lit.: Harvey, 10]
Baron traveler grossly embellishes his experiences. [Ger. Lit. , knowledge retention practices and leadership development.
* Communities of Practice (CoPs) In today's economy, CoPs are instrumental in creating new business opportunities through staff with internal expertise who translate new insights into new services and products. (20) By bringing together groups that cross organizational boundaries (various teams, business units, divisions), HR can promote knowledge learning and sharing. Usually voluntary, what makes a CoP unique--if working well--is the sense of aliveness and engagement. Open dialogue, different levels of participation and a focus on value are three key factors for an effective CoP.
A recent study explored benchmarking the impact of CoPs. The results revealed that some companies take success stories of business benefits and translate them into measures for a "health check" for their CoPs. For example, the energy company ConocoPhillips measures the development of its CoPs ("networks of excellence"). Performance is calibrated cal·i·brate
tr.v. cal·i·brat·ed, cal·i·brat·ing, cal·i·brates
1. To check, adjust, or determine by comparison with a standard (the graduations of a quantitative measuring instrument): against expectations with 10 critical success factors: clear business case, leadership/sponsorship, clear deliverables, adequate resources, development of trusted relationships, a transfer process, supporting technology, motivation, recognition/rewards, and network measurement. For transparency, progress toward goals is identified on the dashboard (1) See Mac Dashboard.
(2) A software-based control panel for one or more applications, network devices or industrial machines. Dashboards display simulated gauges and dials that look somewhat like an automobile dashboard. (an organizational scorecard process) with red, yellow and green indicators. The recommendations of the KM team are the outcome of the "health check." (21)
Storytelling teaches lessons, exchanges ideas, changes behaviors and builds community. Stories describe a journey, crisis, opportunity or choices with results and/or consequences. HR can use storytelling to illustrate corporate values and promote workplace behavior. The advantages are many: 1) people tend to listen to stories receptively, 2) stories are memorable, 3) stories can inspire heroic behavior, and 4) stories can forward change. In the business world, storytelling--in the form of business anecdotes--is a powerful corporate communication tool. It can promote organizational change in the workplace culture, deliver a message, capture and transfer tacit knowledge, and encourage innovation. (22)
* Knowledge Retention Practices Actions that demonstrate a positive organizational reputation have a direct impact on retention. SHRM research, titled "The Employer Brand: A Strategic Tool to Attract, Recruit and Retain Talent," found that candidates carefully consider a company's reputation for being ethical as a top reason to work for an organization. In fact, 74% of HR professionals cite the company reputation as critical for successful recruiting. (23) Organizations that take social responsibility seriously and give back to the community are viewed positively, especially by the Millennial Generation. As seen in Fortune Magazine's 2009 "The 100 Best Companies to Work For" edition, several organizations emphasize social responsibility. For example, KPMG KPMG Klynveld Peat Marwick Goerdeler (accounting firm)
KPMG Kaiser Permanente Medical Group
KPMG Keiner Prüft Mehr Genau (German)
KPMG Kommen Prüfen Meckern Gehen in New York City New York City: see New York, city.
New York City
City (pop., 2000: 8,008,278), southeastern New York, at the mouth of the Hudson River. The largest city in the U.S. donated monies originally intended for staff holiday gifts to a local food bank. Salesforce.com in San Francisco San Francisco (săn frănsĭs`kō), city (1990 pop. 723,959), coextensive with San Francisco co., W Calif., on the tip of a peninsula between the Pacific Ocean and San Francisco Bay, which are connected by the strait known as the Golden provides its workforce with six paid days a year to volunteer. Such actions will likely increase in the future, in view of the stand by the Obama administration on the importance of volunteerism vol·un·teer·ism
Use of or reliance on volunteers, especially to perform social or educational work in communities.
volunteerism and giving back to the community.
* Leadership Development
For both short- and long-term organizational success, building leadership capacity prepares the organization to rise above cyclical cyclical
Of or relating to a variable, such as housing starts, car sales, or the price of a certain stock, that is subject to regular or irregular up-and-down movements. corrections. As noted in SHRM Foundation's report Developing Leadership Talent, a firm's performance depends on the development and management of knowledge, through and within its leaders. (24) SHRM found that in this difficult economy, 80% of companies are either initiating or expanding their strategies to develop a diverse generation of leaders from within a firm. (25) The 2008 Annual CHRO CHRO Commission on Human Rights and Opportunities (Connecticut)
CHRO Chief Human Resources Officer
CHRO Chimney Rock National Historic Site (US National Park Service) Survey by HR Policy Association shows that 80% of chief HR officers see leadership development and succession as a top HR challenge. (26) Yet, there remains a significant gap of internal leadership and an available pipeline for succession planning.
The Multigenerational Workforce
Few companies have begun to focus on knowledge transfer from older to younger workers. With projected skills shortages, appropriate measures must be in place to prevent knowledge loss in the coming years. However, due to the economic downturn, many Baby Boomers See generation X. will remain in the workforce longer than planned. Some companies are now focusing on creative talent strategies to retain workers over the age of 50 for their knowledge and expertise. Older workers bring performance advantages needed in the global competitive environment, such as advanced skills, experience, and knowledge of the company, people and customer base. Programs such as innovative growth opportunities, health care benefits, flexible work and part-time employment help to retain talent of the multigenerational workforce. (27)
Older workers will eventually retire, taking with them valuable knowledge. The health care industry is an example of a sector facing a high loss of talent due to the aging workforce. A study explored the impact of corporate memory loss at health care institutes as the result of increasing retirement rates of senior executives. Interviews at diverse health care facilities revealed a loss of tacit knowledge compounded by insufficient managerial competencies for senior management positions. (28)
Effective cross-generational knowledge transfer requires awareness of the different styles of the four generations in the workplace. Generally, younger workers prefer interactive virtual learning, while older workers enjoy face-to-face learning. (29) Overall, understanding generational differences in terms of learning styles and communication preferences can aide in effective knowledge transfer. HR can educate the workforce about these differences, thereby improving design of knowledge transfer programs and processes. However, it is good to keep in mind that preferences of learning styles can change over time. Ultimately, it is important to carefully select the method based on learning objectives while also recognizing different learning styles and preferences.
Today, workforce planning is essential. A Watson Wyatt survey of North America-based organizations in a variety of industries found that four out of 10 companies now see workforce planning as important--reflecting economic changes--and nearly 31% of companies have begun activities on workplace planning. A majority of companies report that their CEOs (85%) and senior management (74%) are concerned about workforce planning issues. Actions employers are taking include 1) continuing to replace talent in all roles (50%); 2) restructuring (42%); 3) scaling back on replacing talent (33%); 4) only replacing talent for critical jobs (21%); and 5) not replacing talent (3%). Hiring freezes and layoffs are included in these workforce planning tactics. (30)
To learn about creative and proactive actions by HR and their organizations in this economic downturn, SHRM created an Economic Stimulus Prize. HR professionals identified best practices to avoid layoffs, keep talent, curb health-related costs and boost financial literacy Financial literacy is the ability of individuals to make appropriate decisions in managing their personal finances. Raising levels of financial literacy is now a focus of government programmes in countries including Australia, Japan, the United States and the UK. . These three examples show how HR is working to safeguard the company and its workforce--and be better placed for the future economic turnaround. (31)
* Career Development: Toyotestsu America, Inc. (a tier-one supplier for the auto industry in Somerset, Ky.)
The HR department devised a strategy to provide a program of career development training, with funds found by asking employees to "dig deep" and find new ways to cut costs.
* Leadership Development: Noblis (a nonprofit organization Nonprofit Organization
An association that is given tax-free status. Donations to a non-profit organization are often tax deductible as well.
Examples of non-profit organizations are charities, hospitals and schools. for science/technology/strategy in Falls Church Falls Church, independent city (1990 pop. 9,578), NE Va., a residential suburb of Washington, D.C.; inc. as a town 1875, as a city 1948. There is diverse light manufacturing, including telecommunications equipment. , Va.)
Talent is the primary source of the company's long-term reputation. Despite economic pressures, employee professional development was made the number one corporate priority. Participation in the formal leadership program has doubled.
* Strategic Alignment: America Family Insurance (a Fortune 500 mutual insurance company in Madison, Wisc.)
The company's goal is to be number one overall in customer satisfaction. To position itself for growth when the business climate improves, the 2009 HR business plan, titled "Mission: Alignment," includes eight initiatives: wellness, benefits, leadership, diversity, onboarding, technology, organizational design and social media.
Global HR/Knowledge Management and Knowledge Transfer
"The ability to transfer knowledge smoothly and efficiently across borders has become an important competitive differentiator," emphasizes Ernest Gundling, author of Working GlobeSmart. (32) While there are now fewer expat assignments, the manner in which companies are using assignments has been changing, as highlighted in a SHRM February 2009 article "Expats Still Essential But Recession Changes Their Roles." The 2008 GMAC GMAC General Motors Acceptance Corporation
GMAC Graduate Management Admission Council
GMAC Give Me A Call
GMAC Genetic Manipulation Advisory Committee
GMAC Genetic Modification Advisory Committee (Singapore)
GMAC Give Me A Chance Global Relocation RELOCATION, Scotch law, contracts. To let again to renew a lease, is called a relocation.
2. When a tenant holds over after the expiration of his lease, with the consent of his landlord, this will amount to a relocation. Trends Survey found that over the past three to four years, the focus of expat assignments has shifted from filling skill gaps to building management experience for employees. (33) This shift in focus makes knowledge transfer even more important in global organizations.
In fact, research shows that global companies are increasingly working to break down boundaries that preclude knowledge from crossing cultural and national borders. (34) One study empirically explored the role of the expatriate Expatriate
An employee who is a U.S. citizen living and working in a foreign country. assignment in knowledge transfer. The results suggest that temporary (short-term) assignments are more effective for knowledge transfer. At the same time, long-term assignments positively influence the willingness of expatriates to transfer knowledge across subsidiaries of multinational corporations, with greater autonomy and responsibility for employee performance. (35)
However, cultural differences can be a substantive barrier to knowledge transfer. As Aliza Dart-Scott, SPHR SPHR Senior Professional in Human Resources
SPHR Solidarity for Palestinian Human Rights
SPHR Sphere , director of HR in the Manufacturing Solutions Division at Oregon-based Autodesk, knows well, transferring critical knowledge depends on bridging the cultural chasm: "HR support is critical to ensure an effective cultural training and integration for the expat in his or her host country, the work environment--and for the family, too." How expatriates conduct themselves on assignment will, in part, influence their ability to share and transfer knowledge. As Lucinda B. Smith, GPHR GPHR Global Professional of Human Resources , senior vice president of HR at AGCO AGCO Alcohol and Gaming Commission of Ontario
AGCO Anderson, Greenwood, & Company
AGCO After Google Check-Out , notes, "culture has a wide-reaching impact in knowledge management." Mini-case study #2 presents an example of a U.S. multinational company balancing cross-cultural relations to improve and increase knowledge transfer.
Mini-Case Study #2: Knowledge Transfer and Expat Exchange
Background: Founded in 1990, AGCO Corporation, "Your Agriculture Company" (NYSE NYSE
See: New York Stock Exchange : AG), offers a full product line of tractors, combines, hay tools, sprayers, forage forage
Vegetable food, including corn and hay, of wild or domestic animals. Harvested, processed, and stored forage is called silage. Forage should be harvested in early maturity to avoid a decrease in protein and fibre content as crops mature. , tillage equipment, implements and related replacement parts, distributed globally through more than 3,000 independent dealers and distributors in more than 140 countries worldwide. In 2008, AGCO had net sales Net Sales
The amount a seller receives from the buyer after costs associated with the sale are deducted.
This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight of $8.4 billion (www.AGCOcorp.com). The company has plants throughout the world: Brazil, Finland, France, Italy and the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. .
Situation: The most active locations, from an expat perspective, are Brazil and the United States. Through several initiatives, the plants in Brazil and the United States have successfully exchanged and transferred knowledge. The exchange with Finland, however, has been quiet or nonexistent non·ex·is·tence
1. The condition of not existing.
2. Something that does not exist.
non . Several years ago, the company sent a high-level U.S. expatriate to a plant in Finland. Interested in different cultures, he quickly learned about the Finnish culture and determined that the reason for the limited exchange to Finland may be partly due to cultural differences. He found the Finnish engineers to be top performers and suggested the company would benefit from an exchange of engineers from Finland. This expat has worked with HR to promote further exchange to and from the company's plants in Finland.
Learning: At the plants in Brazil, the engineers actively seek out assignments and trust the company to take care of them when on assignment. The U.S. engineers may not have sought expat assignments, but they are happy when offered and also content with the policy, including the compensation package. In contrast, the Finnish engineers who have been approached for expat assignments have been very focused on details. That is, they carefully assess the personal and economic risk associated with an assignment rather than approaching it as a personal and professional opportunity.
Actions: AGCO's international assignment manager will present assignment offers differently to potential Brazilian and Finnish assignees. The company is implementing cultural training for assignees as well as its business travelers. As a result, AGCO is now tapping into a new talent pool.
As highlighted by Kenneth J. Somers, SHRM Global Special Expertise Panel member, learning and accountability are essential for global knowledge transfer: "We all know that expatriate assignments are expensive in a 'normal' economic climate. When we have circumstances like those we are experiencing now, the focus on delivering tangible value becomes profound. In my experience and personal view, any expatriate--regardless of the duration of his or her assignment--must be held accountable for knowledge transfer. Having said that, the manner and effectiveness with which institutional knowledge or subject-matter expertise is transferred is subject to the influences of cross-cultural forces. In Japan, for example, it is customary that a new expatriate is granted position respect upon arrival. But he or she must quickly demonstrate competence to earn the personal respect needed to be successful in transmitting the knowledge associated with the expat's responsibilities. Owing to owing to
Because of; on account of: I couldn't attend, owing to illness.
owing to prep → debido a, por causa de Japan's largely nonconfrontational business culture, the real danger is that the expat to Japan may never understand why he or she is experiencing challenges in being effective."
"In contrast to Japan," Somers continues, "my experience in India taught me that an expat needs to earn personal and professional respect on an almost continuous basis. India's business culture is more assertive as·ser·tive
Inclined to bold or confident assertion; aggressively self-assured.
as·sertive·ly adv. , and the expat will quickly know if he or she is respected. In both cases, HR needs to play the critical role of coaching the new expatriate for success by providing early and consistent feedback on how the expat is actually doing." Along with economic challenges, cross-cultural understanding is a key success factor for knowledge transfer in the global arena.
Most obstacles to knowledge management are internal. The lack of understanding about KM by company leaders, not having an organizational working definition of KM and a culture of hoarding knowledge are the top three factors that inhibit successful knowledge management. Functional silos also add to the difficulty of sharing knowledge. HR can be instrumental in educating senior management about the benefits of KM, such as better communication and knowledge flow. For example, companies can begin to overcome barriers by establishing a KM taskforce that includes a strategic business leader along with representatives from HR and IT. Through the use of tactics such as communications, education and performance management, organizations can leverage behaviors that promote knowledge sharing. (36)
Ethics in Knowledge Management
From the HR viewpoint, knowledge management is also about the ethical management of people. Knowledge sharing fosters creativity and innovation for competitive advantage. However, knowledge exchange cannot be at the detriment Any loss or harm to a person or property; relinquishment of a legal right, benefit, or something of value.
Detriment is most frequently applied to contract formation, since it is an essential element of consideration, which is a prerequisite of a legally enforceable contract. of the organization. At some point, HR may be involved in ethical investigations related to inappropriate knowledge sharing (e.g., confidential information Noun 1. confidential information - an indication of potential opportunity; "he got a tip on the stock market"; "a good lead for a job"
steer, tip, wind, hint, lead , trade secrets, intellectual property). Keeping in mind factors such as those identified in Figure 4 will help to frame the issue when evaluating situational ethics Situational ethics, or situation ethics, is a Christian ethical theory that was principally developed in the 1960s by the Episcopal priest Joseph Fletcher. It basically states that sometimes other moral principles can be cast aside in certain situations if love is best about KM. Rating these factors as yes, no or maybe can help HR and an ethics taskforce consider possible ramifications ramifications npl → Auswirkungen pl during an investigation. (37)
Figure 4 | Evaluation of Situational Ethics Factor Consideration Involvement Have all shareholder viewpoints been considered? Fairness If I were the shareholder, would I see this decision as fair? Consequences Have we considered all of the consequences of the decision? Relevance Have we gathered all information possible to make an informed decision? Corporate Values Does the decision uphold the organization's values? Community Would we want this decision to become a global law, applicable to all such situations? Shame If the details of this decision/action plans were disclosed to everyone, how would we feel? Source: Adapted from Groff, T.R., & Jones, T.P. (2003). Introduction knowledge management: KM in business. New York: Butterworth Heinemann.
In today's economy, knowledge management is critical to ongoing organizational effectiveness, sustainability and profitability. Yet, KM does not occur in a vacuum and requires commitment on the part of HR and senior management to effectively utilize this strategic tool for competitive advantage. In the coming years, HR must focus on the management of knowledge workers to further knowledge integration and the resulting organizational benefits.
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New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of : Butterworth Heinemann.
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A firm's competitive advantage depends more than anything on its knowledge: on what it knows--how it uses what it knows--and how fast it can know something new. (1)
Knowledge management is defined as the process of creating, acquiring, sharing and managing knowledge to augment individual and organizational performance. (2)