TUESDAY, JULY 31, 2007

What is Knowledge Management?

Data are collection of facts, measurements and statistics whereas Information is defined
as organized or processed data that are timely (i.e., inference from the data are drawn
within the time frame of applicability) and accurate (i.e., with reference to original
data). Knowledge is information that is contextual, relevant and actionable. While data,
information and knowledge can all be viewed as assets of an organization, knowledge
provides a higher level of meaning about data and information and therefore tends to be
more valuable. Knowledge as a resource is valuable since it focuses attention back
towards what is important. Over time, information accumulates while knowledge
evolves.

The management of corporate knowledge and intellectual assets that can improve a
range of organizational performance characteristics and add value by enabling an
enterprise to act more intelligently is known as Knowledge Management. This is a
process that helps organizations identify, select, organize, disseminate and transfer
important information and expertise that are a part of the organizational memory that
typically resides within an organization in an unstructured manner. The value addition
this provides to an organization are effective and efficient problem solving, dynamic
learning, strategic planning and decision making.

Knowledge Management focuses on identifying knowledge, helping transition of tacit

knowledge to explicit knowledge so that this can be shared in a formal manner and thus
creating knowledge repositories which will enable reuse. Knowledge management
enables the communication of knowledge from one person to another so that it can be
used by the other person. The domains in which knowledge concepts are leveraged in
organization through knowledge initiatives are:

• Sharing Knowledge and Best practices

• Instilling responsibility for sharing knowledge

• Capturing and reusing best practices

• Embedding knowledge in products , services and processes

 • Producing knowledge as a product

• Driving knowledge generation for innovation

• Mapping networks of experts

• Building and mining customer knowledge bases

• Understanding and measuring the value of knowledge

• Leveraging intellectual assets

WEDNESDAY, JULY 25, 2007

A Brief Introduction to Knowledge Management

Knowledge management and intellectual capital are terms frequently being used today's world.
In this age of information organizations see their people as their key assets. The knowledge,
skills and competencies of these people add to the growth of the organization. The challenge is
how to tap this knowledge and make it available to all who will benefit it. A challenge that cuts
across corporate libraries and information centers.

Knowledge is broadly discussed as being of two types (Davenport 1998). One is explicit
knowledge, such as customer information, market information and so forth. This type of
knowledge can be easily handled by technology. The other is tacit knowledge, knowledge that is
in peoples' heads. There is a general recognition that we cannot actually manage tacit
knowledge, because tacit knowledge cannot be documented. It can be transferred, but only
through relationship.

Knowledge Management ('KM') comprises a range of practices used by organisations to identify,

create, represent, and distribute knowledge for reuse, awareness and learning.

Keep visiting this blog to read more on Knowledge Management from some more experts in this
area.

TUESDAY, JULY 31, 2007

Benefits of Knowledge Management

Careful application of knowledge, like other assets, can result in better decisions,
particularly, at the working level. It’s not decisions made by strategists at the top
that make or break a company; but the sum total of the day-to-day decisions made
at the front lines of an organization. Better decisions are achieved by spending less
time on information gathering and more on the creative process. Decision support
systems help with the analysis, but are still driven by the ability to find relevant
information. Provides the tools to:

Increase relevant information access

Facilitate collaboration & knowledge sharing

Retain institutional knowledge

Overcome organizational & geographical boundaries

Shorten cycle time

Resulting in:

Lower cost of doing business

Higher quality products, decisions & recommendations

Increased productivity

More time analyzing vs.data collection

SATURDAY, JULY 28, 2007

Motivations for Knowledge Management in Organizations

There may be different reasons why Knowledge Management will be developed within
organizations. Some of them are:

1. The need for making available, increased knowledge content for the development
and provision of products and services.

2. For facilitating and managing organizational best practices, innovation and

continual learning

3. For achieving better quality products in shorter development cycles.

4. For leveraging the knowledge of subject matter experts across the organization
 5. For managing the distribution of data and information in different business
environments, enabling people within to reuse information and best practices.

6. For employees to benefit from "networking" wherein there is a personal and team
growth by way of learning and sharing information.

7. Managing the intellectual capital developed within the organization.

Organizations are realizing the potential of Knowledge Management, but the rigor
seems to be slow even today.

THURSDAY, JULY 26, 2007

The 8 Cs of Knowledge Management

In one of my discussions with a friend, the question of what would you look at when we
create a KM framework came up. I thought this would be a good topic to cover for
today's blog too!

Quoting from MadanmohanRao's "Leading with Knowledge", the 8 C's of KM while

developing a framework are:

1. Connectivity: What connectivity devices, bandwidths, interfaces, technologies

and tools do your knowledge workers have when they are in the office or on the
road?

2. Content: What knowledge assets are relevant to the context of your workflow,
and what are your strategies for codification, classification, archival, retrieval,
usage and tracking?

3. Community: What are the core communities of practice aligned with your
business and what organizational support do you have for identifying, nurturing,
and harnessing them?

4. Culture: Does your organization have a culture of learning where your

employees thirst for knowledge, trust one another and have visible support from
their management?

5. Capacity: What are your strategies for building knowledge-centric capacity in

your employees, for instance, via workshops, white papers, mentoring and e-
learning?
 6. Cooperation: Do your employees have a spirit of open cooperation, and does
your organization cooperate on the KM front with business partners, industry
consortia and universities?

7. Commerce: What commercial and other incentives do you use to promote your
KM practice? How are you "pricing" the contribution, acceptance and usage of
knowledge assets?

8. Capital: What percentage and amount of your revenues are invested in your KM
Practices, and how are you measuring their usage and benefits in monetary and
qualitative terms?

These set of questions actually help us decide on a strategy to be taken when we look at
creation of the framework of Knowledge Management in any organization.

WEDNESDAY, JULY 25, 2007

Barriers of implementing Quality and Knowledge Management

Some of the barriers we find in implementing Quality & KM in organizations are:

1. Setting Priorities: The work load of associates within organizations which do not
allow them to take action on activities that give in results in the long run and
create stability. Team does not want to think long term, since short term
challenges are more of a botheration.

2. Sidetracking: Instead of focusing on main concepts, ancillary issues such as cost

and time, takes more priority.

3. No buy-in: Lack of confidence in the originator 's competency, knowledge and

skills by other for the true situation and needs,as expressed by the originator.
Perceptions build around little exposure and not wanting to explore and take
risks or look at opportunities.

4. Shortsightedness: No willing to wait for complete implementation or giving time

to see the effects and high demand of results before agreed upon time lines. Not
willing to see the long-term results and impacts. Concentrating on issues rather
that identifying and removing root causes.

5. Organizational Politics: Internal competition rather than collaboration of

activities; the "know-all" attitudes from senior members not creating a pro
 activeness; ego-clashes, jealousy, feeling threatened by competency and skills of
others, looking only for power and popularity et al, diminishes the organization's
culture and growth.

6. Time: Lack of interests and stretching beyond whereby the solution misses the
timing requirements of the problem at hand. The importance is then lost.

7. General: Lack of communication and required information that demands

specifics at the right time for the right people to take actions.

8. Rigidity: Not being flexible and adaptable poses serous problems in

implementation.

9. Single sightedness - seeing the best practice as the answer to everything, even
where it is not warranted

A strong knowledge and awareness in the Leadership coupled with a drive for excellence
and growth proactively will reap high success and excellent results within organizations.

Importance of Knowledge Management

Knowledge Management has been recognized as an essential component of a proactively

managed organization. The key concepts include converting data, organizational insight,
experience and expertise into reusable and useful knowledge that is distributed and shared
with the people who need it. Knowledge Management addresses business challenges and
enhances customer responsiveness by creating and delivering innovative products or
services; managing or enhancing relationships with existing and new customers, partners
and suppliers; and administering or improving more efficient and effective work practices
and processes. Effective solutions are aligned with the organization's business strategy and
result in enhanced individual and organizational performance. Several factors that
contribute to the importance of managing knowledge are referenced below:

Competitive Advantage - Knowledge can be an organization's most competitive

advantage. Wealth results when an organization uses its knowledge to create customer
value by addressing business problems. "A firm's competitive advantage depends more
than anything on its knowledge, or to be slightly more specific, on what it knows - - how it
uses what it knows - and how fast it can know something new." - Source: Knowledge in
Organizations

Technology - Because of the tremendous advances in technology, enormous amounts of

information can be disseminated to people regardless of their geographic location or time
zone. The speed of transmission and frequency in which this information is received requires
an adaptable, skilled and educated workforce. From a knowledge management perspective,
the complexities associated with these technological changes will cause us to think
differently about the manner in which people learn whether it is inside or outside of the
classroom. Competitive Advantage - Knowledge can be an organization's most competitive
advantage. Wealth results when an organization uses its knowledge to create customer
value by addressing business problems. "A firm's competitive advantage depends more than
anything on its knowledge, or to be slightly more specific, on what it knows -- how it uses
what it knows - and how fast it can know something new ." Source: Knowledge in
Organizations

Organizational Change - Due to organizational changes, restructuring, mergers and

acquisitions, companies have lost some of their valued history and cultural norms. An
organization's ability to create, acquire, process, maintain and retain old and new
knowledge in the face of complexity, uncertainty and rapid change is critical.

Enhanced Decision-Making - Learning from and applying past experiences can accelerate
the completion of future work and enhance the decision-making process.

Workforce Demographics - An aging workforce, coupled with retiring baby boomers and
the loss of intellectual capital or institutional memory are creating a new sense of urgency
for organizations. Although predicting employee separations is at times challenging,
knowledge transfer is vital to sustaining critical business functions. While many employees
may continue employment beyond retirement eligibility, these employees will inevitably
leave the workforce.

The Importance of Knowledge Management

Most companies are focused on producing a product or service for customers. However, one
of the most significant keys to value-creation comes from placing emphasis on producing
knowledge. The production of knowledge needs to be a major part of the overall production
strategy.
One of the biggest challenges behind knowledge management is the dissemination of
knowledge. People with the highest knowledge have the potential for high levels of value
creation. But this knowledge can only create value if it's placed in the hands of those who
must execute on it. Knowledge is usually difficult to access – it leaves when the knowledge
professional resigns.
“The only irreplaceable capital an organization possesses is the knowledge and ability of its
people. The productivity of that capital depends on how effectively people share their
competence with those who can use it.” – Andrew Carnegie
Therefore, knowledge management is often about managing relationships within the
organization. Collaborative tools (intranets, balanced scorecards, data warehouses,
customer relations management, expert systems, etc.) are often used to establish these
relationships. Some companies have developed knowledge maps, identifying what must be
shared, where can we find it, what information is needed to support an activity, etc.
Knowledge maps codify information so that it becomes real knowledge; i.e. from data to
intelligence.
For example, AT&T's knowledge management system provides instant access for customer
service representatives, allowing them to solve a customer's problem in a matter of
minutes. Monsanto uses a network of experts to spread the knowledge around. Employees
can lookup a knowledge expert from the Yellow Page Directory of knowledge experts.
In the book Value Based Knowledge Management, the authors advocate that every
organization should strive to have six capabilities working together:
1. Produce : Apply the right combination of knowledge and systems so that you
produce a knowledge based environment.
2. Respond : Constantly monitor and respond to the marketplace through an
empowered workforce within a decentralized structure.
3. Anticipate : Become pro-active by anticipating events and issues based on this new
decentralized knowledge based system.
4. Attract : Attract people who have a thirst for knowledge, people who clearly
demonstrate that they love to learn and share their knowledge opening with others.
These so-called knowledge professionals are one of the most significant components
of your intellectual capital.
5. Create : Provide a strong learning environment for the thirsty knowledge worker.
Allow everyone to learn through experiences with customers, competition, etc.
6. Last : Secure long-term commitments from knowledge professionals. These people
are key drivers behind your organization. If they leave, there goes the knowledge.
Knowledge professionals will become the dominant force behind the new economy, not
unlike the farmer was once the key player behind the agricultural age. By the year 2010,
one-third of the workforce in the United States will be comprised of knowledge
professionals. It is incumbent upon all organizations to embrace this need for managing
knowledge. Just take a look at those organizations that seem to create value against the
competition. You will invariably find a strong emphasis on knowledge management.

Why Knowledge Management?

Before we start to explore and understand the details of what knowledge management is,
and how to implement knowledge management projects and initiatives, we need to first ask
ourselves why we want to consider knowledge management in the first place?
What are the real benefits that can be gained from effective knowledge management for the
individual, the team, the entire organization, the community, the nation, or even the entire
planet Earth?
Knowledge management is far reaching. Maybe you are considering developing your own
personal knowledge management competencies, to become a more effective player in the
global knowledge economy, or becoming a more competitive knowledge leader and
knowledge driven organization.
Maybe you wish to develop and apply knowledge management strategies to government,
military operations, global poverty eradication, international disaster management and
even, now, knowledge management for global climate change.
The list is endless. Knowledge management is applied today across the world, in all industry
sectors, public and private organizations and humanitarian institutions and international
charities.
Once we can understand the value and benefits to be gained, we will then become far more
motivated to look further at the implementation of knowledge management. Doing
‘knowledge management’ for knowledge management’s sake is likely to produce a failure, or
mediocre results at very best.
Knowledge management, as a discipline, must result in better achieving, or even exceeding,
your objectives. The purpose of knowledge management must not be to just become more
knowledgeable, but to be able to create, transfer and apply knowledge with the purpose of
better achieving objectives.
How can we better achieve objectives with effective knowledge management?
Well, for a start, effective knowledge management should dramatically reduce costs.Most
individuals, teams and organizations are today continually ‘reinventing the wheel’. This is
often because they simply do not know that what they are trying to do has already been
done by elsewhere. They do not know what is already known, or they do not know where to
access the knowledge. Continually reinventing the wheel is such a costly and inefficient
activity, whereas a more systematic reuse of knowledge will show substantial cost benefits
immediately.
But as well as reducing costs, effective knowledge management should also dramatically
increase our speed of response as a direct result of better knowledge access and
application.
Effective knowledge management, using more collective and systematic processes, will also
reduce our tendency to ‘repeat the same mistakes’. This is, again, extremely costly and
inefficient. Effective knowledge management, therefore, can dramatically improve quality of
products and/or services.
Better knowing our stakeholder needs, customer needs, employee needs, industry needs,
for example, has an obvious immediate effect on our relationship management.
So it is very easy to see how effective knowledge management will greatly contribute to
improved excellence, which is to:
a) dramatically reduce costs
b) provide potential to expand and grow
c) increase our value and/or profitability
d) improve our products and services
e) respond faster
Knowledge simply underpins everything we do.
But the benefits of knowledge management for improved excellence, is simply ‘one side of
the coin’. There is more.
Effective knowledge management, especially accelerated knowledge creation, is the driver
for innovation. Increasingly, products and services are becoming ‘smarter’ and more
knowledge based.
Our ability to better collaborate in physical and virtual teams, as knowledge workers, is
driving the process of new knowledge creation. Ideas can now be turned into innovative
products and services much faster.
As organizations, we are learning faster, and that means that individuals are learning faster.
People are developing their competencies and confidence faster in organizations that
practice effective knowledge management.
In summary, we simply cannot afford not to mainstream, to embed and embody knowledge
management principles, strategies, policies, processes, methods, tools and technologies into
our daily personal, team and organizational lives.
The Knowledge Economy is the next booming economy in a world of recession
In a world that is facing economic recession many are starting to ask ‘What is going to be
the next booming economy, what are its characteristics and, how will it help us to grow out
of recession?’
At knowledge-management-online.com we strongly suggest that the next booming economy
is already here! It’s the rapidly growing global knowledge economy!
More individuals, teams, organizations and inter-organizational networks will be
restructuring and renewing themselves with the primary purpose of profitably trading their
knowledge to add even higher value, predominantly on the World Wide Web.
Already we see more enlightened organizations developing and applying the knowledge they
have about their industry, customers, partners and stakeholders, as their prime strategic
asset, and at the highest point in the value chain. And many are becoming less involved,
and more open to profitably outsourcing the other business operations.
Around the world we hear automobile companies talking far more about their critical and
key knowledge areas of design, knowledge of manufacturing , knowledge of distribution,
knowledge of service and support etc as their ‘crown jewels’ or ‘master recipe’.
Based on applying this key knowledge they then outsource the other business components.
We hear the same from the aerospace industry, the oil and gas industry, the information
technology industry, the food and agricultural industry, the healthcare industry, in fact
most, if not all, industries.
Our knowledge mantra is 'know and apply what you know the best, and link to the
rest'
Knowledge has become the key strategic asset for the 21st Century and for every
organization that values knowledge it must invest in developing the best strategy for
identifying, developing and applying the knowledge assets it needs to succeed.
Every organization needs to invest in creating and implementing the best knowledge
networks, processes, methods, tools and technologies. This will enable them to learn, create
new knowledge, and apply the best knowledge much faster.
Every individual who wishes to successfully participate in the rapidly growing global
knowledge economy must now consider the development of their personal knowledge
management competencies as an ‘essential life skill’ for the 21st Century.
It has been said many times, ‘knowledge will radically and fundamentally transform
economies’.
One thing is absolutely certain in this rapidly changing world.
The best knowledge will always be in demand.
In, say, fifty years time you can be certain of one thing. Leaders of economies, industries
and organizations will always be very interested in finding new and better ways to create
and apply knowledge.
Effective Knowledge Management is a timeless and changeless principle.
The strategies, methods and tools of knowledge management will undoubtedly change, but
the timeless principles will, of course, remain unchanged.
And to survive and succeed in the new global knowledge economy, we must become far
more effective and more productive. We must always strive for the best relations and
highest quality.
To do that, the successful organizations and individuals will not allow themselves to keep
‘re-inventing the wheel’ or ‘repeating the same mistakes. This is so costly and, we suggest
that good leaders will simply not tolerate, nor be able to afford, such cost inefficiencies
caused by knowledge gaps and bad knowledge flows.
Would the global financial crisis have been prevented or minimized with far more effective
global knowledge management?
Finally, those individuals and organizations that can best sense, become quickly alerted to,
find, organize, and apply knowledge, with a much faster response time, will simply leave the
competition far behind.
All of this can only be achieved through good knowledge leadership that understands the
unchanging timeless principles for knowledge, that transforms individuals and organisations
to become far more responsive and effective players in a growing knowledge economy.
Knowledge Management is for everyone.
Global and/or Planetary Knowledge Management is becoming a reality today.
It is our belief that the knowledge economy is rapidly becoming the largest and most
successful and sustainable economy in the world.
Why chose knowledge management?
Today, some see knowledge management as a choice. Today, those that work with
knowledge very well are considered extraordinary.
Those that fail to understand knowledge management will consider it as ‘extra effort’ to our
main work, or consider it a passing fad. They will risk ‘throwing the baby out with the
bathwater’.
We predict that effective and extraordinary knowledge management, at all levels, for the
individual, team, organization and global community will naturally become mainstream and
oThe Importance of Knowledge Management Today
By Paula M. Singer PhD and Jeri E. Hurley, PHR
With so many employees in libraries today approaching retirement age, many
libraries are becoming
concerned about the knowledge gap that will exist between the retirees and the new
employees who fill the
positions. Most of the baby boomers that are approaching retirement have been
loyal to their place of work
and more than likely have been employed by the same library for many years. Over
this span of time they
have gained a wealth of knowledge about the library, the clientele, co-workers, the
work processes and
procedures, and how to function in their job the most efficient way. Has any of this
knowledge been
captured to pass on to the next employee and throughout the library to other
employees so they will not
have to start at ground zero again? Why lose all this knowledge that has taken
someone many years to gain?
Knowledge management seeks to make the best use of the knowledge that is
available to the library, while
creating new knowledge in the process. Knowledge management should be about
exploiting and realizing
knowledge of the employees and building a culture where knowledge sharing can
thrive. Throughout this
process, the library will generate value from their intellectual and knowledge-based
assets. Therefore, the
library will continue to grow and prosper from the knowledge of employees
throughout the library. This is
also a great benefit for new employees replacing retirees within the library
structure. Knowledge
management is often facilitated by information technology, but technology itself is
not knowledge
management.
For hundreds of years, owners of family businesses have passed their
commercial wisdom
on to their children, master craftsmen have painstakingly taught their trades to
apprentices, and workers have exchanged ideas and know-how on the job. Yet it
wasn't
until the 1990s that chief executives started talking about knowledge
management. As the
foundation of industrialized economies has shifted from natural resources to
intellectual
assets, executives have been compelled to examine the knowledge underlying
their
businesses and how that knowledge is used. At the same time the rise of
networked
computers has made it possible to codify, store and share certain kinds of
knowledge more
easily and cheaply than ever before. -- Debbie Coughlan, National Knowledge
Management Director, Clayton Utz (Melbourne)1
Not all information is valuable. Therefore, each library will need to determine what
information qualifies as
intellectual and knowledge-based assets. In general, however, intellectual and
knowledge-based assets fall
into one of two categories: explicit or tacit. Explicit assets are such things as
technology plans, original
specialized cataloguing, genealogy, and how to fix the 20-year-old HVAC system
at central. As a general
rule of thumb, explicit knowledge consists of anything that can be documented,
archived, and codified.
Much harder to grasp is the concept of tacit knowledge, or the know-how
contained in employees' heads.
The challenge inherent with tacit knowledge is figuring out how to recognize,
generate, share, and manage
it. While information technology in the form of e-mail, groupware, instant
messaging, and related
technologies can help facilitate the dissemination of tacit knowledge, identifying
tacit knowledge, initially,
is a major hurdle for most organizations.
Volume 2, No. 6 • June 2005 Library Worklife home
HR Practice
Page 1 of 3
By the early nineties, it was clear that there were two distinct branches of
knowledge management. The
first branch of knowledge management involves the capture of information and
experience so that it is
easily accessible. In this view knowledge management is an issue of information
storage and retrieval
through information technology. This had either little impact or a negative impact
on the way in which
knowledge was used.
The second branch of knowledge management gives priority to the way in which
people construct and use
knowledge. It recognizes that learning and doing are more important to
organizational success than
dissemination and imitation.
BENEFITS
Some benefits of knowledge management correlate directly to bottom-line savings,
while others are more
difficult to quantify. To get the most value from a library's intellectual assets, the
knowledge must be
shared and serve as the foundation for collaboration. Therefore, an effective
knowledge management
program should help the library do one or more of the following:
�Cultivate innovation by encouraging the free flow of ideas
�Improve customer service by streamlining response time
�Improve employee retention rates by recognizing the value of employees'
knowledge and rewarding
them for it
�Streamline operations and reduce costs by eliminating redundant or unnecessary
processes
CHALLENGES
Even with the advantages of knowledge management, there are also challenges to
knowledge management
such as:
Getting Employees on Board
The major problems that occur in knowledge management usually result because
organizations ignore the
people and cultural issues. In an environment where an individual's knowledge is
valued and rewarded,
establishing a culture that recognizes tacit knowledge and encourages employees to
share it is critical. The
need to sell the knowledge management concept to employees should not be
underestimated; after all, in
many cases employees are being asked to surrender their knowledge and
experience — the very traits that
make them valuable as individuals.
An incentive program can be developed to encourage employees to buy in to the
system, although this is
not foolproof either. The ultimate goal is that employees will realize that
knowledge management will
make their jobs easier and more enjoyable. Then hopefully they will cooperate and
share their knowledge.
Allowing Technology to Dictate KM
Although technology can support knowledge management, it is not the starting
point of a knowledge
management program. Make knowledge management decisions based on who
(people), what (knowledge)
and why (business objectives). Save the how (technology) for last.
Not Having a Specific Business Goal
A knowledge management program should be in line with the strategic plan and
goals of the library. While
sharing best practices is a commendable idea, there must be an underlying reason
to do so.
Not Keeping Knowledge Updated
Since knowledge can get stale fast, the content in a knowledge management
program should be constantly
updated, amended and deleted. Also, the relevance of knowledge and the skills of
current employees is
always changing and evolving. Therefore, there is no endpoint to a knowledge
management program.
Not All Information is Knowledge
Page 2 of 3
Libraries need to be aware of compiling too much information. More information
is not necessarily a good
thing for the program. The point of this program is to identify and disseminate
knowledge gems from a sea
of information.
Realizing the importance of knowledge management is the beginning of the
process. Once a successful
program is put into place, the employees and the library should reap the benefits of
utilizing the existing
knowledge and capitalizing from the new ideas and knowledge gained from the
program.

The importance of knowledge management

Knowledge-management strategies are a natural partner to HR, especially as the term human
capital has become more popular with its emphasis on firm-wide knowledge sharing and
organisational learning. Karen Battersby, course leader of Nottingham Law School’s
postgraduate diploma in knowledge management for legal practice, explores the components of
a knowledge-management system and highlights the range of benefits knowledge sharing can
have in UK law firms.
There has been an explosion in knowledge-management activity, particularly in UK law firms
over the past ten years. Typically, firms have employed dedicated lawyers (professional-support
lawyers) to carry out knowledge activities, such as the creation of precedent-legal documentation
and keeping fee earners updated on new aspects of the law.
They have also acquired sophisticated IT systems to store and retrieve accumulated knowledge.
However, market conditions are now tougher, and law firms often see any non-fee-earning
activities as overheads, which need to be cut to maintain the firm’s profitability. But, viewing
knowledge management as a non-essential activity that can be dropped without causing harm to
the firm is not the right approach. Knowledge management goes to the very heart of a firm and
produces a range of benefits that can help firms survive in difficult times and thrive in better
ones.
What is a knowledge-management system?
Before looking at how knowledge management benefits the firm, it is important to understand
what a knowledge-management system is. Unfortunately, definitions vary.
If you accept that knowledge is the principle economic resource that businesses such as law
firms have to offer their clients then knowledge pervades every aspect of the firm, and a
knowledge-management system can encompass many differing aspects of knowledge. There are
numerous definitions of what knowledge itself is and how it differs from data and information.
However, in practice it is important to share all relevant forms of knowledge, know-how and
information that enhance the firm’s business.
When thinking about setting up a knowledge-management system, firms often focus on IT, but
this is only a conduit for housing and disseminating the knowledge around the firm. Those
setting up the system need to identify the type of knowledge the firm should share to benefit its
business. Generally, there are four sources of knowledge in law firms:
• Published material, such as library resources, including online material (the key
characteristic is that this material can be bought);
• Personal knowledge and experience of the lawyers and others in the firm (this is
contained in people’s heads and expressed through their behaviour);
• Knowledge contained in a lawyer’s work product, for example, letters of advice,
agreements (this can be located in the word-processing system and paper files, and can
often be collected and computerised);
• Specially created knowledge, for example, precedents created by professional-support
lawyers.
The knowledge-management system should focus on creating, capturing and disseminating
knowledge and information from the above sources that support the firm’s strategic aims.
Always remember that managing such knowledge may not necessarily mean codifying it onto a
computer system, for example, tacit knowledge (that is, knowledge in people’s heads) is often
best transferred between people directly. In this situation, the knowledge-management system
could facilitate putting people in touch with each other. It is better to think of knowledge as a
flow between the four sources, rather than as a static object, and this will help identify the
appropriate actions to manage it. For example, published material may inform personal
knowledge and experience, which manifests itself in work products and which may then be
incorporated into specifically created material.
Also remember that useful knowledge for the firm’s business is not restricted to technical legal
knowledge, but the same principles can be applied to client knowledge or financial and
marketing information to help the firm achieve the benefits it desires. So what are the potential
benefits?
The knowledge economy
We are now living in a knowledge economy where the principal economic resource businesses
have to offer their customers is knowledge. While most businesses can now claim to be
knowledge businesses, this is particularly true of law firms that sell the knowledge and skills of
their lawyers to their clients.
A large part of the value of managing knowledge, for example, collecting fee-earner advice/work
documents and making it available to all members of the firm, lies in preserving knowledge that
would otherwise be lost when individuals leave the firm. Particularly in recessionary times, when
there is likely to be a higher turnover of staff, the firm does not want to lose all the valuable
investment it has made in individuals if it can help it.
Some writers, such as Sveiby and Lloyd1 argue that knowledge businesses’ ability to survive
depends on their ability to transfer knowledge between their members to counter the effects of
key individuals leaving. Repositories of collected and combined knowledge become part of the
firm’s organisational memory and can become an asset that belongs to the firm, outlasting the
original contributors of knowledge. It is important to keep such repositories fresh with constant
contribution to and updating of the shared knowledge. Both professional-support lawyers and fee
earners play an important role in this.
Not only can knowledge be preserved for continuing members of the firm, but it is also a
resource to help new recruits bring themselves up to speed more quickly with the firm’s work.
This highlights the next set of benefits associated with knowledge management.
Efficiency and quality
Most firms have recognised that the key benefits of knowledge management are increased
efficiency and quality. Many law firms undertake knowledge-management projects, particularly
when they become larger, to prevent their lawyers from reinventing the wheel when they can re-
use work that other lawyers in the firm have already carried out. This efficiency has knock-on
benefits, such as allowing senior lawyers to delegate more work to junior lawyers and
concentrate on higher-value work themselves. This increases realisation (because less time is
written off, for example, on research activities that can’t be charged to the client due to the
pressure on fees) and indeed can increase profitability on the work.
This latter benefit depends on the firm being able to realise that it carries out work faster and
more cheaply due to the re-use of knowledge by appropriate charging methods, such as fixed or
market-based fees. These take into account the time saving, but leave a greater margin of profit
than charging by the hour. This is quite a change for a lot of firms who still rely on hourly
charging, although the signs are that more clients are requiring fixed or value-based charging.
With yearly increases in fee rates becoming more difficult to achieve, efficiency will become a
key driver of profitability.
Quality is regarded as one of the most critical factors in the successful delivery of legal services
and most clients now take technical quality as a given. Knowledge management facilitates the
sharing of knowledge and helps provide a consistent high-quality legal service across the firm.
Law firms are also focusing more on risk management, particularly in post-Andersen days (not
least to reduce insurance premiums). Maintaining quality of advice through up-to-date
knowledge is an important tool for this.
Knowledge management can also be used as a marketing and retention tool for new and existing
clients by showing the behind-the-scenes investment the firm puts into its practice. Client
satisfaction can, therefore, be another important by-product of knowledge management.
Client satisfaction
Many law firms are moving towards sharing at least part of their knowledge resources direct
with clients, either as an added-value extra to maintain a profitable relationship or as a new
product sold to clients in its own right. For example, Linklaters’s Blue
Flag service is an example of know-how resources being sold to clients over the internet.
Innovation arises out of the cross-fertilisation of knowledge so knowledge management can lead
to the creation of new products and services.
Internal benefits
Not only does knowledge sharing help with a range of decision-making processes due to the
capture of past experience, but as knowledge-management systems become more prevalent in
law firms, they are likely to become selling points for the recruitment and retention of lawyers.
Where it is difficult for an individual to keep abreast of the increase in European legislation as
well as their own national legislation, a good knowledge-management system gives lawyers
comfort in the support the firm offers them. It is also likely to be regarded by lawyers who grow
up with such systems as an essential element of their professional lives. It serves as a training
tool in that an individual lawyer’s stock of personal knowledge can be increased by tapping into
the shared knowledge resources. It can also motivate fee earners in their work by removing the
more repetitive elements of legal work, for example, through use of standard precedents, and
allowing them to concentrate on the more interesting and novel aspects of practice.
Establishing knowledge management as a key function of a firm can also have an effect on the
culture of a firm as a whole, predicated as it is on people sharing their knowledge. It can,
therefore, foster a sharing environment where lawyers are more willing to work together in teams
and combine their knowledge for the benefit of the firm’s practice and its clients.
Measuring the benefits
As one might expect with such a wide range of potential benefits and an asset as intangible as
knowledge, there can be difficulty showing management the causal link between knowledge
management and benefits such as improved firm performance.
This is an area with which knowledge-management professionals must grapple if they are to
avoid general management questioning the tangible value of the initiative.
The difficulty arises as knowledge management does not stand alone in relation to realising
benefits. As noted, knowledge management converts efficiency benefits into profitability, but
this depends on other actions such as ensuring the right level of people are carrying out the work
to match the knowledge and setting pricing policies that realise the benefit. Retaining lawyers,
and thereby reducing the costs of staff turnover, may be partly due to the firm’s knowledge-
management system, but may also rely on other factors, such as rates of pay. Law firms still rely
heavily on financial measures of success, such as direct return on capital, but knowledge capital
is not easily susceptible to such measurement.
Nevertheless, to avoid senior management regarding knowledge management as a pure overhead
activity, knowledge managers need to collect as much evidence of the effect of the systems as
they can. This will often present itself in the form of anecdotal evidence, for example, someone
who can say that having a document on the system saved them two hours of research. These
success stories and measures of the growth of knowledge resources should be captured to justify
and encourage investment in this area.
The importance of knowledge management
At the end of the day, knowledge management, despite its name, relates to some very basic
aspects of good law-firm management, which is essential for the survival and growth of a firm.
Nor is it just an activity for large firms. Small firms may not be able to invest in expensive IT
infrastructure or employ dedicated professional-support lawyers, but the size of their firm may
enable their knowledge management to be based around sharing knowledge among their
members and housing it in folders on their standard IT systems, for example.
For those firms wishing to get through recessionary times in the best possible shape, maintaining
their knowledge-management systems will pay dividends both in the short and the long run.

Importance of Knowledge Management

 Knowledge Management has been recognized as an essential component of a proactively
managed organization. The key concepts include converting data, organizational insight,
experience and expertise into reusable and useful knowledge that is distributed and shared
with the people who need it. Knowledge Management addresses business challenges and
enhances customer responsiveness by creating and delivering innovative products or
services; managing or enhancing relationships with existing and new customers, partners
and suppliers; and administering or improving more efficient and effective work practices
and processes. Effective solutions are aligned with the organization's business strategy and
result in enhanced individual and organizational performance. Several factors that
contribute to the importance of managing knowledge are referenced below:

Competitive Advantage - Knowledge can be an organization's most competitive

advantage. Wealth results when an organization uses its knowledge to create customer
value by addressing business problems. "A firm's competitive advantage depends more
than anything on its knowledge, or to be slightly more specific, on what it knows - - how it
uses what it knows - and how fast it can know something new." - Source: Knowledge in
Organizations

Technology - Because of the tremendous advances in technology, enormous amounts of

information can be disseminated to people regardless of their geographic location or time
zone. The speed of transmission and frequency in which this information is received requires
an adaptable, skilled and educated workforce. From a knowledge management perspective,
the complexities associated with these technological changes will cause us to think
differently about the manner in which people learn whether it is inside or outside of the
classroom. Competitive Advantage - Knowledge can be an organization's most competitive
advantage. Wealth results when an organization uses its knowledge to create customer
value by addressing business problems. "A firm's competitive advantage depends more than
anything on its knowledge, or to be slightly more specific, on what it knows -- how it uses
what it knows - and how fast it can know something new ." Source: Knowledge in
Organizations

Organizational Change - Due to organizational changes, restructuring, mergers and

acquisitions, companies have lost some of their valued history and cultural norms. An
organization's ability to create, acquire, process, maintain and retain old and new
knowledge in the face of complexity, uncertainty and rapid change is critical.

Enhanced Decision-Making - Learning from and applying past experiences can accelerate
the completion of future work and enhance the decision-making process.

Workforce Demographics - An aging workforce, coupled with retiring baby boomers and
the loss of intellectual capital or institutional memory are creating a new sense of urgency
for organizations. Although predicting employee separations is at times challenging,
knowledge transfer is vital to sustaining critical business functions. While many employees
 may continue employment beyond retirement eligibility, these employees will inevitably
leave the workforce.

Definition of Knowledge Management

There are several different, and sometimes quite confusing statements that claim to be a
definition of Knowledge Management' and there are different perspectives on what
Knowledge Management is. For example:
▪ KM is about systems and technologies
▪ KM is about people and learning organisations
▪ KM is about processes, methods and techniques
▪ KM is about managing knowledge assets
▪ KM is a holistic initiative across the entire organisation
▪ KM is not a discipline, as such, and should be an integral part of every knowledge workers
daily responsibilities
What is most important, is for you to have your own definition of Knowledge Management;
what KM is to you and your organisation. What is even more important is that you and your
colleagues have a 'common shared understanding' of what KM means for you all.
To help you get started, we have included immediately below a few definitions of what KM
means to some organisations. We suggest you consider them, together with any other
definitions you may have, and see if there are any words or phrases that particularly
'resonate' with what you are trying to do. This will help you formulate your own definition of
knowledge management.
At the end of this page, we invite you to share with us all, any definitions you have
discovered and/or formulated. We can then all comment and rate the usefulness of each
definition as we wish. This then provides us, at the bottom of this page, with a list of KM
Definitions, listed in highest rated/ranked order, to help us even further. So please share
your definitions and/or any comments or rating to definitions.

Some well known KM Definitions

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"If only HP knew what it knows it would make three times more profit tomorrow"
Lew Platt, ex CEO Hewlett Packard
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"Knowledge Management is the discipline of enabling individuals, teams and entire
organisations to collectively and systematically create, share and apply knowledge, to better
achieve their objectives"
Ron Young, CEO/CKO Knowledge Associates International
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"Most activities or tasks are not one-time events. Whether its drilling a well or conducting a
transaction at a service station, we do the same things repeatedly. Our philosophy is fairly
simple: every time we do something again, we should do it better than the last time".
Sir John Steely Browne, BP, Harvard Business Review, 1997.
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"The capabilities by which communities within an organisation capture the knowledge that is
critical to them, constantly improve it and make it available in the most effective manner to
those who need it, so that they can exploit it creatively to add value as a normal part of
their work"
GlaxoSmithKline
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"Knowledge management will deliver outstanding collaboration and partnership working. It
will ensure the region maximizes the value of its information and knowledge assets and it
will help its citizens to use their creativity and skills better, leading to improved
effectiveness and greater innovation".
West Midlands Regional Observatory, UK
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"We recognise that our most important asset is people and their knowledge. We understand
Knowledge Management (KM) as the cultivation of an environment within which people are
willing to share, learn and collaborate together leading to improvement".
Care Services Improvement Partnership (CSIP)
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"Knowledge Management ('KM') comprises a range of practices used by organisations to
identify, create, represent, and distribute knowledge. It has been an established discipline
since 1995 with a body of university courses and both professional and academic journals
dedicated to it. Many large companies have resources dedicated to Knowledge Management,
often as a part of 'Information Technology' or 'Human Resource Management' departments.
Knowledge Management is a multi-billion dollar world wide market.
Knowledge Management programs are typically tied to organisational objectives such as
improved performance, competitive advantage innovation, lessons learnt transfer (for
example between projects) and the general development of collaborative practices.
Knowledge Management is frequently linked to the idea of the learning organisation
although neither practice encompasses the other. Knowledge Management may be
distinguished from Organisational Learning by a greater focus on specific knowledge assets
and the development and cultivation of the channels through which knowledge flows"
What are the challenges of KM?

Getting Employees on Board

The major problems that occur in KM usually result because companies ignore the people and
cultural issues. In an environment where an individual's knowledge is valued and rewarded,
establishing a culture that recognizes tacit knowledge and encourages employees to share it is
critical. The need to sell the KM concept to employees shouldn't be underestimated; after all, in
many cases employees are being asked to surrender their knowledge and experience — the very
traits that make them valuable as individuals.

KM Requires Ongoing Maintenance

As with many physical assets, the value of knowledge can erode over time. Since knowledge can
get stale fast, the content in a KM program should be constantly updated, amended and deleted.
What’s more, the relevance of knowledge at any given time changes, as do the skills of employees.
Therefore, there is no endpoint to a KM program. Like product development, marketing and R&D,
KM is a constantly evolving business practices.

Dealing with a Data Deluge

Companies diligently need to be on the lookout for information overload. Quantity rarely equals
quality, and KM is no exception. Indeed, the point of a KM program is to identify and disseminate
knowledge gems from a sea of information.
How can I gain support for my KM effort and get people to use the systems and processes we’re
putting in place to facilitate KM?

One tried-and-true way to build support for KM is to pilot the project among employees who have the
most to gain and would be the most open to sharing their knowledge. This will vary depending on the
organization. It’s also a good idea to involve in the pilot a select group of influencers—employees
who are well-respected by their peers and whose opinions are highly regarded in the organization. If
both groups have good things to say about the KM effort, their positive attitudes will go along way
toward convincing others of the merits of KM.

To get people to participate in the KM effort, you have to bake knowledge collection and
dissemination into employees’ everyday jobs. In other words, you have to make it as easy for them
to participate as possible. A lot of early KM efforts failed because they added cumbersome steps to
the jobs of already overworked employees. So when things got busy, workers just didn't bother with
the extra steps. And since most people are already stretched so thin these days, they can’t
contemplate adding another layer onto their daily routine. The best KM efforts don’t seem like an
effort.

Linking KM directly to job performance, creating a safe climate for people to share ideas and
recognizing people who contribute to the KM effort (especially those people whose contributions
impact the bottom line) are also critical tactics for getting people to make KM a part of their day to
day.

Finally, many companies create incentive programs to motivate employees to share their knowledge.
This can work, but the danger with incentive programs is that employees will participate solely to
earn incentives, without regard to the quality or relevance of the information they contribute. Ideally,
participation in KM should be its own reward. If KM doesn't make life easier for employees, it will fail.
Besides using technology, how else can tacit knowledge be transferred?

Shadowing and joint-problem solving are two best practices for transferring or recreating tacit
knowledge inside an organization. With shadowing, less experienced staff observe more
experienced staff in their activities to learn how their more experienced counterparts approach their
work. Dorothy Leonard and Walter Swap, two knowledge management experts, stress the
importance of having the "protégé" discuss their observations with the "expert" in order to deepen
their dialog and crystallize the knowledge transfer.
Another sound approach that Leonard and Swift recommend is joint problem-solving by expert and
novice. Since people are often unaware of how they approach problems or do their work and
therefore can’t automatically generate step-by-step instructions for doing whatever they do, having
them work together on a project will bring the expert’s approach to light. The difference between
shadowing and joint problem solving is that shadowing is more passive. With joint problem-solving,
the "expert" and the "novice" work hand-in-hand on a task.
What benefits can companies expect from KM?

Some benefits of KM correlate directly to bottom-line savings, while others are more difficult to
quantify. In today's information-driven economy, companies uncover the most opportunities — and
ultimately derive the most value — from intellectual rather than physical assets. To get the most
value from a company's intellectual assets, KM practitioners maintain that knowledge must be
shared and serve as the foundation for collaboration. Yet better collaboration is not an end in itself;
without an overarching business context, KM is meaningless at best and harmful at worst.
Consequently, an effective KM program should help a company do one or more of the following:
• Foster innovation by encouraging the free flow of ideas
• Improve customer service by streamlining response time
• Boost revenues by getting products and services to market faster
• Enhance employee retention rates by recognizing the value of employees'
knowledge and rewarding them for it
• Streamline operations and reduce costs by eliminating redundant or unnecessary
processes
These are the most prevalent examples. A creative approach to KM can result in improved

Knowledge Management Definition and Solutions

Knowledge Management (KM) topics covering definition, systems, benefits, and challenges.
By Meridith Levinson
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CIO —
• What is knowledge management (KM)?
• What constitutes intellectual or knowledge-based assets?
• Besides using technology, how else can tacit knowledge be transferred?
• What benefits can companies expect from KM?
• How can I sell a KM project in my organization?
• How can I demonstrate the value of a KM initiative?
• Is there a best way to approach KM?
• What are the challenges of KM?
• How can I gain support for my KM effort and get people to use the systems and
processes we’re putting in place to facilitate KM?
• Who should lead KM efforts?
• What technologies can support KM?
• What is social network analysis (SNA) and how is it related to KM?

What is knowledge management (KM)?

Unfortunately, there's no universal definition of knowledge management (KM), just as there's no

agreement as to what constitutes knowledge in the first place. For this reason, it's best to think of KM
in the broadest context. Succinctly put, KM is the process through which organizations generate
value from their intellectual and knowledge-based assets. Most often, generating value from such
assets involves codifying what employees, partners and customers know, and sharing that
information among employees, departments and even with other companies in an effort to devise
best practices. It's important to note that the definition says nothing about technology; while KM is
often facilitated by IT, technology by itself is not KM.

Think of a golf caddie as a simplified example of a knowledge worker. Good caddies do more than
carry clubs and track down wayward balls. When asked, a good caddie will give advice to golfers,
such as, "The wind makes the ninth hole play 15 yards longer. " Accurate advice may lead to a
bigger tip at the end of the day. On the flip side, the golfer — having derived a benefit from the
caddie's advice — may be more likely to play that course again. If a good caddie is willing to share
what he knows with other caddies, then they all may eventually earn bigger tips. How would KM
work to make this happen? The caddie master may decide to reward caddies for sharing their tips by
offering them credits for pro shop merchandise. Once the best advice is collected, the course
manager would publish the information in notebooks (or make it available on PDAs), and distribute
them to all the caddies. The end result of a well-designed KM program is that everyone wins. In this
case, caddies get bigger tips and deals on merchandise, golfers play better because they benefit
from the collective experience of caddies, and the course owners win because better scores lead to
more repeat business.

efficiency, higher productivity and increased revenues in practically any business function.