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Copyright 2000 – Origin Knowledge Strategy: Aligning Knowledge Programs to Business Strategy KM World Workshop Peter H. Jones, Ph.D. Origin Technology in Business KM World 2000 Tuesday, September 12, 2000

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Page 1: [PowerPoint Slides]

Copyright 2000 – Origin

Knowledge Strategy:

Aligning Knowledge Programs to Business Strategy

KM World Workshop

Peter H. Jones, Ph.D.Origin Technology in Business

KM World 2000Tuesday, September 12, 2000

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The Knowledge Strategy Game

UnderstandingKnowledge

Strategy

FOLLOW INSTRUCTIONSON TOP CARD

The ResourceStrategyModel

Managing Knowledge

Strategy

PRICE $200

StrategyMethods

&Applications

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A Knowledge Strategy …

Got One Already?

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Understanding Knowledge Strategy

Tierney, (1999) “A company’s KM strategy should reflect its competitive strategy.” With focus on creating value for customers, turning a profit, and managing people. (HBR)

Zack, (1999) “… the most important context for guiding knowledge management is the firm’s strategy. Knowledge is the fundamental basis of competition. Competing successfully on knowledge requires either aligning strategy to what the organization knows, or developing the knowledge and capabilities needed to support a desired strategy.” (CMR)

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Types of Strategy

Survival vs. Advancement (von Krogh, Roos, Slocum, 1994)

Survival – maintaining current level of success, mastering current markets and competitors

Advancement – Future success based on new markets, nonreplicability – requires knowledge creation

How do you plan/design strategy? Formal strategy and planning – Traditional

strategy sets positions, targets, measures. Alignment means “follow the leader.”

Learning and emergence – New thinking (not always in practice) shows strengths in org learning and preparing for conditions.Alignment means “Learn and collaborate.”

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Strategic Drivers

MarketGrowth

OperationalEffectiveness

CustomerIntimacy

Growth through share, market strength, distribution – external market focus

Forging long-term, deep relationships with customers – external focus, growing with customer success

Profit through productivity and cost control – internal development focus

Traditional KM driver, but should not be the only one!

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Strategic Drivers

BusinessStrategy

Market Growth

KnowledgeStrategy

OperationalEffectiveness

CustomerIntimacy

Product InnovationKnowledge CreationIntellectual Capital

Product SalesTime to MarketDistribution NetworksPricing StrategyPatent & Product Leverage

Process InnovationKnowledge SharingDeveloping Learning Culture

Business InnovationCustomer Knowledge IntegrationBranding Knowledge

Process streamliningSupply chain mgt Accounting & Financing

Customer retentionCustomer product needs

Revenue growthPartnering / Alliancing

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What Drives Knowledge Strategy?

Business Strategy What knowledge does it take to compete?

What are your critical knowledge gaps?

Product Innovation Can you design breakthrough products?

“Spark innovation” through a participatory culture?

Organizational Complexity How can you adapt to speed & information overload?

Build a quick-learning organization?

Customers and Markets Profound customer understanding

Radically improved time to market

Knowledge leverage in the marketplace

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Potential Entrants

Industry Buyers

Substitute Products

Suppliers

Resource Strategy Model

KnowledgeResources

Firm’s KnowledgeStrategy

Customer(A firm’s resource)

Strategic Resources(Partners, External Network)

Organization, Capabilities,

Core Competencies

Porter’s 5 Forces strategic model (SWOT approach) breaks when applied to leverage of specific firms. Chaotic business dynamics now require we leverage unique strengths, not look at external industry trends.

A resource strategy addresses firm’s only competitive differentiation - renewable resources of knowledge, skills, and capabilities (Penrose, Zack, Teece, Quinn, Grant, Kogut).

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Resource-View of Strategy

Uniqueness of firm gives it competitive strength Diversification exploits imperfections in markets

Development of dynamic capabilities based on knowledge

In turbulent business environment – Focus on what we can know – Strengths and Weaknesses

Organizational culture as an inimitable strength (Barney, 1991)

Beliefs, values, shared meaning

Culture cannot be exported or replicated

Social communities prevent overdependence on individuals

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Resource Strategy...

Knowledge-based Intangible, intellectual assets and renewable resources

Unique advantages, competitive knowledge

Innovation and renewal Knowledge used to recombine traditional capabilities

Accelerates rate of new learning Learning speed most significant competitive advantage

Integrates customers & suppliers New webs of knowledge resources

Strategic planning differs from traditional Knowledge SWOT, Scenarios, Internal/External

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Managing Knowledge Strategy

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Four Enabling Dimensions

What do we know and where is it ?

How do we participatewith this know-how?

How do we support this know-how?

What processes leverage that know-how?

Collaborative Technology

Practices

Knowledge Resources

Culture andLearning

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Linkage to Balanced Scorecard

Financial Goals

Customer Goals

Internal Business Process Goals

Learning & Growth GoalsOu

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Perfo

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ce Drivers

Business Strategy

Knowledge Strategy

Desired Outcomes

Desired Behaviors

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Planning from Knowledge Perspective

Cultural Assessment ….Readiness assessment

Knowledge Framework to embed Business Plan

Portfolio of Knowledge Management Projects

Champion for each project

‘Value from Knowledge’ Plan

Business steering team review and presentation

Phased Implementation

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Knowledge Strategy Methods

“Delegated Strategy Integration”

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Knowledge Strategy Methods

Knowledge SWOT

Business + Knowledge

Strengths, Weaknesses, Opportunities, Threats

1. Establish or affirm current Business Strategy

2. Evaluate internal drivers - impacts of current knowledge by:

Resources

Practices

Culture and Learning

Technologies

3. Use these as basis for Strength and Weaknesses.

4. Evaluate external drivers – impacts on knowledge

5. Use these for Opportunities and Threats

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Knowledge Strategy Methods

Strategic Scenario Planning

Create shared models of potential future conditions to guide dynamic strategy.

Why? Scenarios provide robust tools for integrating very complex business conditions applicable to strategy.

Also – people are good at remembering stories; SWOT chart points fall away quickly.

How? Team workshop approach, with broad participation. You want new ideas, dissension, “out in leftfield”

Strategy as “serious play”

Source Scope of this workshop can’t cover scenarios. See: Schwartz,The Art of the Long View

Ringland, Scenario Planning

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Knowledge Strategy Methods

Strategic Scenario Planning

Developing scenarios for adapting organization to potential future trends and changes.

1. Establish participatory scenario team- Future workshop, Team Design, other workshops

2. Set scope for scenarios

3. Generate sources for scenarios

4. Develop initial categories

5. Build miniscenarios as small groups

6. Group review of miniscenarios

7. Pull together themes and design 3 scenarios

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Aligned Knowledge Management

Business strategy guides your knowledge assets

Linking knowledge requirements to: Resources:

Making information accessible to point of need

Info usability with common categories & process

Culture: Enabling, rewarding teams & experts for cross-sharing

Developing culture of knowledge creation

Practices: Embedding new best practices in organization

Transparent leveraging of expert knowledge

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Leading to Technology Solutions …

Scale and Accessibility

Organizational Enterprise Inter-Enterprise

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ApplicationStrategy

Knowledge Management e-Community

Content Management Systems Information Portal

Communities of Practice

AllianceExtranets

Strategic KnowledgeManagement

Online KnowledgeCommunities

InformationIntegration Portal

Internal Application

Portal

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Strategic Knowledge Resources

Collaborative Technology

Knowledge Resources

Core and complementary competencies

Organizational capabilities

Structured and unstructured information

Personal knowledge and unique skills

Customer relationships

Intellectual property

Infrastructure and standard systems

Groupware and email applications

Web-enabled portals and Internet applications

Process management systems

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Strategic Knowledge Resources

Practices Business processes

Organizational routines

Embedded and specialized processes

Practice communities

“How things are done”

Culture and Learning

Core organizational values

Personal values and leadership

Organizational environment

Hiring and enculturation

“How we see ourselves”

Individual and group skill development

Organizational learning

Style of management, work, engagement

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Conclusions

Good strategy is dynamic and adaptable - Knowledge Strategy is ongoing as well.

Requires leadership and will – organizational change always requires focus on vision.

Traditional management may require education for integrating knowledge into business strategy.

Other firms’ KS processes may not apply to yours - No knowledge advantage can be claimed “out of the box”

Understand what’s worked for others, experiment, listen to your people, your culture.

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Exercises

1. Knowledge SWOT - Group Exercise Create groups by industry and strategic thrust

Discuss current initiatives and strategic drivers

Select ONE business initiative to work on as group

Identify SWOT drivers for this initiative

Develop Knowledge and Business SWOT

2. Identify Application Areas for SWOT: Knowledge Resources

Culture and Learning

Practices

Technology

3. Informal Presentation and Discussion Each group present SWOT analysis to group

Show applications/alignments per 4 dimensions

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Four Knowledge Enabling Areas