Sustainable Organisation

Introduction:

Knowledge has become as one of the most valuable resources to any organization and a determiner for success or failure of firms. Mostafa Nejati et al (2010) cite Connor and Prahalad, 1996; Hall, 1993; Nonaka & Takeuchi, 1995, managing knowledge, as the process called knowledge management, has become the key in creating competitive advantages for the firms and a driver of organizational excellence. In the current context, Organizations are more than ever, aware of the uniqueness of knowledge and intellectual capitals in bringing competitiveness to their firms.

The concept of dwindling natural resources, global warming and sustainable development has drawn immense attention. Accordingly, Organizations are beginning to recognize the importance of adapting to the natural environment and respond to changes in the global environment and the reduction in natural resources (Haigh and Griffiths 2008, Pratt 2006, Norman and McDonald 2004, Bansal 2002 and Sheats 2000). There are organizations that are counting their success not just in terms of economic but also value social and environmental factors equally.

Today organizations are seeking their competitive advantage in the effective and unique use and development of their knowledge so that it creates new areas of core competencies for them. As per Choi, Poon, and Davis (2008), knowledge has nowadays become a major source for organizational competitiveness.

Organizations are successful companies when they consistently create new knowledge, disseminate it widely throughout the organization, and quickly embody it in new technologies and products. Innovation becomes the sole business and define the activities of such “knowledge-creating” company.

Different forms of Knowledge:

Nonaka (2007) mentions that traditionally, Western management, reflects a view of the organization as a machine for information processing as per Frederick Taylor to Herbert Simon. According to this view, the only useful knowledge is formal and systematic – quantifiable data, codified procedures, universal principles. According to Nonaka, the key metrics for measuring the value of new knowledge are similarly hard and quantifiable – increase deficiency, lower costs, improved return on investment.

But Nonaka refers to a second way that knowledge influences business organizations from his study of highly successful Japanese competitors like Honda, Canon, Matsushita, NEC, Sharp, and Kao.

In his view, these companies have become famous for their ability to respond quickly to customers, create new markets, rapidly develop new products, and dominate emergent technologies. The unique approach to manage the newly created knowledge leads to their success.

Organizational learning is complementary to knowledge management. It involves embedding what has been learned into the fabric