Introduction
Information is a very important tool in the normal running of organization. Within an organization, there should be a clear management and flow of information between the management and the employees in order to harmonize its operations. Knowledge management has gained a lot of attention from various scholars and managements in the past.
It has come out clearly that one reason why firms fail to meet their expectations in their various fields is lack of clear knowledge management. As an organization increases in size, the need to have knowledge management increases. This is because different people will be assigned different tasks, and one group may not have knowledge of what the other group is doing.
However, all the members of the organization should be aware of all the activities taking place within the organization in order to eliminate cases of omission or overlapping of tasks. There should be a clear flow of information from the management to the employees to ensure that all that they engage in are in accordance with the strategic objectives of the organization.
It is upon this that many organizations have come to appreciate the importance of knowledge management system. Scholars have been keenly trying to find out how best organizations can successfully manage their knowledge. Knowledge management system has gained a lot of popularity in the recent past.
Burey (2010, p 77) says, “Knowledge management systems refer to any kind of IT system that stores and retrieves knowledge, improves collaboration, locates knowledge sources, mines repositories for hidden knowledge, captures and uses knowledge, or in some other way enhances the KM process.” This definition brings out the fact that knowledge management system is an IT supported system that helps in the storage, retrieval, improvement, and location of knowledge within an organization.
It is important to note that despite the growing importance of knowledge management system to organization in the recent past there has been a conflicting idea of the importance of knowledge management system. The failure of Telstra to manage information when undertaking the contract awarded to it by NBN Co resulted into massive violation of environmental policies that put workers and the public at health risks due to exposure to asbestos. This research focuses on this case study to develop a proposal that can be used by similar firms in future.
Knowledge Management Failure at Telstra
According to Hitt (2008, p. 76), most firms do not consider knowledge management as an integral part of their success in the market. They take knowledge management casually, always thinking that the knowledge that the top management unit has is always enough to run the organization successfully.
A reflection of the case study involving the contract assigned to Telstra by NBN Co demonstrates that this line of thinking is not only suicidal to success of an organization, but can also subject a firm to litigation. Telstra has gained a good reputation in its policies in management of asbestos. When NBN Co decided to award the contract to this firm, their main reason for this choice was the trust that Telstra had developed in this field.
The basis upon which NBN Co made its decision was justifiable. On the other hand, Telstra abused the privilege that was given to it by failing to use the right workforce in this project. The management of Telstra assumed that the knowledge that its employees had gained while working for it is not necessarily important in future projects.
The firm was too concerned in cutting its cost of operations to think of the best way of managing its employees. It therefore, retrenched most of its employees, especially those that were field officers. They believed that they could easily outsource for such services at a cheaper cost other than having to maintain these employees.
The management forgot the fact that these employees already had the knowledge of how to manage asbestos through previous training and experience in similar projects in the past. The management forgot that the good reputation it had built in the market was not due to its structures, but because of a pool of employees who knew how to handle various tasks in this field.
When retrenching these employees, the management forgot that it was dismissing its own experience, the reputation, and competent that had taken it years to build in this industry. These employees went with all this information. One intriguing fact is that the contract awarded to Telstra involved renovating a system that it had worked on previously using the employees it had retrenched.
These employees understood the risk factors involved in this project, and would have been in a better position to handle this new project. These employees knew the health risks involved in the project both to the workers and the public in general if the process was not conducted in accordance with the procedures.
It may be factual that these former employees could have been aware that this project was awarded to their former employers. They could have been aware of the possible consequences of poor approach to this project, but having been fired from the firm, they must have felt that they had no obligation bringing the attention of their former employer to the possible consequences of approaching the task.
Some could have even assumed that the management had the right information, and therefore, would use the right approach and meet the requirements expected when handling the tasks. Telstra on the other hand, realized that it did not have the right workforce to handle the task having retrenched its employees.
It realized that it had to seek for the workforce from other firms. In order to reduce the cost of operations further, the management went for firms with lesser expertise in this field because they charge lesser prices. These firms realized that the contract was big and further subcontracted other smaller firms for the task. This resulted in a scenario where the workforce that was finally taken to the field had no prior experience in this field, and did not understand the safety procedures when undertaking these duties.
This explains why they not only exposed the public to the risks associated with exposure to asbestos, but also subjected themselves to these substances during their work. Telstra could have succeeded in cutting its costs of operation. However, this came at a serious consequence to the firm, to the public, and the firm that awarded it the contract which is NBN Co.
The relevant authorities are demanding for explanation. Although NBN Co may be exonerated from any wrong doing, it is still liable to an extent, for failure to have a close monitoring unit in this project. They should have had a mechanism to inspect whether the task they assigned to Telstra was being conducted in accordance with the laid down procedures.
Theirs was an error of omission that could cost them their reputation in the market, besides other disciplinary measures that might be taken by the relevant government authorities. For Telstra, they are not able to run away from the full responsibility of the unfortunate turn of event. It was awarded the contract, failed to use the appropriate workforce, and therefore, resorted to using individuals and firms with no knowledge and experience in handling this task.
It is also apparent that the management never even bothered to follow-up to determine the ability of these individuals to deliver on the assigned task. As it comes out from this case study, the former employees left with the knowledge from the firm. It is apparent that Telstra never had a knowledge management system even before firing its employees.
According to Maier (2004, p. 62), it is normal for a firm to hire and fire employees on various basis in its quest to increase its productivity. However, it is important to ensure that the knowledge that an employee gains while working for the firm is retained within the firm when such an employee leaves. This is because the employee was duly paid by the firm for that task, and all the relevant knowledge regarding the task becomes the property of the firm.
The knowledge should be stored safely by the firm in a system that can easily be retrieved, modified and used by another employee who shall be in that position or any other position to which that the information will be relevant. This is what the management of Telstra failed to do. There was no clear mechanism through which relevant knowledge that employees gathered while in the field would be stored.
If this system were available, the management should have known that this new project had health concerns that should have been considered on a serious note before the new employees could start working. This is also demonstrated in the way they acted when assigning the task to other firms.
This firm should have realized that it had a lot of stakes in this project because of its magnitude. However, there was no clear information flow between the Telstra management and the management of the subcontracted firms.
Proposal for a Knowledge Management System for Telstra
The current situation in which Telstra finds itself is very awkward, and the fate of the firm is no longer in its hands anymore. Its fate is in the hands of the government agencies responsible for environmental protection and NBN Co. these government agencies may decide to press charges against this firm, and force it to pay huge sums of money as fine.
This can be worse when these agencies decide to recall the trading license of Telstra because this will force it to look for markets outside this country. On the other hand, NBN Co may also decide to press charges against Telstra. They are justified to do this because Telstra never informed them that they were considering subcontracting the tasks to other firms.
This will not only injure the finances of this firm, but also affect its good reputation negatively. This is the predicament that this firm finds itself in because of lack of proper knowledge management system. This is a lesson to this firm, and to others, and a sound warning that lack of knowledge management system may cost a firm a fortune. Although neglected for long, it is time this system was given the seriousness it deserves.
Based on the findings from the case study given above, the management of Telstra should consider a number of systems to manage its knowledge in order to protect it from such occurrences in future. According to Gottschalk (2007, p. 67), knowledge management system can take different approaches based on the needs of the firm.
The current situation of this firm means that it will need to employ three aspects of knowledge management system. The three include a content management system, document management system and finally a decision support system.
Content Management System
The management of Telstra should start by creation of content management system. This is very important because it is apparent that the firm lacks the right knowledge having fired its more experienced employees. Content management system will help in creating, managing, and distributing of the content within the intranet, internet and the website of the firm as might be necessary.
In this stage, the firm will basically ensure that it has the right knowledge within its system that would enable it undertake its duties successfully. As Becerra (2010, p. 90) observes, this would require the firm to have basis upon which this content will be created. In this process, technology will be relevant in developing the templates, tagging the content with metadata and making this content easy to edit whenever there are changes.
The process of content creation should involve various stakeholders within the firm. It should be a collaborative process which brings together all the employees of the firm, the management and other relevant stakeholders. Being a system, the management should define units working on different tasks to make the system complete.
The units within the system should not overlap, but each unit should know what other units are involved in, and what these other units expect from them. In this system, the output from one unit would act an input of another unit which it will process further to create more useful output.
For instance, when one group brings in raw data from the field, another group will be responsible for coding this data, while another group will interpret it. The final group will present the data in the form that can be consumed by every member of the organization either in the data base of the firm, in the internet or the website of the firm.
Document Management System
The second step would be to develop a document management system. As the name suggest, this system is explicitly responsible for the management of documents upon collection, coding and presenting them in a manner useful to all the members of the firm. This next step would be to try to manage this data is a way that is beneficial to all the stakeholders of the firm.
As the management continues to develop more knowledge into this field, it will reach a point where this knowledge becomes too massive to be handled using simple data management systems. The introduction of new knowledge does not mean that the old knowledge is irrelevant. As such, the data arriving at the firm must be stored in a way that will enhance their retrieval at whatever time it may be required.
Ackoff (2009, p. 7) says that there are instances where new knowledge coming in is an advancement of the old knowledge. In such instances, there will be a need to harmonize such related pieces of information to enhance knowledge in that field. However, this should not jeopardize the originality of the initial sources of knowledge because there may be a need to make a reference to them.
Just as the system described above, this system will have components responsible for knowledge synthesis, transfer, retrieval and storage. While the first system involved all the relevant stakeholders within the firm, this system will be under direct supervision of the top management. Only a few individuals will be allowed a comprehensive access to this vast knowledge.
The stakeholders will only have access to knowledge relevant to their tasks. This will help the firm protect its strategies from other competitors. Some of the most important tasks in this system will include capturing the data, classification of this data using metadata, indexing of the data, creation of searching and retrieval techniques, versioning of the data and finally administration and security of the data.
Decision Support System
This may not necessarily be the end stage in knowledge management system, but ultimately it is one of the most important stages in knowledge management system. According to Resnick (2004, p. 77), the main reason why there is need for knowledge creation and knowledge management is to help in the process of decision making. The world is increasingly getting competitive, and firms are finding themselves under pressure to deliver.
These forces the firms to come up with strategies that would help ensure that they make decisions that would create a competitive advantage to them. The decision support system helps management in making sound decision based on the knowledge available in the database of the firm. Girard (2005, p. 15) says that for a firm to be certain that they are making the right decision, they should ensure that they make data-driven decision.
This is because such decision can be justified if there is need for it. This can be done using Online Analytical Processing System which would help in data mining, and warehousing of this data. This system seeks to solve problems of the organizational management by developing strategies based on the knowledge of the firm in that particular area.
As Thierauf (2009, p. 59) observes, “It is necessary to ensure that the system fulfills the three criteria that determine its success, namely compatibility, understandability, and effectiveness.” This system will help in ensuring that the decision made is compatible to the capacity of the firm and other systems it has.
Understandability will be ensured to help other members of the organization know why the decision was made and its benefits if well applied. Finally, effectiveness will be emphasized by the management to ensure that all the relevant stakeholders apply the policies made out of these decisions. These three phases should be continuous as demonstrated in the figure below.
Figure 1: Knowledge Management System Circle
Promotion of Acceptance and Assimilation
Knowledge management system is a process, and once all the structures are put in place, the next phase is always to make the strategy work. The management must ensure that all the stakeholders involved must accept the strategy in order for the assimilation to be successful. Castells (2011, p. 89) says that it is only when a project has the backing of all the relevant stakeholders that it shall be able to meet its intended goals.
This process is always categorized into three phases. In the first phase is the knowledge management system adoption. In this process, the management will start by internally analyzing the firm to determine the adoptability of the policy. The management will evaluate the knowledge needs and flows, determine how to communicate it, and come up with a strategy in which it can be adopted within the firm.
The next phase will be the knowledge management system acceptance. This is a very important stage. When introducing a new concept within an organization, Gerami (2010, p. 235) observes that there are always anxiety, job-fit issues, the usage approach, motivation among other social factors.
These are issues that must be dealt with thoroughly to ensure that the process is successful. To manage these factors, there is need to involve all the users in design and implementation process. The management should ensure that this new system is user friendly and more assuring to the stakeholders. They should also provide relevant technical and the managerial support that would help in enhancing the system.
The last stage would be knowledge management system assimilation. This is the process of rolling out the new strategy within the firm. When the new system has been accepted within the firm, all the activities that this organization engages in should reflect the new system adopted. This would improve productivity of the organization.
List of References
Ackoff, R 2009, “Knowledge and Wisdom”, Journal of Applies Systems Analysis, vol. 16. no. 19, pp. 3-9.
Becerra, R 2010, Knowledge management: Systems and processes, M.E. Sharpe, Armonk.
Burey, M 2010, “Knowledge Management”, International Journal of Computer Science and Information Security, vol. 7 no. 2, pp. 34-237.
Castells, M 2011, The Rise of the Network Society: The Information Age: Economy, Society and Culture, John Wiley & Sons, New York, NY.
Gerami, M 2010, “Knowledge Management”, International Journal of Computer Science and Information Security, vol. 7. no. 2, pp. 234-237.
Girard, J 2005, “The Inukshuk: A Canadian Knowledge Management Model”, KMPro Journal, vol. 2. no. 1, pp. 9-16.
Gottschalk, P 2007, Knowledge management systems: Value shop creation, Idea Group Publishers, Hershey.
Hitt, R 2008, Strategic Management Competitiveness and Globalization, Thomson, London.
Maier, R 2004, Knowledge management systems: Information and communication technologies for knowledge management; with 91 tab, Springer, Berlin.
Resnick, L 2004, “Management requirements for knowledge management systems in the virtual organisation”, International Journal of Networking and Virtual Organisations, vol. 2. no. 4, pp. 12-78.
Thierauf, R 2009, Knowledge management systems for business, Quorum Book, Westport.