Your Say: Linking KM to real business needs

For all the success stories that knowledge management has produced since the discipline was first introduced in a corporate setting, many organisations still fail to realise the true benefits KM implementation can bring. Simon Lelic talks to representatives from Aventis, Entopia, the IIMSI, TFPL and Verity, and discusses the importance of linking any KM programme with tangible business needs.

As this issue of Knowledge Management goes to press, KM Europe 2002, the third in what has become a record-breaking series of events, is a matter of weeks away. This year’s combined conference and exhibition is likely to attract upwards of 2,000 visitors, including the world’s leading practitioners, together with a broad cross-section of organisations currently active in the knowledge-management field. From fad to fashion to board-level concern in almost every major global company, KM has come a long way. Success stories abound and the body of literature dedicated to documenting good practice grows unabated, which in turn helps to explain why the discipline has developed such a committed following since its inception.

But as any CKO, technology vendor, consultant or knowledge manager worth their salt will tell you, no organisation will become more effective, more efficient or more profitable simply because it decides to ‘do’ KM. Many KM programmes fail regardless of how much money is poured into them or how dedicated the sponsor or programme leader may be. The reason, says Ken Standfield, chairman of the International Intangible Management Standards Institute, is that many organisations continue to implement KM in an unstructured and unscientific manner. Or as Jason Slusher, senior manager, Knowledge Management, at Aventis Pharmaceuticals, puts it, “Programmes that fail may not have connected KM to a specific business problem, stated measurable goals up front, used measurements throughout the project or set targets that solutions are designed to solve.”

Slusher goes on to argue that if a KM initiative is not directly linked to helping an organisation achieve a competitive advantage, it should be altered to do so or promptly terminated. This is an idea developed by Sandra Ward, director and head of consultancy at TFPL, who says, “The only significant purpose of a KM strategy is to support and facilitate the achievement of a business strategy and objectives through the building and leveraging of organisational capability.” She adds that if there is no clear business reason to build an environment that stimulates knowledge sharing and creation, there will be no reason for people to want to engage in KM initiatives, nor for managers to involve themselves or encourage their staff to participate. “Life is too busy for people to want to engage in initiatives that are peripheral to their main objectives.”

Many firms nevertheless fail to tie their KM programmes to tangible business needs, and in recent years the lure of technology has been partly to blame. “Organisations tended to place a higher focus on technology than usual through the IT-boom years,” says Simon Atkinson, managing director of Verity (GB). “Y2K and e-commerce projects forced a charge towards IT spending and implementation that was out of proportion with normal operating practices in many cases.” And as Ward suggests, sections of the trade press have certainly been guilty of propagating the idea that technology is the single key enabler for knowledge management, seemingly irrespective of the context in which such tools are deployed. This is certainly a trap many companies have fallen into. While technology is obviously an important component of KM, every business initiative requires the correct blend of a number of critical factors if it is to be successful – if these are ignored, as Slusher says, the project will fail.

Lionel Baraban, co-founder, president and CEO of Entopia, is nevertheless confident that organisations are starting to realise the symbiosis between the technology and the cultural approach to knowledge management, and many vendors and consultants are, in turn, modifying their offerings accordingly. “Those selling technology solutions are beginning to realise that they lack some of the skills that are needed to best position and introduce these tools to really achieve business benefit, and they are seeking partnerships with companies that possess them,” Ward adds. Standfield, too, believes that consulting firms are heading for the middle ground that bridges the divide between a purely technology-based solution and one that focuses exclusively on human interaction. This may be a reaction to hardening market conditions, as Atkinson suggests, which have necessitated increased levels of scrutiny when it comes to technology spend and investment, but the result is that more vendors and consultants are now packaging their products so that functionality matches business needs.

And while, as Standfield says, there may still be a degree of confusion over KM – what it does, what it means and how it works – broad levels of understanding are growing. “Understanding has progressed in leaps and bounds,” says Baraban. “Knowledge management has been around the block for some time now, and has been through a number of cycles of inefficient and ineffective implementations.” Ward, too, is impressed with the alacrity with which appreciation of the subject has grown, pointing to the increasing levels of adoption in the public sector over the past two or three years as evidence of this. “Those working in KM, particularly at CKO level, are also a talented bunch,” she adds. “They are characterised by a tremendous thirst for learning and open minds. They both work with practical KM solutions and deal with KM at a conceptual level, shaping the principles that drive new thinking and innovation with KM.”

As a result, businesses are more aware than ever of how ineffective a KM programme is likely to be unless it is linked to real business needs. As Baraban says, “More organisations are recognising that they must align their KM project to business processes if they truly want it to succeed.” Ward is also adamant that organisations are realising how crucial this association has become. “The organisations that TFPL works with across our recruitment, consultancy and training businesses want us to help them solve business problems,” she says. “This is the case whether they operate in the private or the public sector. Either they have already invested in KM programmes and are looking for additional people or skills, or their knowledge management programmes require tuning and they are looking for critical review and support to accelerate their progress. They may even have just begun to recognise that KM is an area they need to explore. In all cases, though, they are driven by business need. They sense that something is missing – that their organisational knowledge could deliver more benefit.”

Again, the economic climate may well have played its part in this respect. As Atkinson points out, companies looking to make any investment nowadays have little choice but to make sure they will realise a tangible gain from that outlay. The hype that once surrounded KM has passed, adds Standfield, leaving enterprises with no option other than to place the discipline on an equal footing with any other business process, including TQM, process re-engineering, six sigma, balanced scorecard and so on. “If KM cannot prove its worth in hard financial terms, show when and what paybacks are expected, then KM initiatives will be passed over in preference of more conventional strategies such as downsizing and cost cutting,” he says.

Having accepted the association between realising an ROI and tying KM implementation to tangible business goals, organisations must then take the appropriate steps to ensure that their knowledge-management strategies are properly targeted. As Ward says, “KM initiatives shouldn’t start with a KM idea looking for a home; they start with a business problem looking for a solution.” She refers to the words of Hubert Saint Onge, a keynote presenter at last year’s KM Europe, who said, “I believe in getting work done and in using knowledge platforms to get work done.” This, Ward argues, is the philosophy that should drive any KM initiative. “The role of knowledge leaders is to be aware of the underpinning principles of KM, to understand key KM practices, to identify the areas in their organisation that require KM intervention and to work with the business to create, select and implement the mix of KM approaches that is most likely to produce results,” she says.

To this end, Baraban recommends that those responsible for driving the knowledge-management programme within their organisation plan, plan and plan again. It is crucial, he says, that businesses look back at strategies that have failed in the past, identify why they didn’t work, and discard any dysfunctional processes and applications. In a similar vein, Slusher advocates auditing existing KM projects to determine what knowledge they are meant to be supporting. “KM initiatives should only support knowledge that is strategic to the organisation,” he says. “For example, if a technology company wants to enter a new market by gaining a competitive advantage in services, KM initiatives focused on developing innovative software should be realigned to support the new organisational goals.” Likewise, he continues, future KM programmes should only be proposed after a comprehensive knowledge strategy has been formulated.

As part of this process, it is equally important that every knowledge-management initiative involves everyone it will ultimately affect. Atkinson, for instance, believes it makes sense to engage any party that has an active interest in the project, providing that control and direction of the programme is not compromised. And as Standfield says, “Senior executives should always implement KM from the bottom up, and not from the top down. Bottom-up KM initiatives are the most successful, as they involve the employees first, not last. The more people who are involved, the greater the network effects and the potential for success.” The point, it seems, is that knowledge management is not something that can be done to an organisation – it has to be developed with the business. According to Ward, this is an idea that came across strongly at TFPL’s recent CKO summit, held in Dublinlast month. As she says, many successful organisations are seconding people from their business units into the KM function for a short period of time and totally immersing them in knowledge-management theory and practice before sending them back to become leaders of KM-based change in their respective departments.

Clearly the success rate of KM-related initiatives is climbing, yet many projects have failed in the past – and in some cases continue to fail – precisely because their proponents saw knowledge management as a solution without really understanding what the problem was. The lessons, though, are there to be learnt, and, thankfully, this tendency is no longer the norm. Instead, driven in part by increased levels of understanding and partly by the economic imperative of current market conditions, organisations are recognising the importance of linking their knowledge-management programmes to tangible goals. This is of course more easily said than done, but if companies take the necessary time and effort to ensure that it is business needs that drive KM strategies and not the other way around, the returns they are likely to see – in terms of increased efficiency, effectiveness and profitability – will increase in step.

Contact details

Ken Standfield can be contacted at ken@standardsinstitute.org

Sandra Ward can be contacted at sandra.ward@tfpl.com

Simon Atkinson can be contacted at satkinso@verity.com

Lionel Baraban can be contacted at lionel@entopia.com

Jason Slusher can be contacted at jason.slusher@aventis.com