Knowledge Management – Key Knowledge Management – Key Challenge for GovernmentChallenge for Government

Creating Value from Knowledge Creating Value from Knowledge - - Lessons LearnedLessons Learned

BACKGROUNDBACKGROUND

Need for better knowledge management within Need for better knowledge management within the public sector has been acknowledged as a the public sector has been acknowledged as a central strategic commitment. central strategic commitment.

Government has a poor track record in Government has a poor track record in knowledge management .knowledge management .

Growing recognition that in a changing public Growing recognition that in a changing public sector, learning and knowledge are possibly the sector, learning and knowledge are possibly the most crucial variables in addressing these most crucial variables in addressing these challenges. challenges.

Internal challenges: Internal challenges:

Corruption, Corruption,

Ineffective and inefficient use of state resources, Ineffective and inefficient use of state resources,

Poor development practice,Poor development practice,

policies that are poorly understood and policies that are poorly understood and implemented, implemented,

Services standardsServices standards

External challengesExternal challenges

Urgent service delivery in areas such as Urgent service delivery in areas such as education, healthcare, housing, social grants, education, healthcare, housing, social grants, and other social servicesand other social services

STAR MODEL

TECHNOLOGYARCHITECTURE

STRATEGY

STRUCTURE

PROCESSREWARDS

PEOPLE

Motivation Information

Behaviour

Performance Culture

Skills and mind-sets

Power

Direction

Lack of common conceptual understanding of knowledge Lack of common conceptual understanding of knowledge management management

Recognised the need for knowledge management Recognised the need for knowledge management

There are a number of KM initiatives in governmentThere are a number of KM initiatives in government. .

TThere are no specific metrics or a measurement framework here are no specific metrics or a measurement framework

No formal KM architecture in place.No formal KM architecture in place.

KEY FINDINGSKEY FINDINGS

TECHNOLOGYARCHITECTURE

-No formal KM architecture-KMS not aligned to KM strategy-Underutilised KMS systems

STRATEGY-No formalised KMstrategy-KM strategy not alignedto business strategy-No KM policy

STRUCTURE-Bureaucratic structuresand procedures-"Machine organisation" –no creativity, initiative-Functional/Departmentalsilos-Poor KM capabilities ofworkforce

PROCESS-Inadequate KMprocessess-Not formalised

REWARDS-There is no formal rewardsystem for KM-There are no formalmetrics for KMmeasurement

PEOPLE

-Lack of sharing due topower and status-Command and control-Departmentalism/competition-Lack of managementsupport

mot

Knowledge is:Knowledge is:

Both Both ”KnowThat” ”KnowThat” andand ”KnowHow” ”KnowHow”

Facts Facts andand Action Action

“Talking is not doing”. Gogo

Levels of Capacities to ActLevels of Capacities to Act

AbleAble(to do something)(to do something)

Competent Competent (Able + Achieve Results)(Able + Achieve Results)

Expert Expert (Peer-recognised(Peer-recognised

Competence. ”Competence. ”Master”Master”))

Wise Wise (Human)(Human)

The Learning PyramidThe Learning Pyramid

5%Lecture

10%Reading

20%Audio Visual

30%Demonstration

75%Practice by doing

90%Teach others / immediate use of learning

Source: National Training Laboratories, Bethel, Maine

Activity and average retention rate

Two dimensions of knowledge in organizations

CognitiveCognitive

Individual's Individual's mental modelsmental models

consisting of consisting of mental maps, mental maps,

beliefs, beliefs, paradigms, and paradigms, and

viewpointsviewpoints

Technical Technical

Concrete Concrete know-how, know-how,

crafts,crafts,

and skills that and skills that apply to a apply to a

specific contextspecific context

TACIT KNOWLEDGETACIT KNOWLEDGErooted in action,rooted in action,

experience, and involvement experience, and involvement in a specific contextin a specific context

EXPLICIT KNOWLEDGEEXPLICIT KNOWLEDGEarticulated, codified, articulated, codified,

and communicated in symbolic form and communicated in symbolic form and/or natural languageand/or natural language

There is a body of opinion that true knowledge is only tacit: as soon as it is codified or structured and stored it becomes information.

Knowledge sharing Knowledge sharing processesprocesses

Continuous process of transformation from one form to another.

Externalisation

Internalisation

Socialisation

Combination

Transformations between tacit and explicit Transformations between tacit and explicit knowledgeknowledge

•Socialisation•Sympathised knowledge

Connected with theories of group processes and organisational culture

Process of sharing experiences

Shared mental models and technical skills

Examples: apprenticeship, on-the-job training, communities of practice

•Externalisation•Conceptual Knowledge

Driven by metaphors, analogy, concepts, hypothesis and models

Triggered by dialogue or collective reflection

Holds the key to knowledge creation

Examples: abductive reasoning, new product development

•Internalisation• Operational Knowledge

Embodying explicit knowledge into tacit knowledge

"Learning by doing"

Through documents, manuals, or oral stories

Example: Project management, success stories

•Combination•Systemic Knowledge

Systemising concepts into knowledge systems

Combining different bodies of explicit knowledge through documents, meetings, internet

Example: Prototype, formal education and training

TACIT EXPLICITto

TACIT

from

EXPLICIT

KM – Highest Value PotentialKM – Highest Value Potential

1.1. Align KM with business strategy – a Align KM with business strategy – a knowledge-based strategyknowledge-based strategy

2.2. Improve climate for knowledge creation Improve climate for knowledge creation and sharing – Collaborative Climate.and sharing – Collaborative Climate.

3.3. Improve knowledge sharing with Improve knowledge sharing with customers.customers.

4.4. Invest in Internet-based communicationInvest in Internet-based communication5.5. Build organisation for content Build organisation for content

management (On-line library, databases)management (On-line library, databases)

5

4

3

2

1

Where is most money spent on KM? – Ranking

Learning is a means to an end – KM Learning is a means to an end – KM must have a business focusmust have a business focus

KM requires deep rooted behavioural KM requires deep rooted behavioural and strategic changeand strategic change

KM concerns how to create KM concerns how to create environments for people to create, environments for people to create, leverage and share knowledgeleverage and share knowledge

KM requires top management KM requires top management involvement; it is a fundamental shift in involvement; it is a fundamental shift in strategic perspective.strategic perspective.

IT is a tool for information exchange, but IT is a tool for information exchange, but IT investments yield low value.IT investments yield low value.

• It’s the same thing as It’s the same thing as learninglearning

• It’s a simple add-on to It’s a simple add-on to business as usualbusiness as usual

• It’s capturing It’s capturing knowledge kept in the knowledge kept in the heads of peopleheads of people

• It’s a function to be It’s a function to be delegated to HR or ITdelegated to HR or IT

• It’s a matter of It’s a matter of investing in ITinvesting in IT

Myths and Reality about Knowledge ManagementMyths and Reality about Knowledge Management

KM: the Art of Creating Value from Intangible AssetsKM: the Art of Creating Value from Intangible Assets

Improving Knowledge Improving Knowledge FlowFlows:s:Two InfrastructuresTwo Infrastructures

People networksPeople networks

Collaborative Collaborative ClimateClimateTrustTrust

Know-HowKnow-HowIT networksnetworks

Cable widthBits per second

Know-WhatKnow-WhatInformation, factsInformation, facts

A Knowledge-Based View of the FirmA Knowledge-Based View of the Firm

KnowledgeKnowledgeWorkersWorkers

CustomersCustomers

Support staff, Support staff, systems & systems & processesprocesses

VV

10. Strategic Purpose:10. Strategic Purpose: How How can the value creation can the value creation

capacity of the capacity of the wholewhole be be maximised? maximised?

The Ten Knowledge Strategy The Ten Knowledge Strategy IssuesIssues

3. Learn from customers, 3. Learn from customers, suppliers and other suppliers and other stakeholders. stakeholders. •Betz Labs – participates Betz Labs – participates in customer quality teamsin customer quality teams•McKinsey – manages McKinsey – manages Alumnae activelyAlumnae actively

6. Help our customers’ 6. Help our customers’ con-versation with their con-versation with their customers. customers. •B-K – organises seminars B-K – organises seminars by authorsby authors•Lovisenberg Hospital; Lovisenberg Hospital; fear reduction – ex-fear reduction – ex-patients meet new patients meet new patientspatients

4. C4. Convert individually onvert individually held knowledge to held knowledge to systems, tools and systems, tools and templates.templates.•Databases, Document Databases, Document handling, etchandling, etc•All types of softwareAll types of software

9. Integrate systems, tools 9. Integrate systems, tools & processes and products & processes and products effectively internally.effectively internally.•PwC – KnowledgeCurvePwC – KnowledgeCurve•Motorola – uses KM to Motorola – uses KM to break silosbreak silos

1. Improve the transfer 1. Improve the transfer of knowledge between of knowledge between Experts in our Experts in our organisation.organisation.•BP – Communities of BP – Communities of PracticePractice•Prof.services – Prof.services – Master/ApprenticesMaster/Apprentices

5. Improve individuals’ 5. Improve individuals’ knowledge by using knowledge by using systems, tools andsystems, tools and templates.templates.•IKEA – business IKEA – business simulationssimulations•NASA – flight NASA – flight simulatorssimulators

8. Help customers and 8. Help customers and suppliers access knowledge suppliers access knowledge via our systems, tools & via our systems, tools & processes. processes. •E&Y – ErnieE&Y – Ernie•GE – Sharing BI and market GE – Sharing BI and market data w. customersdata w. customers

7. Use 7. Use knowledge from knowledge from customers and suppliers customers and suppliers to add value to our to add value to our systems, processes and systems, processes and products.products.•Frito-Lay – adds Frito-Lay – adds competitive intelligence competitive intelligence to commoditiesto commodities•Ritz Carlton – shares Ritz Carlton – shares patron data for superior patron data for superior serviceservice

2. Transfer knowledge 2. Transfer knowledge to customers, suppliers to customers, suppliers and other and other stakeholders.stakeholders.•McKinsey shares McKinsey shares concepts w. clientsconcepts w. clients•GE – shares “Black GE – shares “Black Belt experts” best Belt experts” best practice w. customerspractice w. customers

Purpose of a Knowledge-based StrategyPurpose of a Knowledge-based Strategy

KnowledgeKnowledgeworkersworkers

CustomersCustomers

Maximise the capacity of the whole System to create value, Maximise the capacity of the whole System to create value, by enhancing by enhancing the knowledge flows between customers, individuals and processes.the knowledge flows between customers, individuals and processes.

Support staff,Support staff, IT systems & IT systems &

processesprocesses

VV

What were the gains?What were the gains?

Patent management – Dow Chemical ~$25M ->$100MPatent management – Dow Chemical ~$25M ->$100M Sharing Technical expertise and Best PracticeSharing Technical expertise and Best Practice

• Chevron – ”millions of dollarsChevron – ”millions of dollars

• Xerox – 5000 ideas for improvementXerox – 5000 ideas for improvement

• BP – “millions of dollars” BP – “millions of dollars”

• Shell - $5 millions in 5 monthsShell - $5 millions in 5 months Increased innovation – Increased innovation –

• Buckman Labs, 40% increase in new product launches.Buckman Labs, 40% increase in new product launches.

• Pillsbury 67% success rate in new product launches after KM Pillsbury 67% success rate in new product launches after KM introduction.introduction.

• MTN – 15 service ideas from customers via Call centre in one MTN – 15 service ideas from customers via Call centre in one weekweek

PR-gain – Skandia Intellectual Capital Statement ~$1 Bn in MVPR-gain – Skandia Intellectual Capital Statement ~$1 Bn in MV Expert turnover reduced by 70% - AffExpert turnover reduced by 70% - Affärsvärldenärsvärlden

Framework for KM SupportFramework for KM Support

Document RepositoryDatawarehousing

Yellow Pages of Experts

Expertise Profiles andDatabases

Electronic Discussion ForumsCollaborative Filtering

Intranets and Search Engines

1 2

3 4

Artifact Individual

Locus ofKnowledge

Unst

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truct

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d

Level

of

AP

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Some Trends in Knowledge Intensive Firms Some Trends in Knowledge Intensive Firms

11stst wave: Focus on knowledge worker efficiency wave: Focus on knowledge worker efficiency (reduce costs): (reduce costs): • ‘‘Toolification’ of tacit knowledgeToolification’ of tacit knowledge• Internet for storing informationInternet for storing information• Optimisation of office spaceOptimisation of office space

22ndnd wave: Focus on knowledge worker effectiveness wave: Focus on knowledge worker effectiveness (increase revenues)(increase revenues)• Technology: Internet-based Collaboration technologiesTechnology: Internet-based Collaboration technologies• Communities of PracticeCommunities of Practice• Optimisation of social space (eg. Collaborative Climate)Optimisation of social space (eg. Collaborative Climate)• New organisational formsNew organisational forms

Continuous: Focus on Superior Client ServiceContinuous: Focus on Superior Client Service• Technology; CRM, InternetTechnology; CRM, Internet• Personal; Account organisationPersonal; Account organisation

IMPLEMENTATION FRAMEWORKIMPLEMENTATION FRAMEWORK

KM TECHNOLOGYARCHITECTURE

6. Choose technology that willfacilitate the chosen KM

strategy?

STRATEGY1. Determine whetherorganisation needs a

codification orpersonalised strategy

STRUCTURE2. Determine the best

structure that willfacilitate theorganisationbecoming anknowledge

managementorganisation

PROCESS3. Develop processesthat assist knowledgecreation, verification,

packaging, distributionand application

REWARDS4. Design reward

structure and systemthat will measure and

reward theachievement of theorganisational KM

goals

PEOPLE5. HR policies must

ensure that theappropriately skilledpeople are chosen to

develop a creativeand knowledgesharing culture

Motivation Information

Behaviour

Performance Culture

Skills and mind-sets

Power

Direction

Tell me, I'll forget. Show me, I may remember.

But involve me and I'll understand.Lao Tzu ~600 BC