Write a report on “Knowledge Management”.
The term, “Knowledge Management” is such a process of sharing, developing, capturing as well as using effectively the knowledge of an organization. It also refers to such an approach that is multidisciplinary in order to achieve the objectives of a particular organization by making the best knowledge utilization (Rubenstein-Montano, Liebowitz, Buchwalter, McCaw, Newman, Rebeck and Team 2012). The efforts of managing knowledge focus typically on several organizational goals. Therefore, this report is mainly aimed to implement the way of accomplishing the organisation objectives of ALDI in terms of the knowledge management system. Thus, this report aims to discuss critically the current processes of knowledge management of the selected organization that is ALDI by considering both of the weaknesses and the strengths. On the other side, the impact of the proper implementation of knowledge management system in ALDI is aimed to be portrayed in order to gain more competitive advantage in the countries where this organization has its presence. Based on the discussion, some recommendations would be discussed in this report as well.
ALDI is the leading and popular chain of global discount supermarket (Aldi US 2016). It has near about 10000 in 18 countries (Aldi US 2016). This organization has an estimation regarding the turnover that is more than €50bn. ALSI is mainly based in Germany (Aldi US 2016). This retail organization was established in 1946 by the brothers Theo Albrecht and Karl Albrecht while they took over the store of their mother in Essen that had been operated since 1913 (Aldi US 2016). It is one of the largest companies which are privately owned all over the world (Aldi US 2016).
The processes of Knowledge management are referred to the paths that a company manages knowledge at several stages of the life of it in a particular company. Hence, in case of ALDI Store, this retail organization also utilizes few specific knowledge management processes in order to gather details or information by utilizing tools as well as methods. There are some processes of knowledge management those are assisted by the different techniques as well as tools (Alavi and Leidner 2014). These are as follows,
Knowledge Discovery – It is mainly the construction of the new techniques as well as the explicit knowledge from the information and data or from the prior knowledge synthesis (Alavi and Leidner 2014). In ALDI, new explicit knowledge’s discovery relies on combination most directly, where at the same time, the new tacit knowledge’s discovery relies on socialization most directly.
Knowledge Capture – It is the process through which ALDI convert the explicit form to tacit form and vice versa with the help of sub-processes of internationalization and externalization (Davenport, De Long, and Beers, 2012).
Knowledge Sharing – It is the process with the help of which tacit or explicit knowledge is communicated in ALDI, to the other individuals. ALDI mainly mentor a new staff, shadow an expert through this process (Davenport, De Long, and Beers, 2012).
Knowledge Application – It is while the available knowledge is utilized by ALDI for making decisions as well as performing tasks through routines and direction.
The strengths of KM processes are as follows,
Sharing knowledge is an important part to make knowledge management system work, however ALDI has failed for sharing proper knowledge with managers and employees. these processes are difficult and complicated for understanding for the training and average workers for using knowledge management processes is costly (Ruggles 2014).
Knowledge management can play a significant in terms of implementing proper strategic planning. While an organization can be able to implement proper knowledge management in their business operation therefore, no one can resist that particular organization to gain success in terms of doing competition in their respective marketplaces and industries (Ruggles 2014). Thus, ALDI can follow the implementation of the strategic planning by using knowledge management. The most important feature of the strategic planning is that it helps organization to gain a long-term competitive advantage in the marketplace (Gold and Arvind Malhotra 2014). ALDI has to embrace knowledge sharing as well as abandon their concepts of hoarding information. The competitive advantage or competitive success of this retail organization would be related to less on how financial as well as physical resources are strategically allocated and more on how intellectual capital is strategically managed from disseminating, coding as well as capturing information. On the other hand, the competitive advantage can be gained by the knowledge management in order to acquire new competencies with the help of development as well as training and to the re-engineering processes of business (Quintas, Lefrere and Jones 2015). The major fact that can generate a huge competitive advantage for this particular retail organization is that the knowledge management processes attempts for preventing issues like the lost income or lost knowledge by establishing technological as well as human networks able to harass the collective experience and expertise of ALDI (Dalkir 2013). The move of ALDI from the economy that is industrially-based or the information based one requirement a top notch system of knowledge management for securing a capacity and competitive edge for learning. the ability of ALDI for tapping quickly into wisdom provides it a competitive advantage in the market.
The knowledge management process has huge usage in the operations of an organization. The efforts of knowledge management aims on the objectives of an organization like continuous improvement, integration, the sharing of the lessons learned, innovation, competitive advantage as well as improved performance of the organization (Dalkir 2013). These particular efforts overlap with the organizational learning and can also be distinguished from that by a huge focus on the knowledge management as an asset of strategy and an aim on the encouragement of the knowledge sharing. Knowledge Management is an organizational learning enabler. Most importantly, proper implementation of the knowleddge management system can be the key to build competitive advantage for ALDI (Dalkir 2013). This retail organization has therefore, adapted the changes in the knowledge management system and also make changes in the knowledge management system in terms of innovation in order to increase the competitive advantage of ALDI in their marketplace. the organizations like ALDI who intend to survive in the complex as well as the unpredictable competitive markets should adapt quickly to the new dynamics like knowledge management in the retail business operation of the company (Hislop 2013). Therefore, it can easily be said that the proper usage of knowledge management system would help the company do that they can be able to leverage of this for their competitive advantage in their marketplace. Most importantly, this particular usage of the knowledge management system can help the ALDI in both of the sector / industry level as well as national level. As it is Essen based retail organization, therefore, it is quite obvious that the usage of the knowledge management would affect the competitive of the organization in the national level (Holsapple 2013). On the other hand, similarly, this utility of the knowledge management would also help ALDI to gain industry level competitive advantage globally in order to compete with their competitors.
The way of disseminating as well as spreading knowledge in the organization as well as the employees of a particular organization can mainly vary in different companies. the most important thing that should be remembered by the retail organization ALDI in this context is that the knowledge must be spread among the employees of the organization in order to make continual improvement in the business operation as well as the increase in the competitive advantage of ALDI in a global context (Holsapple 2013). the dissemination of knowledge management in ALDI is very important in order to maintain the shelf life of the organization which is simply the time length that a commodity can be stored without becoming unfit for sale, consumption or use (Hislop 2013).
Obsoledge is nothing but the concept which is the combination of obsolete and knowledge. In order to resolve the problem of the knowledge of being obsolete, organizations like ALSI has to make continuous improvements as well as update on the knowledge management system of that particular company (Hislop 2013). Most importantly, it can be the only way with the help of which the obsolete of the knowledge can be prevented.
The concept of obsoledge as well as the way of mitigating this problem can easily be understood with the help of the difference between the tacit and explicit knowledge. The tacit knowledge is that knowledge, people carry in their minds as well as they also find it hard for accessing (Jones and Sallis 2013). On the other hand, explicit knowledge is that knowledge that codifies and is documented as well as can also be transferred to others easily.
Change encountered in the business operation has both of the advantages as well as risks in terms of the aspect of that particular organization. The risk of the changes encountered in the business operation can be several types (Wang, Noe and Wang 2014). The major risk associated with the changes encountered in the business process is the failure of the change. Sometimes it becomes very difficult for the business operations of the company in order to cope up with the changes. Therefore, the productivity of the organization decreases with the shortfall noticed in the changes made in the business operation of that particular organization (Fuller 2012).
Labour market segmentation notices a market for teh labours of a certain company with the sellers as well as the buyers in the open competition with each other, which can function in the similar way broadly like the other friends (Wiig 2012). In case of ALDI, it can be considered as one of the great companies for working if an employee has what it takes for rising to the top of the barrel if that particular employee likes an organization that is regimented as well as well-structured (Fuller 2012). Therefore, it is the place for employees ALDI can profit continue for rising aiding to the construction of more stores be prepared.
The problem with this organization in terms of the labour market segmentation is that ALDI tends to operate on a small number of the staffs who are productive. On the other hand, the major issue of this organization is that ALDI has violated the rules of not employing child labour in their retail stores (Fuller 2012). Such a significant and critical issue can greatly hamper the process of gaining competitive advantage.
This specific issue can become the biggest consequence for the company as theb knowledge based society of today’s world not be ready to support such wrong doing as employing child labour has been noted as an illegal offense and most importantly it can be considered as a crime (Woods and Cortada 2013). The knowledge based society of today’s world can also come forward to punish this organization by boycotting their products or in other significant ways of protestation.
Social capital in an organization is that particular asset that can connect several forms of human capital. It is that particular connection’s pattern, which can synthesis benefit for one specific group as well as constraint for other (Löwstedt and Stjernberg 2014). It is the form of the cultural as well as economic capital in that social networks are central, transactions are specified by the cooperation, trust and reciprocity, and agents of market produce services and goods as well not mostly for themselves, but for a common good (Alegre, Sengupta and Lapiedra 2013). It has been utilized for explaining the diverse group’s improved performance, the entrepreneurial firm’s growth, enhanced supply chain relations, superior managerial performance, the evolution of communities and value derived from strategic alliances.
On the other hand, the human capital for ALDI is simply the collection of resources, all the knowledge, wisdom, judgement, training, intelligence, experience, abilities, skills as well as talents collectively and individually as well by the individuals in that organization. These kinds of the assets or the resources are the entire potential of ALDI that can represent a form of wealth that can be directed for accomplishing the objectives of that particular retail organization (Becerra-Fernandez and Sabherwal 2014).
The Corporate Social Responsibility needs that organizations consider the fairness among the employees, sub-contractor employees and clients (Rollett 2012). ALDI is expected for protecting natural resources and for demonstrating responsibility and involvement in environmental components, human rights, community and sustainability that can be affected by the business operations (Becerra-Fernandez and Sabherwal 2014). The Knowledge management had been the strategy before the Corporate Social Responsibility model that was most promoted by the leaders in the corporate management field of ALDI. It utilizes the human resources as well as knowledge in an effective, innovative as well as efficient way (Borghoff and Pareschi 2013). The strategy of KM demonstrates the community of employee and its partners of ALDI as few of most essential organizational assets. These values are compatible with concern of the CSR of this organization with the rights and needs of partners and employees (Hasanali 2015).
The Macroeconomic Policy can be defined as the set of rules as well as regulations those have been implemented by the government of several countries in order to stimulate or control the aggregate indicators of the frames of economy of the macroeconomic policy (Rao 2012). The indicators of aggregation involve interest rate, grown rate, unemployment rate, inflation, money supply as well as the national income. Therefore, the proper implementation of the Macroeconomic policy by ALDI can create huge impact in the employment as well as the economical aspects of this organization.
This retail organization can easily ensure both of the two aspects with the help of the proper implementation and development of the two major macroeconomic policies such as the monetary policy and the fiscal policy (Rollett 2012). Fiscal policy is the policy where the government of Germany or the other countries where this organization has presence, tax or spending for stimulating growth (Rollett 2012). On the other hand,, the Monetary policy deals with the changes in the supply of money and the changes in the parameters that impact the money supply in economy.
In this entire report, there are several issues as well as consequences have been noticed and identified in terms of several aspects like, knowledge management practices, relation between knowledge management and Corporate Social Responsibilities and others. Therefore, based on the overall discussion made in this report some recommendations can be implemented. Among the recommendations, the first and forecast recommendation for ALDI must be the proper implementation of the knowledge management system. This organization should adopt those practices of the knowledge management those can be very effective for the improvement in the performance of the employees as well as for the increase in the productivity. On the other hand, they should be very careful about the maintenance of knowledge in order to gain more competitive advantage. ALDI should be careful about maintaining the proper relation between the CSR and the Knowledge Management system. In addition, ALDI has to follow the macroeconomic properly and effectively.
Conclusion
From the entire report, one thing has been confirmed that knowledge management is very effective in all of the aspect starting from the improving performance and productivity to the increase in the revenue. In the present scenario of ALDI, this concept has actually been reflected in this report. Knowledge management practices or the proper development of the knowledge management system can play a significant role in several contexts. it can also help the organization in order to maintain all the organizational goal by improving the employee as well as the overall performance of the organization itself with the help of effective knowledge management practices.
Reference List
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ALDI US – Homepage. (2016). Aldi.us. Retrieved 22 May 2016, from https://www.aldi.us
Alegre, J., Sengupta, K. and Lapiedra, R., 2013. Knowledge management and innovation performance in a high-tech SMEs industry. International Small Business Journal, 31(4), pp.454-470.
Becerra-Fernandez, I. and Sabherwal, R., 2014. Knowledge management: systems and processes. Routledge.
Borghoff, U.M. and Pareschi, R. eds., 2013. Information technology for knowledge management. Springer Science & Business Media.
Dalkir, K., 2013. Knowledge management in theory and practice. Routledge.
Davenport, T.H., De Long, D.W. and Beers, M.C., 2012. Successful knowledge management projects. MIT Sloan Management Review, 39(2), p.43.
Fuller, S., 2012. Knowledge management foundations. Routledge.
Gold, A.H. and Arvind Malhotra, A.H.S., 2014. Knowledge management: An organizational capabilities perspective. Journal of management information systems, 18(1), pp.185-214.
Hasanali, F., 2015. Critical Success Factors of Knowledge Management (2002).
Hislop, D., 2013. Knowledge management in organizations: A critical introduction. Oxford University Press.
Holsapple, C. ed., 2013. Handbook on knowledge management 1: Knowledge matters (Vol. 1). Springer Science & Business Media.
Jones, G. and Sallis, E., 2013. Knowledge management in education: Enhancing learning & education. Routledge.
Löwstedt, J. and Stjernberg, T., 2014. Producing management knowledge: research as practice. Routledge.
Quintas, P., Lefrere, P. and Jones, G., 2015. Knowledge management: a strategic agenda. Long range planning, 30(3), pp.385-391.
Rao, M., 2012. Knowledge management tools and techniques. Routledge.
Rollett, H., 2012. Knowledge management: Processes and technologies. Springer Science & Business Media.
Rubenstein-Montano, B., Liebowitz, J., Buchwalter, J., McCaw, D., Newman, B., Rebeck, K. and Team, T.K.M.M., 2012. A systems thinking framework for knowledge management. Decision support systems, 31(1), pp.5-16.
Ruggles, R., 2014. The state of the notion: knowledge management in practice. California management review, 40(3), pp.80-89.
Wang, S., Noe, R.A. and Wang, Z.M., 2014. Motivating knowledge sharing in knowledge management systems a quasi–field experiment. Journal of Management, 40(4), pp.978-1009.
Wiig, K., 2012. People-focused knowledge management. Routledge.
Woods, J.A. and Cortada, J., 2013. The knowledge management yearbook 2000-2001. Routledge.
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