An Introduction to Knowledge Management

Types of Knowledge There are two kinds of knowledge. One is explicit knowledge, which can be expressed in words and numbers and shared in the form of data, scientific formulae, product specifications, manuals, universal principles, and so forth. This kind of knowledge can be readily transmitted across individuals formally and systematically. This has been the dominant form of knowledge in the West. The Japanese, however, see this form as just the tip of the iceberg. They view knowledge as being primarily tacit, something not easily visible and expressible.

Tacit knowledge is highly personal and hard to formalise, making it difficult to communicate or share with others. Subjective insights, intuitions and hunches fall into this category of knowledge. Furthermore, tacit knowledge is deeply rooted in an individual's action and experience, as well as in the ideals, values or emotions he or she embraces.

To be precise, there are two dimensions to tacit knowledge. The first is the "technical" dimension, which encompasses the kind of informal and hard-to-pin-down skills or crafts often captured in the term "know-how". Master craftsmen or three-star chefs, for example, develop a wealth of expertise at their fingertips, after years of experience. But they often have difficulty articulating the technical or scientific principles behind what they know. Highly subjective and personal insights, intuitions, hunches and inspirations derived from bodily experience fall into this dimension.

Tacit knowledge also contains an important cognitive" dimension. It consists of beliefs, perceptions, ideals, values, emotions and mental models so ingrained in us that we take them for granted. Though they cannot be articulated very easily, this dimension of tacit knowledge shapes the way we perceive the world around us.

What is knowledge management (KM)?

Unfortunately, there's no universal definition of knowledge management (KM), just as there's no agreement as to what constitutes knowledge in the first place. For this reason, it's best to think of KM in the broadest context. Succinctly put, KM is the process through which organizations generate value from their intellectual and knowledge-based assets. Most often, generating value from such assets involves codifying what employees, partners and customers know, and sharing that information among employees, departments and even with other companies in an effort to devise best practices. It's important to note that the definition says nothing about technology; while KM is often facilitated by IT, technology by itself is not KM.

Think of a golf caddie as a simplified example of a knowledge worker. Good caddies do more than carry clubs and track down wayward balls. When asked, a good caddie will give advice to golfers, such as, "The wind makes the ninth hole play 15 yards longer. " Accurate advice may lead to a bigger tip at the end of the day. On the flip side, the golfer having derived a benefit from the caddie's advice may be more likely to play that course again. If a good caddie is willing to share what he knows with other caddies, then they all may eventually earn bigger tips. How would KM work to make this happen? The caddie master may decide to reward caddies for sharing their tips by offering them credits for pro shop merchandise. Once the best advice is collected, the course manager would publish the information in notebooks (or make it available on PDAs), and distribute them to all the caddies. The end result of a well-designed KM program is that everyone wins. In this case, caddies get bigger tips and deals on merchandise, golfers play better because they benefit from the collective experience of caddies, and the course owners win because better scores lead to more repeat business.

KM has assumed greater urgency in American business over the past few years as millions of baby boomers prepare to retire over the coming decade. Tens of millions of baby boomers turned 60 in 2005, so those of them who arent already retired are certainly planning to do so soon. And when they punch out for the last time, the knowledge they gleaned about their jobs, companies and industries over the course of their long careers walks out with themunless companies take measures to retain their insights. In addition to an immanent mass retirement, the outsourcing trend has forced CIOs who have entered into outsourcing agreements address the thorny issue of transferring the knowledge of their full-time staff members, who are losing their jobs because of an outsourcing deal, to the outsourcers employees in order to smooth the transition to the newly restructured IT organization.

What constitutes intellectual or knowledge-based assets?

Not all information is valuable. Therefore, it's up to individual companies to determine what information qualifies as intellectual and knowledge-based assets. In general, however, intellectual and knowledge-based assets fall into one of two categories: explicit or tacit. Included among the former are assets such as patents, trademarks, business plans, marketing research and customer lists. As a general rule of thumb, explicit knowledge consists of anything that can be documented, archived and codified, often with the help of IT.

Much harder to grasp is the concept of tacit knowledge, or the know-how contained in people's heads. The challenge inherent with tacit knowledge is figuring out how to recognize, generate, share and manage it. While IT in the form of e-mail, groupware, instant messaging and related technologies can help facilitate the dissemination of tacit knowledge, identifying tacit knowledge in the first place is a major hurdle for most organizations.

Besides using technology, how else can tacit knowledge be transferred? (Shared)Shadowing and joint-problem solving are two best practices for transferring or recreating tacit knowledge inside an organization. With shadowing, less experienced staff observe more experienced staff in their activities to learn how their more experienced counterparts approach their work. Dorothy Leonard and Walter Swap, two knowledge management experts, stress the importance of having the "protg" discuss their observations with the "expert" in order to deepen their dialog and crystallize the knowledge transfer.

Another sound approach that Leonard and Swift recommend is joint problem-solving by expert and novice. Since people are often unaware of how they approach problems or do their work and therefore cant automatically generate step-by-step instructions for doing whatever they do, having them work together on a project will bring the experts approach to light. The difference between shadowing and joint problem solving is that shadowing is more passive. With joint problem-solving, the "expert" and the "novice" work hand-in-hand on a task.

What benefits can companies expect from KM?

Some benefits of KM correlate directly to bottom-line savings, while others are more difficult to quantify. In today's information-driven economy, companies uncover the most opportunities and ultimately derive the most value from intellectual rather than physical assets. To get the most value from a company's intellectual assets, KM practitioners maintain that knowledge must be shared and serve as the foundation for collaboration. Yet better collaboration is not an end in itself; without an overarching business context, KM is meaningless at best and harmful at worst. Consequently, an effective KM program should help a company do one or more of the following:

Foster innovation by encouraging the free flow of ideas

Improve customer service by streamlining response time

Boost revenues by getting products and services to market faster

Enhance employee retention rates by recognizing the value of employees' knowledge and rewarding them for it

Streamline operations and reduce costs by eliminating redundant or unnecessary processes

These are the most prevalent examples. A creative approach to KM can result in improved efficiency, higher productivity and increased revenues in practically any business function.

The 3Cs of Knowledge Sharing:Culture, Co-opetition and CommitmentOne of the challenges of knowledge management is that of getting people to share their knowledge. Why should people give up their hard-won knowledge, when it is one of their key sources of personal advantage? In some organizations, sharing is natural. In others the old dictum "knowledge is power" reigns. In this article we explore some of the barriers and offers some pointers to overcoming them.

Why Don't People Share?

Some of the common reasons given by those I meet and in helpful articles and books (see, for example, the section on psychological obstacles in reference 1 or "the impediments" in reference 2) are:

"Knowledge is power" - but how true is this really? My own view is that citing this reason is often a cop out by managers or change agents who are not adequately addressing the human factors or motivational aspects. In today's enterprise, where so much depends on teamwork and collective knowledge, it is only a handful of people who have knowledge for which they can hold their peers (and bosses) to ransom. It might be the owner-manager of a small company not wanting to lose trade secrets; it may be a particular specialist who has been in the organization many years and built up his or her own unique way of achieving success without perhaps even understanding the deep tacit knowledge of how they do it. Don't get me wrong - knowledge IS power, but is typically not the primary reason for lack of knowledge sharing.

"not invented here" syndrome - this is more common. People have pride in not having to seek advice from others and in wanting to discover new ways for themselves.

Not realizing how useful particular knowledge is to others - an individual may have knowledge used in one situation but be unaware that other people at other times and places might face similar situations. Additionally, knowledge derived for one need may be helpful in totally different contexts; or it may be a trigger for innovation - many innovative developments come from making knowledge connections across different disciplines and organizational boundaries.

Lack of trust - if I share some of my knowledge, will you use it out of context, mis-apply it (and then blame me!), or pass it off as your own without giving any acknowledgement or recognition to me as the source?

Lack of time - this, I suspect, is the major reason given in many organizations. There is pressure on productivity, on deadlines, and it's a general rule that the more knowledgeable you are, the more there are people waiting to collar you for the next task. How can you possibly find time to add your lessons learnt to the knowledge database or have a knowledge sharing session with your colleagues?

Other barriers cited by experts include functional silos, individualism, poor means of knowledge capture, inadequate technology, internal competition and top-down decision making. Generally, a mix of structural and infrastructure barriers is exacerbated by the predominance of human ones - social, behavioural and psychological.

How can we overcome such barriers? Certainly address the issues of organizational structure and inadequate technology. But give your focus to the three Cs of Culture, Co-opetition (a blend of co-ooperation and competition), and Commitment.

Changing CultureCulture change is never easy and takes time. But cultures can be changed. Culture is defined in many ways, such as "commonly held beliefs, attitudes and values" (Institute of Personnel Development), "the collective programming of the mind that distinguished one group from another" (Geert Hofstede), and in many other ways that also embrace rituals, artifacts and other trappings of the work environment. I like the simple but effective definition "the way we do things around here". There is no one place to start, but most interventions are based on a simple layered model that portrays how people's observable actions and behaviours are influenced by reportable attitudes and values based on more deep-rooted beliefs. Therefore to change people's actions you have to address the more fundamental underlying layers. This can be done as an organization-wide programme or in small groups or even individually. Here are some activities that might be used to plan and induce change:

A culture audit - conducting questionnaires, interviews and team sessions with a cross-section of the organization. This is especially helpful in finding out the difference between what is articulated as the desired culture and what is done (e.g. "we put quality first" but at the same time the organization ships out less than perfect products at the end of a financial quarter to "make the numbers"). It is also common to find several sub-cultures that conflict with overarching goals. Can you clearly identify which values and behaviours conflict with better knowledge sharing and perhaps (more importantly) which people should be the target for change?

Challenge 'improper' behaviour - if you identify people hoarding knowledge unnecessarily: challenge them, though avoid "knowledge rage".

Involvement - some of the best knowledge sharing cultures are where everybody (even novices and newcomers) believes that their knowledge is respected, valued and used to inform decisions.

Use of role models - identify those people whose behaviours are an example to others. Celebrate and publicize them. Involve them with other groups.

Team-building / organization development sessions - at regular team meetings, allocate time to understand and improve internal processes; too many meetings are task and output focussed, but fail to address the means of achieving successful outcomes.

Align rewards and recognition to support appropriate behaviours - too many schemes are based on seniority or individual expertise, rather than team effectiveness.

Change people - move the knowledge sharers around; get industrial psychologists and behavioural experts on board; perhaps fire some bosses (seriously!) - after all, it is quality of leadership that will enable all the other culture change techniques to achieve their aims.

Finally, remember that culture goes hand in hand with structure (roles and responsibilities). At every level within the organization, there must be congruence between objectives, structures, processes, people and supporting infrastructure. A good example of changing culture alongside an evolving knowledge management programme is that of Siemens (see reference 3 and Knowledge Digest).

Challenging Through Co-opetitionHuman beings are at the same time social cooperative beings and have a competitive streak. We all like to do better than our peers and excel in something. Yet, in today's complex world, we need help from them to achieve our aims. In an organization, lack of competition - both for individuals and teams - leads to complacency. But competition must be done in a healthy manner. Some things to consider:

In early stages of product development, don't simply approve one line of approach. Have several "competing" projects under way but make sure there are mechanisms to exchange knowledge and challenge / encourage each "runner" e.g. through people sharing, peer reviews etc.

Continually benchmark internal processes and functions with other organizations and potential suppliers. Encourage them to strive for improvement through learning from each other.

Introduce 'competitions', such as the "knowledge champion of the year", the "innovators team award", but invite everybody to the award ceremonies.

Compete, not against other people or teams, but set goals vs. challenging targets or external competitors.

Above all, let the apparent losers of such competitions share in success, celebrate what they have achieved, and make them feel part of the winning team (the wider organization). In one organization I know, whenever a competing development project was wound up, the best people were almost universally attracted to the winning teams (since the healthy competition meant that each had good knowledge of the other).

CommitmentThis builds on the other two Cs. Organizations need to create a commitment to culture, to change, to challenge, to compete and cooperate. If, as is often the case, time pressure leads to poor knowledge sharing, then there must be a commitment to allow time for it to happen. Budget 5 per cent of a project's resources to distilling lessons and sharing. Include time to contribute to knowledge development and sharing in people's job goals (and in the accompanying reward system). Build commitment into team processes.

Commitment to knowledge sharing must be demonstrated throughout the organization. It is apparent through what the leaders of the organization say and do. It is shown by commitment in the organizations' processes, reward systems, development programmes etc. It is, above all, shown by individual throughout the organization being committed to share their knowledge with others even if it is not formally part of their 'day job'.

Summary: Seven Incentives for $$haringMy own experience is that knowledgeable people do like to share their expertise - just listen to them in the bar after work. It's just something about their work environment that discourages this natural inclination. Understanding these barriers and individual motivations is the first step towards implementing changes in the work setting. I've offered some suggestions in the 3Cs above. Different approaches will be appropriate in different situations. But one thing is clear: you can change organizational culture and individual behaviours such that knowledge sharing, rather than knowledge hoarding, is the norm. You only have to look at companies like BP and Siemens to see this in practice. One article which also illustrates some successful examples was written by Larry Stevens, in the now defunct (at least in its hard-copy form) of Knowledge Management Magazine (the one published by CurtCo Freedom Press) in October 2000. He cited seven incentives for sharing with examples:

Hire people who will share - at Collective Technologies of Texas, the process starts with recruiting people through an intensive few days of interactive interviews;

Develop trust - Buckman Laboratories nurtures trust through its ten point code of ethics in which employees are steeped;

Vary motivations - CAP-Gemini Ernst & Young applies incentives at three levels: a solid business case for senior executives, relevant benefits for departments, and incentivizing positive behaviours with employees;

Show public recognition - Harris has its "wall of fame" a gallery of pictures of employees who have excelled at knowledge sharing;

Reorganize for sharing - Northrop Grumman uses integrated product teams, backed up by appropriate mentoring programmes;

Create communities - The World Bank uses electronic bulletin boards focussed around relevant topics, but which cut across organizational boundaries;

Develop leaders - Capital One formed a group from natural knowledge champions to promote knowledge sharing and develop training.