KNOWLEDGE
MANAGEMENT
IS6800 GROUP PROJECT BY:
Kevin Lin
Rajesh Rajasekaran
Gautam Kondru
Andrew Orr
You Should Know This Guy
• Kai-Fu Lee (李開復) – A Speech
Recognition Expert
• 1983, BA, Columbia Univ.
• 1988, Ph.D., Carnegie Mellon Univ.
• 1988~?, Assistant professor at Carnegie
Mellon Univ. (“Most Important Scientific
Innovation” – Business Week)
• 1990~95, Apple Computer (Mgr. of Speech &
Language Technologies Group, V.P. of
Interactive Media Group)
• 1996~97, SGI (V.P. and G.M. of Web
Products Div.), & Cosmo Software (President)
Microsoft, http://www.microsoft.com/presspass/exec/kaifu/default.mspx
Visual Communications and Image Processing 2000, http://www.spie.org/web/meetings/programs/vc00/specevents.html
2
You Should Know This Guy
(Cont.)
• Kai-Fu Lee (Former) Corporate Vice President,
Natural Interactive Services Division (NISD)
• 1998, Founder, Microsoft Research Asia, China
• Feb., 2003, V.P. of NISD at Microsoft Corp
• NISD’s products or services includes
–
–
–
–
speech,
natural language,
advanced search and help, and
authoring and learning technologies.
• July 2005, Kai-Fu Lee left Microsoft.
Mircosoft, http://www.microsoft.com/presspass/exec/kaifu/default.mspx
3
You Should Know This Guy
(Cont.)
• Google to Open Research and Development
Center in China
• MOUNTAIN VIEW, Calif. – July 19, 2005 – Google
Inc. (NASDAQ: GOOG), developer of the awardwinning search engine, today announced that it will
open a product research and development center in
China, and has hired respected computer scientist and
industry pioneer, Dr. Kai-Fu Lee, to lead the operation
and serve as President of the company's growing
Chinese operations.
Google Press Center, http://www.google.com/press/pressrel/rd_china.html
4
You Should Know This Guy
(Cont.)
• Kai-Fu Lee Begins Work In Google's
China Operations
• TechWeb News – September 22, 2005 – Kai-Fu Lee,
the center of an ongoing legal battle between Google
Inc. and Microsoft Corp., has taken up his post as head
of Google's China operations, about two weeks after a
judge ruled that the former Microsoft vice president
could work for the search engine, China's state news
agency reported Thursday.
Tech Web News, http://www.techweb.com/wire/ebiz/171100255
5
You Should Know This Guy
(Cont.)
• Google’s Kai Fu Lee Out of Work Until January
• Oct 28, 2005 – A federal judge issued a “final” order
preventing Google from moving the Kai Fu Lee case to
California. The order puts the case on ice until at least
January, when it will be resumed in Washington state. Lee
has been prevented from taking the reins of his new job
overseeing Google in China since his controversial hiring
from Microsoft in July. Meanwhile, Google hired Johnny
Choua former executive in China of UTStarcom, to get
working on China.
The Unofficial Google Weblog, http://google.weblogsinc.com/entry/1234000587065544/
6
Turnover => Game over ?
• Voluntary employee turnover rate in IT
industry in 2004: 14.90% ( >1/7 )*
• “There is no acceptable level of turnover
if you're losing your best people,” says
Diane Morello, an analyst at Gartner Inc.**
• Sharing & retaining knowledge is
important
*Nobscot Corporation, http://www.nobscot.com/survey/us_voluntary_turnover_0804.cfm
**A.S. Horowitz, You Can’t always guess what they want, Computerworld, (2005)
http://www.computerworld.com/careertopics/careers/story/0,10801,104497,00.html
7
Knowledge
• What is knowledge?
• “Familiarity, awareness, or understanding
gained through experience or study”
• “The psychological result of perception and
learning and reasoning”
Dictionary.com, http://dictionary.reference.com/search?q=knowledge
8
Knowledge
(Cont.)
• Two forms of knowledge
• Explicit
• Represented by some artifact
• Created with the goal of communicating with another person
• ex. Documents, Videos
• Tacit
•
•
•
•
What knower knows
Derived from experience
Embodies beliefs and values
ex. Work experience
• Both forms of knowledge are essential for
organizational effectiveness.
A.D. Marwick, Knowledge Management Technology, IBM Systems Journal, Vol.40, No.4, 814-830 (2001)
9
Knowledge
(Cont.)
• Knowledge is transferable
• Organizational learning takes place as individuals
participate in the conversion of knowledge between tacit
and explicit forms.
• Knowledge Transformation processes
• Socialization (T to T – Tacit knowledge formation and communication )
• Externalization (T to E – Formation of explicit knowledge from tacit
knowledge)
• Internalization (E to T – Formation of new tacit knowledge from
explicit knowledge)
• Combination (E to E – Use of explicit knowledge)
A.D. Marwick, Knowledge Management Technology, IBM Systems Journal, Vol.40, No.4, 814-830 (2001)
10
Knowledge
(Cont.)
• Sample technologies that can support or enhance the
knowledge conversion processes
Tacit to Tacit (Socialization)
Eg. Face-to-face meetings and
discussions of shared experience;
often informal
•NetMeeting, Lotus Sametime
•Synchronous collaboration (chat)
Explicit to Tacit (Internalization)
Eg. Distant learning, learning from a
report
•Visualization
•Browsable video/audio of
presentations
Tacit to Explicit (Externalization)
Eg. Dialog within team, answer
questions (formation)
•Asynchronous collaboration
(Newsgroups, Forums)
•Annotation
Explicit to Explicit (Combination)
Eg. E-mail a report, document
classification
•Text search
•Document categorization
A.D. Marwick, Knowledge Management Technology, IBM Systems Journal, Vol.40, No.4, 814-830 (2001)
11
Knowledge Management
• Definition of knowledge management (KM)
• A.D. Marwick*
• KM is the name given to the set of systematic and
disciplined actions that an organization can take to
obtain the greatest value form the knowledge available
to it.
• Malhotra**
• “Essentially, it (KM) embodies organizational processes
that seek synergistic combination of data and
information processing capacity of information
technologies, and the creative and innovative capacity
of human beings.”
12
*A.D. Marwick, Knowledge Management Technology, IBM Systems Journal, Vol.40, No.4, 814-830 (2001)
**Y. Malhotra, Tooks@work: Deciphering the knowledge management hype, The Journal for Quality and Participation, Vol.21, No.4, 58-60 (1998)
Knowledge Management
(Cont.)
• KM-focused activities
•
•
•
•
•
•
•
Generating new knowledge
Accessing valuable knowledge from outside sources
Using accessible knowledge in decision making
Embedding knowledge in processes, products, and/or services
Representing knowledge in documents, databases, and software
Facilitating knowledge growth through culture and incentives
Transferring existing knowledge into other parts of the
organization
• Measuring the value of knowledge assets and/or impact of
knowledge management
C. Marshal, L. Prusak and D. Shpilberg, Financial risk and the need for superior knowledge management, California Management
Review; Vol.38, No.3, 77-101, (1996)
R. Ruggles, The state of the Notion: Knowledge Management in Practice, California Management Review, Vol.40, No.3, 80-89 (1998)
13
KM Tools
• Collaborative tools
• Groupware (Lotus notes, IntraNet, ExtraNet)
• Meeting support systems
• Corporate yellow pages (Knowledge directories)
• Content Management
• Internet / WWW ( Information provider)
• Document Management systems (e-filing)
• Digital image processing systems
• Electronic Publishing systems
•
•
•
•
Business Intelligence
Data Warehousing
E-Commerce
Helpdesk systems
S. Moffett, R. McAdam, and S. Parkinson, Technological Utilization for Knowledge Management, Knowledge and Process
Management, Vol.11, No.3, 175-184 (2004)
14
KM: Global Statistics
• International Data Center (IDC) predicts
41% increase in global spending per year on
knowledge services.
• Global spending on KM services projected
to reach $13 billion in 2005.
• Global KM software market was worth $5.4
billion in 2004.
• “Knowledge Drain” & “Knowledge Deficit”
cost Fortune 500 companies billions.
Sandhya, S. M., KM Market: Eyeing Exponential Growth, http://www.ciol.comnfolder/102071101.asp
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Drivers of KM
Competition - 50%
Competitive advantage
Productivity
Peer pressure
Knowledge Assets – 28%
Staff Turnover
Intellectual Capital
Knowledge Sharing
Intellectual property
Attainable results – 14%
Results
Risk Reduction
D. Mason and D.J. Pauleen, Perceptions of Knowledge Management: a Qualitative Analysis, Journal of Knowledge
Management, Vol.7, No.4, 38-48 (2003)
16
Barriers to KM
Culture - 45%
Diverse culture
Organization culture
Trust
Communication
Sharing
Leadership – 22 %
Leadership
Management
Education – 16%
Lack of Awareness
Lack of Vision
Lack of Understanding
D. Mason and D.J. Pauleen, Perceptions of Knowledge Management: a Qualitative Analysis, Journal of Knowledge
Management, Vol.7, No.4, 38-48 (2003)
17
KM Implementation
• Technology-Push Model
18
Journal of Knowledge Management VOL.9 NO 1 2005, pp.7-28
KM – Technology push model
• CISCO SYSTEMS
• Legendary faith in technologies for predictive
modeling and decision making
• Misplaced faith on their Forecasting systems
• Ended up writing off $2.2 billion in inventories
and Sacking 8,500 employees
A key lesson of KM ignored by CISCO:
PAST MAY NOT BE AN ACCURATE PREDICTOR OF THE
FUTURE
19
Journal of Knowledge Management VOL.9 NO 1 2005, pp.7-28
KM Implementation
(cont.)
• Strategy-Pull Model
20
Journal of Knowledge Management VOL.9 NO 1 2005, pp.7-28
KM – Strategy pull model
PARTNERS HEALTH CARE, BOSTON
- KM was implemented to the order-entry system because it’s
central to their physicians delivering good medical care.
• Serious medical errors were reduced by 55%
after KM was incorporated into their Orderentry system.
• PARTNERS found a new drug was beneficial
for heart problems, orders for that drug
increased from 12 to 81 percent.
Knowledge Management Review; Mar/Apr 2005;8;1; ABI/INFORM Global,
Journal of Knowledge Management VOL.9 NO 1 2005, pp.7-28
21
FOREST LABORATORIES, INC.
- CASE STUDY
http://www.frx.com
COMPANY PROFILE
• Founded in 1954.
• Publicly traded on the NYSE, under the ticker
•
•
•
•
symbol FRX.
FOREST, based in NY, has operations on Long
Island in New Jersey, Missouri, Ohio, Ireland
and United Kingdom.
Identifies, develops and delivers pharmaceutical
products that make a difference in people’s
lives.
Total of 5000 employees of which close to 2800
employees are in the sales force.
$3 billion revenue for the FY 2005.
23
http://www.frx.com/about/index.aspx
FOREST ACCOLADES
• Ranked among Fortune’s Fastest Growing
•
•
•
•
Companies, five years (2000 – 2004).
Ranked as one of The Best companies to sell
for by selling power for four consecutive years
(2001-2004).
Ranked #32 on the Pharm exec 50 listing of
the top 50 pharmaceutical companies by sales.
Ranked #5 among the Best Performers of the
S&P 500 in 2004.
Ranked #1 on the Wall Street Journal Honor
Roll for 2003.
24
http://www.frx.com/about/accolades.aspx
FOREST - PRODUCTS
Established Therapeutic Areas
Central Nervous system - LEXAPRO, CELEXA,
NAMENDA, CAMPRAL
Cardiovascular - BENICAR, TIAZAC
Respiratory - AEROBID
Relatively New Therapeutic Areas
Endocrinology
Ob/Gyn – Pediatrics
Pain Management
25
http://www.frx.com/products/index.aspx
Quote from our CEO
• “Pharmaceutical
companies do more to
benefit human health,
reduce pain, prolong life,
and ultimately create more
longer lasting and intrinsic
human happiness than any
other business.”
- HOWARD SOLOMON
CHAIRMAN & CEO of
FOREST
26
http://media.corporate-ir.net/media_files/irol/83/83198/reports/2005/FinancialHighlights.pdf
FOREST–INCOME Statement summary [recent 5 yrs]
27
http://media.corporate-ir.net/media_files/irol/83/83198/reports/2005/FinancialData.pdf
BUSINESS CHALLENGES AT FOREST
Business process improvements at Forest Research Institute (FRI)
1. Advanced methods needed to handle R & D process associated
with required regulatory submissions
2. Need to convert mountains of clinical data into meaningful
information
3. Need to implement collaborative work practices for better
business prospects
4. Increased needs to Digitize, Manage, Secure, Share, Utilize
and Publish intellectual assets effectively for business growth
5. Streamline the often time-consuming internal audit process.
6. Need to effectively handle huge amount of documents
especially R&D related contents.
28
Mr. Perry Venugopal, Assistant Director, INFORMATICS - FRI
CEO QUOTE
• Quotes from a CEO of a
major pharmaceutical
company:
“In this industry, we make
2 products –
Drugs and Documents.
Unfortunately, the
authorities are only
interested in the
documents.”
29
http://www.documentum.com/products/collateral/industry/EPCAutumun_2002_Documentum.pdf
DOCUMENT MANAGEMENT SYSTEMS
• What is DOCUMENTUM?
- DOCUMENTUM is the life
sciences industry standard enterprise
content management (ECM) platform
for creating, capturing, managing,
delivering, and publishing large
volumes of content within and beyond
the enterprise.
- De-facto standard for maintaining
documents, audit trails and optimize
R&D operations in the Pharmaceutical,
life-sciences industry.
30
http://www.documentum.com
FRI DOCUMENT MANAGEMENT SOLUTION
• The PR&D group
- As a tool to edit, manage,
review and approve all
CONTROLLED documents
• The Regulatory Affairs group
- As a tool to collate, manage,
review and approve all the
documents related to an FDA
submission
31
Mr. Perry Venugopal, Assistant Director, INFORMATICS - FRI
FRI DOCUMENT MANAGEMENT SOLUTION
32
Mr. Perry Venugopal, Assistant Director, INFORMATICS - FRI
EMERGING CHALLENGES AT FOREST
FOREST spends approx. $25 million dollars this
year to extend the business functionality of the
existing SAP-ERP solutions in order to
effectively manage the information flowing
across the enterprise.
Mr. Brian Bilyeu, Senior Manager, SAP- Business operations,
Mr. Lawrence Bua, Senior Manager, IT - Operations
33
SAP KM AT FOREST - TO ACCESS
SAP BEST PRACTICES RESOURCES
Mr. Brian Bilyeu, Senior Manager, SAP- Business operations,
Mr. Lawrence Bua, Senior Manager, IT - Operations
34
FOREST-SAP ENTERPRISE PORTAL
Mr. Brian Bilyeu, Senior Manager, SAP- Business operations,
Mr. Lawrence Bua, Senior Manager, IT - Operations
35
FRI R&D Process Improvements after the
DOCUMENTUM implementation
• Better version control management of Forest’s intellectual
assets
• Introduced collaboration work practices both internally and
externally with its research partners and co-marketers.
• Eliminated the internal research audits required for
demonstrating compliance with FDA regulations.
• Re-use the same content wherever appropriate (ie: NDA (US)
vs. CTD (Europe/Japan) – same content- different presentation
• Rapid seamless access to the information enables FOREST to
make GO/NO-GO decisions at the early stage of the product
life-cycle
Mr. Perry Venugopal, Assistant Director, INFORMATICS – FRI,
http://www.documentum.com/industry/life_sciences/research/index.htm
36
Potential Business problems that can be avoided
• 50% of R & D expenses are during the clinical
development phase.
• 7 million pages per year of clinical studies content
to be managed.
• Each day late for the drug arrival to the market
equals $1 million dollar in lost revenue.
• A missed paper-work with FDA or an outdated
information to FDA during the New drug
submission process can potentially delay the FDA
approval process by SIX MONTHS.
37
http://www.documentum.com/industry/life_sciences/research/index.htm
Case Study
Siemens AG
Company Overview
• Siemens:
• Founded more than 155 years ago in
Berlin, it is one of the world’s largest
private organizations
• Employs 440,000 people in 190
countries.
• World leader in Information and
Communications, Automation and
Control, Lighting, Medical, Power and
Transportation.
39
http://www.usa.siemens.com/index.jsp?sdc_p=ft4mls6uo1067030n1067030i1002155pc194z2&sdc_sid=29513262089& viewed 11/08/05
Company Overview
• Fortune Global 500 ranked Siemens AG, number
one in the world's electronic industry in the year
2004
• Reported global sales of $91.3 billion in fiscal 2004
(10/1/03 - 9/30/04).
• Siemens has a decentralized corporate structure
• Every unit has its own executive management,
supervisory groups and regional units.
• Information and Communication Networks (ICN)
• Major division within Siemens
• Employs approx. 33,000 people
• Generates revenues of €7,122 billion (roughly
$8 billion) in sales.
40
http://www.usa.siemens.com/index.jsp?sdc_p=ft4mls6uo1067030n1067030i1002155pc194z2&sdc_sid=29513262089& viewed 11/08/05
US Operations
• US Corporate headquarters
in New York City
• Employs approximately
70,000 people in all 50
states and Puerto Rico.
• $16.6 billion in U.S. sales
• Trades on NYSE (SI)
41
http://www.usa.siemens.com/index.jsp?sdc_p=ft4mls6uo1067030n1067030i1002155pc194z2&sdc_sid=29513262089& viewed 11/08/05
Business Areas in US
• Information and Communications
• Siemens provides systems, services and solutions to 70 percent of the Fortune 500.
• Automation and Control
• Siemens' postal automation systems process more than 90 percent of the mail for the
United States Postal Service (USPS)
• Power
• Power generation systems produce more than 1/3 of the electricity in the U.S.
• Medical
• Processes some 157 million healthcare information transactions every business day.
• Research and Development
• Dedicates $4 million and 5,700 employees to R & D
• Generates more than 32 inventions every business day
• In 2004, it invested approximately $6.2 billion in research and development.
42
http://www.usa.siemens.com/index.jsp?sdc_p=ft4mls6uo1070267n1070267i1067030pc194z2&sdc_sid=29513262089& viewed 11/08/05
Global Clients
•
Audi
IT Client Services
•
John Deere
SAP R/3 Rollout in Europe
•
BBC
Outsourcing
•
Lufthansa
Baggage Management System
•
DaimlerChrysler
Service Process Management
•
•
National Employment Agency,
Romania
IT Infrastructure Services
Department of Labor,
South Africa
IT Outsourcing
•
Siemens Medical Solutions
Global Remote Service for
medical system
Fujitsu Siemens Computers
Application Management for
SAP solutions
•
UK Passport Service (UKPS)
Efficient document processing
HSBC
Call Center
•
Volkswagen
Internet presentation Touran
•
•
43
http://www.siemens.com
Knowledge Management at Siemens
Driver for KM initiatives:
• Growing competition
• Deregulation in the core market in Germany
• Demand for Siemens to provide complex total
solutions
• Transform company into a customer-oriented
organization that provided customized solutions
and services globally
Sven C. Voelpel, Malte Dous, and Thomas H. Davenport, Academy of Management Executive, 2005, Vol. 19, No. 2
44
Siemens KM Initiative
Concept:
• Information and Communication Networks group
had to tap the comprehensive expertise and rich
experience of its employees.
• A Knowledge Management System had to
network the 17,000 sales and marketing
employees across the globe.
Sven C. Voelpel, Malte Dous, and Thomas H. Davenport, Academy of Management Executive, 2005, Vol. 19, No. 2
45
Knowledge Management System
• Knowledge Library: A central component that would
• Consist of thousands of knowledge bids
• Have a web based entry form for users to input bids
• Urgent Request Forum: A place where any user can post a question and
request immediate response.
• Rich Transmission Channels:
• Community news bulletin boards
• Discussion groups for certain topics
• Live chat rooms
• Knowledge Library +
Urgent Request Forum +
Transmission Channels =
Sven C. Voelpel, Malte Dous, and Thomas H. Davenport, Academy of Management Executive, 2005, Vol. 19, No. 2
http://www.europe.redhat.com/software/ccm/customers/siemens.gif
46
ICN ShareNet
• The first ShareNet version was developed with the help of
an external web-development company.
Sven C. Voelpel, Malte Dous, and Thomas H. Davenport, Academy of Management Executive, 2005, Vol. 19, No. 2
http://www.swiss.ai.mit.edu/~rfrankel/community/exsharedir.gif
47
ShareNet
48
http://ccm.redhat.com/doc/core-platform/5.0/acs-core/doc/images/found-item.gif
ShareNet Organization
49
Sven C. Voelpel, Malte Dous, and Thomas H. Davenport, Academy of Management Executive, 2005, Vol. 19, No. 2
Language Barriers
• Initial response to English-only ShareNet
not very positive:
• Some employees did not dare to post a
question in a forum where several
thousand people could see their
grammar or spelling mistakes
• Few others were of the opinion that in
a German-based company the first
language should still be German.
• Language problems were mitigated over
time:
• Users saw the personal benefit of
sharing and receiving knowledge.
Sven C. Voelpel, Malte Dous, and Thomas H. Davenport, Academy of Management Executive, 2005, Vol. 19, No. 2
http://www.wmich.edu/ois/sap/programs/images/germany.map.jpg
50
Cultural Differences
• China
• 50 companies and 27 regional offices
• Headcount of 25000
• Barriers:
• Grammar and spelling mistakes might harm
“face” in the company.
• What is “Face” ?
• Defined as what other people think of you
• Mitigation Practices:
• Additional workshops for ShareNet
Managers
• Chinese version of user handbook
• Allowing to contribute in Chinese language
Sven C. Voelpel, Malte Dous, and Thomas H. Davenport, Academy of Management Executive, 2005, Vol. 19, No. 2
http://archives.cnn.com/2000/ASIANOW/east/01/08/tibet.lama.01/map.china.tibet.gif
51
Incentives
• Bonus-On-Top: First reward system
• Reward to share knowledge across countries.
• Web-based system:
• Shares were awarded for
• Entering knowledge bids into the library
• Reusing knowledge
• Responding to urgent requests and
• Appraising one another’s contributions.
• Redeemable for gifts and prizes such as textbooks, siemens mobile
phones, trips to knowledge exchange partners
• Skewed motivation :
• Trading of shares
• Neglect of actual jobs
52
Sven C. Voelpel, Malte Dous, and Thomas H. Davenport, Academy of Management Executive, 2005, Vol. 19, No. 2
Expansion and Consolidation
• Feb 2002:
• Siemens ShareNet deployed in R&D division with
minor modifications to the system that suited the
division
• July 2002:
•
•
•
•
•
19,000 registered users
More than 80 countries.
Supported by 53 ShareNet managers
20,000 knowledge bids populated in the system
Over 2.5 million ShareNet shares distributed
53
Sven C. Voelpel, Malte Dous, and Thomas H. Davenport, Academy of Management Executive, 2005, Vol. 19, No. 2
Cost Justification
Sven C. Voelpel, Malte Dous, and Thomas H. Davenport, Academy of Management Executive, 2005, Vol. 19, No. 2
54
Benefits and Limitations
• Siemens ShareNet supports the view point that Just-InTime delivery significantly improves performance
• “For insurance purposes an ICN project manager in South
America tried to discover how dangerous it was to lay cables
in the Amazon rainforest. He posted an urgent request asking
for help from anyone with a similar project in a similar
environment. A project manager in Senegal responded within
several hours. Obtaining the right information before the
cables went underground saved Siemens approximately
US$1 million.”
• Limitations of ShareNet:
• Significant costs to maintain
• Limited automation of supervision
55
Sven C. Voelpel, Malte Dous, and Thomas H. Davenport, Academy of Management Executive, 2005, Vol. 19, No. 2
CASE STUDY
56
Company History and
Overview
• Formerly Andersen Consulting; Several Arthur
Andersen consultants established Accenture in
1989
• Accenture formalized Business Integration – a
framework for aligning people, processes and
technology with business strategy.
• Went public with IPO on July 19, 2001 – now
trades on NYSE under ACN
• Currently provides the full range of consulting,
outsourcing and related technology services.
Accenture, http://www.accenture.com/Global/About_Accenture/Company_Overview/History/default.htm, November, 2005.
57
Company Profile
• Largest of the “Pure Consultancies”1
• 123,000 employees at 110 offices in 48
countries 2
• Net Revenues of $15.55 billion for fiscal
year ending August 31, 2005 2
• Clients include: U.S. government, London
Stock Exchange, BP, Cingular Wireless and
Ford Motor Company 2
1
Paik Y., Choi D.Y., The shortcomings of a standardized global knowledge system: The case study of Accenture,
Academy of Management Executive, Vol. 19 No. 2, pp 81-84, 2005.
2
Accenture, http://www.accenture.com/Global/About_Accenture/Company_Overview/History/default.htm, November,
2005.
58
A Need for Knowledge
Management
• As a pure consultancy, “Our people are our
products”1
• They hold knowledge capital in the form of
wisdom and experience.
• Accenture must make its knowledge capital
available to its employees world-wide to
achieve a competitive advantage.
• A KM system makes knowledge sharing
throughout the organization possible.
Recycling Internal Know-How: Knowledge Management at Accenture, http://home.nyc.rr.com/mckeonsamples/article 3.html
59
Definition of Knowledge
Management
The company defines its own knowledge
management as:
“The systematic process of achieving
organizational goals through capture,
synthesis, sharing and use of information,
insights and experiences.”
Recycling Internal Know-How: Knowledge Management at Accenture, http://home.nyc.rr.com/mckeonsamples/article 3.html
60
A Pioneer and Leader in
Knowledge Management
• One of the first companies to invest in
knowledge management.
• Began implementation of KM solutions in
the early 1990s to help deliver quality
solutions faster.
• Since then, Accenture has allocated more
than $500 million to its KM system.
• KM staff of over 500: 150 focus on
database administration.
Paik Y., Choi D.Y., The shortcomings of a standardized global knowledge system: The case study of Accenture, Academy
of Management Executive, Vol. 19 No. 2, pp 81-84, 2005.
61
The Knowledge Xchange
• An electronic depository comprised of 7000
individual databases.
• Information can be accessed by consultants
using Lotus Notes or the internet.
• KX stores internally generated knowledge
grouped by market units and service lines.
• Content includes: presentations, proposals,
methodologies, appropriate experts,
knowledgeable peers and best practices.
Recycling Internal Know-How: Knowledge Management at Accenture, http://home.nyc.rr.com/mckeonsamples/article 3.html
62
Utilizing Knowledge
Xchange
• Consultants can begin new projects with a
KX search for past or similar projects.
• Searches are facilitated by a portal, similar
to a web browser, with a search engine.
• A portal search will return a list of content
matches and links within the KX.
• Consultants can also access a variety of
external sources via the portal.
Recycling Internal Know-How: Knowledge Management at Accenture, http://home.nyc.rr.com/mckeonsamples/article 3.html
63
http://webpages.dcu.ie/~scallanc/Andersens.ppt
64
The Knowledge Xchange
IT Structure
• Directory Databases
 KX Front Page & KX Yellow Pages
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http://webpages.dcu.ie/~scallanc/Andersens.ppt
The Knowledge Xchange
IT Structure
• Reference Databases
 People and Places, Client Experience, Libraries by
Indusrty/Service
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http://webpages.dcu.ie/~scallanc/Andersens.ppt
The Knowledge Xchange
IT Structure
• Discussion Databases
 General forums for service and industry specific
discussions.
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http://webpages.dcu.ie/~scallanc/Andersens.ppt
The Knowledge Xchange
IT Structure
• External Databases
 Provide past or current news stories on industries and
companies grouped by market units and service lines.
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http://webpages.dcu.ie/~scallanc/Andersens.ppt
Managing the
Knowledge Xchange
• Teams of KM professionals are assigned to market
units and service lines.
• Team members:
•
•
•
•
•
•
Ensure consultants contribute to KX
Train consultants in knowledge sharing
Identify relevant knowledge capital
Synthesize, streamline and clarify knowledge
Package and distribute knowledge
Develop vehicles for disseminating information and
knowledge
• Consultants and KM professionals also use their
experience with KM at Accenture to advise clients
on capturing and spreading knowledge in their
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own organizations.
Recycling Internal Know-How: Knowledge Management at Accenture, http://home.nyc.rr.com/mckeonsamples/article 3.html
Measuring the
Successfulness of KX
• Knowledge Xchange was considered so strategic
that senior executives didn’t even ask for an ROI.1
• Success of KM is measured by the reduction in
planning time, minimization of risk, improved
quality and reduced costs. 2
• Example:
A team resolves a software issue by posting a
question and receiving a solution overnight:
Savings estimated at $200,000 of “fix-work” 1
1 Hildebrand, Carol, Processing Information: Andersen Consulting, CIO Magazine, August 1996.
2 Paik Y., Choi D.Y., The shortcomings of a standardized global knowledge system: The case study of Accenture,
Academy of Management Executive, Vol. 19 No. 2, pp 81-84, 2005.
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Shortcomings of
Knowledge Xchange
• Accenture’s KX policies did not consider its
“global vision” and allow for management
flexibility at the local level.
• East Asian consultants were not as
motivated as their U.S. counterparts to
contribute to KX.
• All documents and abstracts had to be
translated to English before submission to
KX.
Paik Y., Choi D.Y., The shortcomings of a standardized global knowledge system: The case study of Accenture, Academy
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of Management Executive, Vol. 19 No. 2, pp 81-84, 2005.
Accenture’s Knowledge
Management Journey
1992 - 1995
Enabling
Infrastructure
“Build it, and they will
come”
 Lotus Notes/KX
 Discussion
Databases
 “Connections”
1994 - 1997
Knowledge
Sharing
“Knowledge is a
by-product”
1996 - 2000
Knowledge
Outfitting
“Knowledge is actively
managed”
 Document Libraries  Thought
Leadership
 Communities
 “Contributions”
1999 - 200?
Smart
Workplace
“Our best knowledge
guides our activities”
 Integrated
performance support
 Web-like
technology
 Job tools are
knowledge tools
 “Aggregation &
Combination”
 “Continuous Learning”
Recycling Internal Know-How: Knowledge Management at Accenture,, http://home.nyc.rr.com/mckeonsamples/article 3.html
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Best Practices for Knowledge
Management
• Knowledge Management Strategy
 Identify and Review the Organization’s Vision and
Mission
 Identification of Relevant and Valuable Knowledge
 Align Knowledge Capture with Business Strategy
• Technology for Supporting KM
 Evaluate IT Tools Needed to Enable KM
 Evaluate Existing Workflow Software
 Align Knowledge and Business Strategies with IT
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Best Practices for Knowledge
Management
• Creating a Culture for Knowledge Sharing
 Incentives for Contribution
 Encourage Utilization
 Monitor Employee Usage
 Global Integration
• Measuring Effectiveness of KM
 Justification for Implementation
 Qualitative Assessment of Value Added
 Quantitative Measurement of Revenue Gained
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Successful KM Initiatives
• Hoffmann-Roche saves over $1 million per day
•
•
•
•
•
due to KM activities.
KM program at HP reduced average call times by
two-thirds & cost per call by 50%.
Chevron estimates initial savings of $150M &
$20M/yr from best practices program.
Dow Chemicals: capitalizing on intellectual
property saved $40M.
Over six years, Schlumberger Corp. realized ROI
of 668% on KM programs.
Teltech clients enjoy ROI of 12:1 for KM efforts
Yelden, E. F., Albers, J. A., The Business Case for Knowledge Management, Journal of Knowledge Management
Practices, August, 2004.
75
Q&A
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