Fortune 500 companies lose at least $31.5 billion a year by failing to share knowledge. A Knowledge Management System (KMS) can help companies significantly reduce these costs.
Before we can look into what a Knowledge Management System is we should consider what constitutes knowledge. And before we do that, let's step back and look into the source of knowledge: data. In the organizational context, data can be defined as facts and figures that are of very little use in their raw form. When we process data to give it some structure and meaning, it becomes information.
For instance, when you plot data about the number of website visitors, you can identify a trend as to whether traffic is going up, down, or remaining stable. Knowledge goes a step further and empowers you to make predictions, associations, and decisions on what to do with this information. Knowledge will enable you to decide what to do when your website visitor numbers are decreasing. Perhaps you should advertise, redesign, improve content, or come up with another plan.
An organization's knowledge can be broadly classified into two broad categories. Tacit knowledge refers to knowledge that's largely related to employees' personal experience and intuition rather than existing in documented form. While this is the most valuable and common form of knowledge in any organization, tacit knowledge is very difficult to communicate. Explicit knowledge, on the other hand, refers to formalized and documented knowledge, which makes it easy to share, retrieve, and use. Hence, it's most important to implement a KMS to convert employees' tacit knowledge into explicit knowledge. As your KMS becomes richer you reduce dependence on your employees' informal knowledge sharing, run less risk of brain drain, and your decision-making process becomes more standardized.
Without a formal system, you run the risk of losing knowledge when employees leave, whether they go because they're forced by a mass layoff or individual firing for cause, or because they're advancing to a different organization for a career opportunity.
Whether they leave on bad terms because of layoffs or voluntarily and happily for a great new job, ex-employees' departures can disrupt operations because they take knowledge with them when they go. (Source: Asterix611)
Formally defined, KMS is an IT system which allows organizations to store and retrieve existing knowledge, share it amongst different groups of people to improve collaboration, and provides options for capturing new knowledge.
There are various types of KMSs, each designed to meet organizations' specific workflows and needs. Here's a look at them:
Decision support systems
A decision support system (DSS) allows organizations to leverage the knowledge in a KMS to make business decisions at various levels across an organization. Employees use knowledge derived from external and internal sources, as well as the impact of past decisions, that's housed within a DSS KMS.
Content management systems
Using a content management system (CMS), organizations can create, manage, and distribute content internally or externally. A CMS provides predefined frameworks and templates for the creation of new organizational knowledge.
Groupware systems
As the name implies, groupware systems help people to collaborate with each other. They may include simple communication tools for sending messages and files or video or audio conferencing applications. Groupware systems could encompass tools that help people work collaboratively on group projects, such as project management and workflow systems.
Document management systems
Document management systems (DMSs) are related to storage, retrieval, and publishing of documents in an organization. They attempt to capture the organization's explicit knowledge and give it a concrete form. Through the use of metadata and indexing, these systems simplify information retrieval.
No matter which type of KMS is most appropriate to your specific needs, one thing is clear: Companies that don't share knowledge will lag in collaboration, innovation, and competitivemess, and that gap will increase as people -- and knowledge -- leave.
Taimoor - Employees need to get constant feedback throughout the year, and see documenting business process as tied to pay. Otherwise it'll just be something that comes up momentarily on the employee's annual review, and then forgotten.
Workplace survivors know you have to give the bosses what they want, not what they say they want.
"Hence companies should make sure that the employees interact regularly so that their is constant flow of thoughts and ideas. "
@AnandY: Yes, interaction is important but the interaction should also be given a written form so that other people are also able to derive meaning from it if the participants are not there. This is where a KMS can help.
"How do you get people to document processes without slowing down business too far?"
@Mitch: I'm not sure how companies are doing it but I can think of adding a clause as part of an employee's appraisal if he's been able to document whatever he's been doing. That will serve as an incentive to document.
Other than this, companies also tend to ensure that employees take their vacations regularly and are forced to share knowledge with other people to handle things in their absence.
@taimur_tz, this is a very good idea. But I think it would be very difficult to share the entire knowledge in short span of time. Hence companies should make sure that the employees interact regularly so that their is constant flow of thoughts and ideas.
That's a great process, Tobyd. It represents a good model of capturing data that Taimur so effectively points out. That is a good example of a true knowledge system.
There is an entire dimension of building value that many organizations overlook and, therefore, do not realize the full benefit.
taimur_tz - Forcing people to take vacations regularly is a good idea. It's humane AND good for business. Other forms of job-sharing can also help in this regard.
How do you get people to document processes without slowing down business too far?
@Mitch: I have worked in KM/KH (Knowledge Management & Know How) largely for big law firms, a world class consulting company and a UN NGO. One of the most effective ways of capturng knowledge I have seen is by the process of a formal debrief of the team leads after every engagement through a set of searching and carefully thought-out questions as a part of a personal interview by a member of the KM team. This output together with key documentation and a summary of findings was then given a rating and appropriately classified for the KM database.
I have many tales to share on this subject if it is of inteest.
"Capturing knowledge is even more elusive in many ways, especially when you get into esoteric areas like creativity."
@Alison: Agreed. And perhaps there are somethings like dance that may very well left to be an art form rather than be made a science so that the room for creativity prevails.
"It's a bit like trying to capture how to ride a bike as a set of heuristic rules. It''s easy to show someone how to ride a bike, much harder to write instructions on how to ride a bike and expect non-bike riders to be able to ride by following them."
@Kim: That's a very apt example and that's how things work in most companies in their initial stages. The owners come up with a great artistic solution that they go out and sell in the market and get successful. But the real challenge lies in coverting that art into a science so that your success can be repeated over and over.
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