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KenManila, Philippines | Monday, October 4, 2004 The benefits of knowledge management "So what’s it in for me? Am I really going to get my money’s worth? Is it really value-adding?"
Sound familiar? Well, these questions naturally come to life every time we are faced with decisions like investing in a new strategy, program, process or project. It’s always going to be about cost-benefit analysis. How much money am I going to be sinking in to this investment and how much return or value am I going to get out of it? Well, these questions hold true also for KM initiatives. Now that we are faced with increasingly difficult economic times, are initiatives such as KM programs and practices truly worth the effort as well as the investment? Or can we just keep on doing what we used to do and still survive in the competitive arena that we find ourselves in? Top management always want a clear understanding of the ’bottom line’ benefits of knowledge management before they invest in such initiatives. So, let’s take some time to look at the benefits of these KM initiatives. The concept of the KM Benefits Tree, which was developed by David Skyrme Associates, a networked management consultancy specializing in advising senior executives and policy makers on how to create and implement successful knowledge-based strategies, highlights the interrelationships of three major categories of benefits commonly associated with successful KM initiatives. The categories are:
KNOWLEDGE BENEFITS Benefits under this category include:
One concrete example is the organization of numerous physical files of, let’s say, a manufacturing firm or an academic institution or a government agency. Categorization and segregation into working databases allows the employees who need specific information to access it more efficiently through word or category searches rather than having to sift through so many folders. Updating of these databases will also result in having the most recent and relevant information and knowledge stored and easily accessible by any employee who may need them. INTERMEDIATE BENEFITS Benefits under this category include:
Thus, duplication of mistakes would be minimized if not eliminated and knowledge gained from doing a certain activity or task can be passed on for the benefit of other teams. Going back to our physical file organization example - because everything is organized, the decision maker can now proceed more efficiently with the decision making process. He does not have to use the "I’m sorry but I don’t have that information with me." or "I don’t know what you want to get from all this." excuses anymore. ORGANIZATIONAL BENEFITS Benefits under this category include:
In a constantly evolving and competitive environment, organizations are faced with having to continuously improve especially in the area of creating innovative products and service that would be meet the also constantly evolving needs and wants of their customers. Ultimately, without patronage from customers, the organization will die a natural death. In our physical file organization example, as a result of organized databases, the decision maker has the necessary information and knowledge to substantiate or justify, let’s say, R&D initiatives that would lead to more innovative and create products and services. These initiatives may cost the company at the start but, looking at the long-term perspective, we can see that, when the products and services are created and then sold to a market that needs or wants them, then the company will actually reap the rewards of satisfied customers translating into increased sales revenues which helps offset the initial capital sunk into the R&D initiatives. "So what’s it in for me? Am I really going to get my money’s worth? Is it really value-adding?" Bottom line, the benefits of any KM initiative should always outweigh all the efforts put into KM implementation to help your company move forward. |
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