Solutions > Alignment Strategy

Alignment of corporate strategy with enterprise value enhancement

Knowledge has been defined as an opinion, idea or theory that has been verified empirically and agreed upon by a community. In a sense, it is defined as a justified true belief. Management on the other hand is the cyclical process of planning, organizing, action, control and feedback. Knowledge management is a discipline that promotes an integrated approach to identifying, managing and sharing all of the information assets in the enterprise, including databases, documents, policies and procedures as well as unarticulated expertise and experience resident in individual workers. Knowledge itself is an elusive asset, which is why knowledge management, a discipline that manages and improves the organizational learning process and where the human factor is still critical, is still maturing.

The recent focus of knowledge management systems has been on effective information access that improves and speeds up the learning process, and such systems facilitate the collection, organization and transfer of knowledge aided by search engines, relational and object databases, groupware and other technologies. The core component of the current knowledge management systems is the data warehouse and the emphasis is mainly on explicit knowledge. The management of tacit knowledge is relatively unexplored, particularly when compared to the work on explicit knowledge. Tacit knowledge resides mostly inside people, with their portfolio of know-how, memory of past solutions, understanding of what works well, and their ability to see patterns and come up with fresh solutions that have a high probability of success. An enterprise needs to be well stocked with such tacit knowledge for competitive advantage. The need today is for streams of ideas that can continuously enhance value, or in other words, knowledge flow with a focus on value creation.

Aligning corporate strategy with enterprise value enhancement enables an entire organization to be collectively engaged in the process of contributing to the knowledge generation, knowledge communication and knowledge distribution process, the essential steps in productizing knowledge, whether for a product or for a service. Knowledge generation is fueled by knowledge communication across the enterprise, and value addition ultimately takes place through the transformation of knowledge activity into offerings, that is through the process of knowledge distribution. Enterprise value enhancement depends upon the systematic integration and extraction of explicit and tacit knowledge within the enterprise business system and its continuous conversion to new value through the creativity process via highly efficient implementation methodologies eliminating the typical knowledge "siloing" effects that tend to take place in corporate settings due to the lack of effective knowledge management systems.

It is estimated that less than one-fifth of all intellectual capital available to an enterprise is actually utilized. The gross under-utilization of this very important knowledge resource occurs for various reasons some of which are sub-optimized organizational structures, lack of systems for capturing creativity, and interspersed "human elements" such as the lack of motivation and the presence of ego. Opportunities for innovation, which is invention realized or commercialized, do not emerge from sophisticated data analysis or from rearrangement of existing information into different formats - they emerge from experiences and insights and mostly in environments that encourage creativity. Enterprise value enhancement, offered by NVal, is about the systematic collective application of enterprise creativity and knowledge, leveraged to chart future actions designed to deliver on-going value propositions that result in continuous maximization of the value creation potential of the enterprise over the long term.

Please also see:

• Value add cube

• Value enhancement model

• Profitable revenue increasing mechanisms