Analysis of Knowledge Management at Northern Gate During Downsizing

This report examines the case of Northern Gate's senior management decision to downsize while retaining knowledge and expertise. The company, facing challenges after the Cold War, implemented various strategies to prevent brain drain, including establishing a KM council and conducting a knowledge audit. The report analyzes the company's KM objectives, justifying the importance of retaining knowledge for the success of the autonomous business units. It highlights critical success factors such as employee understanding of knowledge sharing, the use of surveys, and the appointment of a KM council. The downsizing initiative aimed to reduce the workforce while maintaining essential skills and expertise, ultimately leading to cost savings, improved production, and enhanced innovation. The report emphasizes the significance of proactive knowledge management in overcoming organizational challenges and achieving long-term success. The author analyzes the strategies used by the management and how those strategies assisted the KM council to attain success. Furthermore, the report provides an analysis and justification of the KM objective and the results which the management obtaining at the end of the KM management process.

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Executive summary
Knowledge management plays a substantial role for the success of organizations. Having the
right number of employees and with proper knowledge makes an organization to overcome
various issues which impact its success. Although some companies choose to downsize
because of various reasons, maintaining knowledge and expertise remains a key factor to
consider because managers always value all factors which make their companies to produce
goods or services which can satisfy their customers. The purpose of this paper is to look at
the issue of northern gate’s senior management decision of downsizing while retaining
knowledge and expertise. The author will provide the case in summary and explain the
various strategies which the management used to attain success and how those strategies
assisted the KM council to attain success. The paper will also provide an analysis and
justification of the KM objective and the results which the management obtaining at the end
of the KM management process.

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Contents
Introduction...........................................................................................................................................3
Case Study Analysis and KM Objectives Identification and Justification.............................................4
Critical Success Factors..........................................................................................................................5
Bibliography..........................................................................................................................................9

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Introduction
According to Saini (2012), knowledge plays a significant role in making organizations
to meet their goals. Although some companies may wish to take various decisions which
impact employees, retaining knowledge remains critical in all decisions. Downsizing without
considering knowledge can make an organization to experience different challenges which
may lead to its closure. Utilizing the right strategies while downsizing is fundamental.
After realizing the company was experiencing challenges especially after the end of
cold war, northern gate (NG) senior management took the decision of downsizing while
retaining knowledge and expertise. The company understood that Knowledge management
(KM) and expertise would play a significant role in preventing massive brain drain
(McFarlane, 2012). The company under the leadership of smith utilized various strategies
including coming up with KM council and conducting knowledge audit to ensure the goal of
downsizing while maintaining knowledge and expertise was attained.
Case Study Analysis and KM Objectives Identification and Justification
Initially, the company did not analyse the employees to know whether they were
sharing knowledge. The management took a creditable move to come up with a strategy of
identifying if the employees were sharing knowledge. The decision to analyse if employees
where aware about the value of sharing knowledge means the management had started
realizing that something was wrong because the company was experiencing difficulties in
meeting its goals.
The end of cold war would make this company to experience various challenges
because most of the products which the company produced were used during that time. Based
on this factor, and bearing in mind that some of the employees had started quitting the
organization, it meant the company was experiencing various problems which would be

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threat to the success of the organization. According to Huang (2014), failing to address some
issues especially those which impact workforce can make an organization to close down. The
great success which smith and his team attained will benefit the company in various ways,
including coming up with innovative products.
The company has different autonomous business units which include information and
services, electronics, aerospace and ships. The fact that the company was trying to down size,
maintaining knowledge and expertise was important for this units to remain in operation
(Ologbo, 2015). After identifying that the organization was experiencing problems, the senior
management to down size while retaining knowledge and expertise.
The objective of undertaking this process was to ensure the company remains with
few employees but with proper knowledge and skills. The company was aware that with the
end of cold war and other factors that would provide it with market opportunities, the large
number of employees would have no purpose. The company also wanted to retain knowledge
because it wanted to have a team that would effectively contribute in production of products
which the company was producing.
One of NG’s main object for knowledge management was to ensure skills and
expertise were well utilized to make the company to continue performing better. Great
number of employees who were leaving the organization after would significantly impact its
performance, bearing in mind that some of them were those who had technical knowledge in
some areas that were critical based of the products that the company was producing.
Critical Success Factors
The ACS’s strategy of downsizing while maintaining knowledge succeeded because
smith ensured the right procedures were used. Because it is fundamental for employees to
understand that knowledge sharing is critical for good performance of an organization, smith

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considered surveys to find out if the staff members were aware about the importance of
sharing know-how with their colleagues (Goel, 2010). The fact that the largest number of
them reported to know the value of knowledge sharing means KM would be effective in this
company.
The fact that the employees understands the value of sharing knowledge will make
them to work as teams and improve quality and quantity (Meharabani, 2012). When
employees with good knowledge team up while undertaking task, they share ideas, skills and
experiences which in turn makes the company to realize success. Understanding the
importance of sharing knowledge with their counterparts will also make the employees to
assist the company to come up with innovative products.
Georgieff (2013) argues that downsizing without retaining knowledge can make a
company to experience challenges which can lead to its closure. The fact that ACS succeeded
in retaining knowledge and reducing the number of employees, it will remain in operation
and save the money which would be used to pay salaries.
According to Petter (2014), critical thinking assists organizations to overcome
problems which can impact knowledge management. John smith’s idea of requesting ACS to
implement appropriate KM initiative was right because it would assist in preventing further
loss of knowledge and expertise in the organization.
Huang (2014) states that before addressing any problem which impact an
organization, it is always advisable to first consider what triggers the problem. Before
launching the KM initiative, Smith and his team considered to identify the best strategies to
identify the barriers which prevented the staff members from sharing information with their
colleagues. Alongside the end of cold war which provided the company with opportunities to
sell their products, lack of sharing knowledge among the employees could be one of the

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factor that was making the company to experience challenges. Having identified that
employees were aware that sharing information with their counterparts was important, it
would be simple for the management to manage knowledge and expertise.
NG’s decision to analyse the level of knowledge sharing among the employees was
fundamental because it assisted the company to understand whether the employees were
aware about the importance of knowledge sharing or not (Malgeri, 2013). It was a surprise
after the audit was conducted to realize that the employees were aware about the value of
sharing knowledge with their counterparts. This means utilization of proper strategies to
retain knowledge would make the company to realize great success.
According to Goel (2010), organizations only succeed in knowledge management if
employees understand the importance of knowledge in workplace. Appointing KM council
which emphasized mostly emphasized on knowledge assisted smith to identify that the
employees were aware about the value of sharing knowledge with their counterparts. The step
by step analysis and good audit process were also significant contributors to the success of
that process.
Before thinking of the strategies which can effectively manage knowledge in an
organization, it is advisable to first consider the factors which can make the staff members
think of leaving the company (Omotayo, 2010). Smith was keen in incorporating this factor
in the strategies for knowledge management because he advised the KM council to identify
the subject matter.
The good leadership of smith, assisted the process of downsizing while maintaining
knowledge and expertise to be deemed successful. After conducting the whole process, the
management managed to reduce workforce from 8000 to 6000 and adapted KM. this means
the company will have the right number of employees based on the tasks available. In

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addition to that, it will also benefit by having employees who can utilize their skills
effectively for the success of the organization
Having successfully downsized while maintaining knowledge and expertise, this
company will be able to realize less cost when it comes to salaries. It will also realize high
quality work and great production. Maintaining knowledge will also make it to be more
innovative. Having the right number of employees with good knowledge helps an
organization to remain successful.

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Bibliography
Georgieff, M., 2013. Who Owns Knowledge Management within Your Federal Agency?.
The Public Manager, 42(3), pp. 65-75.
Goel, G. R., 2010. Knowledge Management as a Process to Develop Sustainable Competitive
Advantage. South Asian Journal of Management, 17(3), pp. 547-562.
Huang, L.-S. C.-P., 2014. Knowledge Management Adoption and Diffusion Using Structural
Equation Modeling. Global Journal of Business Research, 8(1), pp. 78-90.
Malgeri, J., 2013. Enhancing the Knowledge Management Capabilities of Federal Agencies:
Implementation of Effective Knowledge Management Can Improve Performance in
Government Agencies. The Public Manager, 39(3), pp. 254-289.
McFarlane, D., 2012. Personal Knowledge Management: Individual, Organizational and
Social Perspectives. Journal of Applied Management and Entrepreneurship, 17(2), pp. 58-75.
Mehrabani, S. M., 2012. Knowledge Management and Innovation Capacity. Journal of
Management Research, 4(2), pp. 45-56.
Ologbo, A. K., 2015. Knowledge Management Processes and Firm Innovation Capability: A
Theoretical Model. Asian Social Science, 11(18), pp. 58-75.
Omotayo, F. O., 2015. Knowledge Management as an Important Tool in Organisational
Management: A Review of Literature. Library Philosophy and Practice, pp. 124-135.
Petter, G., 2014. Knowledge Management Strategy in Professional Service Firms. Advances
in Management, 7(3), pp. 12-24.
Saini, R., 2012. Impact of Knowledge Management Practices on Selected Industries: A
Structural Equation Modeling Approach. Management & Marketing, 8(4), pp. 102-112.

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