Culture in Emerging Market

 “At the strategic level the organization needs to be able to analyze and plan its’ business in terms of the knowledge it currently has and the knowledge it needs for future business processes.” (Civi, 2000). The only sustainable advantage of a business is what the people know and how they work with it. The most critical knowledge is that which is tacit in nature and cannot be transferred through means of communication. Tacit knowledge is extremely unique, and difficult to formalize (Hamel, 1991). The tacit nature of knowledge creates difficulty in sharing the company’s competitive strategy. It further supplements Civi’s statement that knowledge is essential for future business processes. Based on this, it can be concluded that knowledge is the most crucial resource a company can own.

 The Resource Based View [RBV] of the firm complements strategy, and is a determinant of competitive advantage (Porter, 1979). RBV assumes that a business is a combination of resources which are heterogeneously disseminated. It has been theorised that when businesses own resources which are valuable, rare, inimitable and non-substitutable, they can attain competitive advantage through applying fresh value creating strategies which cannot be easily replicated by competiton (Barney, 1991).

As a resource, knowledge is generally thought to have multiple dimensions to it, and is an crucial initiating point for the representation of knowledge within firms, and their general functional use of KM (McAdam & McCreedy, 1999). The conclusive objective of KM is certainly its’ ‘use’, where ‘use’ is the gained value for the consumer and is easily traceable to innovation (Wilkinson & Wilmott, 1994).

KM within the company has grown exponentially in the twenty years with the development of the information age (Spender & Grant, 1996). In the past, attention to upgrading processes within areas like finance, human resource and marketing, there was however absence of optimization among these disciplines. KM put forth an idea that allowed these multiple disciplines to achieve a more cohesive unity. This incorporation of disciplines leads to further optimization of the processes by producing more commonalities and ultimately leading to dismissal of useless processes (Rahimli, 2012).

Introduction of KM has led to the ability to recognize commonalities within firm’s knowledge development tracks (Teece, 1988). This initiated the use of knowledge by staff other than higher management which would lead to improvement of business processes and generation of better results. This is an excellent form of KM, however, it is not very unique and actually quite underdeveloped. Identification and storage of these similarities somewhere central for future use and reference called ‘knowledge creation’ (Nonaka, A Dynamic Theory of Organizational Knowledge Creation, 1994). The major issue with focusing only on recognizing the similarities is that knowledge is generated, nothing further is done with it. Maximization of the use of knowledge would only come from further its development and retention (Menzies, 1999). Furthermore - probably the most important - knowledge should be transferred.

Retention of knowledge is desired, but it will only be effective if the employees properly understand the reasons behind all the tasks performed. Business processes can be made better and improved if the employees are able to comprehend concepts and practices completely.

Another major aspect of KM is the presence of two types of knowledge, namely explicit  and tacit knowledge. The former is the type of knowledge that can be easily articulated, stored, codified and transferred (Nonaka & Takeuchi, 1995). Latter, on the other hand is abstract and cannot easily be conveyed making its transfer much harder (Polanyi, 1966). Tacit knowledge can only be transferred through active participation. Among the two, tacit knowledge is more important in regard to KM and competitive advantage as the abstractness of the knowledge and information makes it significant to different things rather than a particular thing that explicit knowledge could describe. Tacit knowledge is also the basis for further developing knowledge in-house.

The corporate universities gained importance in late 80’s throughout the world and is supported by large and successful industrial houses. Both are successful “because they focused so exclusively and aggressively on the human resource needs of their own companies and industries” (Guthrie, 2013, p. 2) According to (Allen, 2002), “A corporate university is any educational entity that is a strategic tool designed to assist its parent organization in achieving its goals by conducting activities that foster individual and organizational learning and knowledge.”

Some of the most common reasons for establishment of Corporate Universities are:

1. Promotion of organizational learning

The organizational learning is promoted to a greater extent by these corporate universities. With the help of standard learning code and practices adopted the organizational learning is promoted (Gardner H., 2006).

1. Reduction in the cost of recruitment and other functions of HRRM

Corporate universities train and develop the student to perform according to the needs of organization. These universities mold the students into the desired form of employees through training and into a focus group according to the future needs of organization. This, thus reduces the cost of selection, recruitment, training and other HRM functions. (Towers B., 2000)

1. Increasing flexibility and adaptability of potential employees

Corporate universities create an environment where integrated skills of students are highly developed. The course curriculum and the designing of the methodologies is competitively designed so as to increase the adaptability of employees. Proper training facilities and upgraded methodologies have resulted into increased potential and adaptability of employees (Thompson et al., 2006). 

1. Strengthening of goodwill and creation of win-win situation

Corporate universities play a major role in creating a win-win situation between both the company and the students. Strategic mission and the major objectives of the companies get fulfilled and the skills and technical standard of students and prospective employees get upgraded.

1. Branding benefits from corporate universities 

Corporate universities successfully market the brand of its parent company hence offering unique branding advantage. The free advertisement-on published-sources, collaborative learning programs from other colleges and institutes results into a strong brand presence. Its alliance with the universities and colleges makes it important from the perspective of organization (Grenzer J.W., 2006).

1. Improved HR Efficiency and decreased turnover 

Employees can be expected to stay with the company until their financial, developmental and other specific needs are fulfilled. Through programmes offered at corporate universities, students are provided with such integrated growth and development opportunities. Corporate universities incorporate certified developmental programmes in their training and provide opportunities to grow and learn with certain progessand advancement in career and the parent company (Jarvis P., 2012).This career oriented personal and professional development increases both job and personal satisfaction and develops as a result of which the HR efficiency and also employee commitment increases leading to decrease in employee turnover.