Lecture 6
Knowledge Management Strategy

 [1] Dave Chaffey, Steve Wood - Business Information
Management : Improving Performance Using Infomation
Systems, 2005, Prentice Hall/Financial Times, (734 pages)
 [2] Benson V., Tribe K. – Business Information
Management, 2008, Ventus Publishing (83 pages)
 [3] G. Somasundaram, Alok Shrivastava, Eds. -
Information Storage and Management: Storing,
Managing and Protecting Digital Information, 2009,
Wiley Publishing, Inc (478 pages)
 [4] Wikipedia
 [5] http://tutor2u.net/business/ict/intro_what_is_ict.htm
 [6] http://searchcrm.techtarget.com/definition/CRM
2

 Knowledge management strategy
 Strategy selection
 Strategy options
 Roles and competencies
 Creating a knowledge sharing culture
3

 Nonaka et al. (1995) introduce two definitions of knowledge: tacit knowledge (subjective) and explicit knowledge (objective).
 Tacit knowledge is knowledge of experience
– simultaneously knowledge and practice.
 Explicit knowledge is about rationality and sequential knowledge [1, pg. 216].
4

 The processes through which knowledge is created and transferred, identified by Nonaka et al. [1, pg. 225], are:
 tacit to tacit through a process of socialization;
 tacit to explicit through a process of externalization;
 explicit to tacit through a process of internalization;
 explicit to explicit through a process of combination.
5

 We can also define knowledge by type in terms of function (Zak, 2002) [1, pg.
226]:
 Declarative knowledge (knowledge about)
 Procedural knowledge (know-how)
 Causal (know why)
 Conditional (know when)
 Relational (know with).
6


 Individual/explicit (conscious)
 Individual/implicit (automatic)
 Social/explicit (objectivified)
 Social/implicit (collective).
7

 Frank Blackler (1995) has developed ‘five images’ of knowledge which draw together views of knowledge from different writers. [1, pg. 227]:
 Embrained knowledge is dependent on conceptual skills and cognitive abilities
 Embodied knowledge is action-oriented and is likely to be only partly explicit
 Encultured knowledge refers to the process of achieving shared understandings
 Embedded knowledge is knowledge which resides in systemic routines
 Encoded knowledge is information conveyed by signs and symbols.
8

 Understanding and applying these three different views of knowledge from Nonaka,
Spender and Blackler in the context of their own organization is vital for managers devising a knowledge management programm.
 These views of knowledge should be used to interpret the results of knowledge audits and assessment techniques such as the ASHEN model and will then inform strategy choices [1, pg. 227].
9

 The five core processes developed in the European Framework have been developed from analysis of more than 100 knowledge management frameworks [1, pg. 228]:
1.
Identify knowledge: people need to think about what they want to achieve and the knowledge required to make it happen. If knowledge is lacking a knowledge gap has been identified.
2.
Create knowledge: new knowledge is created by training, learning by doing and problem solving – creating new knowledge for products and services. Innovation is vital to this process.
3.
Store knowledge: knowledge assets form the knowledge base of an organization. These assets may be stored in documents or databases or memorized as tacit knowledge
4.
Share knowledge: distribution to the right people at the right time. The stock approach is when knowledge is shared via documents and databases; a flow approach is when knowledge is shared person-to-person.
5.
Use knowledge: applying what we know, used in the business processes.
10

 Knowledge management tends to be treated mainly as an issue for information systems experts.
 The schemes they produce are predominantly on the supply side, focusing on data and communications systems and processes for making people’s tacit knowledge explicit and available for the rest of the organization.
 As a result, knowledge is treated as a commodity and often confused with data [1, pg. 229].
11

 The distinction between IM and KM could be attended using one of the three approaches [1, pg. 229]:
 Knowledge management is information management by another name. A conflation of knowledge management with the organization of knowledge, the traditional label for the coding and classification of recorded material (content).
 Knowledge management is the management of know-how: processes and ontologies. The emphasis is on the discovery and extraction of value when existing processes and resources are anatomized and recompiled.
 Knowledge management optimizes the conditions for adaptive co-evolution. The key is the interplay of tacit and explicit knowledge.
12

 PricewaterhouseCoopers (2003) identifies the following best practices to enable knowledge management [1, pg.
229]:
 Build executive-level enthusiasm for leveraging organizational knowledge to foster innovation and learning;
 Eliminate organizational barriers that inhibit knowledge sharing;
 Demonstrate organizational commitment to learning and leveraging knowledge;
 Develop a process for identifying organizational knowledge;
 Connect employees through technology and opportunities for personal interaction;
 Make knowledge quickly and easily accessible across the enterprise to support value creation.
13


 Value-adding business process
 Core knowledge-processing activities
 Critical success factors.
14

 The British Standards Guide to Good Practice (Kelleher and
Levene, 2001) suggests the following topics that an organization should include in a simple knowledge management strategy [1, pg. 231]:
■ Organizational priorities for KM
■ KM mission and vision
■ KM operating plan (including objectives and perceived benefits)
■ KM budget
■ Plan for KM technical infrastructure
■ Plans for KM communities of practice
■ Proposed KM metrics and proposed knowledge-sharing incentives and rewards
■ Plans for KM training
■ Plan for communication of KM strategy to all internal and external stakeholders
■ Plan for integrating KM and organizational strategy.
15

 The start of the knowledge management strategy process will make use of traditional strategy tools such as SWOT
(Strengths, Weaknesses, Opportunities, Threats) analysis and
PEST (Political, Economic, Social and Technology) analysis to assess the general business environment [1, pg. 232].
 A knowledge-based SWOT analysis can be used to map knowledge resources available against the four headings. This type of SWOT will ask the following types of questions:
■ What areas of our business benefit from applied, valued knowledge?
■ What areas of our business lack knowledge?
■ Are there opportunities to exploit knowledge?
■ What (competitive) threats are there to knowledge being lost or losing value?
16

 Before defining a KM strategy a company must asses the capabilities and knowledge process in relation to core business activities.
 This is done through the knowledge audit (KA).
 KA is a systematic process of identifying knowledge assets and their relationship across an organization [1, pg. 233].
17

 A team will be created to carry out the audit. Their skills are
[1, pg. 233]:
 Senior manager – Vision – linking knowledge management objectives to business objectives
 Business strategist – Planning and goal setting
 Human resource manager Assessment of employee skills and competencies
 Corporate information manager/Librarian – Organization of internal and external information assets
 Information systems/IT analyst – Development of information systems to support business processes and IT platform implementation
 Chief knowledge officer/ Knowledge manager – Organizationally independent analysts, understands how KM works across the organization.
18

 The knowledge audit process has the following stages [1, pg. 234]:
KA1) Define audit objectives
KA2) Identify ideal state
KA3) Define audit sample
KA4) Select audit assessment tools
KA5) Identify knowledge assets
KA6) Build employee knowledge profiles
KA7) Develop knowledge map
19

KA8) Develop a knowledge value chain to represent core knowledge processes
KA9) Identify key issues and conclusions
KA10) Use discussion and focus groups to test conclusions
KA11) Highlight good practices: examples of KM in practice
KA12) Develop goals, priorities and objectives for the KM strategy
20

 Stages in reaching the objectives could include
[1, pg. 234]:
■ Assess factors that inhibit knowledge sharing
■ Assess factors that encourage or promote knowledge sharing
■ Identify knowledge bottlenecks
■ Identify sources of knowledge creation and innovation
■ Map informal networks and patterns of knowledge sharing across the organizations
■
■
Map knowledge flows from external sources and networks
Assess the impact of customer or supplier knowledge
21

Business objectives should be mapped against relevant categories of knowledge as an indication of desired knowledge outcomes.
An example is in the table below [1, pg. 235]
22

 Ideally knowledge audits should be organization-wide, otherwise many key relationships and knowledge processes can be overlooked.
 The sample will need to reflect all levels of the organization where employees apply knowledge to business processes; in most modern organizations this means that all employees should be considered for inclusion.
 After a knowledge audit has been undertaken, knowledge managers now experienced in the process may be able to undertake local small-scale knowledge audits on a regular basis; for example, after a major product or service launch [1, pg. 235].
23

 It is likely that a knowledge audit will need to use a mix of tools to develop a balanced view of the organization. Audit tools will include:
■ Questionnaires to capture large volumes of data
■ Interviews to explore issues in greater depth
■ Focus groups to explore issues in greater depth and understand relationships
■ Narrative techniques to explore knowledge that is context-dependent, to overcome the problem of people only knowing what they need to know when they need to know it (techniques include narrative databases, storytelling and post-implementation reviews).
24

 Was devised by IBM (Snowden, 2003) and offers a holistic view of knowledge assessment in order to make
sense of the data and information gained from using the above tools [1, pg. 237].
 The ASHEN model focuses on what Snowden describes as ‘knowledge disclosure points’.
 These are any events or activities that reveal knowledge through use [idem]:
■ Decisions
■ Problem resolution
■ Solution creation
■ Judgment
■ Learning points.
25

 For example, a knowledge ‘disclosure point’ would be when the manager takes the decision about the cost of the tickets in a low-cost airline company.
 ASHEN breaks down into these categories [1, pg. 237]:
■ Artefacts. Anything made by people, processes, documents, tools in which knowledge is embedded
■ Skills. Abilities that can be trained and measured without ambiguity – but remember the time issue
■ Heuristics. Rules of thumb, the outcome of experience, the main repository of knowledge, mostly unarticulated
■ Experience. Accumulated experience of failure and success which allows the right pattern to be triggered in the right context
■ Natural talent. Some people are just better at doing things than other people – and they are often not the people you expect.
26

 From the information gathered at the knowledge audit employee knowledge profiles can be built.
 For that we can use, for example, the questionnaire tool, with the following questions [1, pg. 237]:
■ What are your core areas of expertise?
■ Which projects have you worked on?
■ Have you authored any documentation in the last year?
■ Where have you previously worked?
■ What training courses have you attended in the last year?
■ What areas are you interested in but not currently working on?
■ Would you grade yourself as an expert in any of the organizational IT systems?
27

 The profile could also include a Belbin
(2003) team profile, generated from a self-diagnostic questionnaire. Belbin roles can be categorized as [1, pg. 238]:
■ action-oriented roles – shaper, implementer and completer finisher
■ people-oriented roles – coordinator, team worker and resource investigator
■ cerebral roles – plant, monitor evaluator and specialist.
28

 Learning styles can also be categorized using a self-diagnostic test developed by Honey and
Mumford (1986). The following categories of learner are used:
■ Activists: people who learn by doing
■ Reflectors: people who learn by observing and thinking what happened
■ Pragmatists: people who like to understand theories behind actions. Require models, concepts and facts
■ Theorists: people who need to understand how to put learning into practice.
29

 A Knowledge Map (KM) is a visual representation of organizational knowledge assets, flows and relationships [1, pg. 238].
 If we think of an organization as a knowledge market, the knowledge map enables the matching of knowledge buyers to knowledge
sellers; this process also involves
intermediaries as knowledge brokers.
 Knowledge maps are then developed into usable IT-based tools, often hosted on organizational intranets.
30



31

The “kite network” map The “kite map” key
32

 The previous page illustrates a simple social network, the “kite network”.
 The network indicates three popular measures [1, pg.
239]:
 Degrees: number of direct connections a node has. In the previous Figure John has the most direct connections.
 Betweenness: how nodes are located between the important constituencies. Nodes acts in broker roles. In the previous Figure, Sue takes this role.
 Closeness: access to all the nodes on the network. In the previous Figure Simon and Claire are the closest to everyone else, directly and indirectly.
33


 Marks for different answers to the questionnaires
 A social network map
 Different distance metrics for the map
 Group density tables
34

 From the audit process an inventory will be produced, mapping knowledge assets
against knowledge categories and valueadding activities against business processes.
 Using a model of knowledge, a value chain will be used to explain the different ways that knowledge can be used to add value to business processes
[1, pg. 242].
35

Knowledge value chain [1, pg. 243]
36

 As with an information audit, analysis will be undertaken to assess the audit findings against the desired state [1, pg. 244].
37


38

 A good starting point for knowledge management programs is to share and highlight the examples of good practice.
39

 In common with all successful business strategies, knowledge management strategy requires a mission to describe why the organization wants to undertake a knowledge management program and vision to make clear what it wants to do.
 The KM vision and mission will set out why
knowledge is important to organizational business objectives and what is the overall goal of a knowledge management strategy.
40

 The KPMG knowledge management survey (Kok, 2003) highlights key knowledge management objectives [1, pg.
244]:
1 Realizing synergies between units (83 per cent)
2 Achieving higher added value for customers (74 per cent)
3 Improving quality in operational and functional processes (70 per cent)
4 Reducing costs (67 per cent)
5 Accelerating innovation (63 per cent)
6 Boosting revenues for new market development (37 per cent)
7 Reducing exposure to specific business risks (26 per cent).
41


■ Knowledge gap: what the organization must know and what the organization knows.
■ Strategic gap: what the organization must do and what the organization can do.
42


S1) Codification versus (vs.) personalization
S2) Explorer vs. exploiter
S3) Aggressive vs. conservative
S4) Technocratic vs. economic vs. behavioral
43

 In a codification strategy knowledge is carefully organized and stored in databases, where it can be easily used by anyone in the organization.
 In a personalization strategy the focus is upon the person who developed the knowledge and sharing through person-to-person contacts.
 An organization will not wholly follow one of the strategies but will place a strong degree of emphasis. Hansen et al. (1999) suggest the mix should be 80 per cent to 20 per cent (either way)
[1, pg. 246].
44

 Explorers – creators or acquirers of the knowledge needed to become and remain competitive.
 When for the organization there is evidence that knowledge resources and capabilities significantly exceed the requirements of the competitive position, then the company needs to exploit the current knowledge platform. In this situation the company will take the strategic position of an exploiter [1, pg. 247].
 The two approaches should be combined.
45


46

 Earl (2001) has developed further definitions of schools of knowledge management, developing a taxonomy of knowledge management.
 The schools draw on many of the aspects introduced, but use a technocratic/economic/behavioural broad categorization, with further splits [1, pg. 248].
 For examples see [1], table 5.6, page 248.
47

 Communities of practice are vital to an organizational knowledge management strategy that sees learning processes beyond the limits of formalized training.
 A group (often interdisciplinary) linked by shared interest in a subject area; the group will organically evolve over time in terms of membership and scope. The purpose will be to learn and share [1, pg. 250].
48

Communities of practice [1, pg. 251]
49

 The previous Figure illustrates how communities of practice differ from other forms of organizational structures; it illustrates [1, pg. 251]:
■ Formal departments: clear defined boundaries, permanent, structured around organizational goals
■ Operational units: clear defined boundaries, permanent, structured around ongoing operations and processes
■ Project teams: clear boundaries, though may work across departments and operational units, limited lifespan, structured around project goals
■ Communities of practice: fuzzy boundaries, delineated across the organization. Organic evolution.
50

 We can use a model developed by Wegner et al. (2002) for the development of communities of practice. Balance must be developed between these three elements [1, pg. 251]:
■ Domain. What issues do we care about? How will the community relate to the organizational overall strategy and knowledge management strategy?
■ Community. What roles will people play? How will people meet and connect? What activities will take place?
■ Practice. What knowledge will be shared? What leaning activities will take place? What can be standardized?
51

 The following categories can be used to classify communities of practice (American Productivity and Quality Center, 2000) [1, pg. 252]:
■ Helping communities: employees help each other to solve problems
■ Best-practice communities: developing, validating and disseminating best practice
■ Knowledge-stewarding communities: organize, upgrade and distribute the knowledge
■ Innovation communities: foster unexpected ideas and practices. Intentionally mix boundaries to gain new perspectives.
52


■ Support communities that already exist
■ Start with a large number of communities
■ Pilot, then roll out on large scale
■ Pilot, then gradually roll out.
53

 Competitive intelligence can be seen as a tactic used by organizations to improve the knowledge of issues relating to competition in the company’s operating environment.
 Competitive intelligence focuses upon competitive threats and the transferring of market share from the competitors’ bottom line [1, pg. 253].
54

 Miller (2001) has identified four phases of the competitive intelligence cycle [1, pg. 253]:
1 Identification of key decision makers and their intelligence needs
2 Collection of information
3 Analysis of information and upgrading it to intelligence
4 Dissemination of intelligence to decision makers.
55

 The relation between IM, CI and KM is [1, pg.
254]:
 Information management helps us understand what has happened
 Competitive intelligence helps us understand what is
likely to happen externally and what our options are
 Knowledge management helps us change what is
likely to happen, internally and externally, through innovation, reinvention and repositioning.
56

 Focusing upon the use of stories and narrative as a tactic for sharing knowledge and experience is a recent innovation that has become a formal knowledge management disciple [1, pg. 254].
 The European Guide to Good Practice defines narrative as [1, pg. 255]:
 Techniques employed in KM environments to describe complicated issues, explain events, communicate lessons learned, or bring about cultural change.
 The techniques can involve story telling, narrative databases, or after action reviews (retrospective accounts of significant events in an organization’s recent past, described in the voices of people who took part in them). (Mekhilef et al., 2003)
57

Figure 54. Storytelling and narrative process
58




59



60

 Information and communications technologies (ICT) covers any product that will store, retrieve, manipulate, transmit or receive information electronically in a digital form [5].
 The strategy selection of a codification or personalization approach will heavily influence the amount an organization invests in ICT to support knowledge management [1, pg. 257].
 The information gathered from the knowledge audit and use of the ASHEN model will inform the choice of ICT applications and infrastructure required [idem].
 An assessment can be made as to where ICT can be deployed to enable knowledge processes [idem].
 The ICT solution should have a positive impact in reducing the information overload, not add to it.
61

 Developing a corporate intranet has been the aim of the
ICT element of knowledge strategy.
 Intranets are important because they offer a central point of access for a wide range of knowledge.
 There are 3 stages in developing a intranet:
 Static – based on static web pages
 Interaction – adding interaction to the server with bloggs, discussion boards, bulletin boards
 Collaborative electronic work space – all employees are encouraged to share knowledge via collaborative tools and publishing mechanisms

62

 Are extensions of the intranets to create secure electronic networks.
 They will be used by organizations to share information and knowledge with customers, suppliers and partners.
 Extranets will be vital for organizations that need to focus on external knowledge and create communities of practice beyond normal organizational boundaries;
 they can be used in sharing knowledge across a supply chain [1, pg. 258].
63

 In order to gain value from the employee profiles gathered from the knowledge audit, organizations need to use this information to enable expertise location across the organization.
 This is done by creating a searchable and browsable database system based around the profiles, called
expertise database.
 The objective of an expertise database is to enable the internal knowledge markets, matching knowledge buyers to knowledge sellers.
 The systems are often known as ‘corporate yellow
pages’ [1, pg. 258]
64

 An expertise profile could include the following elements (White, 2000) [1, pg. 259]:
■ Educational courses
■ Professional accreditation
■ Previous employers
■ Work undertaken
■ Membership of networks
■ Publications
■ Areas of interests
■ External interests.
65

 Collaborative tools can be used to support communities of practice. They can be divided into two categories [1, pg. 259]
1 Synchronous collaborative tools: remote sharing, presentation, chat, electronic whiteboarding, voting, video and audio.
2 Asynchronous collaborative tools or groupware: allow users to deposit, comment upon, and act upon information provided by others. Discussion software and message boards
66

 Portals offer a customized gateway to organizational information systems, aggregating content that is already available, displaying it in personalized layers [1, pg.
260].
 They reduce information overload because they allow the employees to present the information in ways relevant to them.
 Key components of corporate portals can include the following (Claudio and Gordon, 2003) [idem]:
■ Presentation layer – allows the user to personalize
■ Taxonomy (browsable classified hierarchical structure, e.g. Yahoo classification)
■ Search engine
67

■ Selected external information from the web; and connections to:
■ Collaboration tools
■ Intranet applications or intranet web pages
■ Content management systems (publishing)
■ Document management systems
■ CRM systems
■ ERP systems
■ Financial systems
■ HR systems
■ Data warehouses.
68

 CRM is an term for methodologies, software, and usually
Internet capabilities that help an enterprise manage customer relationships in an organized way.
 CRM tools used in e-business offer new perspectives on customer relationships.
 Knowledge can be gained of [1, pg. 261]:
■ Customer behavior
■ Product use
■ Quality of service
■ Customer preference and brand loyalty
■ How business processes relate and their design
■ Skills and competencies of staff related to delivering products and services
69

 A knowledge management strategy can link with CRM in terms of [1, pg 261]
■ linking to other forms of explicit knowledge in the organization (e.g. in document managements systems
■ expertise location and management – successful resolution of a customer problem
■ collaboration and learning – working in communities to gain new insights into customer relationships
70

2.5.7 Document management / Content management systems (CMS)
 Organizational knowledge will be codified in many forms of documents, such as
 manuals, e-mails, reports, memos, correspondence and minutes of meetings.
 Documents may differ in format and structure.
 Document management systems are software-based systems that control the lifecycle of a document: capture, storage, distribution and collaboration [1, pg
261].
 Document management systems will have the documents stored in structured file systems, with versions of the documents, so that the evolution in time of the document will be visible.
71

 E-learning can be integrated with other organizational processes to create a
‘just-in-time’ learning environment;
 Learning can take place during the business processes
 Employees are empowered to learn on their own
 Experts on certain subjects can offer feedback and advice online.
72

 Chief knowledge officer - The organizational knowledge management champion, who will provide the
KM vision and strategy [1, pg. 263].
 The CKO position having originated from the chief information officer (CIO), which is primarily technologydriven.
 Knowledge manager - Manager who will implement the knowledge management strategy [idem].
 Knowledge worker - An employee who spends a significant amount of their time in creating, using and distributing information and applying knowledge for decision making [1, pg. 49]
73

 A knowledge manager will be closely involved in planning and coordinating the core knowledge processes
 (identification, generation, storage, distribution and application),
 ensuring they are related to business processes and outcomes.
 A knowledge manager will also assess and oversee the development of individual capabilities, setting the conditions for interaction between employees.
 A knowledge manager will also focus on using and applying ICT to enable knowledge management [1, pg.
263].
74

1.
2.
3.
4.
5.
6.
Knowledge has become a crucial element in the competitive business environment.
The key stages of developing a knowledge management strategy are: definitions, audit, objectives, strategy approaches, implementation and quality measures.
There are a number of ways to define knowledge: a distinction between tacit and explicit knowledge can be made. Developing a working definition of knowledge is vital to the success of a knowledge management strategy.
Knowledge management can be broken down into five processes: store, identify, share, create and use can be applied to business processes. Individual and organizational capabilities will impact upon how knowledge is managed in organizations.
All organizations must develop a working definition of knowledge management before developing a knowledge management strategy.
A knowledge audit enables an organization to understand knowledge assets, processes and flows. The audit data can be matched against an ideal state so that a knowledge gap analysis can be undertaken. An inventory of knowledge assets, knowledge maps and profiles of employees is the tangible output.
7.
8.
Using evidence from a knowledge audit, organizations take different approaches to knowledge management depending on relationship between knowledge and key business processes.
The main approaches are codification versus personalization, exploiter versus explorer, aggressive versus conservative and technocratic versus behavioural.
9.
Communities of practice are ways employees share knowledge and learn across organizational boundaries.
10.
Competitive intelligence relates closely to knowledge management and develops a link to developing knowledge about the external competitive environment.
11.
Identifying and developing the right skills for the different roles in knowledge management will have an important impact on the success of a knowledge management strategy.
75