6 VADYBA / MANAGEMENT. 2006 m. Nr. 2(11) KNOWLEDGE MANAGEMENT: LEARNING ORGANISATION (NATIONAL REGIONAL ASPECT) Zenona Ona Atko i nien , Zina Gineitien , Erika Sadauskien Alteration of the economic situation, social life variations determine the changes in organisations. Nowadays, leaders of regional, international markets focus on knowledge management, organisational learning, emphasising that these are the crucial factors in shaping strategies for business organisations. Ever-growing changes and uncertainty in the environment in which organisations must function increase the requirements for employees to adequately react to market needs and to improve product or service quality. In the knowledge society where changes in information, technological innovations are incredibly rapid and where the development speed of the environment and the society increases constantly, organisations and profit seeking enterprises are forced to learn and improve continually in order to be successful. The purpose of this report is to reveal how progressive knowledge management methods, one of the main being learning, determine a competitive advantage of organisations; to present a concept of a learning organisation; to discuss necessity to establish such organisation, its needs and characteristics; and to review the legal acts of the European Union and the Republic of Lithuania regulating processes of knowledge management and knowledge economy. Key words: knowledge management, organisational learning, learning organisation. Core of knowledge management and interaction with knowledge economy Innovative possibilities of knowledge use are already created through the use of continuously advancing technologies and software decisions. Knowledge has assumed a material meaning, it is sort of material information medium - it may be created, used, disseminated, shared. Knowledge management has developed into a separate and independent field, the main purpose of which being the management of intangible organisational assets such as intellectual capital, skills and knowledge of the employees, image of an organisation, etc. On the other hand, practical application of knowledge management so far is rather problematic because of the lack of distinctly defined methods. Knowledge management is a rather controversial scientific discipline. On the one hand, now it is the latest trend in management; this term is often used in prestigious scientific publications. On the other hand, the specialists and scientists working in this field claim that so far knowledge management lacks clarity and determination because of the tendency to fit the trends in management of every description into the concept of knowledge management (M.Bieli nas, 2000). Today knowledge management for every organisation is and will be one of the most important components of its successful activities and development. One of the knowledge management pioneer, Yogesh Malhotra (2000) defined knowledge management in an interview as the critical issue of organizational adaptation and survival in face of increasingly discontinuous environmental change. It combines data and information processing capacity of information technologies and the creative and innovative capacity of human beings. Y.Malhorta (2000) provides the following definition of knowledge management in the sense of information processing: it is the process of collecting, organizing, classifying and disseminating information throughout an organization, so as to make it purposeful to those who need it; information contained in the organisation’s database is organised and analysed in such a manner so it can be easily shared across the organisation, and not only within the branch where it originates; issues related to organising, the solution of which allows determining when and who needs concrete information. Technological supply of information is ensured by various networks, databases, video conferencing, conference boards, etc. In knowledge management the most important is not the increase of available information quantity, but the identification of increasing quality of available information resources and interpretation capacity of human beings. Information per se may be senseless and inappropriate, and even incomprehensible without the context. Studies related to knowledge identify five activities all of which depend on and are integral to information: locating existing knowledge, understanding needs for knowledge, searching for knowledge and sharing knowledge with others; creating new knowledge; knowledge created on the outside of ongoing processes (external knowledge); applying existing knowledge; verifying, extending knowledge. Knowledge management is understood as work with human beings and the knowledge acquired by them. Innovations, originality, adaptation, and learning are essential to knowledge management. These are the ways to ensure interrelationship, dissemination of ideas, critical thinking, competence and co-operation, as VADYBA / MANAGEMENT. 2006 m. Nr. 2(11) 7 well as group work inside and outside the organisation. Knowledge management encourages sharing employee experience, failures and good examples with the group members. According to M.Castels (2000), a knowledge-based phenomenon of the economy is global. In 1958 renowned philosopher M.Polanyi, who paid a lot of attention to the analysis of the development of a concept of knowledge and its impact on development processes, pointed out that the mankind goes through a period of major transformations when the social processes of knowledge creation, dissemination and configuration take place. Means of communication help to develop social relations independent of time and space. Cognitive capability, relationships and cultural identity are essential instruments of survival in a new world (M.J.Rodriques, 2002). A strategic aspect of knowledge management is the knowledge economy, which is significant for the economic policy due to several reasons: at present the knowledge economy is a priority of the economy of the majority of the developed countries, therefore, an issue of the origin and use of knowledge is very important for economic development; a very significant role in the knowledge economy is played by the systems of education and science which need to be altered in Lithuania, as well as in many other countries; a process of knowledge creation and use emphasises the importance of an individual as a main agent and allows to return from synthetic models and aggregated numbers to possibilities and motives of man’s economic activity; the topics of the knowledge economy make entrepreneurs regard the economy not as separate fields and departments regulating them, but as an integrated totality; a policy of the specific knowledge economy has just started being shaped in Lithuania, therefore, it often fails not to repeat the mistakes, which other countries have already made – an exceptional attention to high technologies, priority trends of the economy set out by the state, etc. In an economic sense knowledge is valuable inasmuch as it is applicable. A human being, his/her capabilities, knowledge and possibilities of its use are the most important asset in the knowledge economy. Life-long learning in various environments – formal, non-formal (in an organisation) and informal (experience of life) – is necessary in order for a human being to be educated and his qualifications constantly improving. A.Aušra (2005) proposes to assess learning in the knowledge economy from at least four viewpoints: from the learner’s viewpoint – opposite to the viewpoint of an educational establishment; from the viewpoint of the economic and labour market – but encompassing social and cultural factors; from the viewpoint of education policy – including overview of pivotal competencies necessary for the knowledge economy, promotion of adequate management of educational establishments, financing of the development of human resources, creation of learning methods and opportunities, ensuring of fairness and learning accessibility in all life stages and learning systems (formal, non-formal and informal); from the wide viewpoint of the knowledge economy – linking of education and development of human resources with innovation systems and information society. Potentialities to compete with other countries of the world more and more depend on capabilities of the country’s citizens to effectively use knowledge. When effectively using these changes it is possible to increase the prosperity of organisations and the state. Foreign organisations have long before understood that competitive advantage is mostly determined by better and more coherent strategies of information use when making business-related decisions, drawing up business projects and programmes. Lately an especially great attention is paid to restructuring and innovations of organisations, because in order to remain competitive it is necessary to enhance a flow of new knowledge, which is an essential source of constant improvement and innovations. Organisations must observe global tendencies, know their organisational potentials, learn from others to absorb knowledge from outside, thus be a learning organisation, which creates a favourable environment for learning, experimenting, fostering of enthusiasm and curiosity. Conception of a learning organisation An increasing speed of changes and competition force an organisation to introduce internal changes, seeking to adapt to an abundance of events. D. Neef (1997) describes knowledge management as capability to collect and use the knowledge of the employees, seeking to use this in creation of innovative products and services, and to share operational efficiencies. Having in mind that knowledge is personal and subjective, and activities of an organisation require its effective transfer, we encounter such new definitions as a learning organisation, knowledge transfer, etc. 8 VADYBA / MANAGEMENT. 2006 m. Nr. 2(11) The concept of a learning organisation is of major significance at the worldwide level. This concept encompasses not only business organisations, but also educational establishments and non-profit organisations. The model of a learning organisation is replacing the beaurocratic model that has prevailed in the West for a long time. Competition among various organisations is very intense; therefore, they must make substantial changes that are to apply a new organisational model in order to survive. It is possible to state that there is no single model of a learning organisation. R. Daft (2002) describes a learning organisation as philosophy or an approach to what an organisation is and what the role its employees play in it. If we speak about the principles of management as a learning activity, we may maintain that learning is usually described as "change in individual’s actions depending on his experience" (P.Thompson; 1995). Need for learning is also understood as "learning which encompasses changes, is open to innovations, has available sources so that technologies intended for learning be advanced, also meeting the organisation’s need for learning and knowledge" (J.Henry; 1994). Other authors point out that "such themes as a mode of solving uncertainty of the environment are often characterised in literature as such systems which are often called learning organisations" (P.Thompson; 1995, p. 315). Members of such organisations must comprise their enhanced values, knowledge bases, processes, skills and other systems, which encourage an effective reaction to changes. This prompts the need for higher cultures, systems and employee knowledge formed on the basis of confidence, which are valuable in decision-making and problem solving. (see Fig. 1). FUTURE PRESENT PAST (potential) (actual) (recalled) 1 Imagination 7 Implementation 2 Motivation 6 Satisfaction 3 Planning 5 Evaluation 4 Action PRESENT (Source: Henry J. Creative management. London, Sage Publications, 1994, p. 235) Fig. 1. Management scheme Learning organisations are such organisations in which employees are continuously extending their competence in order to achieve desired results, new and open models of thinking are cultivated, collective objectives are freely developed, learning to see the entirety is in a constant process. When describing a learning organisation the following must be stressed: encouragement of learning, cultivating learning capacity; learning rate; continuous examination of one’s experience; knowledge creation; knowledge and information dissemination across the organisation; a level of learning in the organisation: individual’s => group’s => organisation’s; changes in the organisation, its activity, production made, interrelationships (efficiency as the consequence of learning); learning as a principal value of organisational culture (B.Simonaitien , 2003). The key tasks of a learning organisation are (B.O.Leonien , 2001): to observe the environment; to understand the importance of novelties; to consider each new task as an opportunity to learn; to continuously renovate; to employ people who are willing to learn new working methods, to acquire new skills; to create the possibility for employees to adapt and change; to encourage aspirations for knowledge, curiosity; to help everyone to find and make use of opportunities to learn; to create learning support systems; to regard executives of an organisation as encouragers of improvement of employee skills; to acknowledge and rank those executives who take care of improvement of employee skills; VADYBA / MANAGEMENT. 2006 m. Nr. 2(11) 9 to learn from success and failures; to ensure learning throughout the whole organisation. An organisation would not be able to evaluate the importance of main information resources and information technologies, if it did not clearly realise the main processes carried out by the organisation itself and its individual employees, in the course of which information is transferred from knowledge to concrete actions. It is important to perceive that in each organisation where learning is continuous and the external environment is observed with the aim to adapt to it, certain processes are in progress which have influence in the way opinion is shaped, specific knowledge is created, decisions are made and thus the reaction and actions chosen by the organisation are influenced (Fig. 2.). Understanding of the situation Knowledge creation Decision making ORGANIZATION ACTION Information generation Information presentation Information interpretation (Source: Choo Wei Ch. The Knowing Organization. How Organizations Use Information to Construct Meaning, Create Knowledge, and Make Decisions, New York, Oxford University Press, 1998, p. 4) Fig. 2. Learning organisation. All these processes are carried out subject to accessed information, which at first is interpreted adequately. Information comprehension reflects the information available to or collected by the organisation itself or its individual employees; it also depends on available knowledge, experience, and skills. Later on such information encompasses additional available information and certain created scenarios of specific activities and conduct, thus, creating new information which is important when analysing the organisational environment, observing it, carrying out certain actions, etc. A learning organisation by its nature has been created to change the basic methods applied in management up till now, and to change an action strategy. If earlier the key goal of the strategy was production and profit, now this action strategy and operational principles go through changes by orienting them to information and knowledge. This means that management, which for a long time was economic management, now becomes a knowledge strategy. That is when knowledge collection and its maximum use in the adaptation to the changing environment become the key goal of activities. The formation of knowledge and learning society is linked with the rise of one of its essential characteristics – learning networks. In striving for a common goal, the participants of the learning networks act as equal partners, learn from one another, as well as from the individual and collective activities. One of the major tasks encountered during the development of learning society (learning regions, cities, towns, villages, organisations) – to be able to establish learning networks and help to keep them functioning. In order to fulfil this, it is necessary to know how to determine their condition, characteristics, peculiarities of functioning, hence, it is necessary to be able to study them. The learning network constitutes the relations of exchange, performed by people who collaborate, which determine the development of knowledge, capacity, and 10 VADYBA / MANAGEMENT. 2006 m. Nr. 2(11) competence in this activity. The following basic parameters are typical of the said network: character of the network, participants of the network, relations, purpose of the network, activity of the network („the sequence of events“). These parameters are elaborated for the context of learning in the following manner (P.Jucevi ien , 2006): according to the character of the network learning may be carried out within designated (formal) and occurring (non-formal) networks; personal and social, community, organisational, inter-organisational networks; more often than not within open networks; individuals or their groups and organisations may be participants of the network. Commonly participants of the learning networks are the persons who can have various roles – goalkeeper, ally, opinion leader, loner; the relationship which is outlined: by comprehension of the relationship, its reciprocity, clarity of the norms, complexity, intensity, importance of the relationship; possibility to rely on one another, achievement of goals, regularity of the relationship, atmosphere of the relations and their value. The value of the relations is social capital based on personal and/or business relations; therefore, social capital is divided into internal and external; activity of the network is the sequence of events incidental to the cycle of the lifetime of an organisation. It may be extended through skilful management. Management impact – co-ordination of activities of the network is necessary; learning as continuous improvement of skills is carried out adhering to the principle of the knowledge spiral, in four stages: socialization, articulation, combination, internalization; methods and ways of communication are used to make relations of exchange more successful If in the past the main values of company employees were their loyalty and discipline, now their competence, resourcefulness and capacity to learn continuously and know more than their competitors take precedence. If company employees are capable to learn constantly and to modify their work promptly according to a new situation, then they are the company’s greatest advantage over competitors. Need for learning is understood as learning, which comprises changes, is open to innovations, has accessible sources, so that the technologies intended for learning are advanced and thus the organisation’s need for learning and knowledge is met. Ever-changing environment, ideas of knowledge and economics, globalisation highlight the importance of learning not only at individual, group and organisational levels, but also at regional and national levels. Stress is laid on regional demands, tendencies of the development of a learning region, practical use of knowledge resources. This entire links with the specific features and conditions of the region, new ways of thinking and conduct. Creation of a network of the co-operation in the field of knowledge, technology and innovation management of the European regions is in progress, which enhances the development of the regions, organisational learning, exchange of information, experience, and achievements. Impacts of leadership of organisations, culture and learning striving for a long-term competitive advantage. Knowledge transfer systems used in the development of international organisational networks. Creation of an electronic platform aimed at knowledge exchange and finding of necessary information in information networks. Use of semantic technologies in knowledge management. In knowledge management the most important is not the increase of available information quantity, but the identification of increasing quality of available information resources and interpretation capacity of human beings. Information per se may be senseless and inappropriate, and even incomprehensible if out of context. Knowledge management encourages sharing employee experience, failures and good examples with the group members. The essence of knowledge management is not the objects, but intangible assets, intellectual capital, competitive advantage and innovations. So far knowledge management is in the early stages of practical application, but a direction of its development is already quite distinct: it will be an integrating sphere of management, oriented towards the creation and management of intellectual capital; it will have to conjoin all branches of management. Quality of competence and human resources, as well as capacity to act in knowledge and information society are the vital precondition for formation of the knowledge economy in any country or region, therefore, it is impossible to discuss a learning organisation without mentioning a national regional aspect. I.Kasinskait (2005) proposes to discuss a learning region in a broader sense – as the totality of measures designed to enhance economic development in the region through effective use of local resources and new opportunities. The author declares that a learning region is a physical expression of the perception of changing development, which is explained and implemented through various economic, social, cultural, political, and technological processes of development, emphasising the importance of interactive learning (I.Kasinskait , 2005, p. 63). VADYBA / MANAGEMENT. 2006 m. Nr. 2(11) 11 Hence, the basis of knowledge society is a learning individual, learning organisation, learning region, whereas learning is not fragmentary or spontaneous, but a strategically important, focused process. Therefore, it is vitally important what commitments; strategies and guidelines are provided for by the State with regard to the formation of the knowledge economy. National policy of knowledge economy in the context of the European Union and Lithuania The structural policy of the European Union and participation in it are usually presented as one of the most attractive results of the membership of the European Union, because it is related to considerable appropriations from the budget of the European Union. At the Lisbon European Council in 2000 the heads of the states and governments set a new strategic goal for the Union – “to become the most competitive and dynamic knowledge-based economy in the world capable of sustainable economic growth with more and better jobs and greater social cohesion.” Seeking to enhance the economic prosperity and social welfare of the European Union the Lisbon European Council approved the strategy in which one of the most important priority areas is a competitive, knowledge-based economy (education, research and innovations). Striving for a rapid economic growth and strengthening of competitiveness of Lithuania’s economy the National Agreement on priority spheres of the social and economic development was reached on 3 December 2002. The Agreement provides for the following priority spheres: competitive knowledge economy promoting creation of jobs in knowledge sectors; potential of the education and science sectors in assisting to solve issues raised by the knowledge economy and adequately react to European initiatives related to research and innovation; combating poverty, social exclusion; reorganisation of the agricultural sector, increasing of competitiveness, renewal of the infrastructure, and enlargement of business possibilities; reform of the management and administration of the public sector. Under the Single Programming Document of Lithuania for 2004-2006 the core goal of the development plan of Lithuania is the growing competitiveness of the national economy which determines a rapid growth of the knowledge-based economy, reflected primarily in the increase of the actual GDP and employment, and leading towards growing prosperity and higher living standards for all the residents of the country. The long-term national development strategy, approved by the Government of the Republic of Lithuania, lays down that in seeking the efficient development of the knowledge economy and electronic business, the State must: to improve the legal environment and institutional structure enhancing the development of the knowledge economy; to develop international co-operation when implementing latest scientific achievements of other countries, and creating and expanding virtual centres for science and innovations, to participate in the creation of the European research strategy; to support models of interface between research bodies and enterprises; to promote manufacturing of modern products and services, based on information technologies and telecommunications, for domestic needs and export; provide comprehensive information about possibilities of investing in the sector of information technologies and telecommunications in Lithuania; to promote the use of open source software; to ensure functioning of electronic payment systems; to create conditions to carry out customs, tax payments and income declaration procedures through public networks; to create a competitive environment in the field of telecommunications and data transfer. On 8 November 2004, invoking Articles 4 and 98 of the consolidated version of the Treaty Establishing the European Community and having regard to the economic policy co-ordination procedure approved by the Cardiff European Council in 1998 the core measures of which are national reports on structural reforms, the Government of the Republic of Lithuania approved the national reports of structural reforms for 2004, which repeatedly stressed the purpose, already set out in the Long-term Strategy for Research and Development approved by the Government of the Republic of Lithuania on 22 December 2003, that is to strengthen the national scientific technological potential and to seek its most effective use to speed up country’s progress and increase competitiveness, achieving that: Lithuania will become knowledge society by the year 2015; 12 VADYBA / MANAGEMENT. 2006 m. Nr. 2(11) The system of interaction between science and production will within the next seven years conform to the European practice of implementation of innovations; General expenses on research and development from all financing sources will increase by the year 2010 up to 3 per cent of GDP, and the private expenses will amount to 2 per cent of GDP; Production of high technologies will increase to up to 20 per cent of GDP within the next ten years. The Strategy for the Development of Public Administration until 2010, approved by Government of the Republic of Lithuania Resolution No. 488 of 28 April 2004, the aim of which is to modernise the system of public administration, seeking to create transparent, information technology-based public administration, oriented to results and rendering good quality services to the citizens and other persons. Despite great efforts of the Member States of the European Union (Lithuania including), in January of 2005 the European Commission, considering the economic progress, drew the conclusion that the growth and productivity of Europe during the last ten years failed to meet the growth and productivity of its main economic partners. The Commission also pointed out that when new competitive forces make European enterprises to enlarge the scale of values, and the knowledge economy becomes more and more important, Europe should make use of the important economic advantages in the global economy political and economic stability, qualified workforce, traditions of social partnership, well developed scientific base with its old traditions, and the willingness of the new Member States to reach the economic level of the other Member States. When considering this issue, it was stressed that the progress achieved in the implementation of its goals was small and therefore a new objective was set – to make Europe a more attractive place to invest, produce and work. The European Commission stated that new reforms are necessary for the implementation of this objective, which would improve a business environment; that it is necessary to promote research and innovation in the key sectors, and to modernize European labour markets and social security systems. In order to resolve the existing problems, a strategic analysis of the current situation and tendencies has been carried out and a draft of the strategy for using EU structural aid by Lithuania in 2007–2013 and priorities of its implementation (hereinafter referred to as the “Strategy”) have been drawn up. It is possible to state that the Strategy is the strategic basis of long-term strategic investment programmes – action programmes; therefore, its main attention is focused on investment priorities. The document also sets out general strategic investment priorities, because more detailed investment trends will be developed in the abovementioned action programmes. It is necessary to take various actions and initiatives on purpose to achieve the said objectives: from individual reforms of public policies and the improvement of legal regulation to investment measures. It is appropriate to point out that one of the key trends of this Strategy is to speed up the development of the knowledge economy in Lithuania. Efficient knowledge as the basis of the economy is collected and continuously regenerated, and this economic resource is unique, because it is inexhaustible, unlike the material resources. Collecting of efficient knowledge, its dissemination and effective use are directly related to active promotion of innovation, entrepreneurship and creativity in all spheres of public life and economy, establishment of favourable conditions for workforce to competitively participate in the creative economy based on knowledge and innovation. The abovementioned document stipulates that the objectives of this Strategy will be achieved through investing in three proposed strategic priorities: productive workforce in the knowledge society, competitive economy and quality of life. Creation of knowledge society in Lithuania is a long-term priority, indicated the key investment trend pursuant to this priority – to create society which actively participates in the labour market, whose members continuously acquire, regenerate, expand their knowledge, capacities and skills, and efficiently apply them in the national economy (increasing productivity of workforce is an essential precondition for the implementation of the idea of development). Speaking about the foreseeable future, creation of knowledge society requires active investing aimed at certain changes in several key spheres. For the implementation of this priority, it is planned to fulfil the following main tasks: attracting and keeping persons in the labour market; development of a segment of the workforce of the highest qualification; more effective public administration. It must be noted that creation of efficiently operating (knowledge) economy and establishing of preconditions for its functioning require not only individual skills of human beings, but other essential prerequisites. First of all, it is a thinking country, its general government capable of maintaining the market effective, fostering the enhancement of administrative capacities with the aim of better application of the provisions of the EU acquis, more effective public administration at central government and local authority level, more efficient regulation of economic activity, which helps to enhance the economic and social VADYBA / MANAGEMENT. 2006 m. Nr. 2(11) 13 development. Equally important for creation of the knowledge economy is support provided for improved framing, implementation, monitoring and assessment of public policy and its programmes, as well as promoted public policy reforms, social partnership and dialogue as well as consultation with citizens and various groups concerned. Enhancement of capacities to effectively make use of the EU structural aid designated for Lithuania, as well as enhancement of capacities of social and economic partners is an important aspect of administrative capacities. When using the EU structural aid, possible market distortion and negative consequences for competition must be avoided. Very substantial grounds for intended economic changes are provided by an advanced and accessible infrastructure of information and communication technology (ICT) enabling speedy and cost-efficient dissemination of information, its use in production and rendering of services of public or private sectors. Main attention will be focused on the development of electronic content and ICT infrastructure. The Strategy lays down that in course of development of the ICT infrastructure, main attention will be turned to meeting the needs of the broadband last mile connection, its accessibility, first of all, in peripheral, uncompetitive parts of the country. It is planned to create favourable conditions for provision of public services upon co-ordination of national information sources (registers, information systems) and ensuring the security and compatibility of the systems of service provision. It should be noted that the development of electronic content must be understood as the development of the totality of public services provided by the State (e-government services, e-healthcare services), reduction of exclusion from information society, as well as promotion of the implementation of information technologies in business, developing implementation of electronic business decisions and transfer of business process to electronic media. The Strategy sets out the goal to create by the year 2013 the possibility for all interested small and medium-sized enterprises, residents, public administration institutions and establishments to connect to the broadband networks within the whole territory. Investments in the ICT infrastructure will help to eliminate digital difference: Lithuanian residents will use ICT regardless of their social situation, status or geographic location. By developing information society, public administration institutions will be able to expand the scope of e-government; new ICT-based public services will be provided for people and business, conditions for modernisation of activities of the Government and governmental institutions, enhancement of transparency of public administration procedures. Development of information society will support efforts to preserve cultural identity of Lithuania: Lithuanian consumers will be provided with opportunities to use ICT adapted to the Lithuanian environment and to find in the Internet comprehensive information resources in the state language; the data of the cultural heritage of Lithuania will be stored in digital media. Thus, we may conclude that the knowledge economy becomes the crucial factor in the growth of the economy of the developed countries, that the advancement of knowledge-based industrial and information technologies is an essential condition of national progress, prosperity and welfare, and that the development of the knowledge economy and knowledge society requires not only conceptions and strategies, but also concrete decisions and actions to be taken in the nearest future on purpose to achieve Lithuania’s progress in the global competition. Conclusions Rapidly changing environment determines organisational changes; therefore, it is necessary to taking into consideration many factors, which influence knowledge-based business processes. Emerging information technologies provide new opportunities. However, in order to implement these technologies successfully, regard must be taken of organisational culture and employee competence. In the modern information age knowledge becomes outdated very quickly, necessitating continuous learning by an organisation. Learning and knowledge improvement enable employees to generate new ideas and innovations, and this constitutes a guarantee for company success. A learning organisation is capable to solve problems systematically, to draw on its own and other’s experience, and to share knowledge effectively. In knowledge management the most important is not the increase of available information quantity, but the identification of increasing quality of available information resources and interpretation capacity of human beings. Information per se may be senseless and inappropriate, and even incomprehensible without the context. Knowledge management encourages sharing employee experience, failures and good examples with the group members. The essence of knowledge management is not the objects, but intangible assets, intellectual capital, competitive advantage and innovations. Collecting of efficient knowledge, its dissemination and effective use are directly related to active promotion of innovation, entrepreneurship and creativity in all spheres of public life and economy, establishment of favourable conditions for workforce to competitively participate in the creative economy based on knowledge and innovation. 14 VADYBA / MANAGEMENT. 2006 m. Nr. 2(11) So far knowledge management is in the early stages of practical application, but a direction of its development is already quite distinct: it will be an integrating sphere of management, oriented towards the creation and management of intellectual capital and having to conjoin all branches of management. Ever-changing environment, ideas of knowledge and economics, globalisation highlight the importance of learning not only at an individual, group and organisational level, but also at regional and national levels. Stress is laid on regional demands, tendencies of the development of a learning region, practical use of knowledge resources. This entire links with the specific features and conditions of the region, new ways of thinking and conduct. Creation of a network of the co-operation in the field of knowledge, technology and innovation management of the European regions is in process, which enhances the development of the regions, organisational learning, exchange of information, experience, and achievements. Impacts of leadership of organisations, culture and learning striving for a long-term competitive advantage. Knowledge transfer systems used in the development of international networks of organisations. Creation of an electronic platform aimed at knowledge exchange and finding of necessary information in information networks. Use of semantic technologies in knowledge management. REFERENCES 1. Aušra, A. Atvir j resurs vaidmuo mokymosi procese, 2005 [ži r ta 2006 m. balandžio 2 d.]. 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