Today’s organizations recognize the importance of using organizational knowledge to generate business value, whether through increased innovation or efficiency in operations. Effectively managing the organization’s knowledge has become a strategic priority for IT. According to a survey conducted by the Economist Intelligence Unit, almost two-thirds of executives believe that knowledge management and business intelligence (BI) tools are the most important technology underpinning their company’s goals.1

The term “knowledge,” for the purposes of this article, covers everything from data (raw inputs from the business environment) to information (raw data organized in meaningful ways) to expertise and insights (the meaning derived from applying information in a particular context).

Most organizations have implemented a knowledge management improvement project of some sort. Few have achieved their desired outcomes, however. Two-thirds of executives complain that they are unable to turn the large volumes of data in their IT systems into information that they can act on.2

This article explores how organizations can drive value from their knowledge by making nontechnical changes to their business, supported by case studies from organizations that have successfully done just that.

Improving the Knowledge Management process

Knowledge management is, at its most basic, a collection of processes for capturing, sharing, organizing, finding and using knowledge (no matter what form that knowledge takes). When running a knowledge management diagnostic with clients, we repeatedly find that where an organization is not getting the expected value from their knowledge management technology there is a lack of clear processes for sharing, organizing, finding and using knowledge.Additionally, where processes exist, people are not aware of them or find them difficult act on.Greater value can be derived from existing technology by ensuring that business processes exist, and that people are aware of them and are using them effectively.

For example, a global manufacturing firm recognized that their document management system contained duplicate, conflicting and incomplete records. To ensure they were able to meet legal obligations with regard to document discovery, the firm redesigned and documented their processes for document discovery, management and production, which spanned four different organizations across the UK and U.S. Upon detailed investigation, it was clear that the problems with the document records were due to issues with the processes in place, including unclear divisions of responsibility, duplication of effort within the firm, data duplicated across systems and information being held in locally stored spreadsheets rather than the central system. The manufacturing firm worked with its legal partners to redesign the process and put mechanisms in place to ensure that the new processes were followed. Three years later, the central system is the single repository for information and the organization has made significant savings in legal fees.

Address the Knowledge Management Culture and Behaviors

It is well known that for any change to be successful, the organization must address the cultural and behavioral aspects of change; and this is no different for change related to knowledge management. However, few organizations actively address their knowledge management culture when confronting knowledge management issues. This is to their disadvantage, because culture is one of the biggest determinants of knowledge management success. A new system is only valuable if people use it, and a documented process is only beneficial if it is followed. The most common cultural barrier can be found in the old adage “knowledge is power.” If people keep information close to vest, however, the organization is rarely going to get value out of it.

The UK Department of Health's knowledge management strategy identified that improving overall capability in the department required a significant program of work to institute behavioral and cultural change. The knowledge management team recognized that its staff was struggling with tracking down the right expert in any given subject and finding information that directly answered the question being asked.Furthermore, in some instances, the information they did find was out of date or difficult to authenticate. The Department implemented an intervention program to:

  • Make better use of corporate knowledge by helping staff better understand, integrate and exploit the suite of existing knowledge management solutions,
  • Help teams to work interdependently by stimulating a change in behavior toward a more responsible attitude in managing data, information, knowledge and insights and
  • Enable individuals to work more effectively – improving job satisfaction and work life balance by reducing rework and helping people work collaboratively.

Over an 18-month period, 85 percent of staff (almost 1,250 individuals) took a day-long knowledge management training workshop, where they discussed the importance of knowledge to their role, identified existing issues and developed personal action plans to remedy the situation. The program delivered a common understanding and commitment to the basic principles of knowledge management across all staff. Employees now feel more in control and are more proactive, there is less duplication of content and a more thoughtful approach to information sharing and commissioning. Linda Wishart, head of knowledge management for the Department said, “The program was more successful than we dared hope. There has been a noticeable change in corporate behavior – our recent staff attitude survey showed a 20 percent increase in awareness on last year, which must be attributed to the program.”

Ensure strong Knowledge Management Leadership

Strong knowledge management leadership is key to ensuring that knowledge management processes are followed.Strong knowledge management leadership can manifest itself in many ways: providing incentives for the right behaviors (and disincentives for the wrong ones), exemplifying the desired behavior, providing encouragement, and facilitating sharing and application of best practice across the organization. In an environment where the application of Web 2.0 technologies, such as wikis, blogs, social networking tools and virtual worlds, present countless opportunities for knowledge management by empowering employees and fostering a sharing environment, this can present an additional challenge for leaders, who need to walk the line between chaos and control. This often calls for a change in leadership style from hierarchical to open and sharing, and from a place where mistakes have career-changing consequences to managing a learning organization where mistakes are part of the process.

Perhaps the easiest - and most impactful - thing leaders can do is ensure that good knowledge management behavior is recognized and rewarded. For example, at a global professional services organization, one practice saw a 137 percent increase in document sharing via its corporate intranet within three months of adding knowledge management contribution as a factor in each individual’s performance appraisal scorecard.

It’s also important to reward the reuse of existing information as well as the creation of new information.While this can be seen as a huge challenge in industries where creativity is the lifeblood, it is not insurmountable. For example, the idea of anadvertising agency rewarding an employee for using someone else’s idea in a campaign seems absurd. However, it would be appropriate for both employees to be rewarded – one for the creative idea and the other for finding an application for it.

Knowledge management leadership does not need to come solely from the firm’s management team. At the Department of Health, it became clear that after creating enthusiasm for knowledge management through the training workshops (where division heads and team leads attended the session alongside their teams), the momentum was at risk of decreasing as time went by. This was compounded by other Departmental improvement initiatives being launched that threatened to distract attention from the knowledge management program. To prevent this, the Department implemented a network of knowledge management champions, who were tasked with encouraging continuing knowledge management change in their own workgroups and sharing best practice across the workgroups. Two years after the initial program, the champion’s network continues to meet regularly to share ideas and success stories.

Bringing the Elements Together

Ultimately, to derive maximum value from corporate knowledge the organization needs to employ all the enabling factors – process, culture, leadership and technology. Due to the interdependency of these factors, value driven from one factor can be increased by making an improvement in another (i.e., existing technology can be more valuable when the processes around how it should be used are clarified and communicated).A focus on changing behaviors can mean defined processes become actionable and behaviors can be changed quickly and sustainably when there is strong knowledge management leadership. As the case studies for the UK Department of Health, global manufacturing firm and professional services organization demonstrate, business value from organizational knowledge can be increased by focusing on more than just the technology.

References:

  1. Terry Ernest-Jones. "Know How: Managing Knowledge for Competitive Advantage," Economist Intelligence Unit, June 2005.
  2. Ernest-Jones.

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