Is knowledge management a fad past its sell-by date or a practical approach that actually works? Bettina Pickering, John Kay and David Sumray from PA Consulting Group find out.

A few years ago, a significant number of organisations embarked on knowledge management (KM) type projects with the aim of getting more value from the information the company produces on a daily basis and the intellectual assets usually stored in people's heads or on their hard drives.

The benefits were clear in everyone's mind – easier access to knowledge and a higher quality of information would enable better decision making, better customer service and avoid duplication of time and effort; the list goes on.

At the time, these programmes seemed a good idea based on the very logical and real benefits to be gained, however few organisations actually feel they got the value they expected from these often costly and time consuming programmes.

Why is it then that most KM programmes did not succeed in achieving these benefits?

Although organisations embark on KM programmes with the best intentions, they often tend to underestimate the scale and scope of them. The range of activities that need to be undertaken to make them successful is often not taken into account; most KM programmes tended and tend to focus on only two of the six components of KM; namely the technology and information/data, and neglect the other four crucial components – process, expertise and skills, people and leadership.

As a result, state of the art technology has been implemented and it is available for use however, slick and rigorous KM processes for knowledge capture, maintenance and usage have not been put in place.

The leadership dimension

Also often lacking are the people and leadership dimensions. KM is seldom high on the agenda of a board of directors or firmly embedded in manager’s and employees annual objectives. Where they are, KM objectives are seldom bonus worthy, which means KM is not high on the agenda for each employee.

Successful KM programmes give equal focus to each of the six components:

1. Leadership
Organisations are more transparent today. Leading by example has never been a more important trait. Business leaders need to excel in their understanding and use of knowledge enabled solutions and show the way to their direct reports. Leaders have to encourage, recognise and reward good KM behaviours or risk spiralling costs through duplication of effort and loss of productivity or competitive advantage.

2.Expertise and skills
Tacit knowledge – the expertise of the people in the organisation is the most valuable asset. This tacit knowledge gets lost when staff leave the organisation and needs to be re-created every time someone new joins unless there are processes and learning solutions in place that capture some of this knowledge to pass on. Tacit knowledge if tapped into could either save the organisation significant costs, for example through process improvements across departmental boundaries, or increase profit, for example through connecting different customer facing functions/teams and identifying patterns and new sales opportunities based on those patterns.

3. Process
Clearly defined processes are vital to the success of KM solutions. They range from compliance with legislation like the Freedom of Information Act (FOIA) through content management to skills development processes. Smart organisations ensure they embed effective KM solutions in all business processes – facilitating distribution of best practice. Not all KM can be systematised, especially the creative elements – but organisations can lay down clear pathways to deliver best practice solutions.

4. People (state of mind?)
If the organisation’s culture is stove piped, departmental or ‘not invented here’, KM is not likely to work, unless the organisation is prepared to transform their culture concurrently with the implementation of a KM strategy and technical KM solution. The majority of KM strategies fail because organisations do not address culture, and many implemented KM solutions can deliver significantly more value if cultural issues are addressed

5. Information and data
Information and data are the key ‘explicit’ knowledge asset. They have no value unless they are applied by the organisation and tend to be significantly underused; organisations today use about 10% of the information they generate. With the emergence of on-line technologies organisations have transformed from information hungry to information overload. Most organisations today are losing sight of information and data quality, through duplication and poor version control. They do not apply effective and consistent standards or taxonomy.

6. Technology
Technology acts as a key enabler for KM. It provides the platform for creating, storing and retrieving organisational knowledge. Technology is continuously evolving and growing in complexity. IT solutions have to be effectively managed to deliver appropriate value. The organisation is constantly challenged to maintain or develop skills to get the most from technology investments. Typically IT solutions remain underused, and not delivering the value anticipated at the outset.

Given the amount of explicit knowledge (data and information generated by an organisation in the course of doing business) and tacit knowledge (employee's insights and learning) that organisations generate every day, month and year, implementing KM properly, especially after a failed programme, seems like an impossible and very costly undertaking despite all the very real benefits.

So what are the options for organisations that wish to realise the benefits from KM without embarking on another lengthy and costly programme?

Unfortunately there are no easy quick fixes. However, there are three key actions that an organisation, supported by the HR function, can take to achieve some significant benefits from KM if the organisation is struggling to gain management commitment to properly implement KM:

• Organise KM from the point of usage rather than data creation
• Understand where the key blockages and the weakest links are in the KM cycle and fix these for the high value information flows
• Make it easier for people to do the right thing – blast ingrained habits

The first point relates to the fact that most organisations manage the information and data that is being created giving each piece of information equal weight. Lets use a supermarket as an example – supermarkets are mainly organised based on item value to the supermarket. Items that are more popular or required more frequently than others are usually more easily accessible to customers than others, for example, papers and magazines are usually at the entrance so that customers can quickly get their paper, pay and exit with minimum fuss.

Products that are never bought are not stocked and slow moving goods are not stocked in the premium isles, such as kettles or ironing boards. Organisations need to review their KM strategy and firstly focus on the information and knowledge that is required on the most frequent basis and which results in the most value for the organisation.

Secondly, using the supermarket analogy, in a KM context we tend to see ourselves as consumers of knowledge only, but what happens to the shelf stackers and supermarket managers? Staff and managers need to be re-educated as to their role with regard to KM and measured as to the effectiveness of their shelf stacking and management of the "knowledge supermarket".

For example, showing staff explicitly how often the pieces of knowledge (products) and the areas of the knowledge management solution (shelves) they are responsible for have been accessed by others and what impact their 'products' had on the work of the other person evidenced by comments and feedback. HR managers can facilitate this process and advice business managers on it.

Key blockages

The second point suggests that, once the organisation has decided which areas of knowledge and information to focus on as a priority based on value, it is critical to understand where the key blockages in the KM cycle (creation, managing, sharing and using/feedback) are that prevent the organisation from achieving the benefits in the chosen focus areas. Often these blockages are not of a technological nature but are related to culture, leadership and process.

And the last point means that most of our daily work activities are of a reactive nature – for example answering phone calls, completing transactions, preparing reports, analysing data, meeting customers. However, activities that contribute to KM are proactive activities and fall within the planning and development category such as writing up insights gained from performing certain tasks, sharing customer buying patterns with colleagues to identify additional sales opportunities, looking for trends in employee related information to improve the compensation and benefits offering.

In order to ensure proactive activities are given the attention they deserve, managers need to make sure that staff have allocated time to carry out KM activities. This is not always easy to achieve, however some organisations have introduced departmental and team days facilitated by HR business partners where these activities form part of the agenda and where staff are encouraged to share insights and learnings with their colleagues.

Additionally, to ensure staff are encouraged to do the right thing and contribute to KM activities, KM needs to be firmly routed within every employee’s objectives and made bonus-worthy (or if the employee is not eligible for bonus, non achievement of these objectives needs to have performance management consequences.

HR managers and business partners can take a key role in this process advising departmental heads and the board of directors on the most appropriate process for setting and communicating KM objectives, ensuring that the link between these objectives and the bonus or pay is made and helping business managers to measure their staff based on these objectives.

There are no quick and immediate solutions to properly implement KM in an organisation. However, if an organisation is struggling to gain management commitment to doing KM properly then at the very least there are three key actions HR managers can lead and support that will begin the cultural change and demonstrate the value required to gain real commitment.

John Kay is a member of PA's management group. Bettina Pickering and David Sumray are senior consultants at PA Consulting Group.