Now almost every organization has recognized that in order to survive in today’s competitive and global environment, it has to face knowledge-based economy revolution. They have realized the need and importance of this valuable asset. Since knowledge management caters to the critical issues of organizational adaptation, survival and competence in face of increasingly environmental change, therefore there is an essential need of managing it effectively. Three components that can play effective role in managing this valuable asset effectively include: defining effective strategies for its management, using state of art information technologies for implementing these strategies and developing knowledge management systems and a strong culture that can recognize its need and importance and thus adapt it. Also since knowledge is a prerequisite of learning, therefore it is effective management can result in improvement in capabilities and business activities of a learning organization which as a result can add value to its services or products, thus improving its overall performance and giving a competitive edge to it.