Knowledge management

Until comparatively recently, the value of a company was felt to be determined mainly by the value of its tangible assets. In recent years, however, it has been increasingly recognised that in the post-industrial era, an organisation's success is more dependent on its intellectual assets than on the value of its physical resources. This increasing importance of intangible assets is evidenced by the high premiums on today's stockmarkets. We can measure this by expressing the market value of a company as a percentage of its book value. Looking at this index, we see that the Dow Jones Industrial has risen steadily over the last 25 years and newt stands at over 400%. Underlying this trend are a number of factors. The requirement for highly-skilled labour in many industries, new computing and telecommunications technologies, faster innovation and ever shorter product cycles, has caused a huge change in the ways organisations compete - knowledge is now the key battle ground for competition. Other factors driving companies to try to manage and exploit their intellectual assets more effectively are increasing employee turnover rates and a more mobile workforce, which can lead to loss of knowledge, and globalization, often requiring people to collaborate and exchange knowledge across continents and time zones. The knowledge management discipline aims to address this challenge and can be broadly defined as the tools, techniques and processes for the most effective and efficient management of an organisation's intellectual assets [1].