1. What is knowledge?
Organizations are, currently, realising the increasing value of knowledge as one of the assets based on which it the competitive advantage is built upon. It is, actually, the knowledge an organization detains – under the form of know-how embedded in its employees and managers and knowledge owned, created and/or captured by the organization – that defines how the organization operates and creates value to the market. The knowledge detained by the organization impacts its effectiveness, efficiency, productivity, performance, and innovativeness.
It is of high relevance to note that knowledge is embedded in people. Although technologies can bring huge support to the knowledge creation process, the ability to create knowledge is “owned” by the human being. This means that the ability to capture, create and “store” knowledge belongs to the people of the organization. Therefore, each person, no matter the job or hierarchical position, owns knowledge that should be capitalized in order to achieve a higher performance and innovativeness of the organization.
So, the first key takeaway to retain, before we go deeper in the topic of knowledge is the importance of every single person working in the company and the “piece” of knowledge this person owns. Just think about your own organization. Is it fair to say that your organization is able to operate and deliver value to your customers because you own knowledge that allows the creation of something? Is it fair to say that each person inside the organization – from management, to production, marketing, sales, accounting – owns an important “piece” of knowledge that allows him/her to perform his/her job and contribute to the ability of the organization to operate as a whole? Is it fair to say that is the collection of all this knowledge, like pieces of a puzzle that put all together allows the organization to operate and create the opportunities to grow and be sustainable?
A second very important take away is related with the link between knowledge and action. Knowledge is highly related with action, application of knowledge to create value. Therefore, when we talk about knowledge, we need to include the actions resulting from the knowledge acquired. Just think about training courses you make available to your employees. Will your organizations gain knowledge if the trained employees don’t apply their learned knowledge to improve somehow the organization performance? If the knowledge is not applied and translated into actions, it may be there in the mind of the person that acquired it but is of no use and is as good as if it didn’t exist.
But we can’t talk of knowledge management, knowledge creation, exchange of knowledge and ideas inside an organization without clarifying, first, 3 key concepts that can be, quite frequently, confused – data, information, and knowledge.
Source: https://pixabay.com/pt/illustrations/educa%c3%a7%c3%a3o-de-adultos-escrever-saber-572269/ (Image by Gerd Altmann)
Data, Information, and Knowledge – are we talking about the same thing?
Organizations own or have the possibility to obtain from the external environment data, information, and knowledge. The three concepts properly understood and used can be key to the creation of knowledge, development of new ideas and, therefore, to drive the organization growth, innovativeness, and competitiveness.
Data represents a set of objective facts about an event. Think about your organization’s monthly revenues. Your accounting documents will show you the numbers per month. You know this numbers represent the result of an event – sales. You can take these data and create evolution maps, estimates, etc. But, the numbers, per se, will lack meaning. If you provide these numbers to different people from your organizations, most likely, different type of questions will be raised, different interpretation can be assumed. All because the data misses a meaning.
Source: https://pixabay.com/pt/illustrations/matriz-tecnologia-dados-digital-3109378/ (photo by Jae Rue)
The moment data is interpreted and contextualized, it starts to have a meaning, and that’s the moment you will have information. Let’s take the example of the sales revenue. The moment you understand the context that contributed to the number, you will be able to interpret it and have information. The sales dropped so, maybe the costumers choose to buy competitor products, or it’s a normal season decrease, or there’s quality issues related with the product, or maybe just an economic crise affecting sales all over the country. You can compare sales evolution with previous years and analyse your performance. Giving a meaning to data will allow to understand it and act upon it.
Source: https://pixabay.com/pt/illustrations/perguntar-escrita-quem-o-que-como-2245264/ (Image by Gerd Altmann)
Currently, organizations are already very comfortable distinguishing data from information, but the differences between information and knowledge can still be a little bit fuzzy.
Data can be transformed into information and information can be transformed into knowledge.
The concept of knowledge is based on the certainty of a belief, sustained by evidence that proves the validity of the belief. If there’s uncertainty, then we don’t have yet the knowledge. Let’s go back again to our example of the sales revenue. You can assume that a certain month sales revenue is the consequence of, e.g., competition new products, but do you have irrefutable and valid evidence that sustain this or is this just an assumption based on a set of information collected?
When talking about knowledge, we must also talk about action. Knowledge drives action. Unless we use knowledge to act, we don’t have much. Think about the COVID-19 pandemic. If all the fast research done wasn’t translated into measures and vaccines development, wouldn’t we still be in the same stage we were early 2020? How much information have we received about this pandemic, it’s effects and transmission channels that were proved wrong by scientific evidence? Throughout this crises information has been created, based upon data collected and knowledge has been created from the information released (even though it is still very premature to say we own all knowledge about the pandemics as science is still collecting irrefutable evidence).
Let us make you, now, one question for your own reflexion. Where do ideas fit in all of this? Can knowledge start with an idea? Or is data, information and knowledge that inspire us to come up with new ideas? Or can ideas flow all around us and lead us to create new things?