Successful Knowledge Management

Knowledge Management (KM) main goal is to improve the internal processes of the organization so that it operates better, faster, cheaper, safer or cleaner. 

It is important to create KM strategy. KM strategy is about ensuring that KM processes are as good as they can be throughout the organization. 

Regardless of what industry your organization operates in, it is likely that you are concerned about operational efficiency and effectiveness, which means that operational excellence is a cornerstone of your KM strategy.

The KM strategy should include development and deployment of continually improving KM practices, process innovation, the use of communities of practice and knowledge base, and standardization of process wherever possible.

In a customer service organizations, KM aims to improve the delivery of knowledge to the customers and the people who work with the customers on a day-to-day basis so that customer relationships are maintained, service levels are high and sales volumes are increased. 

In a not-for-profit or non-governmental organization, your customers are the beneficiaries of your KM programs. Similar ideas apply in this circumstance as in a for-profit organization.

The crucial knowledge of an organization is that of the products or services that the organization offers, as well as knowledge about the customers themselves, the market, competitors and other participants in the sector. The majority of this knowledge will be internal with some external knowledge (knowledge from outside the organization) which is needed to fully understand the client, the market/environment, the competitors, etc.

Your KM strategy should include the creation of a reliable knowledge base of products or services for use by your sales force, your service force or your call center or your employees, allied with close attention to customer relationship management (CRM). 

There may also be elements of your strategy focused on the processes of selling and bidding, as even the best product or service will not make money if you can’t sell it. If your organization is in the service sector or is largely concerned with marketing and selling, customer knowledge is likely to be the cornerstone of your KM strategy.

Customer knowledge also applies to internal customers, for example, the IT department’s help desk for internal use. The help desk will need to be able to address employee technology issues based on what services and equipment an employee is using. There is less focus on sales and marketing in working with internal customer knowledge, but the other issues and concerns exist in this case also.

An innovation focus for KM involves the creation of new knowledge in order to create new products and services. The crucial knowledge is knowledge of the technology and of the marketplace. Much of this knowledge will be external, which is what primarily differentiates an innovation strategy from other KM strategies.

The strategy should include knowledge-creating activities such as business-driven action learning, think tanks, deep dives and other creativity processes, as well as knowledge-gathering activities such as technology watch and market research. 

There may also be elements of your strategy focused on reducing the cycle time for new products, as even the best product will not make money if takes too long to get it to the market. If your company is in the high-tech, bio-tech or pharmaceutical sectors, or any other sector with a focus on research and development and/or new products, then innovation is likely to be the cornerstone of your KM strategy.

A growth and change focus for KM involves replicating existing success in new markets or with new staff. It is critical to identify lessons learned and successful practices, so that good practices can be duplicated and mistakes learned from, and to transfer existing knowledge to new staff. 

New staff needs to be integrated efficiently and effectively with adequate training and knowledge transfer so that they become valuable members of the team as quickly as possible. Regardless of what industry you are in, growth and dealing with changing market and organization conditions are often considerations in your KM strategy.

Strategic Focus

In reality, companies may have elements of all four focus areas. They may be concerned about operating their companies efficiently, while also developing customer knowledge and retaining a focus on creating new products. 

However, the KM strategy should primarily address the most important of these four. Don’t spread yourself too thin; don’t try to do everything all at once. Instead, pick the most important driver, and devote your attention to developing an effective KM solution that addresses this focus area.

Doers vs. makers vs. sellers

Some companies do things, some make things, and some sell things. Different organizational focus, different approach to KM. The doers are concerned with operational efficiency, the makers are concerned either with operational efficiency or product innovation (depending on the product and the market they are in), and the sellers are concerned with customer knowledge.

Most organizations are a mix of doing and making, and all sell something, but the point is that depending on the market you are in and the type of product or service you have, you will have a different focus to your KM strategy. One of the main differences in KM strategies is the amount of attention placed on practice knowledge vs. product knowledge.

If an organization does things, its KM approach is all about the development and improvement of practice. The strategy would be to develop policies and procedures, develop communities of practice, and focus on operational excellence and continual practice improvement.

The same is true for the professional services sector and the oil and gas sector. In the case of the oil companies, selling the product requires little knowledge about oil (except for those few specialists concerned with selling crude oil to refineries), and the main focus for KM is on practice improvement. The KM framework involves communities of practice, best practices, practice owners, and practice improvement.

A typical product-based maker organization would be an aircraft or car manufacturer. They make things. Their KM approach is all about the development and improvement of product. They develop product guidelines for their engineers, their sales staff and their service staff. For example, Electronic Book of Knowledge would be a wonderful source to contain information about automobile components, Tech Clubs would be communities of practice.

In a maker organization, the experts are more likely to be experts on a product than on a practice area. With the more complex products, where design knowledge is critical, KM can become knowledge-based engineering, with design rationale embedded into CAD files and other design products.

If an organization is focused primarily on product learning, much of which learning is shared with the product manufacturer. For a product-based organization, the entire focus is on knowledge of product and product improvement.

The danger in KM comes when you try to impose a solution where it doesn’t apply. For example, imposing a maker KM solution onto a doer business, or an operational excellence KM solution onto an innovation business. This is why the best practice is to choose one area of focus for your KM strategy, and work with the parts of the business where that focus area is important.

Workforce demographics

Another factor that can influence your KM strategy is the demographic composition of your workforce. In a Western engineering-based organization, for example, the economy is static, and the population growth is stable. The workforce is largely made up of baby boomers. A large proportion of the workforce is over 50, with many staff approaching retirement. Within a company, very high levels of knowledge are dispersed around the organization, scattered around many teams and locations.

Communities of practice are important in a situation like this, so that employees can ask each other for advice, and receive advice from anywhere. Experienced staff collaborate with each other to create new knowledge out of their shared expertise. The biggest risk to many in an engineering-based organizations is knowledge loss, as so many of the workforce will retire soon.

In a Far Eastern engineering-based organization, the economy is growing, the population is growing, there is a hunger for prosperity, and engineering is also a growth area. The workforce is predominantly young with many of them employed less than two years in the company. There are only very few real experts and a host of inexperienced staff. 

Experience is a rare commodity, and is centralized within the company, retained within the centers of excellence and the small expert groups. Here the issue is not collaboration, but rapid integration and enhanced training. The risk is not retention of knowledge, it is deployment of knowledge.

These two demographic profiles would lead you to take two different approaches to your KM strategy. It is possible to combine the demographic view with the focus areas described previously.

Create your KM strategy based on a combination of the four focus areas and the two demographic types, with the addition of another demographic type, a balanced workforce with a good spread of young and experienced staff.

Galaxy Consulting has over 17 years experience creating and implementing KM strategy. Please contact us for a free consultation!