Technology @ Knowledge Zone


Knowledge Management: The Need of the Hour!!!

by Vipin Arora *

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  • Principal is the amount of money, Rs100, in the savings account.

  • Interest rate, 5%, is the factor used by the bank to compute interest on the principal.

KNOWLEDGE: comprises strategy, practice, method, or approach (how). When a pattern relation exists amidst the data and information ie when one can start forming relationships between data & information, then it has a potential to represent knowledge. It only becomes knowledge, however, when one is able to realize and understand the patterns and their implications. Let us return to our example. If we put Rs100 in a savings account, and the bank pays 5% interest yearly, then at the end of one year the bank will compute the interest of Rs 5 and add it to the principal and we will have Rs105 in the bank. This pattern represents knowledge, which, when one understands it, allows one to understand how the pattern will evolve over time and the results it will produce.

WISDOM: Wisdom embodies principles, insights, morals or archetype (why) Wisdom arises when one understands the foundational principles responsible for the patterns representing knowledge.

The sequence data ---> information ---> knowledge ---> wisdom represents an emergent continuum. That is, although data is a discrete entity, the progression to information, to knowledge, and finally to wisdom does not occur in discrete stages of development. One progresses along the continuum as one's understanding develops.

INTELLECTUAL CAPITAL: Intellectual Capital can be referred to as static properties of knowledge, which is: inventions, ideas, computer programs, patents, etc. It is to the advantage of the knowledge firm to transform the innovations produced by its human resource into intellectual assets, to which the firm can assert rights of ownership. One major task of IC managers is to transform human resource into intellectual assets. Now we can define KM as The Art of Creating Value from Intangible Assets. "Value" being both financial and non-financial.

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* Contributed by -
Vipin Arora
B.Tech. (Polymers), H.B.T.I. Kanpur,
MBA (Batch 2004-06),
Dept. of Management Studies, I.I.T. Roorkee.