People-focused knowledge management

particular purposes such as performing a certain type of work with
greater expertise. We also believe that we can decide to use our
knowledge according to our free will to maximize the effectiveness
of our personal behaviors to serve the goals of the enterprise in which
we are engaged, the stakeholders’ goals, and our own objectives.
Information Is Not Knowledge!
The Purpose of Knowledge Is Action; the Purpose of
Information Is Description
When considering how knowledge affects personal decision
making and reasoning, we need to understand what knowledge is
and how it relates to information. We distinguish between knowl-
edge and information by recognizing that they are fundamentally 
different. Information consists of data organized to characterize 
a particular situation, condition, context, challenge, or opportunity.
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People-Focused Knowledge Management
Knowledge consists of facts, perspectives and concepts, mental ref-
erence models, truths and beliefs, judgments and expectations,
methodologies, and know-how. In part, knowledge also consists of
understanding how to juxtapose and integrate seemingly isolated
information items to develop new meanings — to create new insights
with which to approach effective handling of the target situation.
We use information to describe and specify what things are. We
use information to describe a situation and its context as they exist
and develop. We use information in the form of data tables to
describe everything from the physical characteristics of metals to
today’s and yesterday’s stock market statistics and projections of 
its future performance. Clearly, much information is created by 
the application of knowledge to describe and explain. However, that
does not make information knowledge.
We use knowledge to evaluate and handle situations, decide how
we, for example, use physical tables, or assess how to trade our
investment portfolio given stock market information. We use knowl-
edge to assess, decide, problem-solve, plan, act, and monitor.
Actionable knowledge is possessed by humans as well as by other
active entities (agents) such as process control computers that are
programmed to take actions to manipulate process variables to
achieve a desired performance. Actionable knowledge is used to
receive information and to recognize and identify; analyze, interpret,
and evaluate; synthesize and decide; plan, implement, monitor, adapt,
and act. In other words, knowledge is used to reason to determine
what a specific situation means, how it should be handled, and to
carry out the resulting decision in action. In this context, knowledge
serves two purposes: (1) methodological knowledge controls the 
reasoning process; (2) domain knowledge provides the content of 
reasoning. In addition, information is needed to describe the state of
the situation that is the subject of reasoning.
Passive knowledge may exist in repositories — in systems and pro-
cedures, books, documents, databases, and in many other forms (see
Chapter 1 and Figure 1-6). Structural IC consists mostly of passive
knowledge except when embedded in active agents such as computer-
based action systems. We use passive knowledge when it is obtained
by an active agent and is operationalized. It can, for example, be
operationalized and activated by a person who learns about it by
reading a description of it, reasons with it, and acts on it. In a less
obvious manner, it can be embedded in an organizational structure
through specified systems and procedures that are operationalized by
people observing managerial intents through their daily actions.
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Actions Are Initiated by Knowledgeable People
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Knowledge is accumulated and integrated and held over time by
receiving new information, using prior knowledge to interpret it and
create hypotheses about its meaning, relevancy, and acceptability. If
found “believable,” the new knowledge can be accepted and inter-
nalized by establishing its relationship (associations) and deeper
meanings relative to what already is known. This is the case with
personal knowledge when the process takes place in a person’s mind.
It is also the case with creating structural IC (organizational knowl-
edge) when knowledge is acquired and incorporated in repositories.
A brief, practical example portrays differences between informa-
tion and knowledge. Consider the regular and supervisory control
functions for an automated factory, as illustrated in Figure 3-4. In
this system, information on the operating state of the process is
obtained continuously by the computer. Knowledge from process
experts is embedded in, and operationalized and activated by, the
process control computer programs to automate operations. The
experts provide personal knowledge and deep understanding of phys-
ical and operational principles and specific cases on how to deal both
with routine and undesired operating situations. They pool their
precise process knowledge with that of other experts, who have