Herding cats?

Christian Young discusses the essential elements in building a business case for KM and asks, is it such a tall order?

Since I’ve dedicated 2010 to evangelising the importance of a KM value proposition, it seems only fitting that I should write about making the business case for KM. Whether you’re engaging in an initial discussion or rebranding KM efforts, the ability to define, rationalise and set expectations is a critical cornerstone of a successful and sustainable KM initiative.

Prior literature on the subject – for example, Making the Case for Knowledge Management: The Bigger Picture (Neef, 1997); Making the Business Case for Knowledge Management: As Simple as ABC? (Skyrme, 2001); and The Business Case for Knowledge Management (Yelden & Albers, 2004) – has either focused, impractically, on selling a KM strategy (without considering the implications of proposing a strategic solution to stakeholders whose understanding of KM might run the gamut from none to somewhere out in left field) or on justifying KM (which, perhaps, left a bad taste in my mouth because I subscribe to the belief that, as a discipline, KM requires explanation rather than justification; save the pleading for your strategy).

Ultimately, the objective of a business case for KM is to provide organisational stakeholders with an awareness and understanding that will set the stage for a deeper exploration of how KM can be approached strategically. First, build (and sell) the case for KM; second, secure enough buy-in to undertake a proper knowledge audit; and, third, develop (and pitch) a strategic solution.

Elements of a business case for KM

General and organisation-specific definitions of KM;
Awareness of how KM affects an organisation;
Awareness of the role that KM plays in the organisation; and
Cost and benefit(s) of a strategic approach to KM.

General and organisation-specific definitions of KM
I’m fond of defining KM as a set of strategies that improves how information is shared and leveraged in an organisation, but if that doesn’t work for you, then look no further than the Wikipedia entry for KM, for something more comprehensive. Just remember to observe the wisdom of the KISS principle and keep it simple, stupid! Avoid tossing around know-it-all terms, such as tacit and explicit knowledge, and generic statistics about employee retention, knowledge half-life and even competitor’s KM behaviours. You don’t create a connection by talking over the heads of your audience. You have to speak in their language about their organisation. Will some respond to and even demand this type of information? Sure. But your task is to keep them focused on their organisation. What works next door and across the street isn’t necessarily applicable at home and even if it might be, benchmarking the best practices of others is highly premature for organisations still defining their need for and approach to KM. And you should say so.

Awareness of how KM affects an organisation
Fundamental KM belief number one: there is no such thing as an organisation that does not practice KM, whether or not it’s been formally documented or recognised as such. When an organisation says it ‘wants’ KM what it’s really saying is that whatever it’s currently doing isn’t working (for whatever reason and to whatever degree).

This is the reason I espouse explaining versus justifying KM – it’s not some external activity that an organisation can opt-in or out of at its leisure. It is a reality of doing business that it is embodied in all of the processes and activities that inform and influence how human and technology resources are utilised, developed, and leveraged across the organisation.

Awareness of the role that KM plays in the organisation
Fundamental KM belief number two: good KM professionals should, ideally, be working themselves out of a job. While there may be an ongoing need for someone to manage KM systems and routine activities (knowledge audits, data analysis and reporting, and so on) at some point, once the task of facilitating the cultural adoption of KM is complete, these activities should be able to be absorbed by other functional areas (preferably, at the executive level). As a field, KM is rooted in the following core values:

KM is strategic (mission and goals-oriented, tactical, agile);
KM is about sharing (collaboration, partnership, active participation);
KM is about community (mutuality, trust, respect); and
KM is about innovation (growth, adaptation, change).

And, in addition to being warm and fuzzy, KM also provides a holistic lens through which policies, practices, and strategic goals and objectives are analysed to determine how fully people, process, and technology are being engaged. This is a critical aspect of KM that is often ignored. Typically the KM function is engaged to assist in determining how KM systems might be used to facilitate a particular goal or objective, but rarely is KM engaged to evaluate the actual goals and objectives. ‘How can KM support this initiative?’ should give way to ‘How feasible is this initiative from a KM perspective?’.

Cost and benefit(s) of a strategic approach to KM
Regardless of how you choose to make a case for KM you’re going to be asked to justify (there’s that word) its cost and demonstrate its benefit(s). If you’ve successfully established KM as an existing and ongoing organisational practice then consider yourself halfway home. If not, you’ve got an uphill battle ahead of you. However, a smidgen of wisdom, a pinch of logic, and a dash of courage might be enough to pull you through.

1. The actual cost of KM
Whenever the subject of the cost of KM rears its head, it’s decidedly in reference to the purchase of some behemoth enterprise system promising a revolution in the management of information resources. In actuality, aside from the cost of the human resources required to implement a KM strategy (and, if applicable, to manage whatever technology resources are already in play) the most common cost of KM is a factor of the time involved in strategy, process, and educational development and delivery activities. Any other costs to be considered should be outlined and presented in a comprehensive KM strategy based on the results of a formal knowledge audit. At which point cost can be considered a determining factor in the prioritisation of KM activities.

2. The cost of doing nothing
I have yet to come across an organisation that doesn’t want to improve something about itself or sees some inefficiency in how it operates. Find these ‘open flaws’ and exploit them. Focus on the top three to five regularly voiced concerns and suggest how a strategic approach to KM can mitigate them then posit the cost of continued inefficiency in the face of a valid solution.

3. Satisfaction with/usage of enterprise systems
Present a snapshot of how people get at and share critical information and how they regard the systems available.

Focus on the people directly involved in the flow of money – sales, product development and support, and client-facing professionals.

4. Rate of failure of new initiatives
Compare the number of new initiatives introduced in the current year (or recent years) to the number that are still standing as an indicator of change fatigue or cultural resistance to change. (Try to emphasise the initiatives that were reasonably intelligent or worthwhile; failure of the stupid ones tend to speak for themselves). And, if they’re still around, enhance your findings with qualitative ‘lessons learned’ feedback from project sponsors and champions.

5. Rate of new hire acclimation
Work with HR to seek out both new hires (at varying lengths of employment) and hiring managers to obtain feedback on how quickly new hires have been able to get up and running in their roles, get at critical information, and accomplish (relatively basic) work-related and HR tasks.

6. Resource/succession planning policies
Is there a set of policies to plan for the loss of critical organisational knowledge and leadership? Have these critical organisational roles been identified? If yes, is the plan active and effective? If no, bad ju-ju.

7. Quantity and quality of documented best practices
Successful organisations share and institutionalise the knowledge that makes them successful. One of the best indicators of how well an organisation is (or isn’t) managing its knowledge is the quantity, quality, and ease of access to internal (and industry) case studies, best practices, and lessons learned type documents.

In his 2005 ‘Projectified’ blog post, ‘KM and PM: The Redheaded Step Children of all Organizations?’, Brian Kennemer insightfully wrote: “PM [project management] and KM ‘systems’ are about people being comfortable with changing the way they do things.”

The best approach to making a case for KM lies in making people aware of and comfortable with KM; helping them to understand the way(s) in which they are currently engaging in KM activity and illustrating the types of adjustments that can be made to shape their behaviors for a targeted result.

Sounds like a tall order? In my experience, not so much.

Christian Young is an independent KM strategy consultant and occasional blogger based in Atlanta, US. He can be contacted at youngde1@gmail.com. To read Christian’s blog, visit http:kmreflections.blogspot.com