System dynamics for knowledge-based decision making

As knowledge has been recognized as a new resource in gaining organizational competitiveness, knowledge management (KM) is suggested as a method to manage and apply knowledge for business management. KM research, however, has focused on identifying, storing and distributing the transaction-related knowledge in an organization. There has been little research on applying the knowledge to decision-making or strategy development that is the main task of business management. The application of knowledge to decision making has higher impact on organizational performance rather than just the knowledge management for process transaction. In this research, we suggest system dynamics (SD) for the knowledge-based decision-making. Based on the modelling method of SD, we can translate partial and implicit knowledge resident in an individual´s mental model into organized explicit knowledge. The simulation test of the organized knowledge model enables decision-makers to understand the structure of the target problem and identify the basic cause of it, which facilitates effective decision-making. We compare the proposed method and other KM methods and discuss this research based on the application case to a real telecommunication company