We are living in the knowledge based economy and just passed through economic slowdown. Doing business in this resurgent environment has become challenge for organizations. The current economic slowdown made it imperative to have competitive advantage for organizations as ways of doing business is becoming complex. For companies, one of the ways of developing competitive advantage is knowledge creation and management which ensure their growth and survival. Knowledge is being considered the most important strategic resource, and the ability to create and apply it the most important capability for building and sustaining competitive advantage (Zack, 1999).
In the dynamic business environment, working environment has also become very complex due to continuous changes in customers’ demand and preferences. In order to meet out these changes, Companies are looking for the persons who can do the things effectively and efficiently and can accumulate valuable knowledge.
The importance and role of B-schools is rising continuously primarily because they produced the management professionals to the industries. These management graduates, in b-schools, are taught about the business management and handling of challenges in the real world of businesses. Knowledge creation and management among management graduates is one of the most important roles played by b-schools. In resurgent India, knowledge creation and management is given special attention by industries as well as b-schools as it make them enable to cope with economic slowdown. Nowadays, B-schools are employing proactive and innovative approaches of imparting knowledge to management graduates so as to expand their knowledge base and make them employable. B-schools are trying to bring industry and academia closure so that they can understand the new knowledge requirements of industries. They are collaborating with corporate to provide training and internship to their students. Conferences, seminars, workshops are also given special weight in current Indian scenario by Indian b-schools. In addition, faculty development programs are also being conducted so that a desired level of knowledge creation and management could be achieved.
Objectives of the paper:
• To find out the new dimensions of knowledge creation by b-schools in current Indian scenario.
• To suggest strategies to b-schools to cope with challenges in imparting new knowledge to students in resurgent India.
Knowledge, its Creation & Management…?
I. Knowledge is defined by the Oxford English Dictionary as (i) expertise, and skills acquired by a person through experience or education; the theoretical or practical understanding of a subject; (ii) what is known in a particular field or in total; facts and information; or (iii) awareness or familiarity gained by experience of a fact or situation. In other words, knowledge is a set of data, information, a combination of know-how, experiences, beliefs, emotions, ideas, values, intuitions, attitude, learning style and the ability to deal with complexity which can be used to improve the capacity to act and support decision making.
Knowledge is classified into two type tacit knowledge and explicit knowledge. Explicit knowledge can be expressed in words and numbers and shared in form of data, scientific formulae, specifications, manuals and the like. This kind of knowledge can be readily transmitted between individuals formally and systematically. Tacit knowledge is highly personal and hard to formulize, making it difficult to communicate and share with others. Subjective insights, intuitions, and hunches fall in to this category of knowledge. Tacit knowledge is deeply rooted in an individual’s action & experience as well as in the ideals, values and emotions one embraces.
II. Knowledge creation is a spiraling process of interactions between explicit and tacit knowledge. Knowledge is created differently at different levels. At the personal and team level, it is often as a result of social interaction, i.e., through training, learning by doing, joint problem solving or brainstorming. At the departmental or organizational level, innovation processes are typically aimed at creating new knowledge for product and services. While improvement activities focus on internal processes and procedures. New knowledge creation can also be a result of R&D function.
Ikujiro Nonaka, a leading authority in knowledge creation and management, define the following active learning processes namely socialization, externalization, combination and internalization. The four modes of knowledge conversion are created when tacit and explicit knowledge interacts with each other. These four modes constitute the engine of the entire knowledge creation process. The descriptions of these modes are as follows:
(a) Socialization: It starts with building a field of interaction which facilitates the sharing of members’ experiences and mental models. In the classrooms of b-schools, socialization could be utilized in generating initial and innovative ideas through informal discussion among students.
(b) Externalization: This is the process of articulating tacit knowledge into explicit concepts. This mode is triggered by meaningful dialogues or collective reflection. This activity is possible during formal meeting or brainstorming session in order to improve the initial ideas generated in socialization process.
(c) Combination: Combining different bodies of explicit knowledge is known as combination. Reconfiguration of existing information through sorting, adding, combining and categorizing of explicit knowledge as conducted in computer databases can lead to new knowledge. Creative uses of computerized communication networks and large scale databases facilitate combination.
(d) Internalization: The process of embodying explicit knowledge into tacit knowledge is internalization which is closely related to ‘learning by doing’. When experiences through socialization, externalization and combination are internalized into individuals’ tacit knowledge bases in the form of shared mental models of technical know-how then become valuable assets. This mode could be facilitated through knowledge which is documented.
The entire process of knowledge creation, called knowledge spiral, could be depicted graphically as given below:
Fig 1: Knowledge Spiral
Source: http://www.emeraldinsight.com/fig/0850140301002.png
III. Knowledge management involves creation, dissemination, renewal and application of knowledge towards organizational sustenance and survival (Raman, A.T. 2003). It deals with the ways and means of capturing and making available knowledge of the experts to the others for the purpose of achieving excellence. The process of knowledge management can be, generally, grouped into five stages as follows:
i. Identification of knowledge
ii. New knowledge creation
iii. Knowledge storage
iv. Knowledge transfer/sharing
v. Value creation
The main emphasis of this whole process is on the last stage i.e. value creation. Knowledge, generally, adds value by helping in cost saving efforts, innovation, improving business processes, increasing human capital, effective decision making and delivering more efficient services to its customers. Companies in this resurgent phase are looking for the professionals who can do the discussed efforts and add greater value.
There is no one-size-fits-all way to effectively tape a firm’s intellectual capital. To create value, companies must focus on how knowledge is used to build critical capabilities. Figure below shows that knowledge management is the basis for value creation, organizational growth and competitiveness through innovation.
Fig 2: Knowledge Management for Value Creation
Why Knowledge Creation & Management in Resurgent India?
Creation and management are complementary to each other. Like other management movement, the creation and management of knowledge in every organization has become an issue/challenge to perceive changes in the global economic environment.
To cope up the changes that are taking place in the internal and external environment, the knowledge management has become a crucial and core part of everything. That is why, along with knowledge creation, its management has also become the heart of all knowledge based processes. These dimensions to cope up the dynamic environment include:-
• Economic Slowdown
• Worldwide Innovations
• Strategic Alliances
• Technological Breakthrough
• Emergence of new industries
• Demographic Trends
• Changes in the workforce
All of aforesaid drastic changes are the key driving forces for growing interest in knowledge creation and management.
Recently, we have seen the impact of economic slowdown which resulted in changes within the organizations worldwide. India, although, affected less from the economic slowdown, almost every organization is altering their KSA (knowledge, skills and attitude) requirements in recruitment process. In such a scenario, knowledge creation and management is imperative for companies to survive and cope up. Companies are cutting their training cost due to economic crunch. That is why; b-schools are in growing pressure from industries to make the fresh management graduates knowledgeable and productive in order to reduce subsequent training cost.
Innovation, while there are a lot of similarities in kind between the previous era of globalization and the one we are now in, what is new is the degree and intensity with which the world is tied together into a single globalized marketplace and village.
Innovation efforts target students and faculty groups in B-schools. For students, it covers the behavior and levels of engagement and for the faculties; it focuses on the approaches of teaching. Innovation is the process of identifying problems and creates new knowledge to solve them. The B-schools are focusing on the same approach, they are finding out the existing problems arising out of recession and emphasizing creating new knowledge to manage the growth of economy.
Companies are, now, marching for strategic alliances. Many companies are going for joint ventures, mergers and takeovers to compete in this global and resurgent environment. For this, it is a challenge in front of b-schools to provide new knowledge to their students and aware them how to manage the knowledge based competitive advantage, how real world business issues can be solved by the effective utilization of knowledge.
Knowledge Creation & Management: B-schools’ Approaches
We had just passed through the period of economic slowdown. The period came up with lots of challenges and opportunities. In was a big challenge for Indian B-schools in terms of knowledge creation as it totally changed the existed scenario but the most important thing was to analyze the opportunities and take the competitive advantage.
The B-schools realized the gap between the existing KSA and required KSA and are imparting the art of creating and managing knowledge. It is well said that creating is nothing without managing. Many B-schools had taken steps to create and offer knowledge. This is because of the changes, requirements and demand of the global market in this resurgent phase.
In today’s business environment the biggest drivers are the development and deployment of new technology. The B-schools recognized the key to grow in terms of required skills and knowledge. As per the requirements of changing business environment, they develop the newly required skills in their students in order to build efficient and effective future managers. B-schools are judged on the basis of its industry interface and its ability to turn ‘industry ready’ managers i.e. requirement of present scenario.
The galloping economy in the past few years and the sudden surge in the fortunes of many manufacturing, retail, healthcare, hospitality and financial services firms have accentuated the concern forecasting that the services industries in India would need approximately ten million specially skilled people to enter the job market every year to sustain its economic momentum. This is the biggest challenge in front of Indian B-schools as well Indian industries. For industries, it is a big challenge to attain and retain skilled employees and for B-schools to build students equipped with required skills and knowledge.
B-schools offer management courses and programs that are practically applicable. The courses teach students to handle every day challenges in the real-world of businesses. Generally, the various approaches are employed by B-schools to create knowledge of various functional areas to their students. Contributions of B-school in some functional areas are as follow:-
Marketing and Sales
In this resurgent phase, marketing companies are looking for candidates who have good marketing knowledge and skills and can sell the product easily and efficiently to the clients. Clients are attracted to people who have good communication skills and can sell the product in the best possible way. Keeping this in the view, B-schools impart marketing knowledge to their students how to attract the prospective buyer and to keep his allegiance to your services or products.
Financial Services
B-schools training helps the students understand and efficiently deal in financial services. A sound financial background is necessary to get into the role of a financial analyst. Management trainees, in B-schools, are taught to understand financial concepts through practical research and analysis.
Administration and HRM
Human resource management and administrative management are fields that require lots of practical training. A human resource management trainee, in B-schools, is trained to have thorough knowledge and understanding of how to use the human resources of the organization to the maximum advantage of the company while at the same time making sure that the employees get enough opportunities to rise with the organization.
Hospitality & Tourism
B-school pass-outs can enter Hospitality and Tourism sectors and employ their managerial skills to develop clients, customer relations and business.
IT and ITES
Management Graduates, who specialize in systems, can get recruited for business and IT solutions. Thus, a management student is taught and trained how to become an efficient project manager or an Operations manager. In-depth knowledge and training is provided by the B-schools in this regard.
At the very early stage, Indian B-schools analyzed the changing industries’ KSA requirements and create the knowledge within their faculty members and students. For faculty members, FDPs and MDPs are being conducted by b-schools so as to make them knowledgeable enough to develop the skills and knowledge within their students. In the same manner, students are catered by SDPs in b-schools where they learn about practical aspects of their learning.
Students do not learn much just sitting in classes listening to teacher, memorizing pre-packaged assignments and spitting out answers. They must talk about what they are learning, write about it, relate it to past experiences and apply it to what they feel is important. Equally important is the need make explicit the learning processes that are occurring in the learning environment.
Indian B-schools recognized these challenges involve in management studies and devised new ways like SDPs to cope up. Various value creating activities like Role Playing, Case-Based GDs, Business Games, Simulation, Presentations, Mock-interviews, Negotiation activities, Case studies, Quiz etc. conducted in special classes, called SDPs, impart the knowledge about working environment of corporate. In addition, workshops, seminars, conferences are also being given special attention by b-schools in current Indian scenario as these programs result in explicit knowledge i.e. publications and presentations.
Conclusion:
Knowledge creation and management is the need of the hour in resurgent India as it is the one of the ways to cope up with uncertainties of business world. B-schools in India are performing this job as they are producing management professional equipped with the right KSA to the industrial world. B-schools provide practical and research based training to their candidates who in turn utilize that knowledge in their individual fields when they actually enter the corporate or business world. These Management Schools play a vital role in shaping the future Managers. As discussed, India is in its revival phase. After passing through the current economic slowdown, companies are now changing their job description and job specification. So, this is the time when B-schools should devise new ways to impart knowledge to the management graduates. Newly devised approaches when applied in light of Nonaka’s knowledge creation & management model would result in new dimensions of knowledge creation and management and would help to newly produced management professionals in meeting out the requirements of Indian industries and contribute to Indian growth.
Suggestions:
1. B-schools should focus on current Indian industries’ requirements so that they can alter/customize their management programs accordingly. They should understand the concept of ‘Working closely with employers’. This step would help in bridging the gap between required KSA and existing KSA. Recently Kolkata based Globsyn Business School announced to start a one year MBA course for SMEs to cater the need of SMEs.
2. Knowledge creation and management is a continuous process. Keeping the same in the view, b-schools should introduced short term distance learning programs to cater the needs of working professionals so that they can acquire the new knowledge and update/manage their existing knowledge. These courses would teach professionals to handle every day challenges in the real-world of businesses.
3. It is the need of the hour that Indian b-schools should emphasis more on organizing conferences, seminars, workshops etc. on emerging issues of Indian industries. This step would lead to academic-industry interface and participants of such events including management graduates would have an exposure to the industries’ emerging problems and their possible solutions. This knowledge would help management graduates in performing their job effectively and efficiently and contribute to organizational growth.
4. Indian b-schools should focus more on practical aspects of subjects. Students should be given live case studies of industries to solve. This knowledge would help them to create knowledge about how decisions should be taken in various business situations.
5. In current scenario, it is imperative that B-schools should not be bound to teach the pre-set curriculum in pre-specified methods to management graduates. They should be free to teach customized curriculum as per the need of the time. However, in India, b-schools are generally affiliated and associated with universities which set the curriculum. In this case, universities could alter the curriculum as needed by b-schools.
6. B-schools should approach to industry and incubation centers. These centers could help in imparting the knowledge of setting up of new business, potentials problems, solutions etc. to students. This step, if initiated by B-schools, would help Indian industries by developing new entrepreneurs.
7. B-schools should acquire/develop faculty members that possess deep knowledge of global business and management theory, have local experience and an understanding of practice, and can facilitate learning among students. Faculty members should be encouraged to keep their knowledge and skills update by undertaking practical consultancy on regular basis.
Total Words: 2922
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References:
“Globsyn to start MBA course for SMEs”, The Economic Times – February 18, 2010.
Gupta, Raj Karan (2009) “Leveraging Knowledge Management for Enhancing Competitiveness of Small and Medium Enterprises (SMSs)” Galgotias Journal of Management, Vol 2, No. 1, pp 44-19.
Kazuo Ichijo and Ikujiro Nonaka (2006) “Knowledge Creation and Management: New Challenges for Managers”.
Salina Daud, Rabiah Eladwiah Abdul Rahim, and Rusnita Alimun “Knowledge Creation and Innovation in Classroom”.
Rizvi, Irfan A. and Aggarwal, Ashita (2005), “Making Academia – Industry Interface Work”.
Betts Mick and Calabro Pam (2005), “Graduate Skills and employability: An Integrated Approach to Student Development”.
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