Search Our Catalog of Articles

  
 
Don't Let Consultants Confuse KM

You can quantify the benefits of knowledge management in just four simple steps.
 
IT consultants and marketing men have an irritating knack of surrounding the latest technologies and business models with an unnecessary aura of mystique. When the economy is booming, it's a technique that works well for them. Enough organisations are hypnotised by the hype to throw money at whatever fad happens to be idea of the day. Little if any thought is put into quantifying the likely return on investment (ROI). And if (as happens far too often) a project goes belly-up, the consultants frequently imply that their customers just weren't clever enough to make it work - though not before handing them a hefty bill.
 
The consultants' latest target is knowledge management (KM). As a vocal proponent of KM, it makes me angry that such a fundamentally good idea is being sold with such flagrant disregard for customers' business needs. They'll tell you KM is an expensive project which will involve wholesale changes to your corporate systems and culture. They'll quote timescales of up to five years for implementation and bombard you with fancy-sounding buzzwords such as (and these are genuine) 'innovation environment analysis' and 'knowledge ethnography and taxonomy'. I'm not disputing that the more professional consultancies have perfectly sound methodologies for implementing KM. What I am saying is their approach is too much about the 'how' and not enough about the 'why'.
 
But it's an approach I believe will backfire. The economy is flattening out. In some sectors, it's taking a definite downturn. In such a climate, no sensible organisation is going to invest hundreds of thousands of pounds in a major project unless they can quantify their ROI with some degree of accuracy. And that's where most of the consultants fall down. They offer woolly promises of improved efficiency, or of 'realising your intellectual assets', but no specifics - and, notably, no guarantees. Equally, I've read numerous articles purporting to tell you how to measure the financial return of a KM project, all of which say little more than 'it's very difficult'.
 
But the conventional wisdom is wrong. Put simply, knowledge management is about making all of the accumulated knowledge in your organisation - be it in people's heads or in corporate systems - available to everybody in the organisation as and when they need it. Evidently, this can improve the speed, efficiency and profitability of your business - and to gauge more precisely to what extent is by no means as difficult as some would have you believe. In fact, it's a relatively simple, four-step process.
 
The first stage is to get the senior players in your organisation together and identify your key business objectives. These will be different for every organisation, even ones operating in the same sector. The list could include anything from 'growing our share price' and 'developing new market products' to 'staff retention' and 'improving customer service'.
 
Once you've listed your key objectives, step two - the heart of the process - is what I call the doorstep challenge. You need to go round department by department, process by process, and ask managers to specify what it would mean to them if their department had instant access to all the knowledge within the organisation. For example, production might say that if they had access to information about imminently closing sales they would be able to deliver orders more quickly; customer services might say they could deal with problems far more quickly if they could find out instantly who had worked on particular orders. These may be fairly obvious examples, but your own doorstep challenge will throw up all manner of unforeseen benefits for KM.
 
This stage of the process also has another key function: it helps build understanding of KM's benefits within the organisation. If managers see that it is going to help them operate more efficiently, making their jobs less frustrating and more rewarding, then you've cleared a major hurdle before you've even begun the implementation. They will communicate those benefits to staff on the floor and help smooth the cultural transistion to KM - a vital factor in its successful implementation.
 
Step three involves building a list of applications for KM based on the results of your doorstep challenge. The list will detail fairly specific benefits, which means it should be relatively easy to assign a value to each application. You have now quantified the benefits of KM in terms that even your finance director can comprehend.
 
The final step of the analysis is to relate each of the applications to the business goals that you identified in stage one. It should then be a straightforward task to put them in order of importance. Every business's priorities are different, but by following these four steps you will be able to embark on a KM implementation safe in the knowledge that you will see quantified benefits delivered in the order that's most beneficial for your business, with the support of your staff.
 
I call this four-step process Success Driven Enterprise Knowledge Management (SDEKM). You could say that's a buzzword, but it is very different from confusing consultants' babble. It is a methodology that is designed to clarify issues, not cloud them. We've been using SDEKM with our customers with great success - and no blank faces.
 
Of course, the technologies and methodologies you use to implement KM are important as well, but they are of secondary concern. Work with third parties you trust are working primarily for the benefit of your business. KM is more than a buzzword, too. It is a philosophy that aims to make your organisation as efficient as it possibly can be, one that can learn and adapt to changes, with staff who feel valuable and fulfilled. Don't let anyone fool you into thinking it's really any more complicated than that.