Knowledge Management, Social Networks and Innovation

Knowledge Management, Social Networks and Innovation
Introduction
Knowledge management (KM) and organisational learning (OL) are two key factors for an
organisation to gain competitive advantage (Plessis, 2007; King et al., 2002; Lesser, 2000; Davenport
and Prusak, 1998; Foss and Pedersen, 2002; Grant, 1996; Spender and Grant, 1996) and drive
innovation. Drucker (1993) noted the rise of the knowledge worker, business value was being
transformed from purely tangible assets, such as goods and services, to include intangible assets
related to ideas and application of information, and resulted in the emergence of the knowledge
economy which is crucial to nurturing innovation (Ahmed and Shepherd, 2010). Fostering efficient
processes for KM and establishing a culture that encourages OL has become a means of competitive
advantage and value for organisations. Given today’s economic climate and an aging population, this
has never before been so critical to the success of an organisation.
This essay will outline the literature on OL and KM and look at how social media (SM) and web 2.0
technologies are influencing the OL and KM landscape, and attempt to address this in the context of
innovation. Section two will put forward an integrated framework for KM, which will be used later to
determine the success of ConocoPhillips’ KM strategy. Section three will evaluate OL, KM and
innovation in the context of ConocoPhillips and assess how social technologies have been used.
Section four will cover the conclusion.
Literature Review
Organisational learning
Learning is a process that involves the application of experience and repetition to transform
processes, tasks or products (Teece, 2007). Experience happens over time and in order to apply it,
available data must be converted into information that is accessible; it is then - through the
application of information - that knowledge is created or acquired (Ackoff, 1989). Thus, OL is a
process that involves knowledge acquisition (or creation), information distribution (or transfer),
information interpretation and organisational memory (Huber, 1991; Dixon, 1992; Slater and Narver,
1995; Goh, 2002). A number of disciplines discuss OL (Easterby-Smith, 1997) and no single framework
or universally accepted definition exists within the literature. However, it is widely agreed that OL
forms the basis for an organisation to develop new knowledge and gain insight from internal and
external experiences or information that has the potential to change behaviour leading to innovation
and increased competitive advantage (Huber, 1991; Senge, 1992; Davenport and Prusak, 1998;
Sørensen and Stuart, 2000; Nonaka and Takeuchi, 1995; Slater and Narver, 1995). Through the
learning process and subsequently OL, experience, shared interpretation and collaboration play a
crucial role in enabling organisations to exploit knowledge in order to remain flexible and responsive
to change.
Organisations that are more flexible can react faster to internal changes and external challenges. Hult
et al. (2004) conclude that an organisation’s capacity to innovate and produce solutions to its
business problems correlates with an organisation’s ability to grow and to survive in times of market
turbulence (Tippins and Sohi, 2003; Day, 1994). Brown and Eisenhard (1995) suggest that

organisations with innovative capacity can exploit new products and market opportunities better
than non-innovative organisations. The literature argues that to innovate within an organisation,
knowledge must be shared (Sørensen and Stuart, 2000; Nonaka and Takeuchi, 1995; Hall and
Andriani, 2003). Together this implies that OL leads to developing capabilities that support
innovation (Hurley and Hult, 1998) through knowledge creation and sharing or effective KM, which
can result in learning organisations maintaining an advantage over those that either do not learn or
do not learn as well. KM is, therefore, a major component in supporting OL in realising an
organisation’s innovation potential.
Knowledge Management
von Krogh (1998) argues that KM can identify and leverage the collective knowledge within an
organisation to help the organisation to compete. In order for a KM system to deliver such
advantages, it must be able to capture both tacit and explicit knowledge. Polanyi (1983) views
knowledge as a continuum that ranges from tacit knowledge at one end to explicit at the other Kogut
and Zander, 1992; Nonaka and von Krogh, 2009). Tacit knowledge refers to knowledge that resides in
a person in the kind of experience and know-how, traditionally this form of knowledge is transferred
through face-to-face communications and everyday interactions. On the other hand, explicit
knowledge refers to knowledge that is written down or articulated; this form of knowledge is
relatively easy to capture and includes journals, books, manuals and databases. Table 1 below gives a
comprehensive overview of tacit and explicit knowledge. The challenges associated with KM
primarily reside with how to capture and share tacit knowledge and knowledge sharing remains a
fundamental challenge for effective KM.
Table 1: Overview of tacit and explicit knowledge (Haldin-Herrgard, 2000; Pavlicek, 2009; Dampney et al., 2002)
Schein (2004) maintains that an organisation’s culture can have a direct impact on knowledge sharing
and the willingness to engage in sharing activities of its employees (Leidner and Alavi, 2006; Ho,
2009); therefore fostering a culture of collaboration and trust is vital to the success of any KM
system.
KM in the age of SM
SM, facilitated by web 2.0 technologies, as defined by Drury (2008) and Kaplan and Haenlein (2010)
involves a two-way conversation and user-generated content facilitated by web 2.0 technologies.

Examples include Facebook, Twitter, LinkedIn and Youtube (boyd and Ellison, 2008). SM’s
contributions to innovation have been recognised in the literature (O’Mahony and Ferraro, 2007; von
Hippel and von Krogh, 2003) and it can be seen to represent the evolution of IT systems to handle
tacit knowledge sharing in a two-way dynamic setting (Steininger et al., 2010).
As tacit knowledge sharing occurs primarily through social interaction (Yang and Farn, 2009; Haldin-
Herrgard, 2000; Smith, 2001), and SM does not detract from social interactions in the way other IT
systems do as it provides a suitable substitute for face-to-face communication without significant loss
of knowledge sharing and exchange, there are already reasons to believe that these platforms will
have a positive effect on KM (Ardichvili et al., 2003; Bock et al., 2005; Chow and Chan, 2008; Levy,
2009; Razmerita et al., 2009). This suggests that SM could complement traditional KM leading to the
capture and exploitation of tacit knowledge through social interaction using digital platforms, which
will allow that knowledge to be searchable and persist over time.
Research has shown that weak ties are likely to lead to a greater source of innovation than strong
ties (Hauser et al., 2007) and sites such as Facebook allow users to maintain a larger set of weak ties
(Ellison, et al., 2010) than non-Facebook users. The spaces between ties are called network holes
and are typically bridged by these weak ties and allow social capital to increase (Burt, 2004).This
implies that if an organisation implements a similar network across a global corporation, knowledge
sharing from more distant ties that work in geographically different locations or other divisions can
act as network holes and provide access to previously unknown information. By acting as network
holes, these employees can contribute more to the innovation process than those employees that
work in close cooperation to one another and knowledge can flow through the organisation without
traditional structural constraints.

KM model
Figure 1: Integrated Knowledge Management model proposed by Garcia-Fernandez (2015)
Figure 1 denotes an integrated approach to knowledge management proposed by Garcia-Fernandez
(2015). The model builds on previous literature that covered the concepts of knowledge creation
(Nonaka and Takeuchi, 1995; Crossan et al., 1999), Knowledge transfer and storage (Nonaka and
Takeuchi, 1995) and the application and use of knowledge (Senge, 1992). The previous models all
offer different perspectives on KM but also have their limitations. Nonaka and Takeuchi (1995)
develop knowledge from the viewpoint of creation but do not provide any application, Crossan et al.
(1999) demonstrate knowledge flow through their model but neither offer application or
measurability and Senge (1992) suggests an application but is unable to elucidate where knowledge
actually comes from or how it might be measured when applied to an organisation (Garcia-
Fernandez, 2015). This model attempts to integrate the previous literature into a comprehensive
framework that can be engaged and provide insight to knowledge creation, flow and application that
is measurable.
KM at ConocoPhillips
ConocoPhillips (CP) has taken a holistic approach to KM and has embedded a knowledge sharing
culture throughout the organisations 31,000 strong workforce. CP has been the proud recipient of a
Global Most Admired Knowledge Enterprise (MAKE) award for four consecutive years since 2010. CP
has established an enterprise-wide knowledge sharing team and leverages this across the
organisation to create and encourage the development of consistent processes and technology
enablers for “sister networks” to share common issues and content. CP has fostered a culture of
collaboration and trust towards problem solving, which has been aided by its matrix structure (Riege,

2005). Sponsorship from management and motivating employees through intrinsic benefits has also
encouraged the knowledge-sharing activities within the organisation.
CP’s knowledge management consists of networks of excellence, similar to communities of practice
(Ardichvili et al., 2003) along with a wiki platform that enables proactive knowledge sharing and
problem solving, a knowledge library and an “ask and discuss” forum for more reactive, on the go,
problem solving. As of 2013 the CP community consisted of 105+ enterprise-wide technical expertise
networks of excellence, each with 100 – 800+ members (Ranta, 2013). The organisation could
document over 130,000 instances of peer-to-peer global collaboration from 2006 to 2013, all of
which are key sources of business value. Ranta (2013) explains that the focus has been on knowledge
capture and its re-use to overcome demographic and geographic challenges and has resulted in over
$100 million in documented savings for CP. CP’s approach to developing an effective KM strategy is
outlined in figure 1. It demonstrates how the organisation has differentiated between the formal and
informal processes involved in knowledge sharing to foster a more collaborative culture.
Figure 2: CP's KM strategy approach (Ranta, 2013)
In 2010, CP introduced OneWiki and the ability to close discussion items to its knowledge-sharing
portal. These features leveraged web 2.0 technologies to enhance the knowledge-sharing network.
The “closed discussion” feature allowed knowledge that would otherwise have been lost due to aging
on the network to gain a second lease of life. By officially closing the discussion, the thread is
converted into a lessons learned document, using web 2.0 technology, and transferred over to the
knowledge library where it becomes fully searchable and accessible to others. CP notes that this
approach has created a more fruitful and efficient means of capturing, storing, accessing and reusing
intellectual capital than other more traditional and costly methods (AIM, 2010).
The OneWiki involves many networks, teams and workgroups and provides CP with a natural forum
for capturing insight and wisdom (AIM, 2010). This knowledge is then converted into numerous
searchable lessons learned and best practices within its knowledge library. As the Wiki concept was
already familiar to the majority of employees, the benefits this type of collaborative platform were
already known, so implementation was smooth. By using a wiki, it also stimulated the development
of a common language that helps to increase the likelihood of sharing even more (Nahapiet and

Ghoshal, 1998). Encouraging employees to find and keep accumulated data up-to-date met limited
issues and branding the wiki as “OneWiki” helped to consolidate the system contextually as the
ConocoPhillips encyclopaedia and go–to knowledge repository.
Using the framework
Figure 3: Overview of KM system in CP (Ranta, 2013)
Using figure 3, it is possible to see how knowledge flows through the KM of CP this can then be
applied to figure 1. When applied to the model in figure 1, the CP approach to KM clearly shows the
knowledge creation process being developed at three of the four levels: individual, group or
collective and organisational. CP’s KM does not appear at present to include the interorganisational
level, but this is not surprising, as the energy industry is highly competitive and as such, CP would
seek to protect its intellectual capital and internal knowledge. The CP model also clearly shows the
transfer of knowledge among these groups with individuals being able to add to the OneWiki and
search the repositories for useful information that will aid problem solving. Groups or networks are
also represented and are the primary forum for discussion within “Networks of Excellence”, here
individuals can contribute to the collective know-how and know-what and these contributions can
come from “Sister Networks” too. “Sister Networks” most likely represent the most common
platforms for knowledge transfer, as they would include the transfer of lessons learnt or best practice
from one part or division of the organisation to another.
The knowledge library represents the storing of knowledge in the collective memory and the
collaborative nature represented by over 100 active networks demonstrates the feed-back and feed-
forward loops between socialisation and externalisation. CP has tried to approach their KM strategy
from a holistic standpoint and Garcia-Fernandez’s (2014) model has attempted to produce an
integrated approach to KM, which makes this framework ideal for evaluating CP.

Using the framework suggests that CP has indeed managed to achieve a holistic approach, as it fulfils
all stages of the integrated model and knowledge has become firmly embedded in these tools. The
CP case study has provided some validation of the integrated nature of the model.
CP has fostered a collaborative and trusting culture throughout the organisation. This culture has
been critical in CP’s ability to achieve a high level of success with its KM strategy. The organisational
has primarily been driving process and procedural innovation and is regarded as a leader in
enterprise-wide knowledge management (AIM, 2010). As of June 2013, CP could document a saving
of over $100 million due to innovation in business processes and procedures as a direct consequence
of its KM system.
Conclusion
There is an increasing body of literature that links the use of SM and web 2.0 technologies to KM and
OL, as a method for capturing and sharing tacit knowledge in organisations. Historically, it has been
tacit knowledge that has proved challenging for KM systems to manage and in order for an
organisation to learn effectively it must be able to capture both explicit and tacit knowledge.
Through the application of SM tools to facilitate knowledge-sharing in CP, it is clear that these tools
have led to innovations in processes and procedures and have made major cost savings for the
organisation. CP’s matrix structure along with global collaboration can also provide many
opportunities for filling network holes thus increasing the chances of innovation. The literature
supports these findings and maintains that similar opportunities for innovation can be seen in other
organisation when SM is used to exploit knowledge. The advantages that are afforded through SM
for sharing and disseminating knowledge (including making it searchable) will inevitably lead to
increased competitive advantage and innovation for those organisations who manage to achieve
excellent implementation of these technologies, and cultivate a positive and trusting culture towards
knowledge-sharing.
This essay has by no means covered the full extent of the literature available on OL, KM or the use of
SM to drive innovation. It is also limited, as it has not discussed the relationship of organisational
performance or explored a fine-grained analysis on the effect of organisational culture on KM. The
extent to which SM can cultivate a shared language and aid codifying knowledge should also be
explored in more detail. Further research is needed in these areas to understand how they relate to
innovation through SM initiatives.

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