KM Value

Yesterday I introduced Knowledge Management (KM) as a value-addition to a company and the necessary Enterprise Content Management (ECM) which would be the back bone of such a system. Before I get into the weeds, I wanted to step back and clarify why companies find value in KM.

As the United States has progressed, our economy has began to rely more on intellectual capital than manufacturing. Simply, our nation's competitive advantage lies in the minds of our people rather than the manual labor they might perform. In parallel, a company's market value has become increasingly dependent upon the value of its intellectual capital or intangible assets. Intellectual property, patents, certifications, and training have become cornerstones of the modern company because a company's competitive advantage relies on the ability to create and leverage this knowledge. This forms the foundation of modern knowledge management philosophy.This reasoning touches every part of the corporation from human capital management to IT.

 One overwhelming example of the KM impact lies in organizational design. To fully leverage knowledge, a corporation much establish the appropriate KM functions, units and responsibilities within an organization. They must also align the reporting structure to acknowledge key tacit knowledge flows, build cross-functional/office teams, and develop support networks/communities to spawn and catch knowledge. I will be posting more on how companies can take each of these steps in subsequent posts.

The most relevant idea comes alive when you think about a simple case: a key employee departure. In addition to losing the services of this employee, the company also loses:

1. All tacit knowledge the employee has gained
2. All networks the employee has built
3. All explicit knowledge the employee kept personally

The idea of a true knowledge management system would be to introduce systems of redundancy which allow the company to minimize the risk of knowledge loss (in this case) AND to maximize the opportunity of knowledge creation (in other cases). 

The backbone of this ability for a company is a true enterprise content management system which will ensure that (at the very least) all explicit knowledge be kept in house where other can access the data. Such an application could also facilitate knowledge creation by, for instance, allowing employees to find experts within a company by performing enterprise-level searches. (There are some mitigating factors, such as employee privileges, which I will explore in a later post)

I'll continue to visit Knowledge Management throughout this week. If you have any specific questions, don't hesitate to let me know.