3.8 Conclusion

3.8 Conclusion

We have started this chapter with the Knowledge Revolution which is about a fundamental socio-economic change from adding value by producing things that is to adding value by creating and using knowledge which can grow indefinitely. The nature of the final form of the revolution is not yet known, but one thing is very clear that KR has brought changes on an unprecedented scale both in technological, economical, social, and cultural aspects as well as attitudes, values, and norms of the global society. In today’s knowledge-based society, markets behave differently and require more egalitarian patterns of distribution of resources in order to achieve efficiency. Those who want to reap the benefits of this shift must learn the new principles and unlearn some of the old principles.

            Next we have discuss about globalization which is associated with an ongoing process by which regional economies, societies, and cultures have become integrated through a globe network of information & communication technologies and collaborative business initiatives. It is, sometimes, referred to the integration of national economies into the international economy through trade, foreign direct investment, capital flows, migration, and the spread of technology.  We have discussed that the process of globalization is not a new phenomenon and rooted back to ancient time.  However, in the 19th century globalization approached its modern form. The revolution in transport and communications created an unprecedented impact on the international markets of capital, goods, and labour market.

            The recent trend of globalization, on the one hand, brought unprecedented opportunities to the global community. On the other hand, it has also created many social, cultural, and economic implications which make the impact of globalization highly controversial. For some, globalization has been an instrument for progress; it has created wealth, expanded opportunities and provided a nurturing environment for entrepreneurship and enterprise. For others, globalization has created unemployment, poverty and marginalization, and is thus perceived as a force institutionalizing social crises. However, a consensus does seem to be emerging that, overall, globalization has brought more benefits than costs; that it has exacerbated inequalities both within and between countries because of the sharply diverging experience at individual and country levels; and that it has increased economic and political insecurity even for those who have benefited in monetary terms from globalization. Yet it is still a challenge to make the process of globalization more beneficial for the global community.

            The impact of knowledge revolution and globalization appears in the form of knowledge economies which mainly focused on the production and management of knowledge in the frame of economic constraints, or to a knowledge-based economy. The use of knowledge in economic activities is not a new idea but the use of information technology has created the major difference. Today knowledge has been recognized as the driver of productivity and economic growth.

            Knowledge Economy is different from the traditional economy in several aspects. One of the key aspects of knowledge economy is that it considers that the application of knowledge adds more value than the traditional economic factors like capital, raw materials and labour.  This aspect has given a new domension to business world which demand for higher levels of competencies. So, knowledge economy offers the possibilities of prosperity to those who have the capacity to use available knowledge in innovative ways.  For this, individuals, teams, and organization need to develop the necessary competencies which make them able to participate in today’s technology driven, knowledge intensive, complex work places. Traditional approaches to management, training, and development will not provide the learning environment that is required. Organizations need to convert day to day work environment into a powerful learning environment.

            In knowledge economies, the basic economic resource - the means of production - is no longer capital, nor natural resources, nor labor. It is and will be knowledge. So the workers who know how to add value through knowledge will be the assets of the organization. These workers are known as “knowledge workers”. These are the individuals who possess high levels of education and/or expertise in a particular area, and who use their cognitive skills to engage in complex problem solving.  They depend on their knowledge and the ability to learn, even though they work with their hands. Knowledge workers are characterized by a number of traits, among them the ability to extract and synthesize key information to enhance innovation and productivity.    Knowledge workers are usually categorized as ‘Knowledge Executors’ and ‘Knowledge Generators’. Knowledge Executors are those who apply existing knowledge by manipulating information through processes created or invented by others. Knowledge Generators, on the other hand, create new knowledge by manipulating information to develop new solutions to a given problem, or to create new concepts or products.

            Yet, the most important question is whether traditional employment relationships in organizations are still relevant in the knowledge economy. The global community is divided into two camps on this aspect.  One camp considers that knowledge workers reject traditional employment relationships, in turn preferring ‘portfolio work’ (i.e. holding several part-time jobs simultaneously) and favouring more freestanding relationships as temporary employee, freelancers or self-employed workers. Yet, others argue that new forms of working have developed within the modern corporation. In this case, the more specialist and entrepreneurial knowledge workers are given the freedom to experiment and develop new ideas. These ‘entrepreneurs’ combine the freedom of self-employment with the security and resources of big companies.

            In knowledge economy, the concept of knowledge artifact is very important.  Knowledge artifacts are what we deal with everyday and they include just about any piece of documentation, memos, notes, emails, directories, articles, white papers, case studies, etc. which exists within an organization since they either refer to or incorporate different kinds of tacit and explicit knowledge.  Knowledge artifacts are informational structures describing the current state of affairs in terms of responsibilities, current activities, plans for future actions and so on, and support the coordination in a group of cooperating actors.  Knowledge artifacts can be personal or shared.  They differ from one another in several ways: their form of codification, the way in which they are rendered, their degree of abstraction and their ability to enable actions and decisions. Knowledge artifacts also vary in their degree of articulation; simple knowledge artifacts can be explicit, implicit or tacit. Most artifacts, however, are not simple but complex, and contain a combination of explicit, implicit and tacit components.

            Knowledge artifacts do not perform actions and make decisions. Actions and decisions are undertaken by agents: people, organizations, or in some cases, technology. Agents carry out all the actions and exhibit all the behaviors within a knowledge flow. These agents can be individual, automated, or organizational and have different behavioral models. For example, individual and organizational agents can handle tacit knowledge, but automated agents need codification of tacit knowledge.

In this chapter we have covered various concepts related to knowledge economy. As knowledge economy mainly rely on knowledge. So these concepts will be very helpful to understand the key concepts related to knowledge management discussed in the forth coming chapters.