Building and Sustaining Knowledge Management Systems

Since the early 1990s, the shift from a data-driven landscape to a knowledge-based economy has changed the way businesses gather and use information to connect with their stakeholders, clients and customers. Knowledge Management (KM) grew out of that shift: it helps an organization recognize and use its intellectual capital, whether that sits in a team, a company or a whole economy. Today an effective Knowledge Management System (KMS) is the backbone of an organization, driving innovation, improvement and sustainability.

Building a KMS and keeping it alive requires a clear understanding of the scope, design and implementation of each of its elements.

The Building Blocks of a Knowledge Management System

A KMS needs the complete integration of an organization’s people, processes and technology. Knowledge Management goes well beyond buying or deploying a piece of software. The building blocks are:

• People and culture: the exchange of explicit and tacit knowledge depends on whether employees are willing to share it. A knowledge-sharing culture is usually the first and the longest-running part of a good KMS. Every group in the organization needs to take part, so that communities of practice can form and the sharing that already happens is encouraged.
• Process and life cycle: once the people who will build and use the KMS are identified, the organization needs clear processes for selecting, organizing, sharing, transferring and applying knowledge. These processes are the backbone of the system. They support planning, problem-solving, decision-making and learning, and they connect to other systems such as a Quality Management System.
• Knowledge infrastructure and technology: the third building block is the infrastructure that lets people capture knowledge, share it and build knowledge repositories. Repositories make it easy to share data, processes and best practices across the organization. Good KM software spreads a “knowledge culture” and supports the KMS processes, but it does not replace them.

Types of Knowledge Management Systems

Several types of KMS support different stages of an organization’s knowledge life cycle. Many organizations place them under one “master” KMS, but each has a recognized, specialized role.

• Groupware: tools that help employees collaborate on communication, idea generation, brainstorming and reviews of organization-wide initiatives. Today this includes shared workspaces, team chat and internal wikis.
• Expert systems: information systems that provide high-level, domain-specific problem-solving.
• Decision support systems: systems that give decision-makers the information they need to make choices aligned with the organization’s mission and vision.
• Document and database management: often called the workhorses of KM, these let people control, share and retrieve relevant documents and data when they need them.
• Simulation systems: specialized tools, common in some industries, that model outcomes too dangerous or too expensive to test directly.

From Knowledge to Results

For a large organization, building a KMS can cost a great deal of time and effort, so it has to deliver sustainable returns in the medium and long term. Widely cited KM case studies report results such as these:

• BP Amoco reported savings of about $700 million over three years from reusing knowledge assets and best practices.
• Schlumberger reported savings of about $500 million over six years.
• ConocoPhillips reported savings in the hundreds of millions of dollars from knowledge management.

The cost of not sharing knowledge is just as striking. IDC estimated that Fortune 500 companies lose at least $31.5 billion a year by failing to share knowledge, as reported by SHRM’s HR Magazine in 2004. These figures are dated, but the lesson holds: an organization that does not manage what it knows keeps paying to relearn it.

How to Keep a KMS Working

• Name owners for each knowledge area, so content is reviewed and retired, not just added.
• Make sharing part of everyday work, for example by writing up lessons after each project, rather than a separate task.
• Measure use: what people search for, what they cannot find, and which documents go out of date.
• Choose tools that fit the processes you already defined, not the other way around.