ENTERPRISE KNOWLEDGE PRACTICE AND

RECOMMENDATION BASED ON HOTP MODEL

Baowei Chen, Yuhong Gao

Zhejiang wanli university, No.8, South Qian Hu Road, Ningbo, China

Dan Chang

Department of Economics and Management, Jiaotong University, Beijing, China

Keywords: Knowledge management, HOTP model, Lenovo Group.

Abstract: According to Knowledge Management Maturity Model, the knowledge management implementation of our

country is in cognitive level, and the introduction of enterprise knowledge management has become an

irreversible trend. Globalization business requires enterprises to equip with the ability of communication

and the ability of knowledge acquisition, knowledge creation and knowledge conversion. However, many

enterprises are still ambiguous on the concepts of knowledge management, or simply think that knowledge

management is information management. In this paper, we study Lenovo Group case under HOTP model to

find out its experience and existing problems in the process of the knowledge management implementation,

and to provide reference for other enterprises, which help to promote the development of knowledge

management.

1 INTRODUCTION

Since the 1990s, with the globalization of economy

and the development of science and technology,

knowledge production, dissemination,

communication and utilization of the knowledge is

an important business driving force during the

enterprise growth. Society is moving into a

knowledge economy era, in which the most

important factor is the occupation and configuration

of the intellectual resources, and the production,

distribution and use of the knowledge. in the era of

knowledge economy, knowledge replaced traditional

labor and capital, and become the enterprise the

most important resource. The Famous management

guru Peter F. Drucker said: "in the 20th century

enterprise, the most valuable asset is production

equipment; in 2l century organization, most valuable

assets will be the knowledge workers and their

productivity in the organization.

A global 500’s CEO survey has shown that 2

reasons attribute to the enterprises’ future:

globalization, and the 2nd, knowledge management.

Knowledge management exists for only 10-15years

both in concept and practice, however, 70% of the

Global 500 enterprises has implemented knowledge

management project. 1 While in China, only a

handful of companies have set a CKO position

(short for chief knowledge officer).Compared with

knowledge management, information management

can be seen more often. Although, a survey aiming

at CIOs (chief information officer) in China

conducted by IBM company and Tsinghua

University shows that, Chinese CIOs strategic

position is much lower than the global average level,

and cut no figure in business management.

Lenovo Group is a highly innovative international

technology company, and it has the second computer

sales in the world. On July 9, 2008, Lenovo become

China’s first non-monopoly private company to be

ranked among Fortune Magazine’s top 500

enterprises. Besides, Lenovo Group has located in

the top 3 in China's top 500 private enterprise for

many years. In 2010, it located in the third place. n

this paper, we study Lenovo Group case under

HOTP model to find out its experience and existing

problems in the process of the knowledge

management implementation ,which contribute to

improve the efficiency of KM and IM during an

444

Chen B., Gao Y. and Chang D..

ENTERPRISE KNOWLEDGE PRACTICE AND RECOMMENDATION BASED ON HOTP MODEL.

DOI: 10.5220/0003591004440450

In Proceedings of the 13th International Conference on Enterprise Information Systems (KMKSSC-2011), pages 444-450

ISBN: 978-989-8425-54-6

 2011 SCITEPRESS (Science and Technology Publications, Lda.)

enterprise’s management process and improve its

competitiveness.

This paper is organized as follows: section 2

illustrates the knowledge management and enterprise

competitive force literature research and the HOTP

model. Section 3 uses Lenovo Group as an example

to analyze the advantages and disadvantages of

knowledge management implementation.

Conclusion and recommendation are discussed in

section 5.

2 RELATED LATERATURE

2.1 KM and Competitive Force

Knowledge Management is related to each piece of

work throughout the whole enterprise activity, the

activities of enterprises cannot without knowledge,

and it considers the knowledge learning, utilization,

innovation and spread as the main line, and form a

continuous process. Accompanied by material, flow

knowledge flow is dominated in the management,

thus become the core of management work, and

connect the other management work in an organic

whole.

In the knowledge economy, primarily enterprise is

a body of knowledge, which make an enterprise

distinguish with the others. An enterprise takes the

innovation ability and knowledge study, diffusion

capacity of knowledge as a token, then it formats

and develops its core capability. The reality an

enterprise as a body of knowledge existing makes

the enterprise knowledge management into the main

line in business management .

There have been various types of firm growth

theory over the past years. Theories such as neo-

classical microeconomic theory and industrial

organization theory argued on the power of capital

investment and optimization of costs as the primary

contributor to competitive advantage. Barnet

（

1991)

propose knowledge enterprise maintain competitive

advantage based knowledge (Barney, 1991); Vidya

SeRhri think the enterprise knowledge and

experience and enterprise innovation can produce

sustained competitive advantage; Bloodgood and

Salisbury thinks, the organization can, according to

their own change strategy, take the corresponding

knowledge management strategy to support the

organization competitive advantages (Bloodgood

and Salisbury, 2001); Emin Civi think the purpose of

management of knowledge assets in enterprises is to

obtain competitiveness, and the ability of

management of knowledge is the base to remain

competitive advantage (Lubit, 2001) ; Roy Lubit

thinks, in enterprise's knowledge, the inherent

characteristics of tacit knowledge form the core

competitiveness of the enterprise

(Civi, 2000);

Willem Selen thinks that the establishment of the

learning organization helps to enhance the

competitiveness of enterprises (Selen, 2000).

2.2 HOTP Model

HOTP knowledge model (Liao, 2007) is

Organizational management model, and its

components is hunman, organization, technology

and process. The main reason of applying HOTP

model is the same measurement criteria for

comparative analysis. The consistency of research

methodology and analysis is ascertained. In addition,

the model is considered an appropriate assessment

tools and well accepted medium to the investment,

development, and implementation of KM (Liao,

2010).

In Fig.1, the outer part of the figure represents

infrastructure capability including technology,

structure and person. The inner part of the figure

represents process capability including production,

storage, sharing, usage and evaluation.

Figure 1:Structure of HOTP model.

2.2.1 Human

(1) Knowledge worker. Modern enterprises call their

employees as knowledge workers. They are

organization knowledge producers and users of

organization knowledge, namely, they produce new

knowledge during the business process, at the same

time, they use knowledge base or other social

network knowledge to support their business

activities, so as to realize the integration of

knowledge flow and workflow. Knowledge

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445

management is to make all members of an

organization have access to get the knowledge he

needs and storage what he generate in any time or at

any place.

Knowledge workers should be skilled at related

the use of information technology tools, and will be

able to do define their own information and

knowledge needs, Know how and where could

obtain knowledge, can understand the meaning of

information and knowledge, and then can make

knowledge internalization and combination to

generate new knowledge, and can use knowledge in

the actual work to help enterprises gain the

maximum profit.

(2) Knowledge manager. It is the person who is

specially in charge of knowledge management in an

organization, including knowledge reporter,

knowledge editor, knowledge engineers, knowledge

director, etc.

(3) Leader. Organizational leader plays a vital role

in KM, is the most important promoterin knowledge

management. The function of the leader is inspire

subordinates, guide activities, choose the most

effective communication channel and solve the

conflict between members, and its ultimate purpose

lies in inspire and guide employee's behavior

towards organizations goals.

2.2.2 Organization Reform

It is actually a management reform from the core of

physical resource to the core of knowledge resources

in the management process. In this reform, it

involves the transformation of organizational

structure, and organizational culture and

organizational incentive mechanism.

2.2.3 KM Technology

KM technology refers to the modern information

technology, which could realize knowledge storage

and transfer. The most important technology

includes: Internet and Intranet, database

management system, document management

technology, groupware technology, data warehouse

and data mining technology and on-line analytical

processing technology, workflow and sharing

technology.

2.2.4 KM Process

KM process is a dynamic process of knowledge, also

called knowledge process. In this model knowledge

process includes 5 process: knowledge production,

storage, sharing, use and evaluation. Knowledge

production includes internal knowledge definition,

external knowledge acquisition and knowledge

innovation; Knowledge storage includes intellectual

choice processing, preservation and update;

Knowledge sharing includes two modes the official

channels and informal channels , Knowledge usage

the integration of knowledge flow and business

flow; Knowledge evaluation refers to the

assessment of knowledge quality, timeliness and

effect , and then update knowledge and improve the

application effect .

3 HOTP MODE APPLICATION

Chose Lenovo Group as example.

3.1 Backgroud of KM

Chose Lenovo Group as example.Lenovo Group

began to implement KM in 2003, before which it

implemented ERP system, which was divided three

steps to optimize.

The ERP project proposed in 1997 is an essential

step for Lenovo informatization in 1998, MRP

went live, which marks that Lenovo’s supply chain

automation degree greatly enhanced. On the basis of

business process automation, it realized the

automatic confirmation of Bill of Materiel (BOM),

and establish the relatively perfect production

information system, purchasing information system,

business operation system. In addition, it realized the

first generation of the electronic commerce system -

static information release system.

In May 2000, Lenovo started the second ERP

project stage, the implementation SAP R / 3 system,

which realize business integration and information

sharing, and integrated the original Information

Islands, and realized the butt joint of finance and

business.

The third stage is that, in August 2001, Lenovo

began to implement the SCM project. Through the

SCM project, Lenovo has successfully docked

upstream enterprise and the hundreds of downstream

agents. SCM mainly optimize supply and demand

balance of the upstream and downstream through the

longitudinal control for the products.

Throughout the development path of Lenovo,

Lenovo Group has already successfully implemented

ERP system in the business chain management; in

the other aspects such as Coordination office, human

resources, customer management, file management,

competitive intelligence in the value chain

management, Lenovo also introduct some related

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applications. On this basis, lenovo group transform

knowledge of the enterprise in order to build a

knowledge-based Lenovo, which strengthen its core

competitiveness. Based on knowledge management

maturity model, Lenovo Group in 2003 is in the

awareness stage of Knowledge Management.

The main problem at this stage are: (1) The

knowledge of the various departments are scattered,

which is difficult to form inter-departmental

knowledge sharing; (2) without knowledge

management systems and methods to standardize

knowledge management within the enterprise; (3)

lackness of appropriate organization and the

knowledge management of members, there is no

clearly defined responsibilities to ensure the smooth

progress of knowledge management.

3.2 KM Implementation

For Analysis of Lenovo knowledge management at

4.2, the core idea of the implementation of

knowledge management of Lenovo is to Clear KM

object, Sort out the KM process, establish KM

organization, establish KM post, standard KM

system, assess KM performance as the main content,

expand the knowledge management Project , as

shown in figure 2 (Lenovo Group DB/OL).



Figure 2: Core idea of knowledge management.

3.2.1 KM Objects

KM technology refers to the modern information

technology, which could realize knowledge storage

and transfer. The most important technology

includes: Internet and Intranet, database

management system, document management

technology, groupware technology, data warehouse

and data mining technology and on-line analytical

processing technology, workflow and sharing

technology.

Actionable knowledge management must be the

management of three elements :employees, process

and knowledge ,in the other words, knowledge, staff,

communication, that constitute Lenovo triangle of

knowledge management process.

(1) Staff

Staff are not only the users

、

communicators of

knowledge , but also the creators of knowledge.

Employee's ability to identify problems, expert at

summing up the problem, Willingness to share

knowledge, these are the important work of

knowledge management for Lenovo, especially

under the the influence of intense competitive

pressures and conservative culture, knowledge

sharing is an important part in Lenovo of knowledge

management.

(2) The Communication Process

Knowledge are disseminated in the

communication process, new knowledge is created

in the communication process, Therefore,

knowledge management should pay attention to

create the continuous, smooth communication

mechanism and create equal and harmonious

atmosphere in the communication progress to

promote the creation, dissemination and use of

knowledge .

(3) Knowledge

The knowledge of enterprise include explicit

knowledge and tacit knowledge. explicit knowledge

can be expressed by Symbolic ,it also be quantified.

Lenovo transform explicit knowledge to information

systems for storage, conversion, transmission,

mainly through language, computer information

systems and applications software for the

management of explicit knowledge; tacit knowledge

is from learn and practice of direct experience of

individuals , but also from the contact and exchange

of ideas with people who have experience, such

knowledge " it can be perceived but can’ t be

described with words," that’s difficult to express,

Lenovo achieve this creation and dissemination of

knowledge mainly through team learning.

3.3.2 KM Process

Lenovo implementation of knowledge management

is divided into four phases: pilot demonstration,

knowledge integration, dynamic sharing, knowledge

audit, initially Lenovo took human resources and

customer service as a pilot, then summed up the

problems in process of knowledge management and

find appropriate ways to solve the problems, after

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447

obtaining the fruitful results, Lenovo group

promoted this methods in sales, product

development. Lenovo knowledge management

process is divided into: acquisition and organization

of knowledge, knowledge storing, knowledge

sharing and knowledge innovation.

(1) Acquisition and Organization of Knowledge

Lenovo set up a special department for collection

of information——Marketing Information Service,

telephone hotlines, open mail and home page, the

Information Management department from the head

office and Business Development Department are

together responsible for Planning and processing of

information. Lenovo mainly takes these two ways:

meetings and the use of information management

systems, to disseminate knowledge and information,

meeting is benefit to disseminate knowledge,

exchange experiences, seek unity of thinking, and

implement corporate culture; at the same time,

Lenovo also vigorously promotes the office

automation and development of management of

information systems, it pushes the dissemination and

application of knowledge.

(2) Knowledge Storage

Knowledge storage is that, after selection,

filtration, processing and refining, an organization

stores knowledge in a proper media, and update and

maintain its content and structure at any time, in

favour of the demander obtaining effective

knowledge through convenient and fast access.

Lenovo knowledge management project applied

LKSKM that was based on IBM system, which help

to realize special knowledge portal, and establish

dynamic and organized knowledge base knowledge

storage. In this knowledge base, each knowledge

component and each knowledge product has been

defined the validity, and when it reach the validity,

the system will remind the builder to update the

context, which will contribute to maintain the

knowledge products dynamically. Also, Knowledge

administrator will also timely delete useless, expire

document. In addition, the knowledge component,

which has been uploaded by the staff, must be

audited, and only the valuable knowledge could be

released.

(3) Knowledge Sharing

Knowledge sharing refers to the progress in which

knowledge owners share their knowledge and

innovative thinking with others, and its main form is

the dissemination knowledge, knowledge sharing

through the dissemination of knowledge means that

each employee can make rapid digestion and

absorption of existing knowledge resources to

achieve the rapid growth of personal total

knowledge ,which lay a solid foundation for the

smooth implementation of knowledge management

of enterprise. More process of knowledge

dissemination are complex at the same time, thus

form a complex multi-loop to loop.

Knowledge-sharing approach——team learning.

Team learning. is a prerequisite for Knowledge

sharing .the important aspect of knowledge

management lies in the handling and application of

knowledge, the core issue is whether employees are

willing to exchange their own knowledge with

others in a team, to cause the actual effect of

“1+1>2”. Lenovo Group's new employees must

participate in "into the mold" training, achievements

recorded in personal files, that is important basis for

whether they can be regularization on schedule. Into

an international wave of knowledge management,

especially after the introduction, "into the mold

education " training are improved in many aspects:

on the cultural basis of training and delivery, it woks

for providing effective job skills or professional

training to the employees, while also increasing

interaction, dialogue, exchange with the executive

staff, and from the perspective of staff development

,it adds in more international requirements, so that

"mold" is more responsive to the needs of

development of the company. They not only learn

from their experience, but also have the opportunity

to constructively share their experiences and ideas

with other colleagues ,and get criticisms and

suggestions from other team members, then accept

and implement these recommendations, jointly

review the past behaviour and experience learned.

(4) Knowledge Innovation

Lenovo Group’s development itself is a process of

continuous innovation. They achieve the incremental

innovation of technology, market, management and

system in the process of the creation of the

enterprise. In the respect of technology and market

In the respect of management, they create a sales

system centred in distribution, and an organization

of order-stock and production in safety, and they

implement the division system first in China, etc. In

the respect of system, they establish a new

technology development company, and create a

bonus system for employee, and an Academia Since

based on computer institute of Chinese Academy of

Sciences. The innovative ideas influence every step

of Lenovo Group, so a saying goes in Lenovo like

this, "90% the inheritance, 10% the innovation." It is

the incremental innovation that makes its

achievements .

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3.3.3 KM System

KM technology refers to the modern information

technology, which could realize knowledge storage

and transfer. The most important technology

includes: Internet and Intranet, database

management system, document management

technology, groupware technology, data warehouse

and data mining technology and on-line analytical

processing technology, workflow and sharing

technology.

KM system includes two aspects: on the one hand,

it is the usual management approach, incentive

system and check-up system; on the other hand, it

need the guidance and support from the

organization. The following is a simple instruction

about Lenovo’s KM system.

(1) Incentive system. Lenovo Group have good

incentives to the staff especially the key staff. The

core concept of incentives has two points: ① take

the personal development into the development of

enterprise ② give yourself the stage without a

ceiling. In terms of material incentives, Lenovo

spent a lot of time on the company's equity structure

reform, the implementation of the "Pan-stock

system." Namely makes employee to be the

ownership of the enterprise. Through rewarding key

employees stock options to establish them to

beshareholders, currently staff is holding 35% stake

of the company, their interests and the company are

tied together tightly as a whole, They will take the

personal development into the development of

enterprise. More importantly, each employee will

have no reservations to show up tacit knowledge

such as their knowledge, experience, which played

an important role in the continued development of

Lenovo Group. In the internal Lenovo Group, the

top 10 who uploaded most knowledge items

members would be shown dynamically in the

knowledge management system. They were called

knowledge heroes, and would benefit from it in prize

of the quarterly evaluation. The top 10 people who

learned more than others would also be shown in the

system. One the other hand, these members who did

not upload any knowledge items would be deducted

by certain proportion in the quarter prize.7

(2) Check-up system. after the acquisition with

IBM ,the new Lenovo introduce a new performance

management system - P3 (Priority, Performance,

Pay) targets, performance and bonuses ,in order to

further encourage employees to transfer knowledge,

The new P3 system Continued the original Lenovo

Group’s practice of attention and concern to key

performance indicators and performance

management process KPlS , which ensures close

relativity between bonus and performance,

encourages the team, mutual transfer of their

personal knowledge, and the ability to continuously

exceed goals, and ultimately makes the company

and employees to grow and share revenue.

(3) Responsibility system. Lenovo's approach is

to define knowledge liability table, in which it rule

the intellectual activities template during a process,

and knowledge component on a post, and make it

provisions for employees working content of a

necessary component, and it will force each

employee and department to break original interests

range. For example, supplier purchasing staff must

give all kinds of content about supplier evaluation

index and evaluation process. During reinforced

knowledge management process, the original

knowledge cliques was gradually destroy, and the

corresponding knowledge component transform into

the company's knowledge system.

3.3 Comparative Analysis

In the HOTP model, the human of the knowledge

management includes knowledge worker,

knowledge manager and leader. In Lenovo Group,

the knowledge management department was

established under the support of its president

Chuanzhi Liu, and it was driven by Houqi Zhang,

and it was responsible of the implementation of

knowledge management implementation, definition

of knowledge management process, knowledge

safety and knowledge audit.

In the HOTP model, the organization transform of

knowledge management includes the transform of

organization structure, organization culture and

incentive mechanism. In Lenovo Group, it

established the knowledge management driven by

HouQi Zhang. This department includes about 40

persons, in which there are 8 professionals and the

other co-workers are managers in other departments.

Lenovo Group established dynamic knowledge base,

and the incentive mechanism is that the enterprise

give staff certain material rewards through

quantizing the their knowledge contribution, which

help to promote knowledge sharing and the

construction of learning-style enterprise.

In the HOTP model, knowledge management

technology includes tacit KM technology and

explicit KM technology. The knowledge

management technology in Lenovo Group is

LKSKM based IBM system architecture

development. Before it, Lenovo Group successfully

introduced ERP system, which realize the

ENTERPRISE KNOWLEDGE PRACTICE AND RECOMMENDATION BASED ON HOTP MODEL

449

integration of business flow and cash flow, and the

docking of supply chain.

In HOTP model, knowledge management process

includes 5 process: knowledge production, storage,

sharing, use and evaluation. However, the

knowledge management in Lenovo Group includes

Knowledge acquisition and organization, knowledge

storage, knowledge sharing and knowledge

innovation. The knowledge innovation is included in

knowledge production. Compared with HOTP

model, it lack of knowledge evaluation in Lenovo

Group.

4 CONCLUSIONS

AND RECOMMENDATIONS

Compared with HOTP model and the core idea of

knowledge management in Lenovo Group, the

knowledge management implementation in Lenovo

Group is relatively complete. The implement of

knowledge management in Lenovo Group is based

the ERP project, which has already integrated

business flow and cash flow and ducked the supply

chain. From the perspective of knowledge

management implementation, it is a dynamic,

compositive process

，

which is pushed orderly as a

long-term strategic plan (Chen, 2004). From the

perspective of knowledge management context, it

consider the knowledge management process as the

center, and the other elements, human, organization,

technology actively support the whole process.

According to the analysis in last section, the

disadvantage of knowledge management in Lenovo

Group is that it lack of knowledge management

evaluation mechanism, but incentive mechanism for

promoting knowledge sharing. Actually, according

to HOTP model, enterprise could design

questionnaire from the perspective of human,

organization, technology and process to get the

situation of knowledge management

implementation. In the questionnaire, it could set

muti-level index to quantificationally analyze

knowledge management accurately. Based on the

questionnaire result and the knowledge management

maturity model, it could get the knowledge

management stage at which the enterprise locates.

According to the analysis result, we could conclude

the advantage and disadvantage in the knowledge

management, then make the appropriate decisions.

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