Why we need Knowledge Management
Long before Knowledge Management became a term du jour, the industrialist giant, Andrew Carnegie, said, “The only irreplaceable capital an organization possesses is the knowledge and ability of its people. The productivity of that capital depends on how effectively people share their competence with those who can use it.” The author of modern management, Peter Drucker, wrote, “The basic economic resource—the means of production—is no longer capital, nor natural resources, nor labor. It is and will be knowledge.” Even the genius of Charles Darwin makes the point, “It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change.” In this age, the only constant is change. Beside the well known changes in technology, there are continuing changes politically, socially, and economically. The ability of an organization to stay current and stay relevant requires a core competence in Knowledge Management.
Knowledge Management can transform your organization to new levels of effectiveness, efficiency, and scope of operation. Through advancements in technology, data and information are readily available. The modern business manager is able to discover and learn new measures, new technologies, and new opportunities, but this requires the ability to gather information in usable formats and disseminate knowledge to achieve the organization’s objectives.
Knowledge Management is continually discovering what an organization knows—codifying tacit knowledge, Data Mining, and Business Intelligence; continually increasing what the organization knows—organizational learning and communities of practice, and continually organizing and disseminating explicit knowledge for use throughout the organization.
So, why is knowledge management useful? It is useful because it places a focus on knowledge as an actual asset, rather than as something intangible. In so doing, it enables the firm to better protect and exploit what it knows, and to improve and focus its knowledge development efforts to match its needs. In other words:
- It helps firms learn from past mistakes and successes.
- It better exploits existing knowledge assets by re-deploying them in areas where the firm stands to gain something, e.g. using knowledge from one department to improve or create a product in another department, modifying knowledge from a past process to create a new solution, etc.
- It promotes a long term focus on developing the right competencies and skills and removing obsolete knowledge.
- It enhances the firm's ability to innovate.
- It enhances the firm's ability to protect its key knowledge and competencies from being lost or copied.
Unfortunately, KM is an area in which companies are often reluctant to invest because it can be expensive to implement properly, and it is extremely difficult to determine a specific ROI. Moreover KM is a concept the definition of which is not universally accepted, and for example within IT one often sees a much shallower, information-oriented approach. Particularly in the early days, this has led to many "KM" failures and these have tarnished the reputation of the subject as a whole. Sadly, even today, probably about one in three blogs that I read on this subject have absolutely nothing to do with the KM that I was taught back in business school. I will discuss this latter issue in greater detail in the future. (Alan Frost M.Sc., 2011 )
Akhavan et al (2005) identify several additional failure factors including: lack of top management support, organizational culture, lack of a separate budget, and resistance to change.
Building upon all this, and incorporating previously discussed elements, failure factors of knowledge management systems are as follows:
- Inadequate support: managerial and technical, during both implementation and use.
- Expecting that the technology is a KM solution in itself.
- Failure to understand exactly what the firm needs (whether technologically or otherwise).
- Not understanding the specific function and limitation of each individual system.
- Lack of organizational acceptance, and assuming that if you build it, they will come – lack of appropriate organizational culture.
- Inadequate quality measures (e.g. lack of content management).
- Lack of organizational/departmental/etc fit - does it make working in the organization. easier? Is a system appropriate in one area of the firm but not another? Does it actually disrupt existing processes?
- Lack of understanding of knowledge dynamics and the inherent difficulty in transferring tacit knowledge with IT based systems (see segment on tacit knowledge under knowledge sharing).
- Lack of a separate budget.
Knowledge Management: Advantages and Disadvantages
Knowledge Management is the collection of processes that govern the creation, dissemination, and utilization of knowledge.
· Makes personal, organizational, and societal intelligent behavior possible
· Can acquire job knowledge faster and more accurately
· Helps companies create better advertisement during slow periods
· Distinguishes between general data and what's considered knowledge
· Knowledge Management has involved the collection of "employee locators"
· Inability to deliver the expected performance outcomes
· Information may be incomplete
· Incomplete information can lead to misconceptions
· Lack of detail and or creativity
· Difficult to Access
· Some users are not capable enough to use automated tools to get required information.