Knowledge Management

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Knowledge Management
GROUP 5
Dave Owens T.J. Vogt Chatchawan Wongwattanakit
OT Yueping Wang
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What is Knowledge Management?
Knowledge Management is a waste of money.
Organizations spend billions of dollars in their
efforts to cut a corner or two resulting in just
a fraction of savings Richard Sapio

CEO, Mutual Capital
Alliance
(8)
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Agenda
Questions/ Discussion
What is KM?
Summary
Key Concepts
Knowledge Management
KM in the Army
Implementation Maintenance
Other KM Cases PwC, LRC
KM in China
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What is Knowledge Management?

• Common Knowledge Management Definitions (just
  a few of the many)
• Discipline within an organization that ensures
  that the intellectual capabilities of that
  organization are shared, maintained and
  institutionalized
• The process of systematically and actively
  managing and leveraging the stores of knowledge
  in an organization
• The way a company stores, organizes and accesses
  internal and external information.
• Refers to an entire integrated system for
  accumulation, integration, manipulation, and
  access of data across multiple organizations

(9),(10)
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What is Knowledge Management?

• Knowledge Management is the explicit
• and systematic management of vital
• knowledge - and its associated processes
• of creation, organization, diffusion, use and
• exploitation.

(9),(10)
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Knowledge Hierarchy

• Explicit
• This type of knowledge can be
• Processed by information systems
• Codified and recorded
• Archived and protected

• Tacit
• This type of knowledge exists in peoples heads,
  not articulated or documented

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KM Significance

• Knowledge assets have often become more
  important to companies than financial and
  physical assets and are often the only way for a
  company to distinguish itself from its competitor
  gain competitive advantage
• Lost knowledge given the enormous of baby boomers
  that will be changing jobs or retiring in next
  few years cause productivity cost of an employee
  leaving 85 of their base salary due to their
  replacements mistakes, lost knowledge and lost
  skill( Beazley et al, 2002)
• Relate to the concept of knowledge half-life,
  from which it is found that knowledge reaches
  obsolescence, on average, in 500 days, but can be
  much quicker in some areas
• - Lost knowledge obviously has a cost, estimated
  that 115 billion sits idle in
• lost knowledge affiliated with production
  technologies
• - An astounding example of this is the loss of
  the original computer source
• code, written in the 1950s, that spawned the
  Y2K software crisis, has cost
• businesses worldwide an estimated 1 trillion
  (Petch, 1998)

(25)
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People and Systems

• People
• Knowledge Teams - multi-disciplinary,
  cross-functional
• Learning Organization - personal/team/org
  development
• Corporate Initiatives Chief Knowledge Officer
• Systems
• Knowledge Data-bases - experts, best practice
• Knowledge Centers - hubs of knowledge
• Technology Infrastructure - Intranets, Domino
  Document Management

(9),(12)
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Two Key Thrusts
Sharing existing knowledge Knowing what you know
Knowledge for Innovation Creating and Converting
(9)
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Knowledge Cycle
Innovation Cycle KM Cycle
Collect
Codify
Identify
Classify
Embed
Organize/ Store
Product/ Process
Knowledge Repository
Create
Share/ Disseminate
Use/Exploit
Diffuse
Access
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Seven Levers

• Customer Knowledge - the most vital knowledge
• Knowledge in Products - smarts add value
• Knowledge in People - but people walk
• Knowledge in Processes - know-how when needed
• Organizational Memory - do we know what we know?
• Knowledge in Relationships - richness and depth
• Knowledge Assets - intellectual capital

(9)
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Implementing and Maintaining KM
Maintaining KMS
KM
Why Implement KM?
Strategy for Implementing
Whos Responsible?
ITs Role in Implementing
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Why Implement KMS?

• IBM, Oracle, Cisco
• Measure intranet value at over 1 billion
• BT, UK telecommunications company
• Employee ideas have saved 100 million
• Sodexhos SuperSleuth
• Cash reward for employees submitting sales leads
• Led to over 90 million in sales volume

(20)
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Smaller companies, who often claim that they
cant afford to undertake KM activities, are
wrong on two counts!
Common Misconceptions

• 1.Knowledge is just as important, if not more so,
  to a smaller company
• trying to compete in the rapidly changing
  global marketplace. Smaller
• companies must capture, assimilate, and
  capitalize on every
• advantage they can find, including KNOWLEDGE
• 2.Smaller firms have the advantages from Culture
  and Organizational
• structure in place that is much more conducive
  to implementing
• knowledge management effort such as type of
  environment, which is
• predicated more on social relationship,
  familiarity and trust between
• employees

A little Knowledge that acts is worth more than
much knowledge that is idle.(Kahlil Gibran)
(25)
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Whos Responsible?

• Everyone
• Managers/Supervisors
• Leaders as knowledge champions
• The Knowledgeable
• Not a problem of knowing, but of access
• End Users
• Feedback
• Psychological barriers

(13), (14)
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Role of IT in Implementation

• The biggest contributor to this brilliant growth
  of the knowledge management system is information
  technology.
• Lee et al. also say, ...there are negative
  perspectives about information technology.
• According to a managing partner at a KM
  consultancy firm based in New York, The biggest
  misconception that IT leaders make is that
  knowledge management is about technology...Usually
  people begin a KM project by focusing on the
  technology...But the key is people...

(15),(16)
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Strategy for Implementing KM The MeCTIP model
(19)
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Strategy for Implementing KM

• Macro-environment
• External Factors
• Globalization
• Technology
• E-companies

(19)
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Strategy for Implementing KM

• Organizational Climate
• Structure
• Formal Structures
• Cross-functional project groups
• Cross-discipline learning groups
• Informal Structures
• Grapevine/Underground
• Cliques
• Strategy/Goals
• Culture

The difference between, ...what is formally
agreed and what actually takes place.
(19)
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Strategy for Implementing KM

• Technical Climate
• Infrastructure
• Response to change
• Resistance to change/Conflict
• Listen to negative feedback
• Conflict leads to improved ideas

(13),(19)
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Strategy for Implementing KM

• Technical
• System Standardization
• Compatibility
• Usability

(13),(19)
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Strategy for Implementing KM

• Informational
• Info fatigue
• Infofamine
• Infoglut
• According to Lee et al, ...users do not know how
  to utilize effectively the vast pool of
  information.

(16),(19)
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Strategy for Implementing KM

• Personal
• Knowledge roles
• Motivation
• Learning networks

(19)
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Maintaining KM Systems

• Provide Adequate Access
• Intranets
• Classes
• Psychological Barriers
• Ook Lee study
• 103 questionnaires from Korean KMS users
• 93 respondents were reluctant to say that a
  knowledge management piece was not valid

(17)
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Maintaining KM Systems

• Use it or lose it
• Cook compares KMS to draining battery
• Share knowledge
• Knowledge is individual power, not group power
• Removing knowledge constipation
• Crowded closet

(13)
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Maintaining KM Systems

• Incentives
• Financial
• Big Idea
• Pub Money
• Organizational Sociology
• Know your audience
• Be flexible
• No single recipe for success

(13)
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The Difference of Knowledge Management in US and
CHINA
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Cultural Factors Impacting knowledge Management

• Internationalization creates a need to know how
  peoples in different countries to apply knowledge
  management.
• People from the United States and China have a
  distinctive prevailing decision style that
  reflects differences in cultural values

(4)
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Why they express happiness differently
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The difference of American and Chinese in
personal character
(2), (3)
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The different ways in deal with gift
Presents are usually opened in front of the giver
Presents are usually opened in private
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The difference of U.S. and CHINA in Knowledge
management
(5)
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guanxi in China

• Social ties -- interaction frequency, degree of
  intimacy and trust
• Its not what you know, its who you know.
• Business guanxi (personal relationships in
  Chinese market)
• Government guanxi (personal relationships with
  government officials in different levels and
  bureaus).

(5)
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• Could we combine two styles of knowledge into an
  integral whole

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• In the international work group, people need to
  know how to combine different knowledge into an
  integral whole. To achieve this goal we should
  understand the knowledge creation process

(5)
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The knowledge creation process
(1)
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Knowledge Management in Practice
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PricewaterhouseCoopers

• PwC The PricewaterhouseCoopers Law Firm Law
  Department Service Group
• The Worlds largest professional service
  organization
• Service and Help general counsel and law firm
  executive management solve
• complex business problems
• Measurably enhance their ability to build
  sustainable shareholder value
• Manage Risk
• Improve quality and performance by providing
  services based on quality and
• integrity
• PwC includes the member firms of
  PricewaterhouseCoopers International Ltd.,

(21)
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LRC Legal Research Center

• Helping corporate law departments and their
  outside counsel reduce their research costs and
  efficiently manage their legal knowledge for
  nearly 25 years
• Remain the nations premier provider of
  outsourced legal research, KM, and compliance
  e-training services
• Culturally committed to operational excellence
• Customer intimacy and product/service innovation

(21),(22)
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The Study

• In 2003, Florida Legal Technology Institute Study
• Reviewed the marriage between PwC and LRC,
  catalog the advantages of KM in PwC law firms and
  departments
• KM Study with 348 legal professionals around the
  world (law departments and outside law firms)

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PwC and LRC KM Study Results Announced

• 70 of law firm respondents and 63 of Law Dept.
  respondents reported having KMS in place
  indicated that they use KMS either frequently
  or all the time
• The survey indicated that their KM program either
  meets or exceeds their targeted ROI
• 85 of the law firms
• 78 of the law dept.
• The Avg. budget to support KM initiative was
  reported at 4.7 of the total legal spend.
• Quality, speed and cost containment are what a
  majority of legal professionals are seeking from
  their KM solution providers.
• The most common standards to measure the value of
  KM programs are productivity enhancement and cost
  reduction.

(21),(22)
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PwC and LRC KM Study Results Announced (cont.)

• Legal professionals are increasingly cognizant of
  the value of KMS that retrieve information from
  multiple sources and locations. 82 said they
  would be more efficient if their KM solution
  could access legal knowledge in multiple formats
  from multiple resources.
• The majority of legal professionals surveyed
  believe that research redundancy, the reduction
  of which is a key goal of KM, is caused by lack
  of communication inside the firm or law dept.,
  and by the lack of incentives to motivate
  knowledge reuse and eliminate redundant research
• With the ever increasing volume and types of
  information available, KM is more critical than
  ever. This study provides compelling data on the
  value and important of KMS. KM is an essential
  ingredient for efficient and effective delivery
  and management of legal services. (Jonathan
  Bellis)

(21),(24)
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When Knowledge adds up to nothing

• Charles Lucier, Chief Knowledge Officer at
  International management and technology
  consulting firm said up to 84 of all KM programs
  fail.
• A global bank spanning 70 countries abandoned
  their KMS before it was ever rolled out.
• A European manufacturing company successfully
  implemented a KMS, but it was rarely used.
• A pharmaceutical company implemented a KMS that
  could not be easily adapted to specific context
  of each work group

(21), (26)
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Why Knowledge Can add up to nothing --

• Many companies find that their departments have
  different takes on what the project means or what
  it is trying to achieve
• Many KM program leaders are ignorant when it
  comes to the complexity of these micro-political
  processes
• Even though some firms are implementing KM
  programs with support from senior management, it
  can still fail as a result of lack of support
• Some organizations do not achieve adequate ROI
  from KM as they are failing to measure
  effectively
• Many companies professed to suffer from
  information overload and a shortage of time
  with which to both share and utilize knowledge
• Many firms rely too heavily on consultants who
  position themselves in highly influential
  positions within the organization
• Many initiatives fails as they only enjoy
  superficial support from the top management

(21)
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Knowledge Management Success

• Evidence shows that, despite the potential
  pitfalls and seemingly high failure rate,
  companies are still willing to invest in KM. Why?
  Because there are big benefits there for taking.
• The results of several surveys met
• 87 of European business directors believe they
  could enhance their companys competitiveness
  with improved KM and 76 believe Building
  Sharing Knowledge is important for their company.
  
• Study of 500 firms conducted by KPMG illustrated
  80 of senior executives feel that KM is
  strategic to their organization and 78 feel they
  have missed business opportunities.
• Hoffmann-Roche, the Swiss pharmaceutical firm,
  has estimated that it saves over 1 million per
  day due to its KM activities
• BP Amoco attributed 260 million in bottom-line
  savings to a KM program

(23)
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Knowledge Management Success (Cont.)

• Energy firm Schlumberger Ltd. reported an
  estimated 668 ROI on a 72 million investment in
  KM over a period of six years
• Chevron Corporation estimates that it saved an
  initial 150 million, plus at least another 20
  million annually by instituting a best practices
  program
• Teltech Communications, a firm that specializes
  in aiding companies to implement knowledge
  management programs, reports that its clients
  enjoy an average ROI of 121 for their efforts
• In a survey carried out by Information Week , IT
  executives said they considered KM a strategic
  initiative of high importance, and KM spend is to
  climb at 62 of the IT institutions surveyed
• Hewlett-Packards knowledge efforts aimed at
  customer service have reduced average call times
  by two-thirds and the cost per call has fallen by
  50 percent

(21),(23),(25)
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Keys to successful KM

• As is the case with many new practices in
  workplace
• Getting employees on board from day one and
  making sure they realize exactly how KM program
  is to impact on their routines and bring benefits
  for the organization as a whole is pivotal
• Make sure KM becomes a fundamental aspect of the
  way you do business
• Be sure your KM implementation is less about
  reporting and more about sharing knowledge
• Knowledge is a company asset, hidden, until the
  knowledge worker releases it. The key to
  generating the best returns from your KM Program
  is to implement a well-planned methodology and
  ensure that your organization facilitates this
  release of information.
• -Mike Bagshaw, Development Director at
  Trans4mation Training Ltd,

(24)
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Army Knowledge Management
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Army Knowledge Management
It is the Armys goal to deliver critical
capabilities to the warfighter, and oversee the
development of a knowledge-based
workforce LTC William Nelson

Deputy Director GA CKO
(Governance, Acquisition
and Chief Knowledge Office)
Army Office of CIO/G-6
(7)
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Army Knowledge Management

• Development of Army IM/IT and KM
• Coordination between Combatant Commands and Joint
  Staff, components and agencies, etc
• Serves as the focal point for management and
  integration with IM/IT
• Oversees the acquisition of IM/IT and KM solutions

(7)
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KM is a Journey, not a destination.
(Warick Holder)

• Knowledge resides in the users and not in the
  collection.
• (Y. Maholtra)
• Successful knowledge transfer involves neither
  computers nor documents but rather interactions
  between people!!
• (Mason Mitroff
  1973)

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Summary

• Key Concepts of KM
• Explicit Knowledge
• Tacit Knowledge
• Implementation, Maintenance
• China
• KM cases, advantages and disadvantages
• Army KM

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Questions
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Sources
(1) Communications of the ACM ,Volume 48, Number
4 (2005), Pages 73-76 ,Knowledge management in
China, Glen R. Burrows, Damon L. Drummond, Maris
G. Martinsons (2) KNOWLEDGE MANAGEMENT OF
HIGH-TECH FIRMS Chung-Ming Lau, Yuan Lu and Shige
MakinoThe Chinese University of Hong Kong (3)
Xiaohong Chen State Development Research Center,
PRC Ryh-Song Yeh ,Peking University SOURCE
http//unpan1.un.org/intradoc/groups/public/docume
nts/APCITY/UNPAN020318.pdf (4) Inkpen, A.C.
2000. Learning through joint ventures A
framework of knowledge acquisition. Journal of
Management Studies, 37 1019-1043. (5)
Hoskisson, R.E., Eden, L., Lau, C. M., Wright,
M. 2000. Enterprise strategies in emerging
economies. Academy of Management Journal, 43
249-267. (6) Army Regulation 25-1 Army
Information Management (7) LTC William Nelson,
Deputy Director GACKO, Office of Army G6,
interviewed by phone by Dave Owens,
15 October 2007. (8) Richard Sapio, CEO of
Mutual Capital Alliance, interviewed in person by
Dave Owens, 22 September 2007 (9) Skyrme, David
J, Developing a Knowledge Strategy STRATEGY,
January 1998, http//www.skyrme.com/pubs/knwstrat.
htm (10) Corral, Sheila, Are We in the
Knowledge Management Business? ARIADNE, February
1999, http//ariadne.ac.uk/issue18/knowledgemgt/
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Sources
(11) KNOVA, 10 Principles for Knowledge
Management Success, Gartner INC., April
2003 (12) Ferran-Urdaneta, Carlos,
Organizational Structures for Knowledge
Management, Boston University Systems Research
Center, 1999 (13) Cook, P. (1999). I heard it
through the grapevine making knowledge
management work by learning to share knowledge,
skills and experience. Industrial and Commercial
Training , 31 (3), 101-105. (14) Gottschalk, P.,
Holgersson, S. (2006). Stages of knowledge
management technology in the value shop the case
of police investigation performance. Expert
Systems , 23 (4), 183-193. (15) Kulkarni, U. R.,
Ravindran, S., Freeze, R. (2006). A Knowledge
Management Success Model Theoretical Development
and Empirical Validation. Journal of Management
Information Systems , 23 (3), 309-347. (16) Lee,
H.-S., Chae, Y.-I., Suh, Y.-H. (2004).
Knowledge Conversion and Practical Use with
Information Technology in Korean Companies. Total
Quality Management , 15 (3), 279-294. (17) Lee,
O. (2006). Psychological Barriers to Maintaining
Knowledge Management Systems. CyberPsychology
Behavior , 9 (3), 367-368. (18) Moffett, S.,
McAdam, R. (2006). The Effects of Organizational
Size on Knowledge Management Implementation
Opportunities for Small Firms? Total Quality
Management , 17 (2), 221-241.
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Sources
(19) Moffett, S., McAdam, R., Parkinson, S.
(2003). Technology and people factors in
knowledge management an empirical analysis.
Total Quality Management , 14 (2),
215-224.  (20) Ward, T. (2007). Does Your
Intranet Pay Its Way? SCM , 11 (2), 10. (21)
When knowledge adds up to nothing Why knowledge
management fails and what you can do about it,
Journal of Development and Learning in
Organizations (2003), Vol. 17 Issue1 Page
32-35   (22) News Legal Editors from Legal
Research Center KM Study (2003) Legal Knowledge
Management Improves Quality and Speed of Service,
Reduces Costs and Delivers High ROI, According to
Landmark PricewaterhouseCoopers, Business Wire,
June 9, 2003.   (23) Braganza, A., Mollenkramer,
G.J. (2002), Anatomy of a failed knowledge
management initiative lessons from PharmaCorps
experience, Knowledge and Process Management
(UK), Vol. 9 No.1,.   (24) Storey, J., Barnett,
E. (2000), Knowledge management initiatives
learning from failure Journal of Knowledge
Management, Vol.4 No.2, . (25) Yeldon, Eugene
F., Synrad INC, Albers, James A., Pacific
Lutheran University, Journal of Knowledge
Management Practice, The Business Case for
Knowledge Management, August 2004 (26) Chua, A.,
Lam, W. (2005). Why KM projects fail a
multi-case analysis . Journal of Knowledge
Management , 9 (3), 6-17.
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Implementation