sait-i (knowledge management & erp)
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STRATEGIC APPLICATION OF
INFORMATION TECHNOLOGYUnit - I
KNOWLEDGE MANAGEMENT :
Building & knowledge Creating Company:- In an
economy where the only certainty is uncertainty, the one
sure source of competitive advantage is knowledgeWhen markets shift, competitors multiply, products
become obsolete almost over night successful
companies are those that consistently create new
knowledge, disseminating it widely throughout theorganization & quickly embody it in new technologies &
products these activities define the knowledge
creating company, whose sloe business is continuous
innovation. Knowledge creating companies.
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Making personal knowledge available to others is the
central activity of the knowledgecreating companies
it takes place continuously & at all levels of the
organization.Knowledge management has Become one of the major
strategic uses of information technology.
Many companies are building knowledge management
systems (KMS) to manage organizational learning &business know how.
The goal of such systems is to help knowledge workers
create, organize & make available important business
knowledge, wherever & whenever it is needed in an
organization.
This includes processes, procedures, patents, reference
works, formulas, bestpractices, forecast & problemfixes.
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Intranet / internet websites, data mining, knowledge data
bases, on-line discussion groups are some of the key
technologies that may be used by a KMS.
Knowledge management systems facilitate organizationallearning & knowledge creation.
They are designed to provide rapid feedback to
knowledge workers, encourage behaviour changes by
employees & significantly improve business performance.KMS helps to integrate the knowledge into organizations
business process products & services.
Knowledge management can be viewed as three levels of
techniques, technologies & systems that promote the
collection, organization, access, sharing & use of work
place & enterprise knowledge.
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Leverage organization know how
Performance support
Building expert networks
Enterprise
Intelligence
Information
creation,
sharing & mgmt.
Document Mgmt.
Capturing & Distributing expert
stories
Communication & collaboration
New content creation
Access & Retrieval
Documents stored on-line1
2
3
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Knowledge management systems use information
technology to help gather, organize, share business
knowledge within organization.
Corporate intranets have become the knowledge basesfor storage & dissemination.
KNOWLEDGE MANAGEMENT DEFINITION:
(KM)
KM is a business activity with two primary aspects:-1. Treating the knowledge component of business activity
as an explicit concern of business reflected in strategy,
policy & practice at all levels of the organization.
2. Making & direct connection between an organizationsintellectual assets both explicit (recorded) & tacit
(personal know how)and positive business results.
In practice, KM often encompasses identifying &
mapping intellectual assets within the organization,
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making vast amounts of corporate information
accessible, sharing of best practices, & technology that
enables all of the above including information
communication technology (intra net etc.) & group ware(collaborative work groups using it).
A significant element of business community also views
knowledge management. As a natural extension of
business process re-engg.) Knowledge is a fluid mix of framed experience, values,
information, expert insight & intuition that provides an
environment & framework for evaluating &
incorporating new experience & information. Market valuation of a company largely depends on
intangible asset like its knowledge base.
Knowledge unlike any physical asset, delivers
increasing returns.
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KM helps avoid unnecessary work duplication,
expensive reinvention & repeated mistakes.
KM can save your company from knowledge
walkouts. KM can compress delivery schedule & help you deliver
ahead of time.
KM mutually reinforces corporate agility. The ability of
companies to react comes from their knowledge & thisagility reinforces their ability to apply such knowledge.
Data Information Knowledge.
KNOWLEDGE GIVES TODAYS COMPANIES THE
EDGE TO COMPETE SUCCESSFULLY. Basic principles of knowledge management.
1. Knowledge acquisition:- The process of development &
creation of insights, skills & relationship
Ex:- stock Broker can predict.
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2. Knowledge Sharing:- Distributions & making available
what is already known.
Ex:- An expert system helps & technical call centre help
desk.3. Knowledge Utilization:- Learning is integrated into the
organization apply in new situations
- sharing & utilizations take place same time.
Data Base
Capture Tools
Acquisition Sharing
Utilization
Communication
Network
Basic Knowledge
Management
Technology
Collaborative
Tools
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Basic elements of KM & typical technology tools that
can be used.
Concept of knowledge management
Knowledge terms & definitions Information:- Relates to description, definition, or
perspective (What, Who, When, Where)
Knowledge:- Comprises strategy, Practice, Method, or
Approach (How) Wisdom:- Embodies Principle, Insight, moral (Why).
Business Intelligence:- Is the process by which
businesses gather information specific to their use.
Logic:- Is the sequential decision making process in an
organizational context.
Technology:- Particularly the information technology,
aimed at information & knowledge.
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1) Processed Data Actionable Information
2) Gives facts only Allows Making
predictions
3) Clear, structured,
simple can be
expressed in written
form
Intuitive, hard to
communicate, difficult to
express in words
10
Strategy:- Business strategy which incorporates,
information & knowledge.
Knowledge Management:- Is about connecting people
to people & people to information to create competitiveadvantage.
COMPARING INFORMATION & KNOWLEDGE
INFORMATION KNOWLEDGE
4) Ob i d b Li i i
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4) Obtained bycalculating data
Lies in conversation,intuition, peoples
5) Devoid of owner
dependency
Depends on the owner
6) Handled well byinformation systems
Also needs informalchannels
7) Key Resource inmaking sense of data
Key resource in intelligentdecision making /forecasting / intuitive
judgment
8) Formalized in database/ books / documents
Evolved with experience /formed in & shared amongcollective minds.
9) Can be packaged in
reusable form
Often emerges in minds of
people thru theirexperience11
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CLASSIFYING KNOWLEDGE
Knowledge can be classified along four key dimensions:-
Type Focus Complexity
Perishability over time
1 2 3
4
Knowledge
Type
Focus
Complexity
Perishability
Technological
Business
Environmental
Operational
Strategic
Explicit
Tacit
Low
High
CLASSIFICATIONDIMENSIONS
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Characteristic Tacit Explicit
1 Nature:- Personal Can be codified
2 DevelopmentProcess-
Difficult torecord
Can be systematicallyrecorded
3 Location:- Stored in the
head of
people
Stored in documents /
databases13
Knowledge can be broadly classified into two
categories:-
1. Explicit:- Can be document or codified / E-mailed / web
page etc.2. Tacit:- Personal, Context specific, stored in the head of
people.
COMPARING TACIT & EXPLICIT KNOWLEDGE
Ch t i ti T it E li it
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Characteristic Tacit Explicit
4 IT Support:- Hard to
manage,
share orsupport with
IT
Well supported by
existing IT
5 MediumNeeded:- Needs &Rich
Communicat
ion Medium
Can be transferredthru conventional
electronic channel
14
COMPONENTS OF KNOWLEDGE A KM system & KM strategy must support:-
Intuition Beliefs
Ground Truth Intelligence
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BUSINESS & KNOWLEDGE
KMS for the Enterprise:-
The value of a firms products & services is based not
only on its physical resources but also on intangibleknowledge assets.
Some firms can perform better than others because they
have better knowledge about how to create, produce &
deliver products & services
Judgment
Experience
ValueAssumption
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This firm knowledge is difficult to imitate & unique &
can be leveraged into long term strategic benefit.
KMS collect all relevant knowledge & experience in the
firm & make it available wherever & whenever it isneeded to support business process & decisions.
The KMS also links the firm to external sources of
knowledge.
KMS support processes for discovering & codifyingknowledge, sharing knowledge distributing knowledge as
well as the processes for creating new knowledge &
integrating it into the business organization.
KMS applications help companies map sources of
knowledge, create corporate knowledge directories of
employees with special expertise, identify & share best
practices & codify knowledge of experts so that it can be
embedded in information s stems & available to others.
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KMS also includes tools for knowledge discovery that
enable the organization to recognize patterns & important
relationships in large pools of data.
ROLE OF KNOWLEDGE MANAGEMENTSYSTEMS IN BUSINESS ORGANIZATION
1. Creating Knowledge KMS Provides knowledge
workers with graphics, analytical, document mgmt. tools
& also access to internal/external data to generate newideas.
2. Discovering & codifying knowledge Artificial
intelligence systems can elicit & incorporate expertise
from human experts or find patterns or relationship from
huge database.
3. Sharing knowledge Group collaboration systems
(Group ware), can help employees access & work
simultaneousl on the same document from man
OrganizationalProc
ess
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different locations & co-ordinate their activities.
4. Distributing knowledge:- Office systems &
communication tools can distribute documents & other
forms of information among knowledge workers. Knowledge Management in the business organization
Emergence of information & knowledge economy, core
competencies (two or three things that an organization
does best)are key organizational assets. Producing unique products or services or producing at
lower cost than competitors is based on superior
knowledge.
Knowledge assets:- Organizational knowledge regarding
how to efficiently & effectively perform business
processes & create new products & services that enables
the business to create value.
Knowled e assets are as im ortant for com etitive
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advantage & survival like financial & physical assets.
Organizational Learning:-
creation of new standard operating procedures &business
processes that reflect organizations experience. KM increases the ability of the organization to learn from
its environment & to incorporate knowledge into its
business processes.
KM refers to the set of processes developed in an
organization to create, gather, store, transfer & apply
knowledge.
Information technology plays an important role in KMby supporting these processes for creating, identifying &
leveraging knowledge across the organization.
Business organizations have created explicit knowledge
mgmt. programs for protecting & distributing knowledge
th h id tifi d & f di i f
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they have identified & for discovering new sources of
knowledge.
- these programs are headed by a chief knowledge
officer (CKO)
I- ALIGNING KNOWLEDGE MANAGEMENT WITH
BUSINESS STRATEGY
Knowledge Management A strategic perspective:- Inthe emerging economy, a firms only advantage is its
ability to leverage & utilize its knowledge
Industry environment is influenced by unexpected,
multiple changes making competitive advantage notsustainable.
Initiatives like TQM, BPR, SCM, CRM etc resulted in
firms attaining some competitive advantage but are
replicable & not sustainable over longer period of time.
Hence organizations are now focusing on methods of
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Hence organizations are now focusing on methods of
creating new knowledge & harnessing existing
knowledge to gain competitive advantage.
Sustainable competitive advantage thru knowledgemgmt. - major focus for modern organizations.
Strategy Concept & FrameworkStrategy is a method
/ plan by a firm to balance its external (OT) environment
& the internal (SW) capabilities. Porters notion of competitive advantage says resources
& capabilities of an organization can be a source of
competitive advantage if they process certain
characteristics of being rare, durable and difficult toimitate.
If a firm have resources with these characteristics, they
can position themselves strategically on the basis of these
resources & capabilities.
Tangible resources mostly will not have these
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Tangible resources mostly will not have these
characteristics & hence organizations focus should be on
intangible knowledge assets.
Resources & capabilities are easily replicable.
Tacit knowledge gained thru years of experience are not
easily replicable.
Market is dynamic & going thru a string of realignment
hence any strategy based on market & product mix orresources or capabilities may not provide a firm with
sustainable competitive advantage
Integration of knowledge or collective knowledge to be
stressed. Creativity, Innovation & Knowledge Strategy
Creativity & Innovation play a very important role in
designing & driving the business strategy of any modern
organization.
Present industry scenario an organization does not enjoy
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Present industry scenario, an organization does not enjoy
sustainable competitive advantage merely by possessing
resources & capabilities.
These resources should be used & combined in new &different ways or develop new capabilities to gain
sustainable competitive advantage .
Experience &
Knowledge
Creativity &
Innovation
New ways of
CombiningExisting Resources
Develop New
Capabilities
Competitive
Advantage
Some of the innovations brought out by organizations are
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Some of the innovations brought out by organizations are
result of application of new knowledge & others are
result of working with & recasting existing knowledge.
Approach to competitive advantageCompetitive
Advantage
Align KnowledgeStrategy with
Business Strategy
FormulateKnowledge Strategy FormulateBusiness Strategy
Identify
Knowledge Gap
In current dynamic industry scenario organizations
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In current dynamic industry scenario, organizations
cannot achieve sustainable competitive advantage, by
pursuing just a product market based strategy.
They need to appreciate the importance of the knowledgeexisting in the organization & harness the knowledge
thru appropriate KM strategy & align this strategy with
the business strategy.
IIKNOWLEDGE MANAGEMENT TECHNOLOGY
& THE LEARNING ORGANIZATION
The technology perspective:- Some of the technologies
associated with KM:-o Internet / Intranet
o Data Warehousing
o Data Mining
o AI / Expert Systems
o Information Retrieval
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o Information Retrieval
o Electronic Publishing Technology
o Push Technology
o Simulationo Document Management
o Collaboration
o Groupware
o DBMSo Web Mapping Tools
o Help Desk Technology
KM like any other top management initiative may use
technology as an important enabler. Systems Perspective Systems & Infrastructure for
Knowledge Management
Information systems can promote organizational learning
by identifying, capturing, codifying & distributing both
explicit & tacit knowledge
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explicit & tacit knowledge.
Once Information has been collected & organized in a
system, it can be leveraged & reused many times.
Companies can use information systems to codify theirbest practices & make knowledge of these practices more
widely available to employees.
Best Practices:- Are the most successful solutions or
problem solving methods that have been developed by aspecific organization or industry.
In addition to improving existing work practices, the
knowledge can be preserved as organizational memory to
train future employees or to help them with decisionmaking.
Organizational memoryIs the stored learning from an
organizations history that can be used for decision
making & other purpose.
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Information systems can also provide knowledge
networks for linking people so that individuals with
special areas of expertise can be easily identified & tacit
knowledge can be shared. KM Requires:- An information technology
infrastructure that facilitates the:-
- Collection of knowledge
- Sharing of knowledge.- Also requires software for distribution of information
(knowledge) & make it more meaningful.
It systems that are used:-
1 Group Collaboration systems
2 Office Systems
3 Artificial Intelligence Systems
4 Knowledge work systems
IT INFRASTRUCTURE FOR KNOWLEDGE
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1. Share knowledge
Group Collaboration
System
Group Ware
Intranets
2. Distribute Knowledge
Office Systems
Word Processing
Desk top data base
DTP
Imaging & Web Publishing
3. Capture & Codify
Knowledge
Artificial intelligenceSystems
Expert Systems
Nevral Nets
Fuzzy Logic
4. Create Knowledge
Knowledge Work Systems
CAD Investment Work Stations
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IT INFRASTRUCTURE FOR KNOWLEDGE
MANAGEMENT
IT i f f KM
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Managing Documents Word Processing / DTP /
Web Publishing / Work
flow Managers.
Scheduling Electronic Calendars /
Groupware / Intranets 30
IT infrastructure for KM:-
Networks/Databases/Processors/Software/Internet/Tools
etc. are used heavily for above systems
Distributing Knowledge:- Office & DocumentManagement Systems
Office Systems:- Are any application of information
technology that increases productivity of information
workers.
OFFICE ACTIVITY TECHNOLOGY
Communicating E-Mail / Voice Mail /
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Communicating E-Mail / Voice Mail /
Groupware / Intranets /
Digital Answering System
Managing Data Desktop Data Bases /Spread Sheets / User
Friendly Interfaces to Main
frame data bases
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Knowledge Repository:- Collection of documentedinternal & external knowledge in a single location for
more efficient management & utilization by the
organization.
In addition to streamlining workflow, web based &traditional document management systems provide tools
for creating knowledge repositories to help organizations
consolidate & leverage their knowledge.
Creating Knowledge:- Knowledge work systems (KWS)
KWS are information systems that aid knowledge
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KWS are information systems that aid knowledge
workers in the creation & integration of new knowledge
in the organization.
Knowledge work is that portion of information work thatcreates new knowledge & information
Knowledge workers perform three key roles that are
critical to the organization:-
1) Keep the organization up to date in knowledge as itdevelops in the external world.
2) Serving as internal consultants regarding the areas of
their knowledge, the changes taking place & the
opportunities.3) Acting as change agents evaluating, initiating &
promoting change projects.
Most knowledge workers rely on office systems such as
word processors, voice mail & calendars but they also
Require more specialized work systems
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Require more specialized work systems
Knowledge work systems are specifically designed to
promote the creation of knowledge & to ensure that new
knowledge & technical expertise are properly integratedinto the business.
Requirements of Knowledge Work Systems:
1) Must give knowledge workers the specialized tools they
need such as powerful graphics, analytical tools,communication & document management systems.
2) These systems require great computing power to rapidly
handle the sophisticated graphics or complex calculations
required by knowledge workers as scientific researchers,product designers & financial analysts.
3) Knowledge workers are focused on knowledge in the
external world, so system should give easy & fast access
to external data base.
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External
knowledge
Base
Software
Graphics Visualization
Modeling Simulation Document Management
Communication
UserInterface
Hardware Platform:- Knowledge Work Stations
REQUIREMENTS OF KNOWLEDGE WORK SYSTEMS
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REQUIREMENTS OF KNOWLEDGE WORK SYSTEMS
Examples of Knowledge Work Systems
1) Computer aided design (CAD):-
- Information systems that automates the creation &revision of design using sophisticated graphics software.
2) Virtual Reality Systems:-
- Interactive Graphics software & hardware that create
computer generated simulations that emulate real lifesituation
Ex:- Aircraft designstress patterns.
Virtual reality applications are being developed for the
web using & standard called (VRML) or Virtual realityModeling Language.
3) Investment Work Station:-
Powerful desktop computer for financial specialists,
which is optimized to access & manipulate massive
amounts of financial data.
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amounts of financial data.
High end PCs used in financial sectors to analyze
trading situations instantaneously & facilitate portfolio
management.
The financial industry is using specialized investment
workstations to leverage the knowledge & time of
brokers, trades, portfolio managers.
Firms like DSP Merrill Lynch have installed investmentworkstations that integrate a wide range of data from
both internal & external sources.
Sharing knowledge:- Group Collaboration Systems &
Enterprise knowledge environment (Intranets) Community of Practice:- Informal group of people that
may live or work in many different locations but who
share a common professional interest. An important
source of expertise for organizations.
Ex: Linux users group in a corporation that primarily
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Ex:- Linux users group in a corporation that primarily
uses windows operating system.
- Group in an international bank with special interest in
leading activities in south east Asia. Groupware & Web Collaboration Tools:-
- Groupware is built around three key principles:-
Communication
Collaboration Co-ordination
- It allows groups to work meetings, route electronic
forms, access shared folders, participate in electronic
discussions/conferencing, develop shared data base, e-mail.
Information intensive companies such as consulting
firms, law firms & financial management companies
found rou ware an es eciall owerful tool for KM.
Internet tools for e-mail news group discussion
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Internet tools for e-mail, news group discussion,
conferencing offer collaborative work.
Proprietary groupware remains a key tool for application
requiring extensive collaboration, document tracking &frequent updating.
Lotus notes, open text live link & other groupware
products are used for sharing knowledge.
Knowledge Map:- Tool for identifying & locating theorganizations knowledge resource.
Enterprise Information Portal:-
- Software application that enables companies to provide
users with a single gateway to internal & external sourcesof information.
- Portals help individuals navigate through various
knowledge resources also called knowledge portals
- Portals provide single point access to the firms
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- Portals provide single point access to the firms
knowledge resources & helps the firm coordinate
information / decision
ENTERPRISE KNOWLEDGE PORTAL
E-Mail Web Pages Best Practices
Chat &
Conferencing
Document
ManagementProjects
GroupwareData Base &
Ware House
Research &
Reference
Search Tools
& Directories
Enterprise
ApplicationsNews Feed
Group sharing of knowledge requires team members to
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Group sharing of knowledge requires team members to
believe it is in their interest to share, especially in
organizations that encourage competition among
employees. Successful knowledge sharing requires an appropriate
knowledge sharing environment.
CAPTURE & CODIFY KNOWLEDGE
Artificial Intelligence:- Organizations are using artificial intelligence technology
to capture individual & collective knowledge & to codify
& extend their knowledge base (AI).
AI is the effort to develop computer based systems (bothhardware & software) that behave as humans.
Such systems would exibit logic, reasoning, intuition &
commonsense qualities that we associate with human
bein s.
The field of AI includes:-
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The field of AI includes:
Artificial
Intelligence
Natural
LanguageRobotics
Expert
Systems
Intelligent
Machines
Why business is interested in AI?
To store information & preserve expertise.
Create & mechanism that is not subject to human feeling
fatigue etc.
To eliminate routine jobs & unsatisfying jobs held bypeople
Handle massive & complex problems
Capturing KnowledgeExpert Systems:-
Expert systems are knowledge intensive computer
program that captures the expertise of a human in limited
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p g p p
domain of knowledge.
Ex: Diagnosing a cars ignition system, rules of thumb
used by real world experts can be understood, codified &
kept in a machine.
Expert systems lack the breadth of knowledge & the
understanding of fundamental principles of an human
expert. They are quite narrow. The model of human knowledge used by expert system is
called the knowledge base. An expert.
System contains a number of rules to be followed, when
used. Organizational Intelligence Case-Based Reasoning
(CBR)
CBRs are AI technology that represents knowledge as a
database of cases & solutions done in past.
The system generates a six step process to find solutions
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The system generates a six step process to find solutions
to new problems encountered by user.
How Case Based Reasoning Works
o CBR represents knowledge as a database of past cases &their solutions.
U D ib Th P bl1
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User Describes The Problem
System Searches Data Base
System Asks User
Additional Qs
System Finds Closest Fit &Retrieves Solution
System Modifies The Solution
To Better Fit The Problem
Case Database
System Stores Problem
& Successful Solutionto Database
Successful
?
1
2
3
4
5
6
YesNo
In CBR, Descriptions of past cases of human specialists
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In CBR, Descriptions of past cases of human specialists
experience, represented as a case are stored in a database
for later retrieval when user encounter a new case with
similar parameter. OTHER INTELLIGENT TECHNIQUES FOR
KNOWLEDGE CAPTURE & CODIFY
Neural Networks:-
o Neural Networks are designed to imitate the physicalthought process of the biological brain.
o These are hardware or software that attempts to emulate
the processing patterns of the biological brain.
o A neural network uses rules it Learns from patterns indata to construct a hidden layer of logic.
o The hidden layer then processes inputs, classifying them
based on experience of the model.
NEURAL NETWORK
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NEURAL NETWORK
Input Layer Hidden Layer Output Layer
Income Good Credit
Risks
Debt
Age
Payment
Record
Bad Credit
Risks
Neural network applications are emerging for business,
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pp g g ,
science, medicine to address problems in financial
analysis & control & optimization.
Neural nets are used by finance industry to identify
patterns in vast pools of data that help investment firms
predict the performance of quity, corporate bond rating or
corporate bankruptcies.
Visa international is using a neural network to help directcredit card fraud by monitoring all visa transactions for
sudden changes in the buying patterns of card holders.
Unlike Expert System, which Provide Explanation for
their solutions, neural networks cannot always explainwhy they arrived at a particular solution.
Expert systems seek to emulate or model a human
experts way of solving problems & highly specific to a
given problem & cannot be easily retrained.
KNOWLEDGE CREATION FRAME WORK
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NONAKAS MODEL (SECI MOD)
o According to Prof. Ikujiro Nonaka, knowledge creation
is a spiral process of interaction between explicit & tacit
knowledge.
Socialization
Empathizing
Embodying
Internalization
Externalization
Articulate
Connecting
Combination
Taci
t
Tacit
Tacit Tacit
Explicit Explicit
Nonacas Model (Seci Model)
Explicit
Explic
it
Interactions between the explicit & tacit knowledge lead
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p gto the create of new knowledge.
The four modes of knowledge conversion interact in the
spiral of knowledge creation & the spiral becomes large
in scale as it moves up through organization levels &
trigger new creation.
Socialization (Tacit to Tacit):-
- Includes the shared formation & communication of tacitknowledge between people ie in meetings.
- Knowledge sharing is often done without ever producing
explicit knowledge & to be most effective, should take
place between people having common culture.- So, tacit knowledge sharing is connected to ideas of
communities & collaboration.
Externalization (Tacit to Explicit):-
- By its nature tacit knowledge is difficult to convert into
explicit knowledge.
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p g- Thru conceptualization, elicitation & ultimately
articulation, some proportion of a persons tacit
knowledge may be captured in explicit form.
- Typical activities when conversion takes place are in
dialog among team members, in response to Qs or thru
the elicitation of stories.
Combination (Explicit to explicit):-
- Explicit knowledge can be shared in meetings via
documents, e-mails etc. or thrus education & training.
- Use of technology to manage & search collections of
explicit knowledge is well established.- An ex: use text classification to assign documents
automatically.
- Put a document in a shared data base.
Internalization (Explicit to Tacit):-
- In order to act on information, individuals need to
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understand & internalize it, which involves creating their
own tacit knowledge.
- By reading document they can to some extent, they can
re experience what others previously learned.
- Also, reading doc., they have opportunity to create
knowledge by combining their existing tacit knowledge
with knowledge of others.- A typical activity would be to read & study doc. From a
number of data bases.
- Knowledge creation results from interaction of persons
& tacit & explicit knowledge.- Through interaction with others, tacit knowledge is
externalized & shared with others.
- Technologies that may be applied to facilitate knowledge
conversation process:-
Tacit to Tacit Tacit To Explicit
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Tacit to Tacit Tacit To Explicit
E-meetings Answering to Qs
Chat (Synchronous
Collaboration
Annotations
Explicit To Tacit Explicit To Explicit
Visualization Text Search
Browsable Video / Audio
Presentation
Document & Acquisition
52
Basic knowledge Processes Acquisition, Production &
Integration of knowledge occur throughout theorganization to foster organizational learning.
KNOWLEDGE LIFECYCLE MODEL
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1. Outside World
Step 1:-
Acquire Information or knowledge
Training
Researching
Browsing
ReadingPublished or Printed Work
2. Individual Team or Community
Step 2:-Produce Knowledge
3. Transfer Knowledge
Step 3:-
Integrate Knowledge
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g g
Expose Best Practices. (Redesign processes with embedded
knowledge)
Structure & store knowledge for instant access. Share knowledge.
Instruct / Present knowledge.
Knowledge Management Technologies:- Some Soft
Ware Tools- Following s/w tools were evaluated for performance by a
Chicago based product assessment firm & widely used in
the industry:
1. WINCITE 5.0:- Most mature KM productin use for more than 10 yrs.
Used for competitive intelligence & few more areas.
Designed to manage a shared data base & helps analysis.
The ro ram is desi ned with resum tion that eo le
will analyse & contribute value to what is stored.
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y
Uses a group model, where putting content into
knowledge base is done by KM group but users can
suggest additions. Users can add notes with proposed, suggestions, updates
or new information.
The KM group can see these notes & incorporate part or
all of them. KM group & users can add information to the knowledge
base by using forms.
Each form contains a defined field / or fields & one can
add information manually, add as an attachment, ordynamically link to documents outside wincite, in
dedicated databases or internet.
Wincite uses multidimensional data base model
or anized into a relational database (RDBMS).
2. INTRASPECT 1.5:-
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It creates a group memory by storing information in
maps customized to each end user & communicated thru
intranet, e-mail networked file etc. The programme design assumes users will both
contribute to groupmemory & consume information.
The systems peer-to-peer model grants wide authority to
contribute & inform. Every piece of knowledge information has an e-mail
address.
Information sent to the knowledge base can be
supplemented by user.KM s/w tools.. (Contd.).
3. CHANNEL MANAGER 2.0 :-
It is a set of tools designed to gather information &
content from internal & external sources.
Uses push technology to send it to the users who need it.
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System runs on windows NT server & can use any
connectivity compliance data base.
Channel manager does not hold any the actual files &other data any the actual files & other data but just the
pointers to it & thus it is designed to be conservative with
storage space.
The strength of channel manager is its model for rapidproliferation of organized information & low cost of
ownership.
4. BACK WEB 4.0 :-
This s/w tool can contribute to a range of KMapplications with its main area of strength being the
ability to push channels of information to a wide range
of desk top users.
The s/w tool is desi ned to ather information from an
source (internet news feed, internal users etc.) &
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broadcast it to the users who need it.
The s/w user push technology as the mechanism to
deliver information in any file format. The goal of the product is not to store information in a
central repository for archival recall, but to turn available
sources into channels & disseminate information on a
timely basis to users who need it. The end user interface includes embedded browser &
windows explorer like navigation system.
Back web has user s/w for most desk top users including
windows & macintosh.5. KNOWLEDGE X 1.0 :-
This KM s/w tool is designed to serve as a centralized
repository of categorized information & then deliver it in
forms that ease the work of anal sis.
The KM s/w is most effective when its use is centralized
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to a few experts who can master its concepts, then use its
dissemination features to provide targeted, automated
reports to a broader set of consumers. The application of this tool is mainly for competitive
intelligence knowledge.
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STRATEGIC APPLICATION OF IT I
E. R. P
BUSINESS MODULES IN ERP PACKAGE
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Business Environment & Business
Process
Financial
Management
HR
Management
Manufacturing
Quality
Management
Materials
Management
Production
Planning
Plant
Maintenance
Sales &
Distribution
ERP
SYSTEM
ERP SYSTEM
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o Business can be defined as the activities of individuals or
groups, involved in developing, producing & distributing
the goods & services needed to satisfy other peoples
needs.
o Business used resources to produce & services. These
resources are:-1) Infrastructure (Land/Plant etc.)
2) Labour (Human Resource)
3) Capital (Financial Resource)
o Resources become productive when combined in arational way for some creative or gainful purpose (.) this
is the function of the (4) th resource: Management
o Management combines the resources in different ways to
produce goods & services.
o It is the function of management to plan the effective &
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efficient use of the resources available to the enterprise.
o The ERP systems help the management in making the
planning process more productive & efficient
Resources
- Infrastructure
Produced Goods
- Human Resource
- Financial Resource
Management
Production
Process
ERP
Products &
Services
o ERP enables integration & automation of variousb i f i (R h h f i i i i l i )
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business functions (Rather than functioning in isolation).
o Different modules in ERP are integrated they send &
receive data across departmental barriers.
o Automation improves productivity & reduces response &
reaction time.
o A task which involved the co-ordination of two or three
departments, would take days in a non-erp environment(.) with procedure integration & automation, the same
task will be completed in minutes (.)
o Single action may trigger lot of other processes in
different modules.Ex:- Order Processing
BUSINESS MODULES IN ERP PACKAGE
A) FINANCE:- Finance module of most ERP systems will
have the following sub systems:-1) Fi i l A i
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1) Financial Accounting
- General ledger
- Accounts receivable/Payable
- Special Ledger
- Fixed Asset Accounting
- Legal Consolidation
2) Investment Management- Investment Planning / Budgeting / Controlling /
Depreciation Forecast / Simulation / Consolidation.
3) Controlling
- Overhead Based Costing- Activity Based Costing
- Product Cost Accounting
- Profitability Analysis
4) Treasury
- Cash ManagementT M
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- Treasury Management
- Market Risk Management
- Funds Management
5) Enterprise Controlling
- Executive Information System
- Business Planning & Budgeting
- Profit Centre AccountingB) MANUFACTURING (PRODUCTION)
o The major subsystems of manufacturing ERP module
are:-
1. Material & capacity planning2. Shop floor control
3. Quality management
4. Jit/Repetitive Manufacturing
5. Cost Management
6. Engineering data mgmt.7 E i i h l
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7. Engineering change control
8. Configuration mgmt.
9. Serialization / Lot control
10.Tooling
C) HUMAN RESOURCE
o The major subsystems of HR module of ERP are:-
1. Personnel Management
- HR master data
- Personnel Administration- Information systems
- Recruitment
- Benefits administration
- Salary administration
2. Organizational ManagementO i ti l t t
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- Organizational structure
- Staffing / job description
3. Payrole Accounting
4. Time Management
- Shift Planning
- Work schedule
- Absence Record5. Personnel Development
- Career / Succession Planning
- Training Requirement
- Skills / Qualification Assessment.
D) PLANT MAINTENANCE
o Major subsystems of plant maintenance ERP module
are:-
1. Preventive Maintenance control2 E i t t ki
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2. Equipment tracking
3. Component tracking
4. Plant maintenance / warranty claim tracking
5. Equipment calibration trackingISO 9000 requirement.
E) MATERIALS MANAGEMENT
o The major sub-modules are:-1. Purchasing
2. Pre-purchase activities
3. Vendor evaluation
4. Inventory Management5. Invoice verification &
6. Material inspection
F) SALES & DISTRIBUTION
o The major sub-modules are:-
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j
1. Master data management
2. Order management
3. Ware house management4. Shipping
5. Billing
6. Pricing
7. Sales support8. Transportation
9. Foreign trade
ERP MARKET
o ERP software market is very competitive & fast growing
o Annual growth rate nearly 40%
o ERP vendors are expanding market presence by offering
new applications such as SCM, CRM, sales forcet ti t
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automation etc.
o Which ERP originated in the manufacturing market,
usage now has spread to every type of enterprise
including retail, utilities, public sector, healthcare etc.
The top five ERP vendors:-
SAP ag.36%
Oracle applications10% People soft7%
Baan6%
J.D. Edwards7%
Others (SSA, JBA, QAD etc.)34% Indian Scenario:-
RAMCOs marshall is having 10% market share.
Others are SAP R/3, QADs MFG / PRO, Oracle
Financial, Baan etc.
o Each vendor, due to historic reasons, has speciality inti l d l E SAP L i ti
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particular module area, Ex:- SAP Logistics,
Baan Manufacturing, People Soft HR,
Oracle Financials
o Also about 50 established vendor for SME sector.
A) SAP AGFlagship product is SAP R/3 & my SAP.com.
o Systems applications & products
o Started by five Ex. IBM engineers for developingbusiness application softwares that were integrated.
o First ERP product R/2 was launched in 1979 using
centralized main frame system.
o Redesigned as R/3 in 1992 on client-server architecture.o SAP AG is the largest ERP vendor cover 17000
customers in over 100 countries.
o My SAP.com is the internet enabled ERP product.
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o Another significant feature of oracle is its OSBS (oracle
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o Another significant feature of oracle is its OSBS (oracle
small business suite) provided consistent financials,
payroll, inventory control, order entry purchase order &
CRM functionality delivered as web service.c) People Soft inc Flagship Product People Soft 8
o ERP s/w firm started in 1987 specialization in HR mgmt.
& financial services modules.
o Enterprise solutions from people soft include modules
for manufacturing, materials mgmt., distributions,
finance, HR, SCM.
o Main competitors:- SAP AG & oracle with longerexperience with customers & flexible attitude.
o Flagship application people soft 8 is a pure internet based
collaborative enterprise system.
o People Soft 8 requires no client soft ware other than astandard web browser giving ability to run business any
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standard web browser giving ability to run business any
where, any time.
D. The Baan Company Flagship Product Baan ERP
o Founded in 1978 in the Netherlands, Baan Started with s/w
expertise in manufacturing industry.
o Baan ERP covers finance, procurement, manufacturing,
integration & implementation, planning, sales, service &maintenance, collaborative commerce & business
intelligence.
E. J.D. Edwards & Co. Flagship Product OneWorld
o J.D. Edwards was founded in 1977 in Denver (USA) withlong experience of supplying s/w for IBM as / 400 market.
o One World is the ERP solution capable of running on
multiple platforms & with multiple data base.
o The product includes modules for finance, manufacturing,
distribution, logistics, HR, quality mgmt., maintenancemgmt data warehousing customer support & after sales
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mgmt., data warehousing, customer support, & after sales
service.
o OneWorld ERP package is more flexible & within reach
of smaller enterprises.
o J.D. Edwards internet enabled version launched is known
as One World xe (xe stands for extended enterprise).
o J.D.EdwardsWorld
Software
Provides necessaryfunctionality & buift in longevity reduces problem of
obsolescence.
o Different modules available in J.D. Edwards are:-
Financial suite Logistics / Distribution
Manufacturing Suite
Engineering / Architecture / Construction / Real Estate
Energy & chemical suite
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deployment Lower entry price point of ERP s/w to make it financially
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Lower entry price point of ERP s/w to make it financially
viable.
Convergence on windows NT growing popularity of
windows NT forced ERP vendors to offer products on this
platform.
Web enablingMove from client server to web based ERP
s/w. New business sectorsERP applications in service vertical
markets such as government, healthcare, finance, customer
service etc.
ERP Implementation & Case Study ERP implementation can be a challenging task for first
timers or veterens handling a migration.
Implementation has t be done in a phased manner (step by
step).
Total implementations time may be 18-24 months. The normal steps involved are:-
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The normal steps involved are:-
Project Planning
Business & Operation Analysis.
Business Process Reengineering.
Installation & Configuration.
Project Team Training.
Business Requirement Mapping. Module Configurations.
System Interface.
Data Conversion.
Custom Documentation. End User Training.
Acceptance Testing.
Post Implementation audit.
Above steps are grouped & subdivided into four major
phasesnamely
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p y
1) Detailed Discussions.
2) Design & Customisation
3) Implementation4) Production
ERP Case Studies
The purpose of the case studies is to provide an idea of the
situations where ERP projects are implemented & the
benefits of these implementation with analysis of ERP
success & failure in implementation.
CASE:- ERP Implementation EDMAC Compressor
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Company, Inc
The case study (Distributed in the class) Highlights asuccess story of ERP implementation.
Major factors for success:-
1) Involvement of Mgmt. 2) Training. 3) Change Mgmt. 4)
Plan Ahead. 5) Allow for Fail-Safe. 6) Reward Employees.