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Unformatted text preview: Knowledge Management Toolkit, The Amrit Tiwana Publisher: Prentice Hall PTR First Edition December 06, 1999 ISBN: 0-13-012853-8, 640 pages Knowledge Management Toolkit, The Preface Acknowledgments I: The Rubber Meets the Road 1. Introduction Knowledge Management: A Goldmine or an Empty Piggy-bank? What This Book Is About What This Book Will Do How to Use This Book What This Book Is Not About Endnotes 2. The Knowledge Edge Getting to Why: The New World The Missing Pieces Accounting for Abnormal Differences A Common Theme Intellectual Capital The 24 Drivers of KM Knowledge-Centric Drivers Technology Drivers Organizational Structure-Based Drivers Personnel-Focused Drivers Process Drivers Economic Drivers Creating the Knowledge Edge Lessons Learned Endnotes 3. From Information to Knowledge From Data to Information to Knowledge From Data to Knowledge Classifying Knowledge The Three Fundamental Steps Knowledge Management Systems and Existing Technology Taming the Tiger's Tail Business and Knowledge Knowledge-Friendly Companies Knowledge-Sharing Companies Is Your Company Ready for Knowledge Management? Lessons Learned Endnotes II: The Road Ahead: Implementing Knowledge Management 4. The 10-Step KM Roadmap The 10-Step Knowledge Management Road map Phase 1: Infrastructural Evaluation Phase 2: Knowledge Management System Analysis, Design, and Development Phase 3: Deployment Phase 4: Metrics for Performance Evaluation Lessons Learned IIA: The First Phase: Infrastructural Evaluation and Leverage 5. The Leveraged Infrastructure The Approach: Leverage, Leverage, Leverage Leveraging the Internet Enabling Technologies for the Knowledge Management Technology Framework Knowledge Servers Lessons Learned Endnotes 6. Aligning Knowledge Management and Business Strategy From Strategic Programming to Strategic Planning Knowledge Maps to Link Knowledge to Strategy Strategic Imperatives for a Successful KM System Assessing Focus Lessons Learned Endnotes IIB: The Second Phase: KM System Analysis, Design, and Development 7. Infrastructural Foundations Technology Components of the KM Architecture The Seven-Layer KM System Architecture Foundation for the Interface Layer The Web or Notes? Collaborative Intelligence and Filtering Layer Lessons Learned Endnotes 8. Knowledge Audit and Analysis Hindsight + Insight = Foresight Measuring Knowledge Growth The Knowledge Audit Team Choosing Your Company's K-Spots Lessons Learned Endnotes 9. Designing the KM Team Sources of Expertise Team Composition and Selection Criteria Team Life Span and Sizing Issues The Knowledge Management Project Leader The KM Team's Project Space Points of Failure Lessons Learned Endnotes 10. Creating the KM System Blueprint Analyzing Lost Opportunities The Knowledge Management Architecture Components of a Knowledge Management System Designing Integrative and Interactive Knowledge Applications Build or Buy? User Interface Design Considerations A Network View of the KM Architecture Future-Proofing the Knowledge Management System Lessons Learned Endnotes 11. Developing the KM System The Building Blocks: Seven Layers The Interface Layer The Access and Authentication Layer The Collaborative Filtering and Intelligence Layer The Application Layer The Transport Layer The Middleware and Legacy Integration Layer The Repositories Layer Lessons Learned Endnotes IIC: The Third Phase: KMS Deployment 12. Prototyping and Deployment Moving From Firefighting to Systems Deployment? Prototyping Pre-RDI Deployment Methods The Results Driven Incremental Methodology Lessons Learned Endnotes 13. The CKO and Reward Structures From the CIO to the CKO The Successful CKO Reward Structures to Ensure Knowledge Management Success Lessons Learned Endnotes IID: The Final Phase and Beyond: Measuring ROI and Performance 14. Metrics for Knowledge Work Traditional Metrics Common Pitfalls in Choosing Metrics Three Ways to Measure Classifying and Evaluating Processes Alternative Metrics Lessons Learned Endnotes 15. Case Studies Some Background Knowledge Management in the Aerospace Industry: The Case of Rolls Royce Knowledge Management in Sales and Marketing: The Case of Platinum Technology KM in Customer Support: The Case of Nortel KM in the Semiconductor Industry: GaSonics International The Goal: Three Months to Target KM Pilot Case: Monsanto Nutrition and Consumer Products Lessons Learned III: Side Roads: Appendices A. The Knowledge Management Assessment Kit The 10-Step Populated Roadmap Phase 1: Infrastructural Evaluation Phase 2: Analysis, Design, and Development Putting It All Together B. Alternative Schemes for Structuring the KM System Front End Alternative Structures C. Software Tools Software Tools D. Resources on the Web Knowledge Management: Web Pointers Intellectually Rich Companies Bibliographic References and Further Reading Glossary Glossary Preface Real knowledge is to know the extent of one's ignorance —Confucius In the quest for sustainable competitive advantage, companies have finally come to realize that technology alone is not that. What sustains is knowledge. It is in unchaining knowledge that lies in your company's people, processes, and experience that the hope for survival rests. Peter Drucker warned us years ago, but it's only now that companies have finally woken up to the value of managing their knowledge and bringing it to bear upon decisions that drive them up or out of existence. If your organization is confused by vendor buzz and consultant pitches about how they and their products can solve all your knowledge problems, be forewarned: It's not that easy. Knowledge management (KM) is just about 35 percent technology. While technology is the easy part, it's the people and processes part that is hard. The Knowledge Management Toolkit will provide you with a strategic roadmap for knowledge management and teach you how to implement KM in your company, step by step. Technology should not always be mistaken for computing technology; the two are not synonymous. Chapter 1, rather than this preface, introduces you to KM and to this book. Before you begin, a notational warning would be in order. You'll find a lot of citations because of the cumulative tradition that this book follows by choice. However, do not let this distract you; all that you need to comprehend a topic being discussed is footnoted on the same page. You can safely ignore all endnotes without losing any information (unless you want to trace bibliographic history). When a URL is mentioned in the text, you will likely find further information on it in Appendix D. You'll hear about the silver bullet, a term rooted in folklore of the American Civil War. It supposedly emerged from the practice of encouraging a patient who was to undergo field surgery to bite down hard on a lead bullet "to divert the mind from pain and screaming" (American Slang, Harper & Row, New York, 1986). You'll soon realize that you've found the silver bullet of business competitiveness. Think of this book as a conversation between you and me. Remember to visit the companion site at . I would love to hear your comments, suggestions, questions, criticisms, and reactions. Feel free to email me at [email protected] Amrit Tiwana Atlanta Acknowledgments Robert Dubin pointed out as early as 1976 (Theory Building in Applied Areas, Rand McNally College Publishing Co., Chicago, 17-26) that there is probably a five- to ten-year lag between the time a theoretical model—which KM for a large part is—becomes fashionable in the real world. It's the thinkers who prepare the revolution and the bandits who carry it out. I could not even begin to truly acknowledge the intellectual debt that I owe to thinkers like Ikujiro Nonaka, Karl Wiig, Tom Davenport, Bob Buckman, Peter Drucker, Michael Zack, Andrew Inkpen, Wanda Orlikowski, Marco Iansiti, and James Brian Quinn, who prepared the knowledge revolution and have long influenced my own thinking. Special thanks are also due to Herbert Simon for his insightful comments. It is on the shoulders of these giants that this book stands. I would like to thank the people from the industry who made that initial leap of faith and embraced the value of knowledge management in their work, products, services, and as a centerpiece of their businesses. Among the many people I wish to thank for their support are Elaine Viscosi at Intranetics Inc. for permission to use a sample Intranet deployment described as Urban Motors in Chapter 9; Michael Zack of Northeastern University; Chuck Sieloff of Hewlett Packard; Johanna Rothman of Rothman Consulting; Joni Schlender of Plumtree Corporation; Steve Shattuck of Alpha Microsystems; Jean Heminway of Xerox Corporation for her zealous support for the DMA/WebDAV standards and the inputs that she provided; Susan Hanley at AMS Inc; Michael Davis of OSIS; Ray Edwards of Lighthouse Consulting; Joni Schlender of Plumtree Software; Harry Collier of Infornotics, England; Jim Eup of Powerway; Mark Turner of the Natural Language Processing Lab at Thomson; Jeff Barton of Texas Instruments for his insightful analysis of this book; Glenn Shimkus of Platinum Technology, Inc.; Rick Dove of ParadigmShift International; Thomas Davenport of Andersen Consulting and Boston University; Mark Montgomery of GWIN; Fanuel Dewever of Newcom, Belgium; Steve Singer of CIO; Gord Podolski of Nortel Networks; Bettina Jetter of MindJet LLC for extensive information on mind mapping; Simon Tussler of the Boston Consulting Group; Mark Kawakami and others who I have inadvertently left out. I would also like to acknowledge the invaluable suggestions and unfailing support that I have received from my colleagues including Arjan Raven; Bala Ramesh, my mentor; and especially Ashley Bush, who "lived through" several drafts of this book and helped me through the many software crashes that come exactly in the middle of your best ideas in a Windows world. Thanks are also due to my close associates, Smiley and Tommy, without whose help this book would have been a more formidable task. I would also like to thank Mark Keil, Daniel Robey, Richard Baskerville, and Vijay Vaishnavi at the J. Mack Robinson College of Business, from whom I have much learned to strike the balance between rigor and relevance in research. Built upon the shoulders of the giants in information systems research, this book is my humble attempt at proving that there is more relevance in the cumulative body of research that comes out of the ivory towers than we usually get credit for. This book would have been an impossible task without the enthusiasm of my editor, Miles Williams, his able assistant Noreen Regina, and my initial contact at PHPTR, Mark Taub. The quality of this book also owes a lot to my technical reviewers including Corinne Gregory of Data Dimensions, Chuck Fay of FileNet Corporation, and to my anonymous initial reviewers, for their suggestions. The credit for the readability of this book goes largely to my development editor, Mary Lou Nohr, whose insights, arguments, and suggestions helped me see the forest when all I could see were the trees. The visual appeal of this book owes much to the skills of Kerry Reardon. Most importantly, I would like to acknowledge the support and encouragement that my family has provided me. Without them, this book would have been far from possible. Part I: The Rubber Meets the Road Chapter 1. Introduction As we gain more knowledge, we do not become certain, we become certain of more. —Ayn Rand IN THIS CHAPTER • • • • • • Define knowledge management (KM). Understand the noise about knowledge management. Understand why now. Evaluate knowledge management's value proposition Look beyond the buzz to see if there is anything "real" behind KM. Define what knowledge management is not. Understand if your company is ready for knowledge management. Data. At first we had too little. We asked for more and we got it. Now we have more than we want. Data led to information, but what we were looking for in the first place was knowledge. As an increasing number of companies now realize that knowledge is their key asset, they want to turn to managing this asset to deliver business results. Maybe you want to introduce knowledge management (KM) in your own company. But where and how do you begin? What is behind the buzz? What is KM's value proposition? What types of companies can actually begin knowledge management? Is it a technology problem or a management problem? What happens to the millions that your company has invested in information technology (IT) if it is replaced by yet another hyped "fix-it-all" technology? Can you build upon existing IT investments? What kinds of people, skills, and organizational structures are necessary to pull it off? How can KM be aligned with your business's strategy? Is there an architecture that you can use? How can you deploy KM in your own company? Are there any business metrics for it? How can you maximize payoff if you implement KM? Can your small business without deep pockets afford it? How do you know if your business is even ready for it? These are some of the questions that this book will help you answer. Knowledge Management: A Goldmine or an Empty Piggy-bank? Knowledge management might be "hot" as of today, but successful managers have always realized its value. Long before terms such as expert systems, core competencies, best practices, learning organizations, and corporate memory were in vogue, these managers knew that their company's key asset was not its buildings, its market share, or its products, but it lay in its people, their knowledge, and skills. After having tried everything else—from the greatest products and the best technology to virtual monopolies—in their respective markets, more businesses have finally come to the realization that the only sustainable source of competitive advantage is their knowledge. As Drucker fittingly warns us, "those who wait until this challenge indeed becomes a 'hot' issue are likely to fall behind, perhaps never to recover."[1] Why Knowledge? Far from vendor sales pitches, a crying need for knowledge management is evident. This need is a growing reality, worldwide: from Antigua to Zaire. The Scotsman reports that 98 percent of senior managers in a KPMG survey believe that knowledge management was more than just a passing fad.[2] The London Times calls it the "fifth discipline" after business strategy, accounting, marketing, and human resources and called upon British companies to harness it to improve their performance and profitability.[3] The need is evident in Singapore, where The Strait Times reports that "organizations lack a strategy to manage knowledge sharing among their staff." [4] Some organizations there, The Strait Times reports, are not even sure what a knowledge management strategy is or how to develop one. Of 75 senior managers interviewed in Singapore, only 3 of whom felt that their companies were even moderately effective at knowledge sharing, unequivocally voice their intent to make knowledge management their number one priority.[5] This sounds very much like the opinion that we've been hearing in the United States. For good reason: forty percent of the U.S. economy is directly attributable to the creation of intellectual capital.[6] As companies fail to solve KM problems by plugging in "fix-it-all" technology solutions, echoes of the cultural complement needed to make these solutions actually work are resounding far beyond the United States. David Hewson writes in the Sunday Times, "the problem is cultural…where the idea of making information available to all, at every level throughout the company, frequently is anathema to managers." [7] What's Knowledge? Knowledge and knowledge management are lofty concepts—debated by academics and managers and even doubted by some analysts—one that only a few businesses have mastered.[8] The few big businesses that have are the ones that now top the Fortune 500 list and the few small ones top the Inc. 100 hot companies to watch list. Before we continue, here is a working definition of knowledge suggested by Thomas Davenport and Laurence Prusak, which we will refine as we proceed: Knowledge is a fluid mix of framed experience, values, contextual information, expert insight and grounded intuition that provides an environment and framework for evaluating and incorporating new experiences and information. It originates and is applied in the minds of knowers. In organizations, it often becomes embedded not only in documents or repositories but also in organizational routines, processes, practices, and norms.[9] So What's Knowledge Management? Next, let's try getting a temporary handle on what knowledge management means. In the simplest terms it means exactly that: management of knowledge. In the context of our discussion, it can be extended to "management of organizational knowledge for creating business value and generating a competitive advantage." Knowledge management enables the creation, communication, and application of knowledge of all kinds to achieve business goals.[10] Kirk Klasson elucidates, "Knowledge management is the ability to create and retain greater value from core business competencies." Knowledge management addresses business problems particular to your business—whether it's creating and delivering innovative products or services; managing and enhancing relationships with existing and new customers, partners, and suppliers; or administering and improving work practices and processes. KM's Value Proposition The ability of companies to exploit their intangible assets has become far more decisive than their ability to invest and manage their physical assets.[11] As markets shift, uncertainty dominates, technologies proliferate, competitors multiply, and products and services become obsolete rapidly, successful companies are characterized by their ability to consistently create new knowledge, quickly disseminate it, and embody it in their new products and services.[12] In the postindustrial era, the success of a corporation lies deeply embedded in its intellectual systems, as knowledge-based activities of developing new products, services, and processes become the primary internal function of firms attempting to create the greatest promise for a long-term competitive advantage. Kirk Klasson suggests that companies can reap an immense payoff when a knowledge management solution makes it easier for practitioners to reach out to other practitioners who share common problems or have experience to share. Why all this noise about knowledge management and why now? There are nine reasons for this: 1. Companies are becoming knowledge intensive, not capital intensive. Knowledge is rapidly displacing capital, monetary prowess, natural resources, and labor as the quintessential economic resource.[13] Knowledge is the only input that can help your company cope with radical change and ask the right questions before you attempt to find the answers,[a] for without this knowledge you might never even realize how your industry's competitive environment is changing until it's a little too late. It is this knowledge that brings quality into any company's product and service offerings.[b] Further, product life cycles and service time-tomarket can be accelerated in unprecedented ways through knowledge. Knowledge management is the only way to reach and apply this knowledge in time. [a] Asking the right questions and taking action based on such knowledge, Peter Drucker adds, usually double or triple knowledge worker productivity, and usually fast. [b] Drucker also points out that unlike in the production economy, quality of work, decisions, and processes is at least as important as their quantity. eBay (market value, $22 billion), eFax ($200 million), CISCO ($190 billion), Pfizer ($150 billion), and Microsoft ($400 billion) are a few of several hundred thousand examples. 2. Unstable markets necessitate "organized abandonment." Y...
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