Knowledge Management

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Summary: An in-depth overview of KM fundamentals
Review: Organizations are becoming awash with information flows and knowledge assets, and understanding and applying KM principles is becoming an increasing competitive imperative for companies around the world. This KM book provides a useful conceptual introduction to KM strategy, based on research carried out at leading U.S. and European companies.

The primary audience for the book is managers involved in KM practices, and MBA students. The material is divided into 10 chapters, covering KM models, processes, planning, learning, technology infrastructure and measurement.

The book includes a modest two-page list of references and a very useful ten-page questionnaire for assessing KM aptitude in an organization, covering issues like staff awareness, KM commitment, IT infrastructure, business culture, and KM measurement.

The book is based on research carried out in 1999 and 2000 by a University of Surrey project. The material is peppered with sidebars containing actual quotes from strategists and managers at 28 U.S. and European companies like HP, Andersen, Swiss Re, Barclays Bank, Cap Gemini, Siemens, AstraZeneca, Reckitt&Coleman, BP Amoco, KPMG, Buckman Labs, PriceWaterhouseCoopers, Rolls-Royce, Nokia, Cable&Wireless, NatWest, Procter&Gamble, Ericsson and PowerGen.

"KM has come to the fore over the last 8-10 years, progressively brought into centre-stage, driven by the networked economy through increased competition, mergers and acquisitions, and the all-invasive Internet. The net result of all this has been a far greater dynamism in the economy as a whole. People have greater access to information than they ever had before. There is a huge potential for learning at an accelerated pace, for change at an accelerated pace. What this has led to is a need to have a far more responsive organization," the authors begin.

Still, the authors caution that KM need not be a guarantee of success or survival, though it can certainly improve the odds. There is also the possibility that without proper planning, users may merely become 'information rich but knowledge poor.'

The authors draw up numerous taxonomies of knowledge, such as tacit/explicit, embodied/embedded/represented, individual/institutional, static/dynamic, declarative/procedural, routine/non-routine, team-specific/strategic. KM can also extend outside organizational domains to suppliers and distributors, via alliance knowledge; cultural alignment and trust are key pre-requisites for such transfers.

Contextually, KM is more organic and humanistic as compared to the various business strategy paradigms of the last few decades, such as portfolio management, sensitivity training, core competencies, TQM, and BPR.

The human factor was underestimated in BPR, whose focus on process efficiencies often ignored opportunities for knowledge exchange among employees and with customers. One of the major shortcomings of TQM and QC philosophy was its narrow focus on problem solving, and not other corporate issues.

McKinsey classifies KM buying behaviours into five kinds: conservative adopters (with basic KM functionality for cost savings), fast followers (deep KM functionality in a few critical processes), solution buyers (who prefer all-in-one solutions), self-sufficient integrators (market leaders), and business design innovators (driven by visionary leaders).

KPMG identifies five stages in the maturity of KM culture and adoption in a company: knowledge chaotic (no structured KM approach), knowledge aware (basic cataloguing available), knowledge enabled (standardized processes implemented), knowledge managed (integrated KM culture, CKO), and knowledge centric (daily assessment and improvement of knowledge environment).

From a KM practice perspective, Sveiby categorises four modes of knowledge conversion: embodied to embodied knowledge (sharing experiences and mental models, eg. apprenticeship), embodied to represented (eg. cookery books), represented to represented (eg. formal education, corporate universities), and represented to embodied (internalization).

Hansen, Nohria and Tuerney identify two kinds of KM strategies: codification (re-use of knowledge bases) and personalization (encouraging people-to-people networking and mentoring).

A key foundation of KM is nurturing and harnessing communities of practice, where knowledge is put into action. Useful tools here include organizational network analysis (ONA), based on employee answers to a wide range of questions about the conversations they normally indulge in at the workplace and outside. The output is the cross-functional sociogram, which can help identify key knowledge flows in an organization.

Expertise directories and glossaries, knowledge coordinators, network events, online collaboration spaces, and storytelling of illustrative anecdotes are important roles and processes here.

One chapter covers the KM matrix, a useful table with knowledge types on one axis (embedded, embodied, represented) and knowledge processes on the other (sense, organize, socialize, internalize). Accordingly, there are numerous KM activities (and enabling technologies) that arise, such as datamining, knowledge surveys, knowledge taxonomisation, groupware, e-learning, and workflow analysis.

Some obstacles that may arise here include differing learning styles among employees, a 'hoarding mentality,' and work-related cultural differences (particularly for global organizations) related to power, individualism, gender, and ability to cope with ambiguity.

On the technology front, content management is a major factor in the more efficient management of knowledge. Version control, document cross-referencing, library systems, security, bandwidth, interactivity and reusability are key considerations here.

At the end of the day, measures for evaluating KM programmes will have to be applied, but the issues surrounding such intangible assets are not easily resolved. Assessing intellectual capital can cover not just financial returns but also customer satisfaction, employee profiles, business processes, and performance trends (i.e. human, structural and customer capital).

Many of these perspectives and principles are based on the numerous examples cited throughout the book.

"The main objective of KM is to arrange, orchestrate, and organize an environment in which people are invited and facilitated to apply, develop, share, combine and consolidate knowledge," the authors conclude.