Components Of Knowledge Management Management Essay

“Organizations that are aware of their knowledge resources posses a valuable, unique resource that is difficult to imitate and can be exploited to achieve a sustainable competitive advantage (Grainer et al. 2007: 4)”.

This statement stresses the importance of knowledge in any organization, which could also be applied in the hospitality industry. Although, Grainer et al. (2007) add that in order to obtain a positive business performance that will lead to a competitive advantage, the knowledge management activities should be selected according to a strategy that suits the organizational environment of the company.

According to Hansen et al. (1999, cited in Edvardsson, 2008), there are two main knowledge strategies: “codification” and “personalization”. Codification refers to the collection of explicit knowledge that is expressed in words, numbers and specifications, the storage in databases, and presentation of knowledge in a precise and codified form. (Grainer et al. 2007; Edvardsson, 2008). This strategy could result in the development of existing technologies and capabilities, leading to a process of standardization. On the other hand, the personalization approach would include

“face-to-face communication, communication through such structures as networks of people, cross-functional teams, committees, task forces, training and development, internal knowledge sharing through benchmarking and job rotation, and creation of strategic alliances (Lakshman, 2007:55)”.

This strategy regards the use of tacit knowledge that is based on “insights, intuition and personal skills for solving complex problems (Edvardsson, 2008: 554)”. The application of this strategy in business could enhance service or product creation and innovation. Lackshman (2007) suggests that the suitable combination of both strategies could achieve better results in an organization.

In order to advise about the best knowledge management practices for the client of this Business Research, the researcher based on different studies to present the main components of knowledge managements, the needed requirements for their implementation and the possible applications in the organizational environment:

Table 1-Components of knowledge management

Components

Requirements

Application

Employees rewarding

-employees should find value in KM activities in order to be motivated to continue sharing their intellectual resources.

-seeking, sharing, creating, and reusing knowledge

– ongoing training and development efforts

Capturing and reusing enterprise knowledge

-to embed a sustainable way of working;

-To create an organizational knowledge.

-a common, simple set of core capture, transfer and reuse practices which are easily understood, supported, and performed;

-immediate improvements in operational and organizational performance;

Learning processes

-enhance the ability to learn before,

during, and after project or process execution;

-To promote transformational change.

-peer to peer interaction;

-open behavior and fundamental change

Enabling technology

-re-use of the knowledge so that what is learned between the peers is made available and then accessible

-knowledge assets;

-communities of practice

Launching and nurturing communities of practice

-endorsing informal communities that already exist;

-encouraging the emergence of communities around useful themes for the organization;

-involve techniques of leadership to promote sharing between communities

-collection of information and know-how that can be shared through the web or other technology;

-To involve explicit knowledge with the human understanding.

Knowledge sharing

– Internal benchmarking efforts

-culture, employee commitment and trust

-To focus the activities of obtaining and reusing knowledge on performance improvement

Source: Adapted from Denning (2006); Bencsik and Bognar, (2007); Kaplan and Reed (2007) and Lakshman (2007).

Kaplan and Reed (2007) explained that the real effort in knowledge management lies in maintaining and sustaining the strategy that the company is executing. Considering that, the different components of knowledge management presented in the previous table will be related to the strategies applied in the multinational hotel chains of Accor and Marriott through this project.

5.2-Knowledge Sharing approach

In order to better explain and recommend a possible Knowledge Management strategy that could be applied in Pestana Hotels, the researcher evaluated the options and chose the approach of knowledge sharing. According to Yang (2004: 119) sharing knowledge could be seen as the “dissemination of information and knowledge through the whole department and/or organization”. Yang (2004) adds that companies believe that the value of knowledge increases when it is shared, so supporting communication to spread the message across different departments or branches could impact business strategy on all parts of the organization.

5.2.1-Characteristics of Knowledge Sharing

Considering that the application of knowledge sharing in an organization would lead to the processes of change and innovation, Hardy and Connect (2007:19) says that

“Innovation involves a variety of processes to trigger and foster ideas, to be able to think and do things differently, and to nurture a good idea from its incubation through to commercial success in the marketplace”.

Also, Hardy and Connect (2007) adds that small and medium-sized organizations could become sources of innovation because of their advantages regarding diversity, flexibility and prompt decision making.

The application of knowledge sharing as a strategy could also fit into the hospitality industry, since according to the Sveibil’s research (2001, cited in Yang, 2004:120)

“customer information database was set up by the hotels for the best practice of enabling stakeholders to leverage their knowledge from knowledge acquired from a company”.

The current knowledge sharing practices operated by Marriott and Accor will be further explained in this study.

5.3-Leadership profile for the hospitality Industry

Tracey and Hinkin (1994) state that the hospitality industry is a niche of constantly change and because of that, leaders should be able to adapt themselves in order to manage the impact of external forces. Greger and Peterson (2000: 28) explain that

“the astute leader must embrace frequent change and global business dynamics, and be stimulated by the process of re-inventing himself or herself, as well as the company whenever needed to survive and thrive”.

In order to present the best leadership theories that combined could enhance organizational performance of this study’s client, the approach of Transformational Leadership by Tichy and Devanna (1986, cited in Tracey and Hinkin, 1994) was chosen. Viitala (2004: 530) defines this concept as “the style that generates development and change in an organization” and the opposite of transactional leadership, which according to Tracey and Hinkin (1994) is a classical managerial style based on task orientation, authority, and legitimacy through employees. Deming (1994, cited in Gapp, 2002: 338) says that “the job of a leader is to accomplish the transformation of his organization. He possesses knowledge, personality, and persuasive power”. According to Bass (1990, cited in Viitala, 2004), transformational leaders apply the skills of good visioning, influence and charisma to develop a strong relationship with followers in order to help them optimize their current level of performance. Regarding these theories, the researcher structured the expected profile of a leader that fosters the concepts of vision, innovation, change, learning and collective thinking in the hospitality industry:

Table 2- Comparison between effective and ineffective leadership behavior

Effective (transformational) leadership behavior

Ineffective (transactional) leadership behavior

-Vision, passion, and ability to communicate;

-Integrity as a core value;

-Attention to diversity;

-Compassion, consistency and respect;

-Talent and competence;

-Conviction about ideals, beliefs and values;

-Personal involvement and determination;

-Act as the example to be followed;

-Committed with ethics and moral;

-Listening skills ;

-Youthful curiosity, sense of humor, high energy and contagious enthusiasm;

-Imagination and creativity;

-Use of reason and evidence in decision-making process;

-Global business perspective;

-Understanding and effective use of technology;

-Consideration of individual needs, abilities and aspirations

-Celebrating with the team

-Clarifying mission, vision and values towards everyone in the organization;

-Specifying strategies, structures and politics;

-Creating efficient learning processes

-Facilitating collective-thinking

-Manage for the long-term

-Foster intrinsic motivation of employees

-Include the ideas of community and citizenship in management systems

-An inflated ego and the notion of omnipotence;

-Priorities are not established;

-Delay action until the situation became an emergency ;

-Maintain policies and procedures that don’t work anymore;

-References to employees as “them”;

-Lack of complacency and predisposition;

-Fails to follow up requests for assistance;

-Be absent when is needed;

-Focuses attention on irregularities; mistakes, exceptions and deviations from standards;

-Diverts the attention away from work-related problems;

-Emphasis on the traditional hierarchy

-Avoid delegation of tasks and empowerment;

-Manage through fear, control and position power;

-Ignore technology developments

Source: Adapted from Tracey and Hinkin (1994); Greger and Peterson (2000); Viitala (2004); Ringer (2007); Gapp (2002) and Hamel (2009).

5.4-Knowledge Leadership

“The leaders act as role-models for the manner in which knowledge sharing occurs, as well as setting the incentives for doing so. The leaders furthermore facilitate networks of knowledgeable members of the organization and provide best practice of coordination and collaboration activities (Sondergaard et al., 2007: 429)”.

This statement emphasizes that leaders has a critical role related to knowledge capabilities, considering the implementation of knowledge sharing strategies and their impact in organizational performance.

It is said that

“Leadership that promotes learning is leadership where the leader, together with his/her subordinates clarifies the direction of development, creates a climate which promotes learning, and supports learning processes as both individual and group level. The leader also inspires his/her subordinates towards continual personal development through his/her own example (Viitala, 2004: 539)”.

This could be interpreted as a way in which leaders are also responsible for ensuring the continual learning in the organization, since it could be considered as a fundamental tool for the long-term success of knowledge management strategies.

Relating the approaches of leadership with knowledge sharing, Sondergaard et al. (2007) explains that leaders should apply business strategies in the organization, considering the opportunities of each strategy and informing their team about its requirements. Since these attitudes become behaviors, the knowledge sharing culture could be developed. The next section will present the practices that Marriott and Accor develop about this subject. 5.5- Analysis of effective practices

5.5.1- Leadership approaches of Marriot International

Since 1972 J.W. Marriott, Jr., also called Bill Marriott, has been the Chief Executive Officer of Marriott International (Greger and Peterson, 2000). Gregersen and Black (2002:33) adds that

“as the CEO and as chairman of the board since 1985, J. W. Marriott, Jr., has built on the legacy and company culture established by his father and grown the company more than twenty times with sales of over $20 billion per year”.

Bill Marriott (2002, cited in Gregersen and Black, 2002:37) says that “putting the right leadership in place is key”, so the adequate leadership approaches could be intrinsically related to his success as the top manager of this company. Bill Marriott also explains that the Marriott culture is “built on fundamental ideals of service to associates, customers, and community (Gregersen and Black, 2002: 33)” and he adds that that these ideals are the base of the aspects of “spirit to serve (ibid.)”.

In order to clarify that declaration, the researcher reviewed interviews with Bill Marriott and Stephen J. O’Connor, another leader involved with Marriott Corporation, in order to develop the leadership structure that is applied in Marriot International:

Table 3- Spirit to serve

Key components

Based on Gregersen and Black (2002: 34)

Leadership approaches

People are the most important asset

“A successful company puts its employees first. Taking good care of employees makes sense, but the concept of making employees feel really good about themselves seems to be missing from many companies’ philosophies

(Marriott, 2000, cited in Greger and Peterson, 2000:19)”.

The environment supports associate growth and personal development

“We are in the people business… teach them and help them and care about them. Give them a fair shake. Give them skills; help them succeed; make winners out of them (Marriott,1994 cited in Collins and Porras, 2002:64) “

Employing caring and dependable associates that are ethical and trustworthy

“The only way I know in this business to drive the top line is by having the right people deliver good service (Marriott, 2000, cited in Greger and Peterson, 2000:25)”.

Home-like atmosphere and friendly workplace relationships

“None of our formal programs is as important as having hands-on managers in place who possess the people skills to support, encourage, lead, inspire, and listen to associates (Marriott, 2000, cited in Greger and Peterson, 2000:19)”.

Performance-reward system

“Recognizes the important contributions of both hourly and management associates (Marriott, 2002, cited in Gregersen and Black, 2002: 34)”.

Pride in the Marriott name, accomplishments and record of success

“A critical ingredient in our evolution has been a willingness to experiment. Change is to business what oxygen is to life. In a word, vital (Marriott, 2000, cited in Greger and Peterson, 2000:22)”.

Focus on growth-managed and franchised properties, owners, and investors

“Strong individual performance by each hotel leads a strong brand performance. The more powerful the brand, the more powerful the investment becomes for the franchisee going forward (O’Connor, 2002, cited in Adler, 2002: 92)”.

Source: Adapted from Adler (2002); Collins and Porras (2002); Greger and Peterson (2000) and Gregersen and Black (2002).

Marriott (2000, cited in Greger and Peterson, 2000: 17) also argued that “Leadership is having a vision first, and then communicating that vision. Walking the talk, being out in front with the troops; letting them know you are there for them, and being a change maker”. That statement and the key components of spirit to serve could enforce the relation between Marriott’s leadership practices and the transformational leadership approach presented before, since they stress the importance of visioning the future, to have communication skills, to act as a role model, to be committed, accept different opinions and promote motivation, besides other factors concerning their leaders’ behavior.

Also, it is said that Marriott developed the management practice called “management by walking around (Dube et al., 1999)”. Dube et al.(1999) explain that this is related to the concern of Bill Marriott about knowing every branch and the different employees that work for Marriott, in order to guarantee the quality of the service. They add that this practice regards internal benchmarking, aiming the development of customer loyalty and employee satisfaction (ibid.), so the best practices could be shared across the different brands, which could also be seen as a knowledge leadership approach, when it regards to ensure that the knowledge management strategies are also practiced everywhere.

5.5.2- Knowledge Management strategies of Marriott International

Regarding the main knowledge management strategies previously presented in this study, Gupta and Govindarajan’s (2000, cited in Yang, 2004: 120) studies presents that “Marriott International Hotels encourage and reward their employees to transfer job-related knowledge including experience and routines to others by developing and using a ‘codification system'”, so the practice of ‘codification’ is supported by this company. They add that this practice enforce the patterns of service, providing guest satisfaction. Also, Ingran et al. (2000, cited in Yang, 2004:120) explain that this hotel chain “have implemented a mentoring program for converting individual learning, knowledge and experience to others”, which could be related to the ‘personalization’ approach. Therefore, the combination of both methods is embedded in Marriott’s strategy for knowledge management.

According to Strategic direction (2005:15) Marriott International Hotels “use knowledge sharing to increase the effectiveness of its employees by offering a reward based system to staff to transfer information individuals pick up through a codified system, as well as mentoring”, which is also a concern of the employees rewarding system presented before. Strategic Direction (2005) adds that the purpose of this system is the return of customers and that in order to achieve the success of this strategy it is necessary to create a sharing culture that follows certain criteria, which are also applied in Marriott:

Internal knowledge. “Learning from others’ experience, the organization and any information databases within the company (Strategic direction, 2005:15)”. This statement could reveal the importance of internal benchmarking for establishing patterns in Marriott International.

External knowledge. “Learning from the company’s partners, competitors and competitors’ customers (ibid.)”. The knowledge of competitors’ implementations could also be seen as a strategy related to knowledge sharing.

Trust. Trust could be considered as an important aspect related to knowledge management (Hardy and Connect, 2007). Strategic Direction (2005:16) adds that “the more trust there is between colleagues and levels of management, the more open a company will be which will foster knowledge sharing”.

No hoarding knowledge. McGill et al. (1992, cited in Yang, 2004: 120) argues that “a climate that is mobilized for sharing and learning enables employees to acquire knowledge and skills, and to replenish creativity, imagination, exploration, discovery, and intentional risk taking”, so creating a culture of willingness to share knowledge could be intrinsic for its strategy succeed.

It is said that “the Marriott organization has an unrivalled reputation as a service leader and for the breadth and depth of its training and development activity around the world (Teare and O’Hern, 2000: 102)”. Teare and O’Hern (2002) add that in order to promote transformational change regarding learning and training, Marriott combined the technology activities with “the processes of action learning (ibid.)”, applying the practices developed by the “Association of International Management Centres (IMC) (ibid.)”, resulting in the creation of “Marriott Virtual University (MVU) (ibid.)”. It is discussed that the objective of this practice is to provide a worldwide learning network in a low cost for every employee, at any organizational or educational level (Teare and O’Hern, 2000) and its requirements could be connected with the component of learning processes, concerning knowledge management strategies. Also, Collins and Porras (2002: 198) state that since 1970 Marriott has “invested in a corporate Learning Center”, which according to a Forbes Article (1971, cited in Collins and Porras, 2002: 198) had the outcome that “hundreds of Marriott managers stream in and out for refresher courses, right along with new employees involved in ‘total immersion’ training on how to prepare and serve”. This practice that does not require large amounts of technology investments could also be considered in a smaller hotel chain, regarding learning processes.

5.5.3- Accor’s leadership style

It is said that “Accor, the French multinational hotel chain, is the world’s largest hotel, catering, restaurant, and tourism corporation (Aung, 2000:43)”. Since 2006, Gilles Pelisson is the current CEO of this corporation and he has the responsibility to be the top manager of this global group that operates over 100 countries and that has over 150,000 employees. About his leadership style, it is argued that he “command with the aim of accelerating the decision-making process in a time of recession, improving the responsiveness of teams across the organization and maintaining the Group on course (Accor, 2009)”.

Harrison and Enz (2005) argue that the leadership approach developed by the Accor’s founders, Paul Dubrule and Gerard Pelisson is related to the organizational vision. It is said that “many CEOs have been described as visionaries. They have a vision of what the organization should become, and they communicate that vision to other managers and employees. (Harrison and Enz, 2005: 78). They add that “unlike many hotel groups that focus on higher-quality segments, Accor’s vision is to appeal to the masses (ibid.)”. The characteristics of a visionary leadership approach and the current leadership style commanded by Gilles Pelisson could be related with the transformational approach for leadership previously explained, so Accor hotel group could also be considered as an effective company, regarding its leadership style.

Since the CEO of Accor is periodically changed, a former CEO, Jean-Marc Espalioux (2001, cited in Harrison and Enz, 2005) explains that the expansionary vision developed by Paul Dubrule and Gerard Pelisson, which consists in “making their companies one of the largest hoteliers in the world (Harrison and Enz, 2005:79)”, is enforced every time that a new CEO is selected and it usually occurs because “when they selected a new CEO, they made sure that he shared their vision (ibid.)”. This practice of sharing the founders’ vision could be related to knowledge leadership, since there is an orientation for knowledge sharing.

5.5.4- Accor’s knowledge management practices

The researcher based on the findings of Bouncken and Pio (2002) in order to present the knowledge management system that was established by Accor hotel group, consisted by brands such as Formula 1, Ibis, Novotel and Sofitel:

Table 4- Accor’s knowledge management system

Practices

Process

Requirements

Achievements

IT- based knowledge accumulation

To gather data about service innovations, best practices and training possibilities.

Plans and schedules

Allow the transfer of tacit and implicit knowledge.

Access to the IT-based knowledge system

Retrieval of knowledge, which is codified and labeled.

Computers installed with databases

Access of the databases for employees who don’t need it in their operations.

Motivation for knowledge utilization and generation

To manage task-oriented activities with motivation purposes.

Implement idea contests, bonuses, benchmarks, etc.

Implementation of knowledge management profits from the open corporate culture and decentralization.

Source: Adapted from Bouncken and Pio (2002)

Bouncken and Pio (2002: 53) explain that

“the Accor hotel group is engaged in the formulation of knowledge goals. An internet-based intranet will be improved, which contains data about best practice, service innovations, and training possibilities”.

These practices could be related to the component of enabling technology, presented in the section of knowledge management practices in this project, due to the fact that it regards the re-use of the knowledge obtained and its consequential transfer among employees through technological systems.

Aung (2000) studied about the requirements of the operations function in an organization, since the employees should be prepared to operate with the technology provided. Leonard-Barton (1992, cited in Aung, 2000:47) explains that “one competency needed for the operations function encompasses firm-specific knowledge and understanding derived from many individual sources through years of accumulating experiences” which could be seen as the importance of sharing knowledge and training related to technical systems, in order to enhance the operational functions and apply technology in different areas. Also, the procedures of this operation could be linked with the component of capturing and reusing enterprise knowledge.

Another practice of Accor, presented by Bouncken and Pio (2002) is related to the implementation of knowledge management strategies, regarding an open corporate culture and decentralization. They explain that decentralization supports the application of knowledge management in different countries, so after creating, studying and testing them, the “successful practices can be implemented in more hotels (Bouncken and Pio 2002:54)”. This strategy could be connected with the component of learning processes in knowledge management, since it promotes change in the organizational behavior, regarding the abilities to learn with past experiences or, in this case, with internal benchmarking.

Bouncken and Pio (2002:54) also say that “Accor improves knowledge by human resource training and knowledge circles to improve service quality in the service encounter”. They explain that these knowledge circles are related with particular goals, usually concerning the service operations, “which concentrate on task-specific knowledge, established throughout the hotel group (ibid.)”. This practice could also be related with the components of communities of practices, which regards the involvement of certain groups of employees and their understanding about the issue discussed.