The Implications of Tacit Knowledge Utilisation Within Project Management Risk Assessment

The capabilities of an organisation to create, share and utilise knowledge effectively are today regarded as one of the key drivers of competitive advantage for industrial enterprises, predominately for those operating within increasingly globalised marketplaces. The elevated significance of knowledge management is particularly evident in the context of Slovakia due to the rapid influx of large-scale industrial enterprises since the country joined the EU and the necessity to utilise sector specific knowledge. The knowledge held within an organisation can typically be categorised as either explicit or tacit. Explicit knowledge relates to information which is formal and systematic; it can be easily communicated and shared throughout the organisation, and embodied in a computer program or set of procedures. In contrast, tacit knowledge relates to human interactions and is regarded as "highly personal" and not easily formalised or standardised. The terms tacit and explicit knowledge directly reflect the two dominant perspectives on knowledge management relating to "people" and "technology". From a tacit, "people" perspective, the strategy is to develop knowledge sharing between individuals, and while IT is useful it is often peripheral to issues. From the "technology" perspective, the strategy is to capture, codify, store, and distribute knowledge through the use of IT systems. Both perspectives assert that knowledge is a critical asset for the organisation and the delivery of projects. The primary aim of the paper is to adopt a cross-disciplinary approach to knowledge management by assessing the implications and utilisation of explicit and tacit knowledge in the context of project management risk assessment. Within project management, evaluating the opportunities and risks of a new project proposal is a complex process including objective and subjective factors, not only in the process itself but also in the selection of the data used to support or justify the evaluation. The systematic nature of project management ensures that practitioners and academics alike often prefer explicit knowledge which can be expressed by defined scientific or technical principles. In contrast the ability to quantify and articulate the role of tacit knowledge and the impact of human capital within the process remains highly problematic. The paper aims to address the issue through the creation of a reference model of organisation and project management which codifies knowledge in terms of fuzzy set theory. The constraints are specified in the form of fuzzy rules that develop the knowledge base. The main purpose for the use of fuzzy rules is that human interaction has many characteristics which are difficult to quantify and measure precisely. The proposed approach therefore allows for the codification of explicit and tacit knowledge and a new model is presented which integrates both explicit and tacit knowledge as measures within the project risk assessment process.