Unilever & Toyota Knowledge Management

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The emergence of the concept of Knowledge Management (KM) in the early 1990s changed the way organizations pursue an understanding of their respective industries to bolster competitiveness. Knowledge management is a field that seeks to promote the development of integrative approaches geared towards the identification, collection, retrieval, and sharing of knowledge assets of a particular organization (Sanchez 2006). Therefore, KM focuses on the ways through which an organization applies the available information within its operating environment to enhance performance in the highly competitive markets.

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The Toyota Motor Company has developed and implemented several KM approaches that have reinforced its competitive edge globally. Notably, the automotive company has seized the opportunities in various emerging markets thanks to its practical KM strategies (Ichijo & Kohlbacher 2008). Today, companies such as Unilever utilize systems that promote efficient knowledge management practices to facilitate the realization of set objectives (Sim, King & Price 2016). The growth of the social media has influenced the KM approaches adopted by organizations as denoted by their increasing online presence (Leonardi, Huysman & Steinfield 2013). As such, this paper analyzes three KM strategies adopted by the Toyota Company. It also assesses the KM practices that Unilever Company uses to boost its success. The article culminates by analyzing the impacts of social media on the KM strategies.

Toyota’s Knowledge Management Approaches

Knowledge management entails the processes that organizations undertake to facilitate the collection, distribution, and application of knowledge effectively to promote competitiveness. Toyota Company has realized remarkable success over the years implying that it uses effective knowledge management approaches. The company has developed strategies that bolster the creation of knowledge globally, making it the largest manufacturer of automotives in recent years. Analyzing the distinctive approaches applied by Toyota to promote the development of knowledge management practices is relevant.

Decentralization of Toyota’s Global Production

Toyota’s move towards the establishment of regional manufacturing plants denoted the company’s evolution from a centralized multinational production network. Global and regional headquarters as well as local affiliates who facilitate the capturing of knowledge at the local level characterize the current network. The affiliations and subsidiaries located in different countries help Toyota to identify, share, and apply relevant knowledge that boosts its competitiveness in emerging markets (Ichijo & Kohlbacher 2008). The regional outlets ensure that the company manufactures automobiles that fulfill the needs of the customers in the new markets. As such, the decentralization approach has proved useful for the company’s market research strategies as it continues to secure a considerable share of the emerging automotive markets.

The strategy has also been integral in fostering the company’s product development. Toyota manufactures an array of automobile models to meet the specific expectations of their customers. Consequently, the knowledge gained through the decentralization of its headquarters has bolstered Toyota’s production capacity thereby, enabling the company to secure the largest manufacturer spot in the globe (Ichijo & Kohlbacher 2008). Tapping tacit knowledge through the efforts of regional affiliates and subsidiaries has been integral in facilitating the capture of knowledge thereby, enabling the company to understand the new markets. The development of new automotive products signifies the positive influence of its contemporary global optimum production network.

The ‘Learn Local, Act Global’ Strategy

Toyota established the ‘learn local, act global’ approach to promote the development of its operations at a local scale before executing it at the international level. In this regard, the automotive player expects its staff to gain profound understanding of the needs of the local populations in different countries where it has established operations (Ichijo & Kohlbacher 2007). An organization boosts its knowledge management practices by engaging in undertakings that promote operational excellence. Thus, Toyota engages in collaborative efforts with foreign affiliates and subsidiaries to identify the needs and expectations of the customers. The efforts facilitate the sharing and application of knowledge required to boost business performance (Li et al. 2005).

The strategy ensures that the automobile manufacturing giant leverages its knowledge at the local and international scales to bolster productivity. Thus, the frontline management approach embraced by the company to acquire knowledge at the local level before applying it at the global platform has been integral in promoting Toyota’s increasing sales in the recent years. The “learn local” approach makes it possible for the company to gain both explicit and tacit knowledge and thus, apply it to boost global performance (Sanchez 2006).

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Moreover, leveraging local and worldwide knowledge fosters the company’s aspects of taxonomy and content management. Toyota values the essence of content accessibility at the local level before its application to promote the efficacy of the company’s operations in different regions (Kohlbacher 2008). An effective KM system ought to arrange, describe, and structure content in its simplest form before applying it to solve complex issues. Therefore, the strategy adopted by Toyota fulfills this requirement resulting in the efficient performance of the automotive company.

Toyota’s Knowledge-based Marketing Strategy

The market dynamics in regions where Toyota operates require the company to employ a knowledge-based approach to improving its competitiveness. The threat of new entrants in the emerging markets stiffens the competition. Thus, for the company to survive, the adoption of KM practices is necessary (Ichijo & Kohlbacher 2007). Importantly, the company considers the pricing aspect of its marketing strategy to meet the purchasing power of customers in emerging market niches. A majority of the customers in the new markets are sensitive to automobile prices. As such, Toyota manages to manufacture affordable vehicles for customers with different purchasing power capabilities (Kohlbacher 2008).

Toyota bases its marketing mix strategies on the knowledge acquired by the several regional headquarters. The marketing mix of the company reveals that it unceasingly seeks to promote the aspects of price, place, product, and promotion in a way that fulfills the market needs and expectations. For this reason, most people can afford Toyota cars (Kohlbacher 2007). Toyota unceasingly expands its market share as denoted by the swelling annual sales over the years.

Moreover, the three KM approaches that the company employs have considerably bolstered its competitiveness. As a result, Toyota Company has widened its operations in different regions thus, securing the leading automobile manufacturing position globally. Furthermore, the approaches ensure that the firm leverages its local and international knowledge bases to strike a balance. The marketing mix methods of Toyota Company promote knowledge acquisition, sharing, and application to enhance its competitive edge in the industry.

Unilever’s Knowledge Management System

Established in 1927, the Unilever Company has its headquarters in both England and Netherlands. The company focuses on the production of home and personal care products as well as food products (Wolf 2013). The company offers more than 400 brands to customers located globally. The knowledge management system adopted by Unilever has accounted for its considerable financial growth in the recent years as denoted by a turnover of €48.4 billion in 2014 (Caligiuri 2014). In this light, it implies that the knowledge management system that the corporation applies plays a considerable role in promoting the realization of set objectives.

Unilever’s Main Objectives

The primary aims of the Unilever Company include increasing its turnover. The company seeks to enlarge its market share amid the competition from rivals including Nestle, Mars Incorporated, and Proctor and Gamble (De Marchi & Grandinetti 2013). The realization of great profits and expansion to overseas markets is also an objective of Unilever. Furthermore, the company has the goal of increasing the value of its share price. These primary business objectives prompted Unilever to adopt a knowledge management system that guides the decision-making processes that the management undertakes.

Unilever concentrates on the main administrative areas that include human resource management, communication management, and innovation. As such, the company applies IT-based knowledge management tools to foster the realization of the identified objectives. They include web-based request for information (RFI), powerful analytical tools, request for proposal (RFP), and electronic discussion groups (Wolf 2013). Thus far, the implementation of the KM system has fostered the company’s success amid an array of challenges. Wolf (2013) posits that it is important to deal with the problems that undermine the successful implementation of the KM system to bolster the company’s performance.

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Implementation Challenges

The integration of the web-based KM system has faced an array of challenges in spite of the numerous efforts geared towards keeping up with technology changes. The significant problems include measuring the acquired and shared knowledge, security, overcoming shared leadership, and determining the residence of the KM system. The managerial and technical difficulties undermine the effectiveness of decision-making processes, thus requiring intervention to bolster the competitiveness of Unilever.

The quantification of the knowledge captured by the web-based KM systems adopted by an organization can undermine the effectiveness of its performance (Hassan 2015). Since the knowledge obtained by Unilever is founded on people’s experiences and relationships, it is hard to measure its influence on the company’s performance. Thus, instead of focusing on the shared objectives, the KM systems can only concentrate on efforts and results.

The KM tools adopted by a given company can lead to leadership struggles due to the different opinions captured and shared by various individuals for the application (Wolf 2013). For instance, the electronic discussion groups can pose threats on the effectiveness of Unilever’s leadership since they offer workers a “voice” that could trigger internal conflicts. Therefore, the leadership conflict issue could undermine Unilever’s growth due to incorporation of the web-based KM tools.

The security of a knowledge management system could also undermine its practical implementation in a company that seeks to widen operations globally. The KM tools such as RFI that Unilever Company applies lack the proper measures required to secure the privacy and safety aspects of information. The company risks leaking sensitive information to rivals. Such a challenge can undermine the authenticity of the knowledge captured, shared, and applied by the company (Shaikh 2013).

Moreover, an organization applying a given KM system could experience the challenge of not knowing the right department to utilize the system thus, undermining the collaborative approaches needed (Schiuma, Carlucci & Sole 2012). For instance, failure to decide on whether to assign the responsibility of managing web-based system to the IT or human resource department could jeopardize the efficiency of Unilever’s knowledge assets.

Success Measures

Unilever’s management can consider the integration of several actions in a bid to foster the successful implementation of KM system. Importantly, the management needs to understand that people facilitate the creation of knowledge through their relationships and experiences (Wolf 2013). Therefore, it should focus on nurturing relationships and experiences that improve knowledge creation, learning, and sharing instead of concentrating on the knowledge management instruments. Unilever needs to merge its web-based and socialization apparatus in a way that improves relationships and experiences through the use of technology.

In this regard, Unilever can measure knowledge by capturing positive sentiments of the staff and customers towards the company’s processes as well as the value of products it offers (Hassan 2015). For example, the managers can quantify the knowledge obtained, shared, and applied by assessing the positive feedback the global customers give.

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Furthermore, using active socialization processes to share knowledge is essential for curtailing leadership wrangles that might emerge from an organization’s knowledge management system (Hassan 2015). For example, guaranteeing healthy relationships between leaders and followers is vital. It would enable managers to encourage teamwork amid employees. Additionally, doing so would ensure that the individuals involved enjoy the experiences and relationships they establish.

The need to uphold the essence of ethical conduct in an organization is critical for the reinforcement of knowledge management system, especially its security feature (Wolf 2013). For instance, creating a culture that upholds moral values can curtail the exposure of sensitive information while using KM tools such as RFI. Guaranteeing the security of information is crucial for improving the performance of a KM system since the relationships and experiences of interested participants matter.

Moreover, the collaborative approach towards the implementation of a KM system across the departments is crucial for enhancing performance (Kaur 2013). Unilever can apply the KM system in different departments including IT and HR in a way that collects data mutually before sharing it for use in various decision-making processes that seek the realization of the company’s primary objectives.

Influence of Social Media on Knowledge Management

The different social media platforms including Facebook, Instagram, and Twitter have altered the traditional approach to knowledge management applied by organizations in the contemporary settings. The new social knowledge management approach involves the online platforms to facilitate the identification, capture, and dissemination of information essential for bolstering the growth of an organization. Today, organizations have social media accounts such as Facebook and LinkedIn to promote private sharing of knowledge and learning. Besides, they obtain, share, and apply knowledge acquired externally by interacting with customers via social media.

The social media has transformed the way companies collaborate with the aim of generating valuable knowledge. Nowadays, organizations focus on the establishment of effective intranets that integrate the various social media networks not only for collaborative purposes but also promotion of knowledge development and management (Aral, Dellarocas & Godes 2013). The knowledge management systems that leverage the social media focus on knowledge sharing, innovation management, social learning, social tagging, comments, and ratings. Additionally, the social media platforms facilitate the implementation of effective knowledge management approaches by streamlining the aspects of information administration, communication, and identity and network control. Therefore, the adoption of social knowledge management via the different social media podia has improved the decision-making processes of many companies.

Currently, an array of organizations uses social media analytics to generate knowledge regarding the behavior, needs, and expectations of customers. The social media analytics help businesses to gather information from the different platforms and blogs before making sound decisions (Chua & Banerjee 2013). The software incorporated in the various social media podia facilitates the capture of crucial information about the market dynamics like changes in customer behaviors and industrial trends (Parent, Roy & St-Jacques 2007). Primarily, social media analytics target the capture of sentiments of clients for the sake of promoting marketing and boosting customer relations management. For this reason, several companies integrate the analytics software in their different social media platforms to cut customer service costs, bolster revenues, capture clients’ feedback, and enhance the public’s opinion regarding a particular product or service (Tortoriello, Reagans & McEvily 2012).

The social media obtains knowledge before making it considerably iterative. In this regard, it facilitates the transformation of knowledge into a social object, thus fostering the identification of tacit knowledge required to influence decision-making processes (Aral, Dellarocas & Godes 2013). Organizations can collect data via social media platforms. It would facilitate the timely capture of information before sharing it for application in various contexts. Additionally, businesses can categorize the information they require to collect by using key words to invoke discussions regarding the products or services that they offer to customers. Thus, keeping track of the Facebook posts or tweets on a particular issue places an organization in a convenient position to understand the needs of its clients as well as the changes in the market (Majchrzak et al. 2013).

Reference List

Aral, S, Dellarocas, C & Godes, D 2013, ‘Introduction to the special issue social media and business transformation: a framework for research’, Information Systems Research, vol. 24, no. 1, pp. 3-13.

Caligiuri, P 2014, ‘Many moving parts: Factors influencing the effectiveness of HRM practices designed to improve knowledge transfer within MNCs’, Journal of International Business Studies, vol. 45, no. 1, pp. 63-72.

Chua, A & Banerjee, S 2013, ‘Customer knowledge management via social media: the case of Starbucks’, Journal of Knowledge Management, vol. 17, no. 2, pp. 237-249.

De Marchi, V & Grandinetti, R 2013, ‘Knowledge strategies for environmental innovations: the case of Italian manufacturing firms’, Journal of Knowledge Management, vol. 17, no. 4, pp. 569-582.

Hassan, M 2015, ‘Marketing analysis of Unilever’, Total Quality Management, vol. 11, no. 1, pp. 13-24.

Ichijo, K & Kohlbacher, F 2007, ‘The Toyota way of global knowledge creation the ‘learn local, act global’ strategy’, International Journal of Automotive Technology and Management, vol. 7, no. 3, pp. 116-134.

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Kaur, M 2013, ‘Rural marketing: a case study on Hindustan Unilever Limited’, International Journal of Applied Research and Studies, vol. 2, no. 6, pp. 1-14.

Kohlbacher, F 2007, International marketing in the network economy: a knowledge-based approach, Palgrave Macmillan, London.

Kohlbacher, F 2008, ‘Knowledge-based marketing: building and sustaining competitive advantage through knowledge co-creation’, International Journal of Management and Decision Making, vol. 9, no. 6, pp. 617-645.

Leonardi, P, Huysman, M & Steinfield, C 2013, ‘Enterprise social media: definition, history, and prospects for the study of social technologies in organizations’, Journal of Computer‐Mediated Communication, vol. 19, no. 1, pp. 1-19.

Li, L, Tang, W, Fang, M & Yang, Y 2005, ‘Knowledge-based platform for collaborative innovation development of products’, Journal of Shanghai University, vol. 9, no. 1, pp. 68-73.

Majchrzak, A, Faraj, S, Kane, G & Azad, B 2013, ‘The contradictory influence of social media affordances on online communal knowledge sharing’, Journal of Computer‐Mediated Communication, vol. 19, no. 1, pp. 38-55.

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Schiuma, G, Carlucci, D & Sole, F 2012, ‘Applying a systems thinking framework to assess knowledge assets dynamics for business performance improvement’, Expert Systems with Applications, vol. 39, no. 9, pp. 8044-8050.

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Wolf, S 2013, Unilever case study, GRIN Verlag, Munich, Germany.

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