People-focused knowledge management

Tacit & Explicit 
Knowledge
Intellectual
Capital
Decisions
followed by
Actions
Resulting
Behavior
Information
Capital
Data &
Information
Aggregated
Business
Function
Detailed
Business
Tasks
Knowledge
Required
to Perform
Business Tasks
Detailed
Information
Items
Required
General
Infromation Items
Required to Perform
Business Tasks
Information
System
Building
Blocks
Manage
Margin
Risks
Repair Options
to Cust’s
Advantage
Assess Market
Movement
Explore
“What-If
 
”
Scenarios
Understand
Market
Mechanisms
Know
What-If
Analysis
Know
Risk
Analysis
Know
Multi-Leg
Trades
Disburse
Funds to
Customers
Evaluate
Customer’s
Past History
“Calculate”
Customer’s
Account
Understand
Behavior
Patterns
Issue
Margin
Calls
Approve
Dispersal
Request
New Knowledge
Created during Work
Detailed
Breaking
News
Trends of
Customer’s
Equities
Latest Market
Information on
Cust's Equities
Latest Option
Status in Cust’s
Account
Detailed
Customer
History
Market
Driving
Forces
Market
Trends
Financial
Market
Information
System
General
Market
Information
Option
Status in Custs’
Account
Customer
History
Customer
Accounts &
History
Cumulated
Operating &
Performance
Historv
Knowledge
Discovery
in Databases
(KDD)
Knowledge
Bases
(KB)
Knowledge
/ IT Apps
Knowledge Management of
Intellectual Capital
Information Management of
Information Capital
IT-Based Knowledge Management
Figure 8-5
Excellent knowledge assets (intellectual capital) matched with corresponding information capital provide
the capability to act effectively — a financial industry example. Copyright © 1999 Knowledge Research
Institute, Inc. Reproduced with permission.

---

276
People-Focused Knowledge Management
to interpret what situations mean and decide how to handle them
effectively.
Integrative management provides the capability to “run” the enter-
prise in ways that make it more effective and viable. That is achieved
by making decisions followed by actions that avoid undesirable side-
effects. A central premise is that “decisions-in-the-large” (i.e., senior
management, strategic, and many tactical decisions) may not lead
directly to final actions and implementation. Instead, most produce
initiatives that outline desired enterprise directions and are imple-
mented through numerous “decisions-in-the-small” (minute tacit
decisions) by people (or in some instances, automated agents) who
work on the operational level of the enterprise, “on the line.” It is
one of knowledge management’s roles to see that these people and
agents are adequately prepared and supported. Similarly, effective
information management is required to provide the descriptions of
the world that are required to fuel decisions. Hence, integrative man-
agement relies extensively and separately on knowledge management
and information management.
Integrative management cannot flourish and provide value without
general participation throughout the enterprise. Not only must man-
agers practice integrative management, but it must become a prac-
ticed aspect of the general culture. Employees everywhere must be
aware of the conditions and requirements of neighboring functions,
their future directions, and how those might affect their operation.
Such awareness requires knowledge and understanding that must be
developed through widespread knowledge management and adop-
tion of asset management mentalities for dealing with intangible
capital. The awareness also requires effective information manage-
ment to provide high-quality information to those with a need to
know. Hence, to be effective, integrative management requires many
changes and improvements throughout the enterprise. These changes
will also serve other initiatives that, when implemented, will together
provide additional intangible capital that further supports the enter-
prise’s potential for viable success.
Final Thoughts