Disconnect between Expenditures, Organizational Performance and Human Capital

Disconnect between Expenditures, Organizational Performance and Human Capital

By Robin Trehan, B.A, MIB, MBA electronic business

The confusion between knowledge and information has caused companies to spend billions of dollars in information technology investments that have often led to poor results. The disconnection between IT expenditures and the firm’s organizational performance could be attributed to the fact that we face obvious transition of competitive advantage based on information to one based on knowledge creation. Most of the knowledge management projects fail because crucial mistakes are often made on the stage of the design, development and implementation of knowledge management strategies and solutions. Usually these solutions are focusing on technology and information, whereas knowledge processes are primarily social, humane.

Only, human beings can take the central role in knowledge creation. The computers, information management tools, IT infrastructure are mere tools, in the hands of human beings who give knowledge to the information generated by information technology highway.

The disconnect between IT expenditures and the firm’s organizational performance could be attributed to an economic transition from an era of competitive advantage based on information where everything was controlled by formal procedures to one based on knowledge creation where everything is static and dynamic. That knowledge should not be just information and not just data. It is the derivation for knowledge and data. Knowledge and information will define human experience.