A Research on the Issues Related to the Strategic Target... Knowledge Innovation in Enterprises

A Research on the Issues Related to the Strategic Target of the
Knowledge Innovation in Enterprises
WEI Min∗
School of management, Xiamen University, Xiamen, P.R.China,361005
Abstract: To adapt to the changing competitive environment of commercial for enterprises to better
understand and meet the needs of their customers, the managers of enterprises should look at the internal
and external environment from the perspective of knowledge management, by which the Enterprise
knowledge management can be placed in the highly strategic decision to link up with the strategic
decision of the enterprises. By the analysis of the importance of knowledge innovation for enterprise to
win the competitive advantage in market, the necessity of knowledge innovation for enterprises and the
strategy on how to carry on knowledge innovation can be believed. Moreover, the knowledge innovation
and the strategic target to achieve of enterprises have been Explained ant last.
Key words: knowledge innovation; strategy target; competitive advantage
1 Introduction
With the arrival of the era of knowledge-based economy, enterprises have come to realize that their
competitive advantage is the knowledge owned by them. Laurence Prusak believed that only giving a
competitive advantage is knowledge management, and the key of how to win the competition in the
enterprise is using knowledge and acquiring new knowledge at a faster pace. Therefore, the changes in
the status of knowledge highlight the importance of the knowledge innovation in enterprises strategy.
With the rise of the knowledge innovation is the new concept. Amidon gave the definition of the
knowledge innovation, "through the creation, evolution, exchange and application, new ideas can be
transferred into marketable products and services to achieve success for enterprises in revitalization of
the national economy and all-round social prosperity.” In the industrial economy, the main innovation is
seen as technology innovation, and innovation is seen as knowledge innovation in a knowledge-based
economy. Knowledge innovation is believed to acquire new knowledge of the natural science and
technology through scientific research, whose aim is to seek new development, explore new laws, create
a new building and gain new knowledge applied to the products (services) to promote success.
Nowadays, it is very important to stress the need to establish and develop a national innovation system.
In fact, the innovation system will have real vitality only link with the enterprises as the main body.
Knowledge management is to promote the link of the inner of enterprise, the relation of enterprises, the
relation of enterprises and customers, and the relation of enterprise and the universities and research
institutions, by which innovation can be promoted in terms of knowledge networking and knowledge
flows. Knowledge Innovation is not only the life of knowledge Management, but also the driving force
behind the continued development. Knowledge management should create a favorable environment that
is conducive to innovation.
In China, knowledge innovation strategy is still at the initial stage. Some scholars believe that
strategic management paradigm is changing in the era of knowledge economy. Knowledge Innovation
should be a key component of corporate strategy. For enterprises, knowledge innovation is the
foundation for technological innovation, which is an important part of enterprise in knowledge
management activities. Due to the important role of knowledge innovation in enterprises, knowledge
innovation strategy system has become an important part of the system of strategy. The strategy target
of knowledge innovation will become the issue which is necessary to seriously study for us.
∗
WEI Min, a lecturer and postdoctoral research of school of management, Xiamen University, Xiamen, China.
Adress, school of management, Xiamen University Xiamen, China, postcode, 361005.
E-mail:[email protected].
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2 Analysis of the Strategic Target of Knowledge Innovation in Enterprise
In the age of knowledge-based economy, enterprises can not merely rely on technological
innovation to meet the rapidly changing needs of individual customers. Only by vigorously advocating
and implementing knowledge innovation, the modern enterprises can win the development opportunities
in a constantly changing market environment. Contrast to technological innovation, knowledge
innovation is much broader, throughout the entire enterprise infrastructure, processes, products,
strategies and other various fields and levels. The role of knowledge innovation is more important, and it
is more closely connected to the enterprises of the corporate strategy, which determine the competitive
advantage durability and even the victory of the enterprises. By the further analysis, although knowledge
innovation covers all aspects of the enterprises, its core focuses on its core competitiveness and
sustainable competitive advantage areas. Priority objective is to continuously upgrade its core
competitiveness and the sustainable development of enterprises. Specifically, the strategic target of
knowledge innovation contains five aspects as following.
2.1 Enhancing knowledge and technological content of products
In modern society, the evaluation criteria from customers of the product or service have changed.
The knowledge content of products or services is important bases for decision-making of customers
choosing to buy. In a moderate price elasticity within the home electrical appliance purchase decisions,
for example, customers tend to put more and more household appliance products including radiation
technology (knowledge), high-definition technology (knowledge), intelligence technology (knowledge)
and character design (knowledge) as the main basis for the purchase. In response to changes of
customers’ demand in the new competitive environment, and to create continuously enhance of
competitive edge, enterprises of all types, especially large enterprises are beginning to find ways
through innovative strategies to increase knowledge and technical content of the product or service.
Thus, the attractiveness of their products can be enhanced, and the customer’s loyalty can be cultivated.
2.2 The improvement of performance for technology and processes
On one hand, the knowledge content of products or services is determined by the transfer of
knowledge and ability to innovate; On the other hand, it is also indirectly determined by the
performance and advanced level of technology and process. For example, contrast to traditional
mechanical machine, computer control system of intelligence built machine has the character of more
accuracy, more reliable quality and a high level of more personalized. Therefore, the production
produced by intelligent machine of the business processes results in a higher level of knowledge. It
should be noted that the business process, the performance of process and advanced level are decided by
the ability of knowledge transfer and knowledge innovation, which is the results of the external or
internal knowledge of enterprises created by the flow of knowledge and kept doing business in the
process technology.
2.3 Improving the capacity to create knowledge
Whether to increase the knowledge content of products or services, or to improve enterprises’
performance of process or technology, have a strong ability to support knowledge creation. Knowledge
creation indicates their internal research, as well as, the manager and all development staff and
operational personnel to get the ability of developing and applying of the new knowledge. This is the
basic target of enterprise knowledge innovation strategy.
2.4 Strengthening the competitive advantages
In the enterprises with implementation of the knowledge innovation, knowledge innovation is a major
strategic behavior, whose purpose is to directly or indirectly cultivate and enhance the competitive
advantage. According to the resource theory of the strategic management, only can the unique resources
of enterprises form the core competitive edge and competitive advantage, which are the outcome of
being integrated operation of the enterprise value. Therefore, the conditions of knowledge innovation
having formed the core competitiveness and competitive advantage are the knowledge innovation to
create value. Knowledge innovation is a rare ability, and the copying costs of capability of knowledge
innovation are extremely high. Knowledge innovation capability nor does have any suitable alternatives,
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and knowledge innovation involving the conceptions, management, business, technology, and many
other organizations of the enterprises. The excellent knowledge innovation is the production of
integration, and it is also a force of the integrated operation. Therefore, enhancing the competitive
advantage of enterprises is a higher level of strategic target of knowledge creation, which is the
integration of the first three targets.
2.5 Promoting enterprises’ restructuring
If the above-mentioned four targets can be successfully realized, enterprises will be able to produce
a higher level of product knowledge, and they will also be able to continuously improve business
processes and technology and the performance level. The ability to create knowledge for enterprises
can be continuously enhanced, which can be conducive to gradually cultivate and develop the
knowledge and cultural innovation. Finally, the traditional enterprises can be transferred to knowledge
enterprises. And the corporate restructuring is the result of the application of knowledge innovation
strategy, and knowledge innovation strategy can be said to be the target, which is the target after the
introduction of the dimension of time.
3 Measures to achieve the strategic target of the Knowledge Innovation
3.1 Setting a strategic target
Strategy is a research, development, implementation and control of the long-term targets and
guiding principles for enterprises, which is also the guiding strategy of knowledge management
strategies of enterprises, as well as, is the unique activities of senior management of enterprises. For the
movement of knowledge may happen at any time, the production, transmission knowledge and
application of knowledge is along with the activity of enterprises in the entire process. That is to say,
knowledge management activities are throughout the enterprise consistently. Meanwhile, knowledge is
the strategic resources, and the effective management of knowledge is a strategic means to ensure to
achieve their long-term targets. Therefore, knowledge management strategy is the core content of the
strategic management of enterprises which should be matched with the enterprise business strategy to
ensure the enterprises achieve the overall concept. The concept of overall knowledge is the
comprehensive of guiding philosophy when the knowledge involved in various effective management of
enterprises. In the overall concept of knowledge management, enterprises can be full played the overall
function of elements to achieve a multiplier effect. Along with its development, strategic positioning of
the enterprise continued to adjust to changing market environment and culture.Therefore, knowledge
management involved into enterprise strategy, the strategic targets of knowledge management line with
the targets of the enterprises, by which the function of knowledge can be admitted in the overall
framework of the concept of recognition. By the knowledge-based blueprint of enterprises, the
enterprises can be transferred from the basic organizational structure, basic facilities to all the changes in
culture and management philosophy.
3.2 Setting Safeguard mechanisms
3.2.1 The establishment of knowledge management
It is needed to build a knowledge management component of the department for officers from
various departments, with the acquisition of knowledge flow, integration, development and innovation
in the comprehensive management task. Knowledge management staffs are from different departments,
departments. On one hand, they can flow from the enterprise to be considered in the light of the overall
knowledge of the enterprise knowledge management system taking into account their respective
departmental functions for the business process and knowledge requirements; On the other hand,
integration can be spread to every other member of a body of knowledge among the various departments.
It is of important significance to capture the knowledge.
3.2.2 The creation of dynamic team
The organization adapted to changing times is like organisms adapted to changing in the natural
environment, which is continuous evolution. The organizational structure of dynamic team changes
from Linear to the flat. Dynamic Enterprises for a project team is to be complementary to work in
different areas of knowledge and skills, which are concentrated in specific team, and which can be
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quickly and effectively developed to design the programs. Members of the team pending the completion
of the project, the activities of the project will create and codify the knowledge to other staff for sharing
before returning to their respective areas of work. The flat type of organizational structure is designed
on knowledge creation and share, transfer, application and accumulation. It focuses on democracy
cooperation as the emergence of the enterprise for culture, which is useful for the staffs to reinforce
initiative and creativity. And dynamic team also helps the spread, integration, share and the innovation
of knowledge, which makes the enterprises have sharp market reaction, reduce transaction time, costs
and risk. Enterprise with complex and ever-changing external environment may select the best portfolio
in terms of the enterprise environment.
3.2.3 The application the motivation system
To protect the interests of the knowledge owners to enhance their enthusiasm, enterprises should
also develop a variety of flexible incentive compensation system, which are driven by the interests of
the tacit knowledge sharing and dissemination. Enterprise incentive mechanism is to take certain
measures and means to encourage enterprises to stimulate production, in particular, the human element,
which make them consciously contribute their talents to achieve enterprise objectives, giving full play to
their initiative of a long-term process.
Knowledge management incentive mechanisms include the accumulation of knowledge incentive
mechanisms, knowledge operation incentive mechanisms, knowledge performance mechanisms and
knowledge reward and punishment mechanisms.Different knowledge management strategy requires
different incentive system. Even the same kind of knowledge management strategy applied by the
enterprises has different means to encourage the incentives of knowledge-sharing. According to the
characteristics of knowledge-based staffs enterprises can create knowledge management incentive
mechanism from both tangible and intangible aspects to effectively exploit, use and develop the
knowledge-based staff's creativity and potential to achieve the sustainable development of enterprises
and their staff.
3.2.4 Creation of a corporate culture
The corporate culture searches the unity to enhance the cohesion in internal enterprises, and it
searches the development to improve the competitiveness in external enterprises. The corporate culture
is a base of knowledge management, which also decides whether they can achieve the desired goals or
not. And the ability to innovate has been doing business with them. Therefore, the most important aspect
of the knowledge management is not existing intellectual capital management, but to improve the
corporate culture, which makes the knowledge easier to create, exchange and accumulate. If there is no
knowledge sharing of corporate culture, knowledge management will not succeed. The tacit knowledge
formed in the mid and long-term experience of the individual work is of large very value, but it is hard
to share and communicate. Benefits driven are important, but the incentive enterprises innovation do not
merely rely on the model of subsidies benefits driven in long-term. The significance of corporate culture
related to knowledge management is just as the significance of soil related to the tree. The deeper
foundation more of corporate culture is, and the more effective the Knowledge management will be. As
the technology is rapidly changing, the technology content and level of business services are rapid
developing, which requires more sophisticated technology of the staffs. Technical level, ability of staffs
has become conditions which decide a success of the service. In this situation, enterprises must actively
create a knowledge-based atmosphere in their internal.
3.3 The Management of Curing Knowledge
3.3.1 The construction of enterprise knowledge base
Enterprise knowledge base is a set of intelligent systems for knowledge acquisition, classification,
storage, transmission, maintenance and sharing in the integration, which can be manually or
automatically at certain organizations access to the theme of knowledge with any pattern classification
and coding, and the structure of various types of knowledge can be concentrated or distributed. It is able
to provide users with a good knowledge which can be shared and dynamic environment in which to
store the knowledge of the immediate upgrades and maintenance. Thereby, knowledge base can support
the implementation of enterprise knowledge management, which is the core enterprise knowledge
management tool. Knowledge base can be set up to facilitate tacit knowledge into explicit knowledge,
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promoting of the language and experience and the process of coding which is difficult "for him to say
anything " and "education" of the hidden knowledge. Thus, more knowledge for exchange and share can
be realized.
3.3.2 The construction of enterprise knowledge network
The knowledge can be developed only in the exchange, and it can generate new knowledge only on
the basis of sharing and flow. For a company, if it should not have the exchange and sharing of
knowledge, innovation is impossible. During the process of knowledge management, enterprises should
try their best to establish various forms of business knowledge network to facilitate the exchange and
sharing of knowledge. Knowledge Network as a tool of knowledge management, which enables the
company to keep knowledge be transparency, more importantly, the information and knowledge at the
right time can be effectively communicated to staffs in need. Knowledge Network's goal is to link up the
technical and human capacity to achieve the effective integration of intellectual capital, structure capital
and customer capital. Knowledge Network include: intranet, Extranet and exchanges and cooperation in
knowledge-sharing network. In this historic crossroads of enterprise transformation, enterprises must
continue to innovate and improve core competitiveness in order to occupy the high ground in
competition in the future. Knowledge is the fundamental strength of enterprise innovation.
Knowledge-sharing and knowledge innovation in the knowledge management will become a target for
the development of the booster, which become the major source of long-term competitive advantage of
enterprises.
4 Conclusions
For enterprises, knowledge innovation is the foundation for technological innovation, which is an
important part of business of knowledge management activities. Due to the important role of knowledge
innovation in enterprises, knowledge innovation strategy system has become an important part of
corporate strategy. Meanwhile, it is required to clear the direction and the aim of innovation to develop
innovative strategic objectives, to increase theoretical research of knowledge and technological
innovation, so as to enhance the ability to innovate. In addition, the core competitiveness should be
enhanced in the market. In the same time, knowledge and technological innovation of enterprises of risk
and uncertainty should be correctly handled, and the knowledge and technology innovation will never
stop, for the only way for the enterprises are to constantly improve the ability to innovate, enhance the
core competitiveness, and create a lasting competitive edge, can the enterprise achieve sustainable
development.
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The author can be contacted from e-mail :[email protected]
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