Knowledge Value Life Cycle: Model for Valuing Knowledge

Knowledge is a valuable asset as it brings success and sustainability to the organizations around the world. Till recently, the value of an organization is determined from its financial statements. However, these statements are historical in nature and does not depict the true worth of the organization. The future benefit from the organization depends upon its capability to make best use of its assets including knowledge. However there is no business document that shows the volume and value of knowledge present in the organization. It is critical to determine the value of knowledge to ascertain true worth of an organization. This research study attempts to presents factors that influence the value of knowledge during its life cycle. After detailed analysis, finally all were grouped into 'Contemporary Factor' and 'Futuristic Factor' for valuing knowledge. The integration of Futuristic and Contemporary factors forms the Knowledge Value Wheel (KVW) that helps in defining the "Knowledge Value Line" (KVL). The KVL depicts the value of knowledge at any given time. The KVL and KVW combines to form the "Knowledge Value Life Cycle" (KVLC). The applicability of identified factors at various phases of KVLC were examined and discussed. The findings of this study is universally applicable. It will help further research in the area of knowledge management. Managers would be able to differentiate most valuable and useful knowledge asset for effective management. It would also be beneficial to the investors in determining the true worth of the organization in terms of its knowledge asset.