THE IMPACT OF KNOWLEDGE MANAGEMENT ON ORGANIZATIONAL PRODUCTIVITY IN NIGERIA

23

THE IMPACT OF KNOWLEDGE MANAGEMENT ON ORGANIZATIONAL PRODUCTIVITY IN NIGERIA (A STUDY OF NESTLE NIGERIA PLC)

ABSTRACT

Retention of enterprise of key personnel and improved interaction between people, technology and processes continue to drive investments in knowledge management (KM) initiatives. Since seventy percent of the employees knowledge is tacit knowledge that is stored in long-term knowledge resources and activities. An organization continues to be challenged by the dynamic nature of competitive global market place, the necessity to outsource critical knowledge tasks and manage rapid turnover of key personnel, it has become imperative that managers implement knowledge management (KM) practices. An effective knowledge management (KM) application for preserving knowledge base within the firm is presented. The study was carried out in Nestle Nigeria Plc Enugu Depot. The data for this research was collected from the distribution of questionnaires to various respondents. A total of thirty questionnaires were distributed in which twenty seven were completed and returned. The statement of the problem deals on how an organization have the problem of planning for the human resources recruitment, selection and employment of qualified persons who are knowledgeable enough to acquire and manage for efficiency. The result/findings of the research show that there is a relationship between knowledge and information, culture and skills as these cannot do without the other. The study therefore recommends that the proper use of knowledge management and information technology develops an organization capacity to acquire, share and utilize knowledge in ways to improve its survival and success. Finally, proper knowledge management helps to protect, exploit intellectual properties to avoid brain drain and build and sustain competitive advantage

CHAPTER ONE

INTRODUCTION

1.1    BACKGROUND OF THE STUDY

Knowledge management is concerned with the creation of structures that combine the most advanced elements of technological resources and the indispensable input of human response and decision making (Scarnbrough, 1999:70). Corporations have always had experience and integrate it with knowledge acquired from outside sources (Polanyi, 1958).

However, not until recently have scholars and practitioners alike become increasingly attracted to the science of applied knowledge within organizations. This work investigates the vital link between the management of knowledge in contemporary organizations and the development of sustainable competition for efficiency in the Nestle Food Nigeria Plc Enugu Depot. The researcher chooses Nestle Food Nigeria Plc as it deem necessary considering the fact that no virile manufacturing organization can perform effectively without adequate information gotten from reliable sources and from those who are knowledgeable about the facts. The promising field of knowledge management (KM) is differentially defined from other more traditional information technology functions and the evaluation of knowledge management discussed.

The abstract construct of knowledge can be understood through its relationship to data and information (Parikh, 2001:5), posits that data are merely raw facts collected from business transactions and activities and data must be structured into a meaningful, composite model to become information. Once information is created from such of constitution of pure data sets, it is able filtered through a relative model of understanding. Thus, knowledge is created only as information is interpreted and evaluated from a contextual mental model. Individuals and companies as whole have different mental models (Senge, 1994:40), the knowledge gleaned from the same compilation of information can differ greatly not only in quality but also in applicability. Knowledge management thus differs from information management because the former implies a persistent, international effort of extracting from available what is critical for business success, while the latter is more concerned with making critical information available in structure. (Bolterll, 2001:19), knowledge management is therefore the creative mining of information from diverse sources with the purpose business opportunities in mind. As a firm works diligently towards pursuing its information assets through the multitude of perceptual filters available, high impact matchless gems are unearthed, which have the potentials to substantially affect the bottom line.

The recognition of knowledge management as an imperative for improving the knowledge base of an organization will provide an impetus for organizations to understand and nature their knowledge resources and activities. The current global financial and economic conditions have made companies realize the value of their corporate knowledge and seek effective methods to reuse that knowledge.

Since seventy percent of organizational knowledge is in the mind of employees (knows as tacit knowledge) while just 30 percent is in externalized forms (known as “explicit” knowledge), it has become very important to harvest and document employee’s long – term memory, therefore, the creation of a knowledge reserve is a necessary for capturing innovative ideas from individuals as well as groups while interpreting, congealing and repackaging the collective conclusions into organizational knowledge.

In the landscape of modern business, companies are persistently striving to create mechanisms for differentiating themselves from their competitors within given markets. Many markets are quite saturated with numerous firms endeavoring towards like core competencies, organizations are forced to dissect their business processes for the purposes of determining what can produce a sustainable competitive advantage. The information age and the changes created by it have shifted firms away from being myopically concerned with the exploitation of tangible assets towards a steadfast and holistic interest in leveraging in tangible assets towards a steadfast and holistic interest in leveraging intangible assets as well. The management of information as a key to grasping and retaining competitive advantage has recently evolved into the more strategically focused management of knowledge.

1.2    STATEMENT OF THE PROBLEM

Traditionally, it is the function of human resources department of every organization to plan for the human resources needs of the organization. This is with the view to satisfy them through recruitment, selection and employment of qualified persons who are knowledgeable enough to acquire and manage for efficiency. Expects in this field have continued to denounce the way and manner these functions are being carried out in the course of efficient knowledge management for proper information needed by the firm to improve and increase productivity in order to make their products available to public. As a manufacturing firm, the organization cannot satisfy the desires of the people without adequate management of the knowledge base of the organization. In the light of the foregoing, the researcher considers it necessary to look into Nestle Food Nigeria Plc with a view to find some problems that affect the performance of the organization.

It is the function of the human resources department of every organization to recruit and employ human they need in the organization. It is left to them to t rain, maintain and integrate them as well as compensate the employees in order to improve the knowledge base of the organization.

Unfortunately, these functions are not well performed by the human resource department of these organizations because of interference of top government functionaries who give written notes to managers of these organizations, instructing them to give immediate employment to their friends and relatives who may have the right qualifications and skills for the existing jobs. Secondly, when workers are employed in an organization, most of them are trained to acquaint them with the skills needed for the operation of their jobs.

Consequently, the organizations primary objective of satisfying the need of the public will not meet the required standard due to inappropriate management of the acquired knowledge. In the light of the foregoing, the researcher considers it necessary to look into the Nestle Food Nigeria Plc Enugu Depot with a view to find some of the ways used to improve the knowledge base of the organization with regards to knowledge management.

  1. OBJECTIVES OF THE STUDY
  2. To find out the impact of organization that trains, maintain and integrate them as well as compensate the employees in order to improve the knowledge base of the organization.
  3. To continuously help organizations to develop, share, mobilize, cultivate and put to practice and processes to drive investment.
  4. To promote research and development as a result of the use of information and communication technology.
  5. To help management to be committed towards enlarging learning ability and the knowledge base of the organization and employees.
  6. To determine how employees’ will identify and solve shared problems as a team, as well as exploit innovative ideas among themselves.
  1. RESEARCH QUESTIONS

This research study seeks to answer the following questions:

  1. Do managers use simple oral and written languages and being action oriented and facilitates the process “learning by practice”?
  2. Do employees have the skill to adequately categorize, develop, share and maintain knowledge?
  3. Is management information system integrated and continually updated?
  4. Is top management committed to enlarging learning ability and creating a learning organization?
  5. Are employees continually stimulated and encouraged to identify and solve share problems as a team, brain storm to generate creative ideas and share these with each other?
  1. SCOPE AND LIMITATIONS OF THE STUDY

The study covers the knowledge management as an imperative for improving the knowledge base of an organization, with Nestle Nigeria Plc as a case study.

Finance: money is an essential resource for the success of any project such as this, but in this case, it was inadequate as the researcher could not meet up with the cost and photocopying materials.

Time: the time allocated for this study is short, and the researcher had to combine this with other academic work.

Dearth of materials: there are scarce materials on the subject matter of the study this limits the researcher to some extent.

Respondents’ attitudes: most of the respondents do not understand the meaning of knowledge management as an imperative to improve the knowledge base of an organization.

  1. SIGNIFICANCE OF THE STUDY

The study will be beneficial to the following group of persons.

Government: Government will be able to use this material and formulate policies that would enhance employees’ productivity.

Employees: This study will enable the employees to maximize knowledge available within I.C.T. storage devices.

Researchers: Other researchers would see this study as reference materials in further promoting knowledge base of organizations.

Labour union/policy makers: This will enable them to create enabling environment for business to flourish for re-use, awareness and learning.

          Knowledge management as an imperative are typically tied to organizational objectives and are intended to achieve specific outcomes, such as shares intelligence, improved performance, competitive advantage or higher levels of innovation.

  1. HISTORY OF NESTLE FOOD NIGERIA PLC

Nestle Nigeria is part of the Nestle group. The respected and trusted worthy nutrition, health and wellness company renowned world wide for its high quality products. Nestle Nigeria Plc began simple trading operations in Nigeria in1961 and has today grown into a leading food manufacturing and marketing company. Nestle Nigeria was listed on the Nigerian Stock Exchange on April 20, 1979.

          Nestle S. A. Switzerland and Nestle W. A. Ltd. Ghana are the major share holders of the company. As at December, 2006, the number of Nigerian shareholders was 30,000. the strategic priorities of the company are focused on delivering shareholders value through achievement of sustainable, capital efficient and profitable long-term growth. The company’s turn – over in the year was N38.4 billion of which the sum of over 2.5 billion was paid to the federal government as income taxes. In the year 2006, the company’s profit before tax was N8.2 billion and profit after tax was N5.7 billion.

          Nestle Nigeria manufacturers and markets an impressive array of high quality brands; infant cereal, Nestle Nutrend, Nestle cerelac, family cereals; Nestle golden morn, beverage drinks, Nestle Milo, confectionary Nestle Choco Milo, magi cube, magi cube, magi chicken, magi crayfish, magi maxi cube, source magi machop and table water – Nestle pure Life. Nestle Nigeria   also markets coffee- Nestle café classic and Nescafe 3 in 1, and full cream milk product Nestle Nido. These brands and products are the focus of continuous innovation so that they meet and exceed customers’ expectation. The company seeks to achieve a clear cut advantage over competitors’ products and to ensure that its products are available wherever, whenever and however the consumer wants them. Continuous attention is also given to developing the professional and leadership skills of staff at all levels so that they can directly contribute growth and higher level of performance.

To stimulate industrial growth, the company has a policy of long term sustainable business practices. Over seventy – five (75) percent of their raw materials are sourced locally through farmers and suppliers. The business supports an ever increasing standard of living through employment generation, increased income, infrastructure improvement and growing concern for business community in Nigeria. Nestle adheres to comprehensive set of the business principle that reflects both the company’s commitments to long- term successful business development and the necessity to improve short – term. Indeed, creating value for shareholders, consumers, employees and business partners, as well as the local community and the national economics in which nestle operates. This is central to nestle operates. This is central to Nestle Corporate business principles and Nestle management and leadership practices.

The company fully supports the ten principles of United Nations global compact on human right, labour, the environment and corruption. In furtherance of its cutting edge, knowledge base and multi-stakeholders strategic approach to fight HIV scourge in Nigeria, Nestle collaborated with Red Cross Society. Nestle Nigeria continues to contribute to the development of sports and creative arts by sponsoring sporting events and programs such as Nestle Milo Secondary Basketball Championship. The company also promotes Nigeria food culture through Maggi family menu television programmes.

          In pursuit of its sustainable Agriculture initiatives, Nestle is involve in collaborating research with the University of agriculture Abeokouta on popularization of Soya-beans. Nestle Nigeria is committed to environmentally sound business practices. The company integrates environmentally policies, programmes and practices into each business as an element of management in all its functions. With its historical root in nutrition, wide product portfolio, strong brands, research and development competence, skilled and motivated professionals and efficient management. Nestle Nigeria is uniquely positioned to continue to contribute to the progress, prosperity, economic development and industrial growth of Nigeria.

1.8    DEFINITION OF TERMS

Implicit Knowledge: This is the knowledge which depend on the      individuals and is stored in the minds of the people.

Explicit Knowledge: This is the knowledge that is externalized within the organization.

Learning: Earning is a continuous personal transformation and cumulative process of continuous actualization of your knowledge.

Commercial knowledge: According to Oxford Advanced Learners dictionary, commercial knowledge is the knowledge obtained from buying and selling of goods and services.

Innovation: According to Oxford Advanced Learners Dictionary, Innovation is the introduction of new things, ideas, or ways of doing something.

Exnnovation Management: Knowledge management is defined as getting the right information to the right people at the right time in order to make a better management decisions.