The knowledge economy as a factor for enterprise development in management system

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The knowledge economy as a factor for enterprise development in management system

Svitlana Khaminich, D. Sc.in Economics, Professor

(Dnipropetrovsk State University of Internal Affairs), Ukraine

Krystyna Heti, Ph.D., Associate Professor, (Industrial

Engineering and Management Research School), Sweden

Abstract

The article describes the basic concepts of the economy of knowledge, its importance and features. A discussion is made about the role of the economy of knowledge in the management system and recommendations for the use of knowledge in the management of the enterprise. An analysis of the part of knowledge in the management of the enterprise has been carried out, including the main approaches to the management of knowledge and methods of its development. In the concluding part of the article, the study's results are presented, including an inventory of the methodology, which is helpful in analyzing the data and interpreting the results. The main hypothesis, translated into this article, is that the effective use of knowledge in the management of enterprises is a key factor in achieving competitive advantages and success in the modern economy.

The article is relevant regarding the development of technologies and the ability to compete in the market. To support and provide a foundation for recommendations for enhancing knowledge management procedures in businesses, a study has been conducted to better understand the role of the knowledge economy in enterprise management, which is the key factor affecting the efficacy of the use of knowledge. The results of this research can be used as a basis for the business of enterprises, as well as for the beneficiaries of the effective use of knowledge in their activities, as well as for the researchers, who deal with the topic of the economy of knowledge and their role in the modern economy, and also for the faculties in the field of knowledge management, as well as for the development of strategies for managing knowledge in companies.

Keywords: economy of knowledge, enterprise, company, management, competitive transport, business environment.

Світлана Хамініч, Кристина Геті

Економіка знань як фактор розвитку підприємства в системі управління

Анотація

У статті розглянуто основні поняття економіки знань, її джерела та особливості. Проведено аналіз ролі знань в управлінні підприємством, включаючи основні підходи до управління знаннями та методи їх вимірювання. У заключній частині статті представлені результати дослідження, включаючи опис методології, використаної для аналізу даних та інтерпретації результатів. Основні гіпотези, перевірені в даній статті, полягають в тому, що ефективне використання знань в управлінні підприємствами є ключовим фактором досягнення конкурентних переваг і успіху в сучасній економіці. Обґрунтовано висновки про роль економіки знань у системі управління та запропоновано рекомендації щодо використання знань в управлінні підприємством.

Дана стаття актуальна в умовах стрімкого розвитку технологій і посилення конкуренції на ринку. Проведене дослідження дозволить глибше зрозуміти роль економіки знань в управлінні підприємством, визначити ключові аспекти, що впливають на ефективність використання знань, запропонувати та обґрунтувати рекомендації щодо вдосконалення процесів управління знаннями в компаніях. Результати даного дослідження можуть бути корисними як для керівників підприємств, які зацікавлені в ефективному використанні знань у своїй діяльності, так і для дослідників, що займаються темою економіки знань та її ролі в сучасній економіці, а також для фахівців у сфері управління знаннями, які займаються розробкою стратегій управління знаннями в компаніях.

Ключові слова: економіка знань, підприємство, компанія, управління, конкурентні переваги, бізнес-середовище.

Introduction

In the context of the modern economy, characterized by rapid technological advancements and high levels of competition, companies must rapidly adapt to new conditions, adopt new technologies, and utilize their experience and knowledge to achieve competitive advantages. The efficient utilization of intangible components, some of which are unique in nature, such as knowledge and worker knowledge, professional qualifications, and education, leads to markets and enterprise management. The capacity to effectively use knowledge and information in their activities is one of the major factors that enable businesses to prosper in highly competitive situations.

The concept of a knowledge-based economy, which assumes that knowledge has become the primary resource of the economy, is gaining increasing prevalence in the modern world. The knowledge-based economy posits that companies that can create, disseminate, and utilize knowledge more effectively have higher levels of competitiveness and are better adapted to changes in the business environment.

The knowledge-based economy's basic tenet is that knowledge is a vital resource that can be utilized to forge competitive advantages and boost organizational effectiveness in the modern economy. The knowledge-based economy also considers the processes used for knowledge creation, transfer, archiving, and utilization within businesses.

Analysis of recent research and publications

The theoretical basis for the study of the knowledge economy from different points of view was the works of domestic and foreign scientists, such as V. Heyets, P. Drucker, O. Dyakiv, M. Zgurovsky, A. Zharinova, A. Kolot, F. Makhloup, L. Melnyk, V. Poshelyuzhnyi, V. Svitlychna, I. Stoyanenko, E. Toffler, L. Fedulova, A. Chukhno, D. Shushpanov and many others. According to the Organization for Economic Co-operation and Development (OECD) definition, the knowledge economy is an economy that is directly based on the creation, distribution and use of knowledge and information.

O. Dyakiv, D. Shushpanov, V. Poshelyuzhny interprets the knowledge economy as the newest model of development of the economic system, in which most of the gross domestic product is provided through the production, processing, storage, dissemination and use of knowledge, information and the latest technologies.

M. Zgurovsky emphasises that the knowledge economy is new knowledge generated by science, the preparation of high-quality human capital based on quality education, and the creation of additional wealth in the manufacturing sector and business, integral components of a modern society built on knowledge. A. Zharinova, under the knowledge economy, understands the sphere of production of goods and services as a sphere of practical realization of human intelligence, where the dominant and priority resource is knowledge, which becomes a new actual basis for the competitive activity of economic entities in the modern global economy.

A. Kolot emphasises that the knowledge economy is based on highly productive, competitive jobs occupied by highly skilled, innovation-oriented workers; information, communication and other modern advanced technologies are introduced, and high-tech, science-intensive and competitive products are manufactured. L. Melnyk defines the economics of knowledge as a postindustrial economy in which the driving force for further development is the accumulation and use of information and knowledge concentrated in human capital. F. Makhloup included the sphere of education, research and development, communications, information engineering and information activities in this concept.

V. Svitlychna, I. Stoyanenko researched the development of the knowledge economy. L. Fedulova emphasises the importance of the knowledge economy as one that creates, disseminates and uses knowledge to ensure its growth and competitiveness.

Despite the sizeable number and variety of this issue, the issues of a systematic approach to comprehending the essence of the knowledge economy as an integrated category in today's competitive business environment, identifying the levels of its development, evaluating the effectiveness of factors influencing the knowledge economy on the management process of companies, taking into account the conditions of the business environment, remain understudied and unresearched.

Analysis and generalization of publications on this issue led to the conclusion that the existing methodology for managing companies based on the knowledge economy is not sufficiently developed both in theoretical and practical aspects, which indicates the lack of substantiation of common conceptual foundations of the knowledge economy as a factor in the development of a business entity in the management system. The discrepancy between the achievements of the theory and the requirements of the practice of managing companies based on the knowledge economy in today's rapidly changing conditions necessitated this scientific research.

The purpose of the article is to study the role of the knowledge economy as a factor in developing an enterprise in the management system. The article will consider the basic concepts of the knowledge economy and evaluate the role of knowledge in enterprise management. The research findings based on a literature review and interviews with businesses that use the knowledge economy in their operations will be presented.

Formulation of the main material

The modern economy is increasingly based on knowledge and innovation - intellectual capital, as they have become the main drivers of company development. Specifically, intellectual capital has become the primary factor determining a country's position in the modern economy during globalization. In the global economy's crane leaders, there was a steady tendency to replace inventories with information and fixed assets with knowledge. The rapid increase in the influence of this factor on economic development led to the emergence of the concepts of "intellectual economy" and "information society". Intellectual capital determines the possibilities of using financial and material wealth. It is safe to conclude that the development of the intelligent economy is now fundamentally and actively driven by intellectual capital (Khaminich, 2006).

A. Chukhno, exploring current economic and social development trends as a key factor in forming the information society, highlights creative intellectual work. Emphasizing that "not every mental work is creative", he notes: "Creative work, creative activity of man is one of the defining features of the new society" (Chukhno, 2004). Profound changes in all of its sectors that impact the management system are a defining trait of the current economic development stage. A helpful resource that may be exploited to provide value for the business, its clients, and the socioeconomic system at large is the knowledge-based economy.

Heyets emphasises that the knowledge economy is an economy in which both specialized and everyday knowledge is a source of growth. In the knowledge economy. Decisive is the intellectual potential of society, on which it is based and which is a set of everyday (mundane) and specialized (scientific) knowledge that is accumulated in the minds of people and materialized in technological methods of production (Heiets, 2004).

The knowledge-based economy, as a separate scientific discipline, was developed in the 1990^s and has been actively evolving. It is defined as an economic discipline that studies the creation, distribution, and utilization of knowledge and its impact on economic and social processes in society.

Knowledge economics is an economic system that relies on the use and dissemination of knowledge across all industries and management sectors, as well as the creation of knowledge to foster intellectual development and the use of highly intellectual human capital to boost national competitiveness and lay the groundwork for new and innovative economic growth. The knowledge economy not only makes use of already existing information and knowledge but also contributes to its growth and the generation of new knowledge with an eye towards its future productive application. The establishment of the knowledge economy as a development strategy for Ukraine will serve as the cornerstone for ensuring economic growth and forging competitive advantages on the global market, given the current economic climate (Maslak et al., 2020).

Making wise management decisions for the effective functioning of the economic entity helps incorporate the knowledge economy's key concepts into the corporate management system (see Fig. 1). Their extensive (and not alternative) execution is a critically essential point. For this reason, the relationship is depicted as a closed loop in Fig. 1.

The notion that knowledge can be viewed as a separate resource, comparable to traditional production resources like labour, money, and land, is one of the fundamental ideas of the knowledge economy. This means that information may be applied to produce new goods and services, boost productivity, and make businesses more competitive.

Fig. 1. - The main components of the knowledge economy in the enterprise management system

knowledge economy management

Where:

1. Goals and directions of implementing knowledge economy into an enterprise management system;

2. Knowledge as a separate resource of the enterprise;

3. Knowledge is one of the central values of the enterprise;

4. Knowledge as diverse components of activity of different structures of the enterprise;

5. Making informed management decisions for the effective development of the enterprise.

The idea that knowledge may be shared and used without losing its value is another crucial one in the knowledge economy. For instance, a business can train its staff in new skills and knowledge that they can use in their work without the knowledge itself losing its worth and being unusable repeatedly.

The idea that knowledge can be exchanged within various organisational levels to increase access to knowledge and boost company efficiency is another fundamental tenet of the knowledge economy. To speed up the development and improvement of the business, a corporation can, for instance, create a knowledge base where employees can share their knowledge and access the ability of other employees.

Taking into account the concepts above of the knowledge economy, several vital roles can be identified that it plays in enterprise management, namely:

- creating competitive advantages: knowledge economy enables companies to use knowledge to develop new products and services, improve productivity and enhance competitiveness; for example, a company can create new technologies based on the understanding of its employees, which helps it to take a leading position in the market;

- knowledge management: knowledge economy helps companies to effectively manage their knowledge, create knowledge transfer systems between employees, and preserve knowledge for future use; this enables companies to adapt more quickly to changing market conditions and improve their efficiency;

- employee development: knowledge economy motivates companies to develop their employees by providing access to new knowledge and skills and training them in new technologies and methodologies; this helps companies retain their employees and improve their qualifications;

- efficiency improvement: knowledge economy stimulates companies to improve their efficiency by using knowledge to improve productivity and optimize business processes; for example, a company can create a knowledge base where employees can quickly find answers to their questions and avoid duplication of work.

The knowledge economy plays a vital role in enterprise management, enabling companies to use knowledge to create competitive advantages, manage knowledge, develop employees, and improve efficiency. Developing and implementing knowledge management systems is one of the critical aspects that help companies achieve these goals.

Enterprises can use numerous knowledge management methods for gathering, storing, processing, and transferring knowledge. Proper application of these methods is essential for the successful development of a company and determining a sustainable place among competitors in the business environment.

Knowledge - awareness of something; availability of information about someone, something; a set of data from any field acquired in the process of training, research, etc.; knowledge of reality in its individual manifestations and in general (Velykyi tlumachnyi slovnyk suchasnoi ukrainskoi movy, 2009, p. 469). One of the critical methods of knowledge management is the creation of a knowledge base.

Knowledge bases are structured data sets containing information about the company's products, production processes, customers, suppliers, and other operations. They are an electronic resource that contains information and knowledge necessary for performing specific tasks and solving problems.

Knowledge management systems are software that helps companies collect, store, process, and transmit knowledge. They can store knowledge obtained during research, development, and other activities. Documents, instructions, methodologies, and additional information useful to employees can be stored in knowledge bases. Knowledge bases allow for quick access to the necessary information and knowledge-sharing among employees through the active use of knowledge management systems. They may include features such as knowledge search, classification and analysis, and the ability to create and exchange knowledge among employees.

Another method of knowledge management is employee training. The human factor plays a vital role in knowledge-based management systems. Human capital is a key factor in the development of companies and society as a whole (Khovrak, 2011). Training and development of employees is an important aspect of knowledge management. Training can be provided both within and outside the company. For example, a company can organize seminars, trainings, and courses where employees can gain new knowledge and experience within the company; seminars for employees that help improve their professional skills.

In addition, a company can send its employees to external courses and conferences where they can exchange knowledge with representatives of other companies and use social networks. Social networks are platforms that allow users to exchange information and knowledge. Companies can use social networks to create internal communities where employees can share knowledge and experience. This can also help improve communication and collaboration between different departments and groups of employees. It is also necessary to use modern technologies for knowledge exchange, such as corporate blogs, internal chats, and forums.

Another effective method of knowledge management is the creation of teams that bring together employees with different knowledge and skills. Teams can work on specific projects and tasks, exchanging knowledge and experience using mentoring. Mentoring is a process in which a more experienced employee helps a less experienced one to develop professionally. Mentors can help new employees adapt to the company more quickly, improve their professional skills, and gain additional knowledge (Velykyi tlumachnyi slovnyk suchasnoi ukrainskoi movy, 2009, p. 659). This helps to increase work efficiency and create a more innovative environment by implementing modern business processes.

Business processes are sets of procedures and instructions that define how work should be performed within a company. Well-designed business processes can help improve work efficiency and reduce the number of errors. In addition, they may include templates that help employees perform their work more effectively.

The application of knowledge management methods in enterprise management allows for achieving the following objectives:

- establishing a system for knowledge transfer among employees, enabling them to quickly access the necessary information and acquire knowledge from their colleagues;

- enhancing employee qualifications through training, which helps elevate their skills and competencies, thereby improving work efficiency and product quality;

- fostering innovation by creating teams and facilitating knowledge exchange among employees, which cultivates an innovative environment, stimulates the emergence of new ideas and problem-solving approaches, leading to the creation of new products and services and enhancing the company's competitiveness in the market;

- increasing productivity by implementing knowledge management methods, reducing errors and redundancies in work, expediting decision-making processes and task execution, thus promoting enhanced productivity and cost reduction;

- improving communication by organizing groups and providing employee training, which aids in enhancing communication among individuals, reducing conflicts, and increasing the effectiveness of collaborative work.

Table 1