In 2016 the work as part of INNOVARRA project has been continued according to the plan of 5 stated tracks. Preliminary results have been presented at international conferences and forums, and subsequently published in the leading Russian and international scientific journals.
Track A. "Effect of KM practices on business results"
Within this research track the authors analyzed the relationship between three elements of Intellectual Capital (human, organizational and structural) and companies’ organizational performance indicators.
The research was conducted with the data obtained with the help of: 1) a survey of 240 top-managers of Russian manufacturing companies; 2) a survey of 329 employees of Russian schools, 3) a survey of the representatives of Block of Refining, Petrochemistry, Gas Processing of the PJSC «LUKOIL» concerning intellectual capital management system implementation in the company (case method), 4) data collection of real financial indicators of Russian companies from data bases (SKRIN, SPARK).
The results allowed us to make the following conclusions:
- Subjective assessment of the elements of intellectual capital obtained with the help of a survey of top-managers has a weak correlation with proxy-variables of elements of intellectual capital that are obtained from real financial statements of Russian manufacturing companies. At the same time subjective assessment of the elements of intellectual capital is related to return on sales (ROS) and return on assets (ROA) of Russian manufacturing companies within the same year.
- Structural capital has the highest correlation with the organizational performance indicators of Russian manufacturing companies. It means that the application of managerial actions and knowledge management practices that enhance structural capital in manufacturing companies will have the highest influence on performance indicators. We did not find any significant relationship between three elements of intellectual capital.
- Knowledge management practices play a very important role in the development of intellectual capital elements that are then related to financial performance indicators of companies. At the same time we think that one group of knowledge management practices can be a source of creating several elements of intellectual capital (with different priorities). This relationship is analyzed with the help of researchers’ expertise. Besides, the analysis of the case of Block of Refining, Petrochemistry, Gas Processing of the PJSC «LUKOIL» showed the important role of corporate procedures for knowledge management practices enhancement and particularly the role of intranet-portal in the development of elements of intellectual capital (particularly structural capital) and increasing financial performance indicators.
The overall results can bring us to the conclusion that development of different knowledge management practices and intellectual capital elements at the same time won’t increase knowledge management efficiency and financial performance of a company. At the same time the subjective assessment of intellectual capital elements by top-managers has a low correlation with proxy-indicators of intellectual capital elements and financial performance indicators obtained from real financial statements. From the point of view of financial efficiency and the optimal management of resources top-managers should focus on several knowledge management practices and intellectual capital elements that have the highest influence on financial performance indicators in the organizational context. The results obtained within track A may help managers of Russian manufacturing companies to make a meaningful decision concerning application of different knowledge management practices in a company.
Track B. "Typology and generalized enterprise knowledge map"
Knowledge management methods and tools include universal, applicable in various domains and for different types of knowledge (e.g., communities of practice, library or knowledge base, idea management system), and specialized – for certain domains and types of knowledge.
Systematization of universal methods and tools for knowledge management was carried out on the basis of stages of knowledge process (knowledge lifecycle): knowledge capture, codification, distribution, sharing, analysis and evaluation.
Specialized methods and tools were revealed by a literature review on the knowledge domains and types proposed in the generalized (reference) enterprise knowledge map and knowledge typology.
Separate research of methods and tools for capturing knowledge from customers was carried for a more detailed understanding of the relation between universal and domain-specific tools – classification of such tools was made and an empirical study was conducted.
Research questions for further studies have been identified – how to combine universal and domain-specific tools: how to make sure that they complement and not duplicate / interfere with each other? In what situations are universal tools preferable, and in what – domain-specific?
Track C. "Working with knowledge on products/services and customers, customer orientation"
Research activities have been conducted in two directions derived from academic literature and practical features of implementing knowledge management concept in the context of the firm-customer interaction. Each of the directions is correlated with the flow of knowledge between the firm and the customer:
- Outbound knowledge flow, whereas the knowledge is transferred from the firm to the customer;
- Inbound knowledge flow, whereas the knowledge is transferred from the customer to the firm.
Within each direction we identified core types of knowledge which are transferred along the appropriate knowledge flow; the spheres of their application in managerial practice are identified, as well as the core problems and challenges which can arise when managing each of the knowledge flows.
Within the outbound knowledge flow there is a detailed consideration of a case whereas the transfer of knowledge from the firm to the customer results in a biased perception of the information in customer’s mind, leading to a failure for a firm by not meeting the communication aims. The core factors, influencing the perception of marketing information, are categorized, as well as the most meaningful managerial outcomes of the biased perception of marketing information in customer mind are presented.
Within the inbound knowledge flow the problematic case of a “declared” customer orientation is considered, whereas the firm claims to be customer oriented in handling market information, however does not implement it in practice.
Customer orientation is considered in the project as a bundling element, defining the modality of knowledge management activities and their integration in specific managerial process, as, for example, creation and commercialization of a new product. Within the project the methodology of conceptual and operational definition of customer orientation has been substantially extended. The model for integration of customer orientation and external participation in the innovation process has been developed and tested on a sample of Russian innovative companies.
Track D. "Working with knowledge in operations management"
The methodology of context-oriented knowledge management in production networks was proposed. The methodology is based on the organizational and individual context modelling in production networks. The context modelling has two levels:
- abstract level where the conceptual description of the task is created using problem domain terms, and
- operational level when knowledge related to a particular situation is collected.
The two-level context modelling substantially decreases the decision making time due to revealing and using knowledge that is relevant at the current moment.
An original method for matching ontologies of production network participants was proposed. The method supports the production network scalability and its adaptability to changes in the business environment. The method is based on combination of three matching strategies:
- pattern-based matching,
- context-based matching, and
- community-driven matching.
Track E. "Working with knowledge in strategic management and organizational development"
At this stage of the project we developed graphical and matrix methods for knowledge structuring for the tasks of strategic management and transformation of enterprises, as well as the potential of application of enterprise architecture management tools in this area was studied.
Organizational capabilities and related management techniques play an important role in strategic planning, strategy execution and planning of enterprise transformation. At this stage of the project the review of capability-based planning methods was carried out and visual techniques used in this area were studied. The method for capability-based planning and development using capability maps and heat maps was proposed, which was demonstrated on the case of a construction company. The need for an integrated approach to capability-based planning and development by the means of visual modeling was identified.
As part of the project the relevance of strategic alignment for organizations has been studied and confirmed. A matrix method of the strategic alignment of the company was proposed. This method adapts the methodology of QFD (Quality function Deployment) and is based on interrelated enterprise architecture model.
As a result of the literature review we revealed that enterprise architecture management methods and tools can enhance the strategic management in the following areas:
- identification, formalization and visualization of key constructs and models relating to strategic management;
- the use of design techniques and tools to solve (design answers to) business problems;
- provision of computer-aided infrastructure supporting the design of strategic management constructs, such as business model, capability map, etc.
More detailed research and projects in the field of enterprise architecture and business engineering, which translate the proposed ideas into practice in all these areas, were studied.
Enterprise architecture management tools allow companies to take advantage of the various formats of knowledge representation – visual, matrix, text, as well as to integrate and perform automatic conversion between different formats. Ontology plays the bridging role in addressing this issue.
The review of information support of enterprise transformation management revealed an existing list of the information needs of managers and its comparison with the typical information content of the enterprise architecture management tools. This comparison demonstrates what issues are more or less covered by these tools.