Diffusing knowledge-based core competencies for leveraging innovation strategies: modelling outsourcing to knowledge process organizations (KPOs) in pharmaceutical networks

As pharmaceutical firms try to market their products and reduce costs, vertically integrated structureshamper innovation processes. Yet, pharmaceutical firms must innovate to compete. Outsourcing knowledgeintensive activities to knowledge process organizations (KPOs) serves to reduce innovation process obstacles.Grounded in diffusion theory and strategic management literature, this conceptual paper explores fourinterrelated strategic concepts: core competencies, economies of scale and scope, knowledge sharing,and learning. This paper claims that (a) accumulated core competencies of multinational pharmaceuticalcompanies (MPCs) erode over time and these companies become dependent on KPOs (b) MPCs mustunderstand how KPOs manage core competencies (c) economies of scope benefit KPOs enabling them tosustain competitive advantages for their MPC partners, meanwhile the benefits from economies of both scaleand scope shift from MPCs to KPOs (d) KPOs need to monitor their rate of learning to remain competitive.The paper identifies implications for industrial managers and directions for future research.

KBRE: a framework for knowledge-based requirements engineering

Detecting inconsistencies is a critical part of requirements engineering (RE) and has been a topic of interest for several decades. Domain knowledge and semantics of requirements not only play important roles in elaborating requirements but are also a crucial way to detect conflicts among them. In this paper, we present a novel knowledge-based RE framework (KBRE) in which domain knowledge and semantics of requirements are central to elaboration, structuring, and management of captured requirements. Moreover, we also show how they facilitate the identification of requirements inconsistencies and other-related problems. In our KBRE model, description logic (DL) is used as the fundamental logical system for requirements analysis and reasoning. In addition, the application of DL in the form of Manchester OWL Syntax brings simplicity to the formalization of requirements while preserving sufficient expressive power. A tool has been developed and applied to an industrial use case to validate our approach.

The tax treatment of employee stock options : generous to a fault

In the 2000 budgets, both the federal and Ontario governments introduced changes to the tax treatment of employee stock options for the explicit purpose of making their tax treatment in Canada similar to or more favourable than that in the United States. The federal budget added a deferral, similar to that currently applicable to options granted by Canadian-controlled private corporations, for up to $100,000 per year of public company stock options. The Ontario budget introduced an exemption from tax for employees involved in research and development on the first $100,000 per year of employee benefits arising on the exercise of qualified stock options or on eligible capital gains arising from the sale of shares acquired by the exercise of eligible stock options. These proposals reflect the apparent acceptance by the two governments that there is a “brain drain” from Canada to the United States of knowledge workers in the “new” economy and that reductions in Canadian taxes should stem this drain. In the author’s view, the tax treatment of employee stock options, even without these changes, is overly generous. Both the federal and provincial proposals ignore the fact that most employee stock options are taxed more favourably in Canada than in the United States in any event. In particular, most employee stock option benefits in Canada are taxed at capital gains tax rates, whereas in the United States most are taxed at full rates. While the US Internal Revenue Code does provide capital gains tax treatment for certain employee stock option benefits, a number of preconditions must be met. Most important, the shares acquired pursuant to the options must be held for a minimum of one year after the option is exercised. In addition, there are monetary limits on the amount of options that qualify for capital gains treatment. In Canada, there are generally no holding period requirements or monetary limits that apply in order for the option holder to benefit from capital gains tax rates. Empirical evidence indicates that the vast majority of employees in the United States exercise their options and immediately sell the shares acquired. These “cashless exercises” do not benefit from capital gains treatment in the United States, whereas similar cashless exercises in Canada generally do. This empirical evidence suggests not only that the 2000 budget proposals are unwarranted, but also that the existing treatment of employee stock options in Canada is already more generous than that in the United States. This article begins with a theoretical “benchmark” for the taxation of employee stock options. The author suggests that employee stock options should be treated in the same manner as other income from employment. In theory, the value of the benefit should be included in income when the option is granted or vests. However, owing to the practical difficulty of valuing employee stock options, the theoretical benchmark proposed is that the value of the benefit (the difference between the fair market value of the shares acquired and the strike price under the option) be taxed when the shares are acquired, and the employer be entitled to a corresponding deduction. The employee stock option rules in Canada and the United States are then compared and contrasted with each other and the benchmark treatment. The article then examines the arguments that have been made for favourable treatment of employee stock options. Included in this critique is a review of the recent empirical work on the Canadian brain drain. Empirical studies suggest that the brain drain—if it exists at all—is small and that, despite what many newspapers and right-wing think-tanks would have us believe, lower taxes in the United States are not the cause. One study, concluding that taxes do have an effect on migration, suggests that even if Canada adopted a tax system identical to that in the United States, the brain drain would be reduced by a mere 10 percent. Indeed, even if Canada eliminated income tax altogether, it would not stop the brain drain. If governments here want to spend money in order to stem the brain drain, they should focus on other areas. For example, Canada produces fewer university graduates in the fields of mathematics, sciences, and engineering than any other G7 country except Italy. The short supply of university graduates in these fields, the apparent loss of top-calibre academics to US
universities, and the consequent lower levels of university research in these areas (an important spawning ground for new ideas in the “new” knowledge-based economy) suggest that Canada may be better served by devoting more resources to its university institutions, particularly in post-graduate programs, rather than continuing the current trend of budget cuts that universities have endured and may further endure if taxes are reduced.
As far as employee stock options are concerned, if Canada does want to look to the United States for guidance on tax reform (which it seems to do with increasing frequency of late), it should adopt the US rules applicable to nonstatutory options, which are close to the proposed benchmark treatment. In the absence of preferential tax treatment, employee stock options would still be included in compensation packages provided that there were sound business reasons for their use. No persuasive evidence has been put forward that the use of stock options, in the absence of tax incentives, is suboptimal. Indeed, the US experience suggests quite the opposite.

Virtual communities of practice for regional small businesses: bringing informal networks online

Virtual communities of practice (VCoPs) are online business networks which are increasingly used by large organisations as a key strategy for creating value in the knowledge-based economy of the 21st Century.This paper examines the applicability of VCoPs to cross-industry regionally clustered small business networks. Interviews conducted with government and industry informants in two regional areas of Australia indicate that these strategies used for establishing VCoPs are applicable to such small business networks. Both regions had regional networks with active member involvement displaying CoP characteristics. Significant social capital existed on which VCoPs could be built, and there were viable alternatives to satisfy the roles of sponsors and leaders. There were, however, significant impediments that will have to be addressed before VCoPs can be  implemented such as the apparent reluctance of many SME owners to use the Internet and ICT generally, and the preference for informal networking. Funding to ensure that VCoPs are sustainable was also an issue. VCoPs appear to be extremely useful in linking small businesses in regional areas and in the development of viable regional clusters.

A new roadmap to life: media, culture, and modernity in the United Arab Emirates

Critical to the vision of a new United Arab Emirates is an educated, skilled workforce that fuels the intelligent growth needed in a knowledge-based economy. As the country begins developing its version of that economy, the mediated, transparent environment fundamental to this process will carry with it new visions of (and possibilities for) living life. If peaceful change is to be achieved, a transitional generation faces the conundrum of adapting the best that modernity can offer while retaining the best of tradition. As have others, this study suggests two things: that (1) media literacy, growing in part from education, is correlated with urbanization and a changing infrastructure, and that (2) media in all its forms is inseparable from the outcome of this drive to modernization.

Bachelor of learning management initiatives : preferred and actual futures

It is argued in this chapter that we live in the knowledge economy, a term coined by the Organisation for Economic Co-Operation and Development in a report entitled The Knowledge Based Economy (1996). According to this report, the economy has become a hierarchy of networks fuelled by the rapid rate of change in all aspects of life, including learning, which in turn has compressed the world, encouraging the merging of the world's economic and cultural systems. Contemporary economic and social contexts coupled with competing perspectives on the "future" place significant demands upon educators and educational leaders who are increasingly expected to act in futures-oriented ways whilst also remaining true to the professional standards of their present environments (Faculty of Education and Creative Arts, 2003). In response to these issues and internal organisational reviews of Central Queensland University, the revision and renewal of a number of degrees currently being offered by the Faculty of Arts, Humanities and Education have become increasingly necessary. The Bachelor of Learning Management (BLM) is one program that is claimed to be a new and innovative pre-service teaching degree. This chapter explores a project that was undertaken to investigate current student perceptions of the extent to which the BLM has met these claims. Of particular interest was, firstly, student satisfaction with and achievement in the degree and, secondly, the extent to which the BLM has managed to broker the change needed to deliver the required client outcomes. [ABSTRACT FROM AUTHOR]

Toward successful knowledge transfer in web-based self-service for information technology services

Web-based self-service has emerged as an important strategy for providing pre- and post-sales customer support. Yet, there is a dearth of theoretical or empirical research concerning the organisational, customer-oriented, knowledge-based, and employee-oriented factors that enable web-based self-service systems (WSS) to be successful in a competitive global marketplace. In this paper, we describe and discuss findings from the first phase of a multi-method research study designed to address this literature gap. This study explores critical success factors (CSFs) involved in the transfer of support-oriented knowledge from an information technology (IT) services firm to commercial customers when WSS are employed. Empirical data collected in a CSF study of a large multinational IT services business are used to identify twenty-six critical success factors. The findings indicate that best-in-class IT service providers are aware of a range of critical success factors in the transfer to commercial customers of resolutions and other support-oriented knowledge via WSS. However, such firms remain less certain about what is needed to support customer companies after support-oriented knowledge has initially been transferred to the customer firm.

A possible journey to an Australian knowledge management framework

World wide there is a transition towards knowledge-based economies In order to foster them, many economies have built frameworks in conjunction with world forums that promote international cooperation. Our research focuses on Australia, an economy that has been named by the OECD as knowledge-based. Specifically, the paper appraises the transition towards knowledge economies in general. We then examine the Australian context through the implemented eEurope framework with the intent of providing suggestions to Australia in its transition towards building its knowledge management
framework.

Enhancing Knowledge Sharing with Information and Communication Technology (ICT)

The acceleration of technological change and trade liberalization in the 1990s have significantly intensified market competition and transformed the world economic infrastructure from a resource- and manufacturing-based economy to one in which knowledge and services are the key drivers of economic growth. In order for an organization to capitalize on its knowledge and truly become a learning organization, it must begin to systematically manage and leverage knowledge existing internally and externally to create and sustain its competitive advantage. Numerous empirical studies on knowledge management have examined the relative effectiveness of various enablers, such as organizational structure, technology, culture, managerial system and strategy on knowledge creation and sharing in organizations. The enablers examined earlier are mostly related to organizational infrastructure that promotes knowledge sharing in organizations. This paper examines specifically the critical role of information and communication technology (ICT) in facilitating and enhancing knowledge sharing and organizational performance. This study adopted a process oriented approach by using Nonaka’s (1994) knowledge sharing model. The results indicate that significant positive effects of ICT support on knowledge sharing and all dimensions of knowledge sharing are significant predictors of organizational performance.

New Zealand and its competitors in the knowledge economy

In the US, Australia, the United Kingdom, Canada, Finland, Ireland and other countries, the growth of the Internet and other related new technologies have become the catalyst for the creation of ‘knowledge economies’. The new information and communication technologies have created global markets for goods and services. Countries that have encouraged their people through education and life-long learning and by investing heavily in research and development (R&D) are well positioned to take advantage of these new global markets. Along with globalisation has come the death of distance. Thanks to the Internet, New Zealand is no longer remote from the rest of the world.

But New Zealand’s economy is still too dependent on producing commodities for export. While efforts over the last fifteen years to diversify markets have been very successful, we still need to expand our limited range of products. We must take the next important step and transform New Zealand from a pastoral economy into a knowledge-driven economy. For New Zealand, the Internet is the modern equivalent of the freezer ship that revolutionised our economy last century. If New Zealanders do not seize the opportunities provided by the knowledge economy, we will survive only as an amusement park and holiday land for the citizens of more successful developed economies.

This article puts New Zealand into world perspective by assessing its knowledge economy benchmarks against its competitors. It outlines the theoretical background to ‘‘new growth theory'' and delineates the lessons of that theory, especially for New Zealand. It treats the key issues for New Zealand’s emergence as a knowledge economy, including education, the M ori dimension, immigration, research and development, venture capital, export policy and telecommunications regulation.

Computer-aided design decision support: interfacing knowledge and information

Computer-aided design decision support has proved to be an elusive and intangible project for many researchers as they seek to encapsulate information and knowledge-based systems as useful multifunctional data structures. Definitions of ‘knowledge', ‘information', ‘facts', and ‘data' become semantic footballs in the struggle to identify what designers actually do, and what level of support would suit them best, and how that support might be offered. The Construction Primer is a database-drivable interactive multimedia environment that provides readily updated access to many levels of information aimed to suit students and practitioners alike. This is hardly a novelty in itself. The innovative interface and metadata structures, however, combine with the willingness of national building control legislators, standards authorities, materials producers, building research organisations, and specification services to make the Construction Primer a versatile design decision support vehicle. It is both compatible with most working methodologies while remaining reasonably future-proof. This paper describes the structure of the project and highlights the importance of sound planning and strict adhesion to library-standard metadata protocols as a means to avoid the support becoming too specific or too paradigmatic.

Educating for professional capability in the field of information technology: integrating industry-based learning with the academic curriculum

In response to the forces of globalisation, societies and organisations have had to adapt and even proactively transform themselves. Universities, as knowledge-based organisations, have recognised that there are now many other important sites of knowledge construction and use. The apparent monopoly over valued forms of knowledge making and knowledge certification is disappearing. Universities have had to recognise the value of practical working knowledge developed in workplace settings beyond university domains, and promote the value of academic forms of knowledge making to the practical concerns of everyday learning. It is within this broader systems view that professional curriculum development undertaken by universities needs to be examined.

University educational planning responds to these external forces in ways that are drawing together formal academic capability/competence and practice-based capability/competence. Both forms of academic and practice-based knowledge and knowing are being equally valued and related one to the other. University planning in turn gives impetus to the development of new forms of professional education curricula. This paper presents a contemporary case of a designed professional curriculum in the field of information technology that situates workplace learning as a central element in the education of Information Technology (IT)/Information Systems (IS) professionals.

The key dimensions of the learning environment of Deakin University’s BIT (Hons) program are considered with a view to identifying areas of strong integration between the worlds of academic and workplace learning from the perspectives of major stakeholders. The dynamic interplay between forms of theorising and practising is seen as critical in educating students for professional capability in their chosen field. From this analysis, an applied research agenda, relating to desired forms of professional learning in higher education, is outlined, with specific reference to the information and communication technology professions.

Managing design knowledge with mixed-initiative dialogue

This paper is based on ongoing work in developing interactive interfaces to formal methods for encoding design knowledge. It reports on the development of a shared graphical notation to support user interaction with design knowledge based on mixed-initiative. Mixed-initiative provides a model of interaction where both the designer and the knowledge formalism may share responsibility over decisions. The paper discusses how a formal visual notation can support the mixed-initiative mode for developing and managing formal design knowledge. The notation addresses on the dialogue problem between the user and a knowledge based formalism and illustrates a model of interaction in which the user and the formalism can share and input data through a common shared resource, on a common shared task. The paper demonstrates the use of this notation in common decision tasks and the implications for seamless interaction with design support systems.

Toward a synergy between simulation and knowledge management for business intelligence

The adoption of simulation as a powerful enabling method for knowledge management is hampered by the relatively high cost of model construction and maintenance. A two-step procedure, based on a divide and conquer strategy, is proposed in this paper. First, a simulation program is partitioned based on a reinterpretation of the model-view-controller architecture. Individual parts are then connected, in terms of abstraction, to guard against possible changes that resulted from shifting user requirements. We explore the applicability of these design principles through a detailed discussion of an industry case study. The knowledge-based perspective guides the design of architecture to accommodate the need of emulation without compromising the integrity of the simulation program. The synergy between simulation and a knowledge management perspective, as shown in the case study, has the potential to achieve the objectives of rapid development of models, with low maintenance cost. This could, in turn, facilitate an extension of the use of simulation in the knowledge management domain.

Towards a knowledge perspective in information security risk assessments - an illustrative case study

Many methodologies exist to assess the security risks associated with unauthorized leakage, modification and interruption of information for a given organisation. We argue that the traditional orientation of these methodologies, towards the identification and assessment of technical information assets, obscures key risks associated with the cultivation and deployment of organisational knowledge. Our argument is developed through an illustrative case study in which a well-documented methodology is applied to a complex data back-up process. This process is seen to depend, in subtle and often informal ways, on knowledge to sustain operational complexity, handle exceptions and make frequent interventions. Although typical information security methodologies identify people as critical assets, we suggest a new approach might draw on more detailed accounts of individual knowledge, collective knowledge, and their relationship to organisational processes. Drawing on the knowledge management literature, we suggest mechanisms to incorporate these knowledge-based considerations into the scope of information security risk methodologies.