copyright (c) hollrah, kahle, nelson, siripanadorn, & van emden 20021 knowledge management ryan...

Copyright (c) Hollrah, Kahle, Nelson, Siripanadorn, & Van Emden 2002 1

Knowledge Management

Ryan Hollrah, Christine Kahle, Frank Nelson, Ekkarin Siripanadorn,

& John Van Emden


What is Knowledge & What is not Knowledge

Data

Information

Knowledge


The set of discrete, objective facts about events.Represent of facts, documents, sounds, images, concepts, or instructions suitable for communication, interpretation and processing.Easily stored, manipulated, retrievedRaw material used for the creation of information

Data

Source: www.synet.com; www.acm.org/ubiquity/book/t_davenport_1.html


Example of Data

1234567


Collection of data in an organized mannerPattern of data that have meaning.Facts and data organized to describe a particular situation or condition. Constructed by human beings and process of making sense.People are the most valuable information resources provide access to knowledgeable individuals.

Information



Example of Information

My bank account

number is “1234567”


Understanding of information & data.Information combined with experience, context, interpretation and reflection.Develop over time through experience.We use knowledge to determine what a specific situation means. Knowledge is applied to interpretSharing of knowledge is difficult than sharing data & information

Knowledge



Example of Knowledge

My bank account number is “1234567”

How this number is importance to me?

Where can I use this account?


Types of Knowledge Knowledge is shared between groups and communities

through shared experience and through the transfer of both explicit and tacit knowledge.

Explicit Knowledge

Tacit Knowledge


Explicit Knowledge

Explicit Knowledge

Explicit knowledge is formal knowledge that can be directly and completely transferred throughout an organization. It is possible to touch, see, hear, feel and manipulated them. It comes in the form of books, reports, data files, audio cassettes, manuals and etc.

Source: www.synet.com


Tacit Knowledge

Tacit Knowledge

Tacit knowledge is more implicit and much harder to articulate. Tacit knowledge resides in the heads of people and is gained mainly through experience. It's often personal and difficult to capture but it has the most value.

Source: www.synet.com


Information Knowledge

“Information is not knowledge until and unless it is applied effectively.”

Dan Burrus, Futureview, 1989

Source: www.km-forum.org/t000008.htm


Information Knowledge

“ Knowledge is what I have. Information is what I give to you.”

“What I give you is information, even if it represents my knowledge.”

“I possess knowledge, not information.”

“When I pass my knowledge on to you, I do it in the form of information exchange.”

“I take the information that you give to me (your knowledge) and add it to my knowledge to create new knowledge and to make decision.”

Source: www.jpcripwell.com/IandK.html


Data

Information

Knowledge


Knowledge Management

"Knowledge management involves the capture of your organization's information and experience so that it becomes part of your organization's know-how and expertise which can be pooled, disseminated and used by your skilled staff in doing and winning profitable business.”“Knowledge management is nothing more or less than the deliberate management of three resources - people, process, and technology - to put the intellectual capital of a company to work.”

Source: www.retaininternational.com and Reference 8.


Why we need knowledge management now

Why do we need to manage knowledge? Ann Macintosh of the Artificial Intelligence Applications Institute (University of Edinburgh) has written a "Position Paper on Knowledge Asset Management" that identifies some of the specific business factors, including:

Source: www.media-access.com/whatis.html

Marketplaces are increasingly competitive and the rate of innovation is rising.

Reductions in staffing create a need to replace informal knowledge with formal methods.

Competitive pressures reduce the size of the work force that holds valuable business knowledge.


Why we need knowledge management now con’t.

The amount of time available to experience and acquire knowledge has diminished.

Early retirements and increasing mobility of the work force lead to loss of knowledge.

There is a need to manage increasing complexity as small operating companies are trans-national sourcing operations.

Changes in strategic direction may result in the loss of knowledge in a specific area.

Source: www.media-access.com/whatis.html


Case Study

Bridge Information Systems


Overview and Core BusinessFinancial information provider founded 28 years ago in St. LouisOver 5,000 employees operating in 65 international officesLargest provider of financial information and related services in North AmericaServices financial institutions, banks and individual investors

Source: Dianna Leach, Director of Marketing & Communications, Interviewed in person by Ryan Hollrah, September 17th, 2002 & October 4th, 2002.


Client Characteristics99 of the Top 100 World Banking Companies, 97 of the Top 100 Money managers in the US, 100% of the Top Equity funds in the US

Notable Clients: Morgan Stanley, Merrill Lynch and Charles Schwab



Organization Chart

E x e cu tive V PN o rth A m e rica n B IS

E x e cu tive V PD a ta M a n ag e m e nt

C T O E x e cu tive V PE u ro pe /M id d le E a s t/A frica

E x e cu tive V PA s ia

G e n era l C ou n s e l

C E O



Why Knowledge Management?Bridge operates 65 offices in a global environment.

Products are changing all the time.



KM StrategyDevelop an Intranet to allow employees around the world to to exchange information.

Make it easy for Bridge’s global sales staff to have all information available.

A place where explicit and tacit knowledge can be shared.



IntranetWeb site developed and run completely in house.

Includes product information, company background, executive bios, trouble shooting databases, company policies and a phone book



SuccessesInformation was posted and up-to-date within hours of receiving it.

Offered the sales staff the information needed to finalize product sales.

Shared explicit and tacit knowledge successfully.



Case Study

Architecture & Engineering


Overview & Core BusinessArchitecture & Engineering firm founded 50 years ago in Buffalo, NY.Ten offices with 500 employees in the United States and Canada.Services for large organizations such as College/University, Health Sciences, Corporate/Commercial, and Federal clients.The firm has recognized experts in each of the building types for these clients. Clients will choose Cannon Design because of their expertise and community involvement.Work in a Single Firm, Multi-Office (SiFMO) concept – when you hire Cannon Design all 10 offices are working on your project.2002 projected revenue is $54.6 million with a net income of about $5 million.

Source: Client Leadership Forum, Gary Miller CEO, Cannon Design, January 2002.


Client CharacteristicsLarge Organizations

Complicated decision making structures

Community Involvement during process

Complicated information distribution chains

Construction projects between $5 to $200 million

Source: Client Leadership Forum, Gary Miller CEO, Cannon Design, January 2002.


MIS OrganizationThe total company MIS department’s staff consists of 7 fulltime IS, 4 part-time IS for AutoCAD, and 2 general managers overseeing AutoCAD & the Intranet.There is no CIO, and there has never been one. Twenty months ago the Director of IT resigned.An IS Leadership Group, consisting of 3 fulltime IS and 1 part-time IS, who report to the Director of Operations, was formed in March.The total IS budget is unknown because there are no official line items for these expenses.Staff is busy ‘putting out fires’ - no time for testing or strategizing with ‘add an appliance’ attitude.

Source: John Van Emden, Cannon Design, November 5, 2002.


Organizational Chart


Why Knowledge Management?

Construction DetailsSpecificationsBuilding & Zoning CodesLegal DocumentsForms

Building Design Strategy

Expert Perspectives

Project Type Management

Building Specialties

Sharing Knowledge Between 10 Offices

Explicit Knowledge Tacit Knowledge


KM StrategyDevelop Intranet & ActiveAEC (Architecture-Engineering-Construction) sites to share explicit and tacit knowledge with all offices.Company resources of explicit knowledge can be viewed and downloaded from sites.Experts can share their knowledge in practice areas that will focus on building types.Collaboration tools will be integrated to assist everyone in working together.

Source: Intranet Webmaster interview by John Van Emden, Cannon Design - October 1, 2002.


IntranetA customized site running on ColdFusion server on RedHat Linux.

Firm Resources with building details, legal documents, standardized forms, and Administration & IS information.

Practice Areas with shared knowledge categorized by building type.

Information about all staff across the company.



ActiveAECA purchased product that runs on Active Server Pages on Windows 2000 Server.

Collaboration tools for working with the project team.

Posting area for all project documents.

Interaction and management with the client.

Scheduling tools to manage timelines and deadlines.

Source: Ben Cein interview by John Van Emden, Cannon Design - September 13, 2002.


KM DevelopmentActiveAEC was rolled out 16 months ago on its own & ‘linked’ to the Intranet.

The Intranet site has been developed over the past 3 years in various forms.

The MIS department has not been involved in either initiative.

The Intranet Webmaster has no IT background and says “I hate these computers”



KM SuccessesAll explicit knowledge throughout the company has been placed on the Intranet.ActiveAEC has helped give the company a competitive edge by letting Clients get access.There has been a lot of involvement by general managers, accounting, legal, and IS in getting the Intranet rolling.



KM FailuresThe Intranet and ActiveAEC are not integrated to each other or other systems.

Firm domain experts have not been motivated to get involved and therefore tacit knowledge is missing from the Intranet.

Since the MIS department was never involved there have been problems with implementing KM.

The company jokes are will ActiveAEC ever work correctly and will the Intranet ever be ready.



Lessons LearnedNot having the MIS staff involved in the process created many problems.Getting the domain experts on board and motivating them to participate is difficult.Explicit knowledge has been easy to obtain while tacit knowledge has been impossible without the input of domain experts.KM initiatives need to be properly tested and quickly rolled out to keep momentum.



Case Study

Community America Credit Union


One of 50 Largest Credit Unions in U.S.

$1.1 billion in assets

2002 Projected Revenue, $71 million

$286 million in liquid investments and undivided earnings

Source: Community America September 2002 Financial Statements.


Organizational Chart

H RE m p loyee D eve lop m en tP rop erties M an ag em en t

S r. V PA d m in is tra tion

L oan S ervic in gF u n d s M an ag em en t

M ortg ag esC o llec tion s

S r. V PA sse t/L iab iity

B ran ch es ,C on tac t C en te r

E lec tron ic S ervices

S r. V PM em b er S ervices

M arke tin gB u s in ess D eve lop m en tC om m u n ity R e la tion s

S r. V PS tra teg ic S ervices

In fo rm ation S ervicesTech n ica l S ervices4 .8 6 % o f To ta l S ta ff

S r. V P /C IOIn fo rm ation S ervices

C E OP res id en t/C O O

Source: Community America Intranet, Accessed by Frank Nelson, September 4 th, 2002.


KM ProgramKnowledge Is Power (K.I.P.)

Knowledge about internal

policies and procedures, etc.

Tacit Knowledge

KM ProgramCustomer Service Call-Center Solutions (CSCS)

Knowledge about member

accounts.

Explicit Knowledge

Source: Frank Nelson, Branch Manager,Tacit Knowledge of Frank Nelson.


CSCSBasic member identifiers

Name, D.O.B, Social, etc.

Account informationBalances, Types of Accounts

Transaction and conversation historyMonetary and Non-Monetary



Why KM for Member Information?

Information can be shared among all contact pointsNeed for “Heads UP” calls are eliminatedAbility to document conversationsAbility to build work cases



Information Can Be Shared Among All Contact PointsHelps to improve member service

Source: Vicky Sneed, Director of Communications, Interviewed in person by Frank Nelson, September 25 th, 2002.


Need For “Heads Up” Calls Are Eliminated

Fraud Prevention, (bad checks, etc.)

Member speaks with contact center, and then needs to complete paperwork in branch.



Ability To Document Conversations

Member says one thing, staff says another.

When Member forgets who he talked to, we remember.



Ability To Build Work CasesOrder Plastics

Disburse Loans

Order Checks

Research



Ability to Track ProductsMarketing promotions and results

Previous sales calls

Next Best Product to offer Member



What IS K.I.P.’s Purpose?Loan and Deposit Info

Promotional Products and Marketing Info

Up To Date Rates and Fees

Current Forms

E-dex and Department Rosters

CalendarSource: Community America Intranet, Accessed by Frank Nelson, September 4 th, 2002.


Loan and Deposit InfoCurrent product information available as a resource

Accurate information can be provided by experienced or novice employees.

Cross selling of additional products is easier with accurate knowledge and talking points.



Promotional Products and Marketing Info

Promotions material is available for reviewIf a member asks about a marketing piece they saw or heard, staff has a copy.



Up To Date Rates and FeesCurrent Rate Sheets Why is this important?

Approximately 63% of CACU’s gross income comes from loans. Quoting and booking the correct rate is imperative to maintaining the income targets set by the credit union. A rate difference of .10% may not amount to much interest on a small loan. However, considering a portfolio of almost $900 million, the difference over the course of a year is almost a half a million dollars in lost interest. On the opposite hand, paying .10% higher on just under a billion dollars in deposit results in excess payments of over $1 million per year. This mistake, while extreme in the example, would reduce net income by almost 18% over the course of a year.



Current FormsCorrect Forms Used

Ensures legality of contract (paperwork matches computer)

Governmental Disclosure Compliance



E-dex and Department RostersStaff has extensions and fax numbers at their fingertips

Correct people are contacted for issue resolution



CalendarCompany Events Listed

Marketing Drop Dates Listed

Service Anniversaries Listed



SuccessesImproved Service & Productivity

Work Orders are sent Immediately

Members receive accurate information

Faster turnaround times

Fewer processing errorsBetter service, money saved



SuccessesImproved communication

Inter departmental

Employee/member

Quick access to other departments

Explicit Knowledge was easy to obtain



Implementation IssuesTacit Knowledge was more difficult to obtain.

Not all staff used for every transactionMotivation to use program was intense and costly

Server capacity produced downtime and log in problems. Resolved by system upgrades.

When the system is down, operations backlog.

Source: I.T. Anonymous, I.T. Employee, Interviewed over phone by Frank Nelson, September 30 th, 2002.


How much is spent on KM?KM Projects in 2000:

Small Companies-- $632,0003

Large Companies -- $2.7 million3

Worldwide spending on KM Services:

In 2000 – between $1.310 billion to $2.6 billion1

KM Software:In 2000 -- $515 million1

KM Projects in 2002: Estimate for small companies -- $1 million+3

Worldwide spending on KM Services:

Estimate for 2004/2005 – between $8.8 billion1 to $12 billion+10

KM Software:Estimate for 2004 -- $3.5 billion1

Source: See Reference 1, 3 & 10.


KM Spending

Andersen Consulting and Ernst & Young$500 million+ (each) on IT and people to support their knowledge management strategies

Access Health $16 million on KM system (Revenues of $20 million)

+ $40 million later ($100 million in revenues generated)

Source: See Reference 9.


Spending on IT Services for KM

Implementation27.9%

Consulting, planning27.8%

Training15.3%

Maintenance13.7%

Operations, outsourcing

15.3%



Companies with Large KM systems

Source: See Reference 2, 4, 7, 9, 12, 13, 14, and 15.


Audiences of the KM Initiative

General -- Intranet

Marketing

Sales

Consulting

R&D

Customer services

Executives

IS

Human Resources

Finance

General -- extranet

General -- customer



Reasons for Adopting KMRetain expertise of personnelIncrease customer satisfactionImprove profits, grow revenuesSupport e-business initiativesShorten product development cyclesProvide project workspace

11.7%

23.0%

24.7%

37.5%

43.1%

51.9%

Provide project workspace

Shorten product development cycles

Support e-business intitiatives

Improve profits, grow revenues

Increase customer satisfaction

Retain expertise of personnel



More reasons to adopt KM strategy

Offset the effects of employee turnover

Gain insights for new product design, pricing, and innovation

Foster existing customer relationships and build new ones

Support distribution channels of all kinds

Better respond to a diverse and ever-changing landscape

To transfer best practices between co-workers

Source: See Reference 5 and 8.


Business Uses of KM Initiative

5.5%

20.1%

29.9%

31.4%

55.7%

58.0%

62.4%

77.7%

Enhance supply chain management

Enhance Web publishing

Manage legal, intellectual property

Provide project w orkspace

Deliver competitive intelligence

Manage customer relationships

Provide training, corporate learning

Capture and share best practices



Leader of KM Initiative

CFO1.4%

IS Manager8.6%

Other8.8%

CEO19.4%

CIO12.3%

CKO9.0%

Cross-functional

Team29.6%

HR Manager1.9%

Business Manager

9.0%



Implementation Challenges

Employees have no time for KMCurrent culture does not encourage sharingLack of understanding of KM & benefitsInability to measure financial benefits of KMLack of skill in KM techniquesOrganization’s processes are not designed for KMLack of funding for KMLack of incentives, rewards to shareLack of commitment from senior management



Best Practices

Standard format for knowledge management databasesDifferent information gathered in databases for Explicit and Tacit Knowledge

Codification StrategyPersonalization strategy



Best Practices (con’t.)

Consult with end-users prior to development

Outsource development of routine systems

Ensure that knowledge is readily available on a “need-to-know” basis

Have contingency plans for a systems failure


Best Practices (con’t.)

Have a well-organized, user-friendly IntranetEnsure that all knowledge management systems interface with other systems as neededManagement of knowledge allows for higher-quality decisions to be made



Best Practices (con’t.)Wrap-up

These practices become a part of the daily routine of the staffKnowledge management systems should provide value to end-users and customers“Knowledge about past successes, best practices, and failures can be analyzed and used for future decision-making and product innovation.”



Best Practices (con’t.)Wrap-up (con’t.)

“If a best practice does exist, it’s only for a point in time.”

“Knowledge-management and ‘best practice’ databases create brave new infostructures that effectively enforce employee compliance with organizational norms.”

Source: See Reference 6 and 12.


References1. “After-hype: KM enters critical phase.”

Computing Canada 14 Apr. 2000 v26 i8: 13. 2. Davenport, Tom. “The last big thing.” CIO 1

Nov. 2000: 60 – 62.3. Dyer, Greg and Brian McDonough. “The

State of KM.” Knowledge Management May 2001 v4 i5: 31.

4. Earl, Michael. “Knowledge management strategies: Toward a taxonomy.” Journal of Management Information Systems Summer 2001 v 18 i1: 215 -–233.


References5. Elliott, Susan and Carla O’Dell. “Sharing

knowledge and best practices: the hows and whys of tapping your organizations hidden reservoirs of knowledge.” Health Forum Journal May/June 1999: 34 – 37.

6. Ellis, Kristine. “Sharing best practices globally.” Training July 2001: 32 – 38.

7. Guay, Benoit. “Knowledge management is a team sport.” Computing Canada 13 July 2001: 23.


References8. Hansen, Joy I. and Cheryl A. Thompson.

“Knowledge Management: When people, process, and technology converge. LIMRA’S MarketFacts Quarterly Spring 2002: 14 – 21.

9. Hansen, Morten T., Nitin Nohria, and Thomas Tierney. “What’s your strategy for managing knowledge?” Harvard Business Review Mar./Apr. 1999 v77 i2: 106.


References10.Karhammar, Anna. “Knowledge: the holy

grail?” Knowledge Management Special Report March 2002: 3 pp. 3 Nov. 2002 <http:www/connectweb.co.uk/specialreports/knowledge/1/the_holy_grail.shtml>.

11.McDonough, Brian. “Knowledge management software and services: Understanding corporate investment priorities.” KMWorld Sept. 2002 v11 i8: 16.


References12. Schrage, Michael. “When best practices meet the

intranet, innovation takes a holiday.” Fortune 29 Mar. 1999: 198.

13. Schwartz, Jeffrey. “Collaboration – More Hype Than Reality – True Knowledge Management Remains.” Internetweek 25 Oct. 1999: 64.

14. Shein, Esther. “The knowledge crunch.” CIO 1 May 2001 v14 i14: 128 – 132.

15. Smalley Bowen, Ted and Ed Scannell. “Making knowledge mean business: venders rush to jump on bandwagon.” InfoWorld 22 Feb. 1999 v21 i8: 69.

copyright (c) hollrah, kahle, nelson, siripanadorn, & van emden 20021 knowledge management ryan...

Documents

types of knowledge knowledge

example of knowledge

copyright c hollrah

sharing of knowledge

formal knowledge

john van emden slide

information source

frank nelson