The knowledge of experience

| The European | 15th January 2015


You could be forgiven for feeling a certain amount of scepticism about knowledge management. With its somewhat vague name and indistinct purpose, the suspicion that this is just another management fad is understandable. Might it not simply entail endless meetings, pointless paperwork and useless exercises, getting in the way of your company’s actual day to day business?

These are valid concerns, and while it is recognised that some business management projects really are a load of hot air, knowledge management should not be rejected out of hand. If Ernst & Young, The World Bank and Xerox (among others) have implemented knowledge management projects, there has to be some substance to this concept.

I recently caught up with Dr Raymond Levitt of Stanford University, whose research on the intricacies of knowledge flows within businesses has helped shed light on how and why knowledge management works. While he was clear that there are challenges to implementing a knowledge management programme, he was adamant that it can have considerable and far reaching effects on a firm’s efficiency, underlining that its benefits are “absolutely not intangible for a consulting firm or any firm that provides custom, cutting edge solutions”.

So, what is knowledge management exactly, and why might it be something your business could use to advance?

To really understand knowledge management, we need to take a step back and think about how modern businesses work. Elizabeth Smith, management consultant and professor of administrative sciences at the University of Houston, compares today’s context with the building blocks of traditional industry. In the past, effective management was focused on the co-ordination of capital, labour and goods. However, as we have moved into a service and knowledge based economy, the real challenge businesses face is making sure that knowledge can be accessed, moved and stored efficiently. We’ve moved from creating things to creating ideas and we, therefore, need to find ways of sharing, storing and accessing them. In a nutshell, knowledge management is about finding the most efficient way of doing this. Ms Smith reports that up to 90 per cent of an organisation’s knowledge is stored in the heads of its workers. Now, that’s not a great problem when your workers are doing repetitive manual tasks – if one labourer at your factory leaves, it won’t be a huge problem to replace him or her and train up the new recruit. On the other hand, in a creative agency, a business consultancy or a bank, for instance, this is a much bigger issue. When what produces value for your business is all held in the minds of your workers, the stakes are raised when it comes to replacing key skilled staff.

Consider the value knowledge workers add to your business; they come up with the innovative ideas that lead to profits, have an intricate understanding of the processes needed to complete highly specialised tasks and have real know-how, know-where and know-who. If, for whatever reason, a member of your team leaves the business, it’s not just their labour which goes out the door, but an essential cog in your machine. And this is where knowledge management comes in: it’s about finding ways to capture as much of this information as possible and minimise the risks of losing crucial skills.

Knowledge management consultants emphasise that a business should see its workers’ knowledge as an asset. Just as your capital, networks, physical infrastructure and intellectual property are things the business owns and manages, so is its knowledge. As the saying goes, knowledge is power; it can be seen as a tool, a way of making things happen. It is, therefore, essential to find ways of holding on to this and preserving it. When most of this information is stored in the heads of your workers (known as tacit knowledge), the problem is that no one else in the workplace can really access it. However, if you can find ways of encouraging workers to share their ideas, to explain to others how they carry out their specialised tasks, the knowledge becomes explicit, readily accessible to all.

In this way, managing knowledge is about changing the culture of an organisation. As staff learn to share knowledge, the risk of it “walking out the door” is radically reduced. Furthermore, knowledge management can spur on new ideas, save time and encourage a more collaborative environment. By managing knowledge you reduce the risk of “reinventing the wheel”; when staff are aware that a colleague actually already knows how to do an activity, you avoid situations where they spend hours working out how to complete an activity.

We’ve all been in that situation, struggling to find a solution to some problem or another. If only there was a way of finding out if one of our colleagues had already dealt with it? Knowledge management attempts to offer answers to these kinds of issues.

Changing culture

It is becoming increasingly clear that in today’s business environment, traditional hierarchies and structures impede rather than help to succeed. Knowledge management is at the forefront of a new approach to management; holistic, bottom-up and collaborative, it offers a radical yet logical approach to the current commercial context.

As markets fluctuate and challenges are globalised, businesses which share knowledge and manage their intellectual assets effectively will be most successful when it comes to riding the wave. Experts in this field have come up with a number of methods to shake up knowledge management within organisations.

David Skyrme, a leading knowledge management consultant, characterises this process as a method of changing the culture of an organisation. Through various protocols, actions and practices, it is possible to shift the ethos of a firm – from a situation where workers hoard their skills, to a situation where they are willing to share them. Very often workers are afraid that teaching others their particular knowledge will undermine their position, but knowledge management is about encouraging workers to look at this positively. It is often reported that when they have the opportunity, individuals actually take pleasure in teaching colleagues their know-how. Through creating this kind of environment it is also more likely that workers will feel valued and recognised and that they will see the workplace as somewhere they can grow.

The most direct way of capturing knowledge is of course to physically write it down – producing “how-to” guides is obviously important here, but equally it is worthwhile thinking about creating “who-can” guides. Most knowledge management consultants recommend the implementation of a knowledge audit. A kind of survey, it finds out who knows what, where their knowledge is stored and how it is accessed; drawing on this kind of information, it is possible to track where there are knowledge risks within the organisation. You may not have realised but it is quite possible that only one member of staff actually knows how to use a certain program or do a particular activity. A knowledge audit can help prepare for and mitigate this kind of issue.

However, there are a whole raft of other actions you can implement to really turn around knowledge flow within your organisation. Long gone are the days of office staff hidden away in their own little cubicles, but restructuring the physical organisation of an office can have a massive effect on the way knowledge is shared at work. At GCHQ, the British intelligence agency, the office floor has been reformulated to include a central “highway” along which staff are more likely to have the chance encounters, which lead to knowledge sharing and new ideas.

At Xerox, an online forum named “Eureka” was developed, which allowed field technicians to trade their “war stories”. Through recounting experiences, mistakes and solutions to unexpected difficulties, the kinds of accidental lessons individual staff learnt in the field were made available to everyone within the business. Similarly, the World Bank encourages field staff to form online “communities of practice”, essentially threads where workers in disparate countries discuss and share knowledge and new information on a particular field. So, for instance, a malaria expert in Panama might be able to learn from new innovations developed by colleagues in Bangladesh or Tanzania.

Saving time

Knowledge management, as with any other management tool, does not necessarily produce immediately obvious results. It is difficult to measure the success of this kind of strategy and there are certainly a number of barriers full implementation – time and resources are by no means the least important obstacles. Nevertheless, the long-term benefits of an efficiently managed knowledge workplace are profound. Increasing the chances of those “eureka” moments through staff collaboration, creating an environment where individuals feel that they are valued and their knowledge recognised, and the opportunity to save hours of time and effort make knowledge management a crucial investment for any business seeking success.

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