Requirements for knowledge management in the public sector

Two ways of seeing the strategic role of knowledge in organizations

The wider perspective takes knowledge-based value creation into consideration and aims at understanding how knowledge as a strategic resource makes a difference in a competitive sense. The narrower approach focuses on decision-making and reflects an attempt to rationalize organizations’ decision-making processes. Although the wider perspective may be a more appropriate approach in the public sector, where political and administrative interests meet, it seems that, the dominant approach is actually the narrower approach.

This approach easily over-rationalizes public decision-making processes and does not take full advantage of the knowledge management approach. Indeed, major systemic changes necessitate a thorough analysis of the underlying value creation processes, which calls for interdisciplinary dialogue.

The evolving knowledge needs of public management

The management focus is shifting from internal efficiency to customer-perceived value. Simultaneously, the development focus is turning from individual organizations to horizontal service processes, meaning that the unit of analysis needs to be changed. Finally, the key actions of public knowledge management are the improvement of inter-organizational knowledge flows and collaborative processes where targets are defined and performance information is interpreted.Capture

The empirical data showed that it is not a straightforward process to move from an intra-organizational focus to inter-organizational and cross-functional collaboration in service provision. Here, it is important to maintain a strategic focus and concentrate on the creation of public value.

Nevertheless, the empirical examination demonstrated that much remains to be done in creating a common language between different actors. During the development process, the ambiguity of public management and cultural tensions were evident. The empirical data illustrated the challenges of inter-organizational collaboration, where different organizational cultures, perceptions of the ongoing transformation, and individuals’ mental models meet.

It is also worth acknowledging individuals’ disparate incentives for acquiring and using information. These may have a significant impact on individuals’ willingness to engage in the inter-organizational collaboration and learning that the new situation requires.

Key elements of a knowledge management strategy

The knowledge management strategy needs to be (1) steered by the city strategy and (2) tied to the general management system. The latter means that knowledge management should not be a separate function but embedded in everyday management activities. Further, the knowledge management strategy needs to (3) define processes and responsibilities for data gathering and refinement and (4) ensure data quality.

The critical success factor seems to be performance dialogue

From the empirical examination several areas emerged where the lack of a common language and discussion on the objectives and various interpretations of the ways to accomplish these can lead to misunderstandings.

This may further lead to undesirable behavior, like sub-optimization or hoarding of knowledge. In a changing environment, it is especially important to pay attention to the social and organizational context in which performance information is to be used.

Our findings support the literature proclaiming a need to focus more on learning and knowledge-generating aspects in strategic public management. From the knowledge management perspective, this means that it is not reasonable to push knowledge management as a ready-made solution and expect that it will solve the challenges not only in the use of performance information but also in public decision-making more generally.

Although the current political climate in Finland advocates a highly rational approach, it is important to acknowledge the complexity of public decision-making and consider public knowledge management not as a decision-making machine but as a dialogue, where different information and viewpoints are discussed and interpreted.

The weaknesses of focusing solely on the decision-making side of knowledge management

Decision-making is, of course, a critical component in the public sector, where there is ample information available and where success depends heavily on the efficiency of decision-making. However, at the same time, the other side of the coin in public knowledge management is the recognition and building of the required knowledge assets to attain the sustainable development of society.

This viewpoint has been stressed by Wiig (2002), who discusses building “competitive societal intellectual capital capabilities” and the role of “society’s intellectual capital to improve the effectiveness of public and private decision making”. Anttiroiko (2008) continues on the same agenda and discusses strategic knowledge management in public organizations as “a set of theories and guidelines that provide tools for managing an organization’s knowledge assets and processes of strategic importance”.

The viewpoint of knowledge assets becomes crucial in a changing environment where questions regarding the existing and needed knowledge assets determines the future success of the organization.

Thus, when discussing strategic knowledge management in the public sector, it is important to keep in mind that it is a wider discussion than the current focus on decision-making and technological aspects would suggest. Therefore, we suggest that the discussion on strategic public knowledge management should carefully follow contributions in the area of intellectual capital management in public context (cf. Guthrie and Dumay, 2015).

Future research in public knowledge management

The requirement for performance dialogue would mean that more qualitative research is needed on the management processes in which the information is used. Especially in complex situations, information use is often a collective effort, and the interesting phenomenon is actually the dialogue that takes place on the basis of the information provided.

Further, this would mean that a knowledge management strategy should pay attention not only to information provision but also to the creation of organizational structures and platforms that would encourage and enable the evaluation of various interpretations. Furthermore, this raises a question, what are the knowledge assets and especially the individual capabilities that will be needed in the future? Answering this question definitely calls for a strategic discussion, and not only in the public sector.

Read more:

Harri Laihonen, Sari Mäntylä, “Strategic knowledge management and evolving local government”, Journal of Knowledge Management, 22(1), pp. 219-234. https://doi.org/10.1108/JKM-06-2017-0232

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