Abstract: Knowledge is a valuable asset as it brings success and sustainability to the organizations. Till recently, the value of an organization is determined from its financial statements. These statements are historical in nature and contain the book value of physical assets, hence do not depict the true worth of an organization. The future revenue/profit from the organization depends upon its capability to make best use of its assets. This depends on the quality of knowledge an organization possess and its capability to use that knowledge asset. Therefore, knowledge is the most important asset in an organization. However there is no financial statement or business document that shows the volume and value of knowledge present in the organization. Hence, it is critical to determine the value of knowledge to ascertain true worth of an organization.
This research study attempts to present factors that influence the value of knowledge during its life cycle. Data were collected through interviews and questionnaire instrument was used to get subsequent data from 521 business managers working in various industries. The collected data was subjected to various statistical tools to evaluate the factors and their hypothesis. The twenty two factors identified initially were first analyzed for their verification and authenticity. Later each item was regrouped through the Rotated Component Matrix analysis – first order for meaningful set of factors. Based on the result of second order Rotated Component Matrix analysis, all the newly identified factors were finally grouped into two groups of factors that influences the value of knowledge. These groups were: ‘Efforts’ and ‘Business’. The integration of ‘Efforts’ and ‘Business’ factors forms the Knowledge Value Wheel (KVW) that helps in defining the “Knowledge Value Line” (KVL). The KVL depicts the value of knowledge at any given time. The KVL and KVW combines to form the “Knowledge Value Life Cycle” (KVLC).
The findings will help further research in the area of knowledge management. Managers would be able to differentiate most valuable and useful knowledge asset for effective management. Need for further R&D on critical knowledge can be identified. It would also be beneficial to the investors in determining the true worth of an organization in terms of its knowledge asset.
Keywords: Knowledge Management, Value of Knowledge, Knowledge Lifecycle, Knowledge Value Line, Knowledge Value Wheel, Knowledge Value Lifecycle.