Abstract for: A Framework for Measuring the Value-Added of Knowledge Processes with Analysis of Process Interactions and Dynamics
In the current business landscape outputs are heavily dependent on their use of intangibles and knowledge to produce outputs. This shows the importance that intangible assets have in benefits and value in cases such as project selection which cannot be appropriately managed without considering the role of knowledge. This research develops a framework to measure the value that processes add based on knowledge. It starts by considering current systems and analyzing proposed changes with the Matrix of Change to propose alternative systems in which system dynamics can then be used to model the desired system for behavior measurements. The framework applies knowledge as a way to generate value based on the concept of Kolmogorov complexity, a complexity theory that relates the amount of knowledge required to successfully execute change as a determinant of the change itself. Criteria for project selection is then based on the amount of knowledge measured to generate change. The framework is applied to a case study in mobile weapon system using Unmanned Aerial Vehicles (UAV).