praxishandbuch v n kc...declarative and procedural knowledge. whilst declarative knowledge r efers...

An Illustrated Guide to Knowledge Management

Contents

Basics

Objectives and Benefits 1

Basic Concepts 2

Types of Knowledge 3

Experience 4

Knowledge Management 5

Operative Knowledge Management

The Role of the Employee 6

Knowledge Logistics 7

Changing the Knowledge Base 8

Integration into Projects 9

Transfer of Experience 10

Closing a Project with a Lessons Learned Workshop 11

Lessons Learned Workshop 12

Organisational Learning

Experiential Learning 13

From Individual to Organisational Learning 14

Procedure and Analysis 15

Design and Development 16

Strategic Knowledge Management

Corporate Culture and Strategic Knowledge Management 17

The Knowledge-based Network Organisation 18

Strategy Implementation with the Intellectual Capital Report 19

Knowledge Markets as Strategic Interfaces between Organisations 20

Information and Communication Technologies

Relevance and Overview of Technologies 21

Selection Procedure 23

Knowledge and Innovation Management

Linking Innovation and Knowledge Management 24

Supporting Innovation With Knowledge Management 25

Optimising Problem-solving Processes 26

Evaluating Problems 27

Measuring Knowledge

Basics of Measurement 28

Measurement Methods 29

Intellectual Capital Report Model 30

Learning Effects 31

Implementation

Knowledge Management Assessment 32

Approaches to Introducing Knowledge Management 33

The Individual Working Environment 34

Initiation Phase 35

Analysis Phase 36

Design Phase 37

Lessons Learned in Implementation 38

Glossary 39

http://www.wm-forum.org

Recommended ReadingArthur, B. (1996): Returns and the New World of Business. In:Harvard Business Review, Jul.-Aug., pp.100-109Drucker, P. (1994): Post Capitalistic Society; New York: Harper

Basics

Page 1


Objectives and Benefits

The modern business world is characterised bydynamic, changing markets and continuoustechnological advance. To cope with these trends,organisations must become more flexible, andone certain way for them to do so is tostrengthen their potential to learn asorganisations (see Fig. 1).

Thus, "knowledge" becomes an essentialorganisational driver and a key factor in valuecreation. Increased focus must be placed onexpanding the organisational knowledge base,either by learning from others (e.g. colleagues,partners, third party content, etc.) or by creatingnew knowledge through innovation. Bothprocesses help secure sustainable competitiveadvantage (see Fig. 2).

Knowledge management can be seen as anintegrated approach to achieving organisationalgoals by placing particular focus on"knowledge", now widely considered as the newfactor of production.

Knowledge management supports andcoordinates the creation, transfer andapplication of individual knowledge in valuecreation processes. This can only be realised in acorporate culture that promotes knowledgemanagement and actively supports informationand documentation processes (e.g. through thesystematic application of innovation and qualitymanagement tools and methods).

However, to manage an organisationalknowledge base, it must also be measured. Theinclusion of intellectual assets in thismeasurement adds a further dimension to theassessment of traditional factors of production.In this way, other factors (including traditionallyelusive "soft factors") become more readilyavailable for value creation processes.

Comprehensive knowledge management should

ensure that "knowledge" is used as effectivelyand efficiently as traditional factors ofproduction in achieving organisational goals.Added benefits include an improved capacity fororganisational learning and a greater potentialfor action.

The major benefits of knowledge managementfor organisations include:

• Greater transparency of knowledge potentialand gaps

• Knowledge-based value creation processes• Increased motivation through staff

involvement• Increased competitiveness• Long-term security and survival

Management SummaryKnowledge-intensive value creation requires areassessment of the weighting of factors ofproduction and increased recognition andunderstanding of the economic influence ofknowledge.Effective knowledge management not only forms thebasis of successful innovation processes, it also greatlyenhances an organisation's ability to innovate.

Changing the corporate

environment

Organisational Learning

Learning appropriate corporate behaviour

Fig. 1: The cycle of organisational learning

advantage ensures corporate longevityCompetitive

is the driving force behind long-term competitive advantage

Innovation

is the basis for innovationKnowledge

Knowledge Management

Alliance Management

Management of IC Technologies

Learning Organisation

Quality Management

Business Process Management

Innovation Management

Fig. 2: Knowledge as basis for competitive advantage

Fig. 3: Knowledge management as integrative management approach


Recommended Readingvon Foerster, H. (1995): Cybernetics of Cybernetics. 2nd edn;Mineapolis: Future SystemsPiaget, J. (1980): The Psychogenesis of Knowledge and itsEpistemological Significance. In: Language and Learning: The DebateBetween Jean Piaget and Noam Chomsky, Piatelli-Palmarini, M. (Ed);Cambridge, Mass.: Harvard University Press, pp.23-24

Basics

Page 2


Basic Concepts

People use their memories to carry out physicaland mental actions. They actively experience theirenvironment through sensory perception. Theperception of individual stimuli continuouslytriggers off cognitive processes in the brain,which, in turn, result in changes to the memory.This interaction between perception and action isknown as individual learning, with the memoryacting as human cognitive subsystem(see Fig. 4).

Based on these assumptions, individualknowledge can be defined as the set of allpossible memory states (i.e. possible actions) anindividual is able to perform at any given time.Knowledge represents an individual's potentialfor action and is thus always intrinsically linkedto people.

Organisations need to harness the individualknowledge of their members and apply it inbusiness processes to create economic value.Combining these individual memories to form acollective organisational knowledge base playsa decisive role in this process. This is far morethan just a corporate database: It represents theinteraction and communication betweenindividual employees. Thus, organisationalknowledge can be considered as the set of allpossible actions (or business processes) anorganisation can perform at a given time. Thisincludes its ability to perceive its environmentand react to changes. In analogy to individualmemory, the collective knowledge base can beseen as the cognitive subsystem of the socialsystem "organisation" (see Fig. 5).

There are two essential parts to a collectiveknowledge base: the individual knowledge of themembers of the organisation and the frameworkthat connects them, with interaction andcommunication structures also playing a decisiverole. Consequently, one of the central tasks of

knowledge management is to shape anorganisational culture that supports effectiveknowledge exchange.

Organisational learning is the process ofchanging the organisational knowledge base andtypically refers to learning by individual membersand groups. This involves continuous perceptionof the environment (e.g. market changes,technology trends) and appropriate reaction tochanges (e.g. new strategies or improved businessprocesses). Despite its obvious advantages, thesystematic combination and transfer of this newknowledge can be very time consuming, and aneffective information and communicationinfrastructure will be required to ensure allconcerned have the necessary time, space andtools to do so.

All members and groups in an organisationcontribute to the collective knowledge base. As aresult, the knowledge it contains comes from awide range of different projects, tasks andbusiness processes. To accommodate thisdiversity, a knowledge base should be organisedin individual knowledge domains, each dealingwith a specific subject or area.

Management SummaryThe organisational knowledge base contains theknowledge of the individual members of theorganisation applicable to the value chain.A learning organisation is capable of changing itsknowledge base through systematic perception of theenvironment and adoption of appropriateinformation, documentation and communicationprocesses.

Individual

Sensory perception

Action

Memory (cognitive subsystem)

Perception

Action

Organisation

Sensory perception

Action

Knowledge base (cognitive subsystem)

Knowledge domain AKnowledge domain B

Knowledge base

Fig. 5: Organisational knowledge

Fig. 4: Individual knowledge

Types of Knowledge

In general, the following characteristics can beattributed to knowledge:

• it is created dynamically (through changes to cognitive structures),

• it is intrinsically linked to people, and

• it is a prerequisite for human action.

One possible – and often useful – categorisationof knowledge (Fig. 7) is by:

• knowledge psychology,

• articulability, and

• knowledge holder.

Knowledge psychology differentiates betweendeclarative and procedural knowledge. Whilstdeclarative knowledge refers to facts (issues,processes, etc.) and objects (persons, things, etc.),procedural knowledge concerns the waycognitive processes and actions are performed.Declarative knowledge is also described asknowledge of something (knowing), or "knowwhat". Procedural knowledge is also described asprocess knowledge, or "know-how".

Structuring knowledge according toarticulability focuses on whether or not theknowledge holder is consciously aware of theknowledge and can thus articulate it. This resultsin a differentiation between explicit and tacitknowledge. Explicit knowledge is knowledgethat is consciously understood and can bearticulated. In other words, knowledge the"knower" is aware of and can talk about. Tacitknowledge, on the other hand, is knowledge the“knower” is not aware of. It can only – if at all - beelicited, and thus articulated, with great effortand the use of special observation or interview

techniques.

A categorisation according to knowledge holderdifferentiates between individual and collectiveknowledge. Individual knowledge is knowledgeheld by one person. It is not dependent on aspecific context and is controlled by theindividual concerned. Collective knowledge isknowledge that is relevant in a specificenvironment (e.g. company, club). It can includeindividual knowledge that only reaches its fullpotential when combined with that of others (e.g.an orchestral musician who plays better in agroup than as an individual). It can also includeknowledge shared by everyone, i.e. knowledgecommon to all members of a collective (e.g.everyone in the company knows who to contactif they have a problem with their PC).

Management SummaryKnowledge is intrinsically linked to people and enablesthem to act. Categorising knowledge only really makessense if it is done with a specific purpose in mind.

An Illustrated Guide to Knowledge Management Basics

Page 3http://www.wm-forum.org

Recommended ReadingPolanyi, M. (1983): The Tacit Dimension; GloucesterRyle, G. (1960): The Concept of Mind; New York

Knowledge...

... is intrinsically linkedto people

... is the result of acognitive process

... is createddynamically

... is the basis for allaction

Fig. 6: Basic characteristics of knowledge

Fig. 7: Types of knowledge

Collective knowledge

Individual knowledge

Explicitknowledge

Tacitknowledge

Procedural knowledge("know how")

Declarative knowledge("know what")

Articulability

Knowledge holder

Knowledge psychology

Experience

The term experience is often used in connectionwith knowledge and learning. Experience as astate (having experience) is a subset of humanknowledge and is referred to as experientialknowledge (Fig. 8). If, on the other hand,experience is seen as a process (gainingexperience), it must then be seen as a learningprocess, namely experiential learning. Thefollowing central characteristics of experientialknowledge are relevant for knowledgemanagement:

1. Experiential knowledge is often createdthrough observing or carrying out actions andis therefore closely linked to proceduralknowledge (Fig. 10). Repeatedly carrying out aparticular action or actions will lead to arefining of procedural knowledge. For example,the speed and accuracy of a particular skill iscontinuously improved. An experienced grinderwill make a far more sophisticated assessmentof a cylinder’s composition or differences indiameter than an apprentice. Experientiallearning processes also help us to structure andlink existing knowledge. This is whyexperienced employees are able to interpretnew situations quickly, make appropriatedecisions and initiate any action required. Adriving instructor interprets the overall picturein a particular traffic situation, whereas alearner driver still notices the individual details(pedestrians, traffic lights, cars turning left, …).

2. Experiential knowledge is primarily tacit(Fig.10) and, in most cases, transferring thisknowledge requires a huge amount of effort.Experiential knowledge comes from personalexperience of situations. It has far strongerlinks to a specific situation than universallyvalid knowledge (e.g. a2+b2=c2). The limiteddegree of universal validity in experientialknowledge can, however, be meaningful in

other situations. No practical applications canbe derived directly from universal knowledge(Fig. 9).

3. Experiential knowledge is primarily individualknowledge (Fig.10), since it is by naturestrongly linked to subjective feelings andemotions. We don’t experience objects, peopleor situations simply as useful/impractical ornew/familiar; we also experience them asbeautiful/ugly or pleasant/repulsive. Indeed,the phrase "to act on instinct" clearly indicatesthe close links between experiential knowledgeand feelings.

Management SummaryExperiential knowledge is a subset of humanknowledge and is by nature strongly linked tosituations and people. Experiential knowledge ischaracterised by its practical relevance.

An Illustrated Guide to Knowledge Management Basics


Recommended ReadingDewey, J. (1983): Experience and Education; New YorkPolanyi, M. (1983): The Tacit Dimension; Gloucester

ProcessExperience in the senseof "gaining experience"is seen as a process andreferred to asexperiential learning.

StateExperience in the senseof "having experience"is seen as a state andreferred to asexperiential knowledge.

Fig. 10: Classification of experiential knowledge

Fig. 8: Experience as state and process



Explicitknowledge

Tacitknowledge

Procedural knowledge("know how")

Declarative knowledge("know what")

Articulability

Knowledge holder

Knowledge psychology

Experientialknowledge

Fig. 9: No direct applications result from universal knowledge

Mathematics a2+b2=c2

ISO Standards

Corporate standardsSalesman's talent

Experiential knowledge

Universal knowledgeUniversality

CategorisationGeneralisation

Abstraction

Gap betweentheory and practice

Conflict with contextPersonalisationPractical relevance


Recommended ReadingDavenport, T. / Prusak, L. (1998): Working Knowledge: HowOrganizations manage what they know; BostonDierkes, M./Berthoin-Antal, A./Child, J./Nonaka, I. (Eds) (2001):Handbook of Organizational Learning & Knowledge; New York:Oxford University PressNonaka, I. / Takeuchi H. (1995): The Knowledge creating company.How Japanese Companies create the Dynamics of Innovation; NewYork: Oxford University Press

Basics

Page 5



Knowledge Management is the targetedcoordination of "knowledge" as a factor ofproduction and the management of theorganisational environment to support individualknowledge transfer and the subsequent creationof collective knowledge, two essential factors inthe value creation process. Knowledgemanagement is therefore not the management of"knowledge" itself, but rather the managementof the organisation with a particular focus on"knowledge".

To simplify this process, we differentiate betweentwo fundamental levels: the data level and theknowledge level. This is based on the traditionaldifferentiation between knowledge on the onehand and data and stimuli on the other.

There are three main aspects to knowledge:individual knowledge, action and data. The first,individual knowledge (i.e. the sum of anindividual's capabilities and experience),determines the possible actions open to anindividual and, consequently, the contributionsthey are able to make to a particular project ortask. The second aspect, action, includes bothphysical and mental actions (e.g. problemsolving). The actions required to complete anindividual task often result in large amounts ofdata, the third aspect to knowledge. This includesboth internal data (e.g. from other projects) andexternal data sources such as libraries or onlinedatabases.

These aspects form the operational layers in theknowledge management model illustrated inFig.11:

• Knowledge level• Data level• Action level

The knowledge level is made up of the

knowledge of the individual members of theorganisation and their interaction with eachother. The data level consists of all availabledocumented knowledge (e.g. in databases or asprinted documents). The knowledge and datalevels provide input for the action level. This iswhere business processes are enacted andrepresents the organisation's value creatingprocesses.

These three levels are linked with the five coreknowledge processes (information,documentation, communication, application andlearning) to form a basic model of knowledgemanagement.

Management SummaryKnowledge management places particular emphasison the role of "knowledge" in organisationalmanagement. One of the main aims of knowledgemanagement is to establish an appropriate frameworkto support the optimal development and applicationof knowledge in value creating processes.

Action level

Application Learning

Knowledge level Knowledge domainsCommunication/

Interaction

Social subsystem

Documentation

Information

Data level

Technical subsystem

Team buildingTeam knowledge

Documented knowledge

ProjectTeam learning


Documentation

Data level

Knowledge level

Fig. 12: Projects as framework for knowledge creation and application

Fig. 11: Basic model of knowledge management

The Role of the Employee

Knowledge management can take many differentforms, depending on the actual goals and/orindividual actors involved (Fig. 13). The majorityof common approaches deal with knowledgemanagement by and for groups of employees(organisational knowledge management).However, this can be extended by considering theknowledge management activities that take placeat the action level of individual employees.

This does not imply that personal knowledgemanagement should be seen as diametricallyopposed to a knowledge management focus oncorporate goals. Indeed, many of the conflicts ofinterest that come to the fore in knowledgemanagement activities have far deeper roots. Asimple example of this is training. Most peoplealso have an interest in improving their value onthe employment market and, as a result, may wellput in requests to attend training courses thathave no direct relevance to corporate goals.Another classic example is the hoarding ofknowledge by experts to protect their personalinterests.

A closer look at the links between these twoforms of knowledge management reveals thatdifferences in corporate and personal goals makedifferent knowledge relevant (Fig. 14). Wherecorporate and individual knowledge interestsoverlap, there is no immediate conflict ofinterests. However, from a knowledge perspective,there are often no clear boundaries betweenpersonal and work-related interests. The amountof effort a person is prepared to invest inknowledge that is important for the organisation,yet of no personal interest, is primarily a questionof motivation, and can thus only be influencedindirectly. On the other hand, the extent to whicha person can utilise their time at work to furthertheir own knowledge interests (not necessarilyrelevant to the company) depends greatly on the

amount of autonomy their employer is willing togrant. Both these factors can also influence ashift in boundaries (Fig. 14). Greater autonomyboosts motivation. Motivated employees aregenerally more productive and can be given moreautonomy. Whilst there is no denying thatgreater autonomy might also result in a slightreduction in capacity, this should be more thancompensated for by the benefits that come withincreased motivation.

Management SummaryTo avoid unnecessary conflicts of interest, knowledgemanagement must also consider the perspective ofthe individual employee. Motivation and autonomyestablish the boundaries between company relevantand personally relevant knowledge.

An Illustrated Guide to Knowledge Management Operative Knowledge Management


Recommended ReadingBarth, S. (2000): The power of one. In: Knowledge ManagementMagazine, Dec.,URL:http://www.destinationkm.com/articles/default.asp?ArticleID=615Slade, A.J./Bokma, A.F. (2001): Conceptual approaches for personaland corporate information and knowledge management. In:Proceedings of the 34th Annual Hawaii International Conference onSystems Sciences, HICSS-34, pp.418-425, IEEE Computer Society; LosAlamitos, CA, USA

Focus onpersonal goals

Focus oncorporate goals

Group level

Individual level

Collectiveknowledge management

Organisationalknowledge management

Individualknowledge management

Personalknowledge management

Fig. 14: Dealing with company and personally relevant knowledge

Fig. 13: Actors and goals in knowledge management

AutonomyMotivation

Companyrelevant

knowledge

Personallyrelevant

knowledge


Recommended Readingvon Krogh, G. (2000): Enabling knowledge creation: How to Unlockthe Mystery of Tacit Knowledge and Release the Power ofInnovation; Oxford Univ. PressSenge, P.M (1994): The Fifth discipline: The Art and Practice of theLearning Organization; New York


Page 7


Knowledge Logistics

Knowledge logistics handles knowledgerequirements, available knowledge andknowledge transfer. Knowledge requirementsform the starting point in the sphere of influenceof knowledge management processes (see Fig.15).

Available knowledge is represented by thecompany’s knowledge holders and corresponds tothe organisational knowledge base.

Knowledge transfer is the process of linkingknowledge requirements and availableknowledge. This can occur either via humannetworks or via information and communicationtools (Fig.16) as illustrated in the Basic Model ofKnowledge Management on (see Fig.11).

To enable effective knowledge transfer viahuman networks, knowledge seekers andproviders must have access to suitablecommunication methods (e.g. meetings, coachingsessions). Face-to-face communication is themost valuable and, at the same time, most time-consuming form of knowledge transfer and isparticularly suitable for complex issues (e.g.clarification of R&D problems).

Knowledge is transferred via information andcommunication networks when a knowledgeseeker accesses relevant stored data and turnsthis into knowledge. This requires priorknowledge of a particular knowledge domain(context). Special mention should also be given toknowledge transfer via telecommunications tools(e.g. telephones, video conferencing, …), whichenable communication across geographicalboundaries. The possibilities now offered by videoconferencing tools are very similar to thoseoffered by face-to-face communication.

The above examples illustrate the mainrequirements for effective knowledge transfer ina business environment. Care should be taken toselect a form of knowledge transfer that best

meets the organisation’s business requirements.Human networks are an excellent way oftransferring knowledge on complex issues. Forsimple issues, knowledge transfer can also beeffectively achieved using information andcommunication tools.

The context and background available to theknowledge seeker plays a key role in the selectionof the appropriate form of knowledge transfer.Face-to-face communication provides knowledgeseekers with the added benefit of being able toincrease their contextual knowledge, whereas forinformation- and documentation-basedknowledge transfer, they must already have therelevant contextual knowledge (although this canbe acquired separately).

In addition to the selection of the right form ofknowledge transfer, a suitable infrastructure andenvironment is also required (information andcommunication infrastructure, time, ...).

Management SummaryKnowledge logistics handles knowledge requirements,available knowledge and knowledge transfer.Knowledge can be transferred via social networksand/or via information and communicationtechnologies (data level).

Corporate strategy

Business processes

Knowledge requirements Knowledge transfer

Internal expansion

Available knowledge

(organisational knowledge base)

External expansion

(knowledge creation)

(outsourcing)

Fig. 16: Knowledge transfer between knowledge seekers and knowledge providers

Fig. 15: Sphere of influence of knowledge management processes

Action level

Knowledge level Data level

Action level

Knowledge level

Knowledge level

Data level

Data level

Social subsystem

Social subsystem Technical subsystem

Technical subsystem

Learning

Learning

Application

Application

Knowledge seeker

Documentation

Documentation

Information andcommunication systems

Social network

Knowledge provider


Recommended Readingde Bono, E. (1990): Six Thinking Hats; LondonHamel, G. (1999): Competing for the future, 11th edn; Boston:Harvard Business School Press


Page 8


Changing the Knowledge Base

If an organisation cannot meet its knowledgerequirements from its available knowledge, thegap will have to be filled either by developingknowledge internally or buying it in (in theform of external services). The method chosenwill depend on the company’s existing or plannedcore competencies (Fig. 18).

A company’s core competencies are the basis ofits success and are generally more durable thanend products or services. Core competencies canbe described as entrepreneurial excellence in aparticular field, and are generally the result ofextensive interaction between (groups of) expertsand/or knowledge holders. This combines theknowledge in the corporate knowledge base andother resources to form a unique combination ofskills and expertise (see Fig. 17). Corecompetencies also form the basis for thedevelopment of core products and core servicesand can generally be applied in different businesssegments. Customer requirements in differentbusiness segments ultimately determine whichend products and/or services are developed.

Knowledge is developed internally throughknowledge creation, one of the tasks ofinnovation management. This can only beachieved in an appropriate environment (see Fig.18) and requires both teamwork and the effectiveuse of creative potential. A wide range ofcreativity techniques are available (Fig. 18) tosupport these efforts. The participants increativity workshops, for example, should comefrom as wide a range of professional backgroundsas possible and always include experts notdirectly involved in the actual problem orknowledge domain.

To enable a break with familiar methods andsolutions and open up new possibilities, it may beappropriate in some cases to also include externalknowledge holders and experts. The interaction

and communication between participants inthese workshops unearths new solutions, as aresult, for example, of considering approachesused in other internal or external knowledgedomains.

There are a number of reasons for includingexternal knowledge sources in internalinnovation processes, including:

• Economic/time restraints mean no internalresources are available to cover the knowledgedomain

• It does not make strategic sense to develop theknowledge internally.

The knowledge base can be expanded externallythrough outsourcing. This involves buying inspecific services, skills and expertise outwith thecompany’s core knowledge domain(s), and caninclude both routine tasks and specific tasks thatcan only be accomplished by appropriate expertsor knowledge holders. It also involves enlistingthe support of external partners to establishand/or develop knowledge domains relevant tothe company.

Management SummaryAn organisation develops its core competencies bycombining internal and external resources and, inparticular, knowledge.The ability to expand or change its knowledge basethrough knowledge creation and the inclusion ofexternal knowledge sources determine anorganisation's ability to act and innovate.

Drive chain for sports utility vehicle xy

Example:

Business segment 1 Business segment 2 Business segment 3 Business segment 4 Sports Utility VehicleHGV

Core product 1 Core product 2

Core competency 1 Core competency 2

Drive componentsLightweight body

Diecast technologyGearbox technology

KD 1

KD 2KD 3

KD 4

KD 5

KD = Knowledge domainPF = Production factor = Knowledge holder= End product and services

Kinematics, Materials Technology, Acoustics

Fig. 18: Requirements and methods for knowledge creation

Creative environment

No distractions (telephone, other interruptions, ...)

Creative skills as prerequisite

Sufficient time

Target-oriented methods

Constructive communication culture

Pleasant physical environment (calm, furnishings, lighting, …)

Technical equipment (flipchart, overhead projector,

podium, moderation kit, ...)

Top management supports creativity

Morphological box

Bionics

635 Method

Synectics

Functional analysis

TRIZ as specific tool for innovation and creativity

Knowledge creation methods

Fig. 17: Core competencies for a strategically oriented knowledge base

Integration into Projects

One aim of projects is to complete a complex taskor problem in the most efficient manner possible.The more complex the task or problem, the morecomplex the required project organisation andknowledge system will be (Fig.19). The inherentcomplexity is demonstrated, for example, in thedegree of interdisciplinarity required in theproject team.

Integrating knowledge management into projectimplementation processes involves three basicknowledge management functions:

The first is to establish an efficient knowledgesystem for the project. Any knowledge-orientedactivities or interventions are relevant to thatspecific project and are based on the definedproject goals. One way of improving theefficiency of the knowledge system is to payincreased attention (Fig. 21) to communicationprocesses (e.g. the way status meetings areprepared and wrapped up) and reflection (e.g.reviews at the end of individual project phases).This extends the direct steering of projects at thedata level through planning and monitoringprocesses to include indirect steering throughcommunication and reflection processes at theknowledge level.

The second function concerns knowledgetransfer between projects. This aims to re-useknowledge from similar projects in new projectsand thus avoid "reinventing the wheel" (e.g.checklists). Transferring knowledge betweenprojects has obvious benefits for the companybehind the projects. One way of ensuringknowledge transfer is to integrate knowledgegoals into individual project phases or finalproject goals. The inclusion of mandatoryknowledge goals creates a necessity forknowledge transfer in projects.

The third function is the transfer of experience

between projects. By transferring experience,systematic use can be made of prior learningprocesses in subsequent projects, thus avoiding“making the same mistakes twice” (e.g. LessonsLearned Workshops). Repeated learning by "trialand error" can be extremely costly fororganisations, particularly since these areuncoordinated learning processes and canhappen time and time again. The integration ofmandatory learning goals into individual projectphases or project goals will also help ensure thatexperience is transferred.

Project team members are usually fully aware ofthe importance and necessity of transferringknowledge and experience. However, theygenerally allocate a lower priority to theseactivities than to primary project goals (deadline,costs, quality). The integration of mandatorylearning and knowledge goals into project goalsplays a key role in the project-orientedknowledge management process.

Management SummarySuccessful knowledge management in projectsmust resolve the conflict of interests betweenprimary project goals and learning/knowledgegoals.



Recommended ReadingGareis, R. (1990): Management by Projects; ViennaSchindler, M./Eppler, M. J. (2003): Harvesting Project Knowledge: AReview of Project Learning Methods and Success Factors. In:International Journal of Project Management, Vol. 21/3;Kidlington/Oxford: Elsevier Science Ltd., pp.219-228

Complexity of problem Inherent complexity of knowledge system

Fig. 20: Paradigm shift in project steering

Fig. 19: The complexity of problems and their knowledge systems

++ ++ ++...

++ ++ ++...

✔ ✔✔

Planning

Monitoring

Communication

Reflection

Transfer of Experience

It is not possible to transfer experience throughcommunication and/or documentation andinformation processes, all that can be transferredis a description of what was experienced and anyinsights gained. Experiential knowledge can onlybe created through the process of experientiallearning and not through transfer processes.

The transfer of experience is a special form ofknowledge transfer and, as part of a corporateknowledge management strategy, has two basicaims: Firstly, the transfer of experience shouldprovide individual employees with a broaderspectrum of decision-making options andpossible courses of action in business situations.This avoids unnecessary effort and repeatedlearning through "trial and error". Secondly, thetransfer of experience supports individual andorganisational learning processes and helps tobuild up individual expertise and develop thecompany’s capacity to learn. Two basic strategiesplay a role in the transfer of experience:

A codification strategy attempts to documentthe parts of experiential knowledge that can bemade explicit (i.e. can be written down), thusdetaching it from the individual employee andmaking it available to others in a codified form(Fig.22). Other employees who encounter similarsituations can refer to and apply thesedocumented learning experiences (e.g. LessonsLearned Reports) whenever appropriate withoutdirect contact to the expert.

A personalisation strategy, on the other hand,focuses on transferring experience through directcontact (Fig. 22). The intention here is toencourage additional tacit knowledge transferthrough processes of communication and mutualobservation. To ensure that these contacts occursystematically, and are not just left to chance, acompany must know what expertise itsemployees have. E-mails, project documents,

minutes, reports, interviews, etc. contain goodindications of what could be included in expertprofiles.

The three levels indicated in Figure 21 serve as thebasis for the analysis, design and development ofthe transfer of experience in a company. Transferof experience will always begin and end at theindividual level. In codification strategies, theorganisational level represents the repositoryand distribution source for documented learningexperiences, whereas in personalisation strategiesit provides the necessary tools (e.g. expertprofiles) for identifying colleagues and/or expertswith the experience sought. The team level notonly delivers the required context for the transferof experience (e.g. projects), it also acts as animportant link between the individual andorganisational levels (e.g. Communities ofPractice or Lessons Learned Workshops).

Management SummaryThe transfer of experience is a special form ofknowledge transfer. This type of transfer should serveto broaden the spectrum of decision-makingpossibilities and courses of action open to employeesand avoid unnecessary repeated learning through trialand error.



Recommended ReadingArgyris, C./Schön, D.A. (1978): Organizational Learning: A Theory ofAction Perspective; Reading (MA)Hansen, M.T./Nohria, N.; Tierney, T. (1999): What's Your Strategy forManaging Knowledge? In: Harvard Business Review, March-April1999, Number 2; BostonKolodner, J.L. (1983): Maintaining organization in a dynamic long-term memory. In: Cognitive Science, Vol 7, No 4, pp.243-280Polanyi, M. (1983): The Tacit Dimension; Gloucester

Organisational level

Team level

Individual level

Personalisation Codification

Network(e.g. expertdatabase)

Distribution(e.g. Intranet)

Support(e.g. Communities

of Practice)

Support(e.g. Lessons

Learned Workshops)

Transfer ofexperience

through communication

Transfer ofexperience through

information and documentation

Fig. 22: Advantages and disadvantages of codification and personalisation strategies

Fig. 21: Transfer of experience through personalisation or codification

+ knowledge is always available+ particularly suitable for frequent re-use+ can be passed on quickly and easily; high degree

of distribution

- codification is complex and time-consuming

- documented knowledge can quickly become obsolete

- complicated wording or terminology makesknowledge difficult to absorb

- context cannot be fully described/provided

- some knowledge cannot be made explicit

- different "mental models" prevent direct use ofdocumented knowledge

Codification strategy+ -

+ -- complicated search for the right person

- the right person is not available

- personal aversion

+ knowledge is always up-to-date

+ complexity of knowledge transfer can be adaptedto the situation

+ creative innovation possible during transfer

Personalisation strategy

Closing a Project with a LessonsLearned Workshop

It is an extremely worthwhile exercise to close aproject by passing on any lessons learned,positive experiences and suggestions forimprovement to future projects. When a project iscompleted, the individual project team membersoften interpret what went on in different ways.These differing points of view result from theindividual roles they played in the project andtheir experiences in these roles. This leads to awhole series of different interpretations,assessments and actions. A Lessons LearnedWorkshop gives team members an opportunityto present and discuss their individual points ofview. It also encourages individual learning(personal measures) and organisationaldevelopment (recommendations).

The method described below is a useful way ofdiscussing and transferring experiences with agroup of around 30 participants. The aim is toenable effective and efficient transfer ofexperience in one day. Insight should be gainedinto the following issues:

• What was done well in the project?

• What could have been improved?

• What would be the ideal situation for points that could have been improved?

• What would I personally do differently in the next project?

• What should the organisation do differently inthe next project?

The most important stages in this procedure are:

• Defining the relevant issues (Fig. 23)

• The Lessons Learned Workshop (Fig. 24)

• Processing and applying the results

If a one-day workshop is planned, it makes goodsense to define the relevant issues in advancein a smaller group (e.g. project managers, sub-project managers, quality managers, …). Examplesof possible issues are given in Fig. 23.

Defining the issues in advance will steer theworkshop strongly in a particular direction. Thisrestriction will prevent other issues identified bythe participants during the workshop from beingdiscussed. If such issues are to be included, then itmakes sense not to define the issues in advance,but rather to do so with the whole group at thebeginning of the workshop. This will double thetime required for the workshop.

This shows the importance of includingexperienced project team members in thedefinition of issues.

Management SummaryIt is a worthwhile exercise to close a project by passingon any lessons learned, positive experiences andsuggestions for improvement to future projects.Defining the issues in advance will save time duringthe workshop.



Customers

Suppliers

Project structure

Clarity of roles

Information flow / management

Cost steering / monetary goals

Project documentation

Project team

Organisation of project specific qualification measures

Requirements / specifications

Planning of technology and methodology

Project planning (performance, deadline, costs, personnel)

Internal cooperation

Organisation/planning of projects

Project management

Project communication

Strengths and weaknesses in project culture

Cooperation in team

Cooperation with project environment / internal interfaces

Cooperation between project and line management

Continuity of key people / team members

Crisis / conflict management

External cooperation

Selection of team membersAbility of team membersCost / deadline / quality awareness

Transparency of project statusProject handbook

Responsibilities (tasks)Competencies, responsibility

Meeting structureMeeting culture

Coordination, decision-makingRisk assessmentCrisis management

CooperationCommunication and information flowCustomer satisfaction

CooperationCommunication and information flowSatisfaction as a customer

Fig. 23: Possible subject categories for a Lessons Learned Workshop

Lessons Learned Workshop

The most important stages in a workshop of thiskind are:

Background:

The introductory session should include clear anddetailed presentations of the project (from startto finish). In this way, participants will bereminded of what actually went on during theproject. Emphasis should be placed on earlyevents, since these are more likely to have beenforgotten in the meantime.

Cluster building:

The input from the brainstorming sessions iscollected and sorted into subject areas. A keyterm is defined for each subject area (cluster)that best describes its content. This abstractionsimplifies subsequent work with the individualclusters.

Lessons learned:

An ideal target situation is defined for each issuewhere improvement was considered necessary.Each participant then notes what he or she coulddo in his or her individual project roles to ensurethis ideal target situation is achieved. These aresummarised to produce a list ofrecommendations for the organisation.

Fig. 24 provides a more detailed time schedule forthis kind of Lessons Learned Workshop.

Although one of the goals is obviously individuallearning on the part of the workshopparticipants, other colleagues not directlyinvolved in the workshop or project should alsobe able to profit from any lessons learned.

After the workshop, it is vital that any insightsand proposed measures are implementedappropriately. For this to happen, the results andknowledge must be passed on in a suitable formto the appropriate places or bodies to initiate

organisational learning. The insights gained in aLessons Learned Workshop can have long-termeffects on the organisation, for example,through:

• Introduction of new training measures/programmes

• Corrections/additions to project and quality handbooks

• Presentation of results to the Board and management

• Publication in the Intranet.

This method of transferring experience includeselements of both codification and personalisationstrategies, whereby the focus is on codification.Consequently, it strives to ensure that lessonslearned are transferred through information anddocumentation processes between experts andproblem solvers.

It is also advantageous to include selected(inexperienced) employees as participants in theworkshop, since they will learn from direct (face-to-face) communication with experts(personalisation strategy).

Management SummaryLessons Learned Workshops are an effective andefficient way of transferring experience in a relativelyshort period of time (one day). The results are thenpassed on to the appropriate people in theorganisation to initiate organisational learning.



Recommended ReadingDavenport T./Prusak, L. (1998): Working Knowledge: HowOrganizations Manage What They Know; Harvard Business SchoolPressSenge, P. (1994): The Fifth Discipline; New York

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ins 1. Introduction and background

The aims and rough time plan for theworkshop are explained to all partici-pants. Relevant presentations serve torefresh memories of the project, inclu-ding all its highs and lows.

2. Brainstorming

The participants are then split up intosmaller groups (of approx. 10 people),with each group working on a particularissue. After a short explanation of theprocedure and their particular issue,group members write down their ownpersonal experiences of the project (e.g.on "Post-It" notes or cards).

3. Clustering and abstraction

The statements are then collected andsorted into subject areas (clusters) bythe group. A key term or title summari-sing the individual statements is definedfor each cluster (abstraction).

4. Cluster discussion/processing

The following questions are then askedabout each subject (cluster and title):What would be the ideal result or situa-tion for this particular subject in a pro-ject? How would this be recognised?What can I do personally as a projectteam member to ensure this ideal situa-tion is achieved in the next project?What can the organisation do to ensurethe ideal situation is achieved?

5. Group rotation

The groups then study the results pro-duced by the other groups and eitheradd their own comments to the existingsubjects, propose new subjects or di-scuss the results.

6. Presentation and closing discussion

When each group has had time to workon all subject areas, individual presenta-tions are prepared. The results are thenpresented to and discussed by all parti-cipants.

Fig 24: Lessons Learned Workshop

Experiential Learning

Experiential knowledge can only be gainedthrough the process of experiential learning.Figure 25 shows a simplified model of thisprocess.

Knowledge is a necessary basis for experientiallearning. Even a “random attempt” requires acertain amount of declarative and proceduralknowledge. Knowledge (and the knowledgeholder) should be considered as part of asituation, whereby any connection resultingfrom the situation is often described as context.

By applying their existing knowledge to asituation, people develop expectations of what itwill entail and what the results of any planned orobserved actions will be. Even the assumptionthat nothing will happen is an expectation.Action is only required in the case of directlearning through “trial and error”. No deliberateaction is required in experiential learning throughobservation.

It is the individual’s perception that makes senseof what the situation actually entailed and theconsequences of any actions taken or observed. Asubsequent comparison of what was perceivedand what had been expected will result in eitheran agreement or a deviation. Agreement confirmsboth expectations and original knowledge.

The person determines the relevance of anypositive (success) or negative (failure) deviation.This is a prerequisite for the acquisition ofexperiential knowledge. Any change to existingknowledge constitutes the end of the current andthe beginning of a new experiential learningprocess.

Knowledge, expectation, perception andrelevance play decisive roles in experientiallearning processes and all have a very stronginfluence on each other. For example,

expectations will greatly affect perception.

There are a number of possibilities open tomanagement for influencing experientiallearning processes and thus the creation ofexperiential knowledge, including:

• Placing people in situations that fosterexperiential learning (e.g. job rotation)

• Encouraging people to take or observe action(e.g. job enlargement, job enrichment)

• Creating space for reflection and systematic comparison of expectations and perceptions (e.g. regular project reviews).

• Establishing a culture that is open to change in established knowledge (e.g. where people can admit to and learn from mistakes)

Rapid advances in technology now make itpossible to create artificial situations andenvironments (virtual realities) for experientiallearning (Fig. 26).

Management SummaryExperiential knowledge can only be gained throughthe human process of experiential learning. However,companies can influence both experiential learningprocesses and the creation of experiential knowledge.

An Illustrated Guide to Knowledge Management Organisational Learning


Recommended ReadingDewey, J. (1938): Experience and Education; New YorkKolb, D.A. (1984): Experiential Learning: Experience as The Source ofLearning and Development; Englewood Cliffs (NY)Schön, D.A. (1983): The Reflective Practitioner; New York

Knowledge

Perception

Relevance Expectation

ActionComparison

Assimilation Situation

Mutualinfluence

Influence throughe.g. job rotation

Influence throughe.g. greater autonomy to reflect

Influence through e.g.job enlargement, job enrichment

Influence throughe.g. a culture open to change

Fig. 26: Experiential learning: Comparison between reality and virtualrealities (e.g. flight simulators, business simulation games)

Fig. 25: The cycle of experiential learning

Experiential learningin the real world

Experiential learningin virtual worlds

Real consequencesof action

No real consequencesof virtual action

From Individual toOrganisational Learning

A learning model for humans (Fig. 27) shows thelearning process as a four-phase cycle, withdifferent types of knowledge created in eachphase. This new knowledge then forms thestarting point and object of the next learningactivity.

Procedural learning in humans involves theperception of stimuli and the initiation ofappropriate behaviour (action). The analysis ofprior experiences (contextual placement) and thedevelopment of behavioural guidelines (cognitiveassociation) are known as declarative learning.However, this dichotomy should not bemisinterpreted: Both levels of learning (and typesof knowledge) are in fact activated in andinteract with the learning process, even if one ofthem assumes a more prominent role.

A comparison of analogies between humans andorganisations (Fig. 28) shows organisationalstructure as a procedural element andorganisational culture as a declarative element inorganisations. These analogies are based on thefollowing assumptions:

• People use procedural knowledge (know how)to interact with their environment throughaction. In comparison, organisations useappropriate structures (procedures, processes) togenerate activities and interact with theirenvironment.

• In humans, declarative knowledge (knowwhat) is the starting point for proceduralknowledge and any subsequent actions.Correspondingly, culture can be described as thedeclarative knowledge of an organisation, since itprovides the meaning and guidelines forbehaviour and thus forms the basis of all actions.

Consequently, the organisational learning processfollows comparable phases to its humancounterpart, whereby any changes in structurecan be seen as procedural learning and changesin culture as declarative learning in anorganisation. Although it is again possible thatone particular learning process will assume amore prominent role, in practice they will alwaysinteract.

Individual learning processes form the startingpoint for organisational learning. It is individuallearning that provides the impetus fororganisational change. The implementation ofany such change also requires individual learningprocesses, which can involve all members of theorganisation or smaller groups, depending on thescope of the actual change.

Management SummaryOrganisational learning can be seen as beinganalogous to individual learning. It is based onindividual learning processes and involves changingthe organisational structure and/or culture toguarantee survival in a dynamic environment.



Recommended ReadingArgyris, Ch. (1999): On Organizational Learning; OxfordKolb, D.A. (1984): Experiential Learning: Experience as The Source ofLearning and Development; Englewood Cliffs (NY)

Procedurallearning

Declarativelearning

Procedural knowledgeOrganisational structure

Declarative knowledgeOrganisational culture

PerceptionPerception

Contextual associationCultural interpretation

Cognitive associationStandards and Values

ActionsAchievements

HumanOrganisation

Fig. 28: Comparison/analogy between humans and organisations (in this case a company)

Fig. 27: Human/organisational learning model

Human Organisation

Goal/Purpose

Affects through

Motorium

Sensorium

Perception

Brain(cognitive subsystem)

Learning methods

Survival(by adapting to the environment)

Survival(by adapting to the environment)

Actions(man machine interaction)

Muscles

Sense organs

Signals

Procedural knowledge

Procedural learning

Declarative knowledge

Declarative learning

Products + Services;Financial Statement, Advertising, ...(inter-action with customers + suppliers; society)

Sales + Marketing;Press Officer, …

Market Research +Service;Company Management

Turnover, Profit, Share Price, ...;Requirements, Claims, ...;Laws, Conditions, Regulations, ...Organisational structure

Structural change

Organisational culture

Cultural change

Procedure and Analysis

A general, three-step (analysis, design anddevelopment) sequential model (Fig. 29) can beapplied to organisational learning.

The following dimensions and theircharacteristics can be used as the basis for theanalysis and design of the organisationalstructure:

• Specialisation (specialised – generalised)

• Coordination (impersonal – personal)

• Configuration (hierarchical – heterarchical)

• Delegation of decisions (centralised – decentralised)

• Formalisation (bureaucratic – unbureaucratic)

The analysis and design of the organisationalculture can be based on basic culturalassumptions. These include views on andattitudes to:

• Environment (threat – opportunity)

• Reality (facts – creativity)

• Human nature (independent – dependent)

• Human action (control – trust)

• Interpersonal relationships (competition – cooperation)

Once the impetus for organisational learninghas been given, i.e. a need for organisationalchange recognised in reactions from theenvironment, the analysis phase can begin. In thisphase, goals should be defined and the actualsituation (structure and/or culture) establishedand processed.

In addition to the goals for the entire learningprocess, sub-goals should also be defined foreach individual (sub-)stage. Sub-goals are derivedfrom appropriate main goals and can be extendedto include any requirements specific to aparticular issue. When formulating goals,attention needs to be given to the fact that theseshould be specific, measurable, ambitious,realistic and scheduled.

Any research methods used will depend stronglyon the resources available and should considercontent, human resources and economic factors.Questionnaires are a quick and easy way ofestablishing a general picture of the currentclimate, whilst semi-standardised interviews(Fig. 30) take a more detailed look at theinterviewee’s individual situation. Observationmethods are used primarily to support and/orverify other research methods.

Management SummaryOrganisational learning can be achievedsystematically through the analysis and design ofstructural and cultural dimensions.



Recommended ReadingKotter, J.P./Heskett, J.L. (1992): Corporate culture and performance;New YorkPugh, D.S./Hickson, D.J./Hinings, C.R./Turner, C. (1968): Dimensions ofOrganization Structure, ASQ 1968, Vol. 13, pp. 65 – 105Schein, E. (1992): Organizational Culture and Leadership; New YorkSiehl, C./Martin, J. (1988): Measuring Organizational Culture: MixingQualitative and Quantitative Methods. In: Jones, O., Moore, D.;Snyder, C. (Eds): Inside Organizations, Understanding the HumanDimension; Newbury Park, pp.79-103

Design DevelopmentAnalysis

Impetus fororganisational

Learning

Fig. 30: Example target/actual culture comparison for "interpersonal relationships"

Fig. 29: Towards oganisational learning

“Gaps”as basis for intervention

Target CultureActual Culture

• Analyse goals• Determine actual

situation• Synthesise and

prepare data

• Define targetsituation• Compare target/actual

situation; deriveinterventions

• Determine strategy• Establish organisational

implementationmeasures

• Prepare measures• Implementation• Verify goals have

been reached andsecure results

Competition

Information Processuncoordinated

Staff/Staff poor

Staff/Mgmt.poor

Project/Line Mgmt.complicated

Interdepartmentalpoor

Unequalgroups

Cooperation

Information Processcoordinated

Staff/Staffgood

Staff/Mgmt.good

Project/Line Mgmt.clear

Interdepartmentalgood

Good mixin groups

Design and Development

The next stage in the design process is to define adesired target situation, compare this with theactual situation and derive appropriateinterventions from the results of this comparison.The objective is not to present a finite picture ofthe characteristics of the individual dimensionsused in the analysis, but rather to identify thosethat deviate most from the defined targetsituation.

The target situation can either be establishedduring the analysis of the actual situation or inworkshops with “opinion makers” (e.g.management, staff representatives, etc.) andstaff. Graphical representations are an excellentway of presenting the results of the situationalanalysis and/or a target/actual comparison (e.g.Fig. 30), since managers often think and act “innumbers”, and show greater interest in dealingwith any shortfalls presented to them in thisform.

An appropriate strategy should now be defined toaddress these shortfalls. This will depend on thedegree of deviation between the target andactual situations and the urgency of anyidentified issues. The changes can either beintroduced slowly on a step-by-step basis(evolutionary approach) or quickly in largerchunks (revolutionary approach). One advantageof a step-by-step approach is that it allows timefor staff to be fully involved in the changeprocess, whilst a radical (less promising) changeprocess leaves limited if any time for staffinvolvement.

Utmost care should be taken in the planning andorganisation stages, since the way a project ofthis kind is handled at the start can have a majorinfluence on how any measures are subsequentlyaccepted.

The process then moves into the development

stage, where any proposed interventions areimplemented, i.e. suitable measures aredeveloped, introduced and evaluated to ascertainhow effective they have been for the goals set.

Marketing plays a particularly important role inthe preparatory stages and serves to promote theproject throughout the organisation, raise itsimage and increase acceptance among staff.

The project can either be implemented on a step-by-step basis (e.g. as a pilot project) or on acompany-wide scale (“big-bang).

Repeated analysis of the individual dimensionsserves to verify the efficiency and effectivenessof any measures introduced. In this way, theprocess can be continuously refined tosuccessively reduce or eliminate any deviationsdetermined between target and actual situations.

Management SummaryOrganisational learning takes the form of changeprojects, which must be handled differently to classicprojects. Success factors include staff involvementand management participation (e.g. as role models).



Fig. 31: Interview guidelines for culture survey (excerpt)

Environment

• Does the organisation dominate its environment?

• Is the environment considered a challenge for XY?

• Does everyone know the organisation’s goals?

• Are the goals clear, and do they match the organisational environment?

Reality (Truth, Time and Space)

• Are tried and tested solutions preferred to new (creative) ones? Will consideration be given to external solutions or only to

internal possibilities?

• What is the general approach to time? Is the focus more on the past, the present or the future?

• Is enough time allowed for asking/answering questions? Which “medium” is used?

• Is there sufficient opportunity/space for informal knowledge transfer?

Human Nature

• Who makes decisions? How are decisions made? Do people make use of any freedom they might have to take decisions?

• How is work/performance checked? (self-assessment, trust, milestones, etc.)

• How does the organisation approach responsibility? Who has responsibility? Is this consistent throughout the organisation?

• Are there any incentive systems in place? If so, do they work? Should there be incentives for knowledge sharing?

Human Action

• Is this focus more on completing tasks (routine processes) or on active learning (knowledge creation)?

• Does the organisation tolerate and how does it react to mistakes?

• Relationship between work and leisure: totally separate or a way of life?

Interpersonal relationships

• Attitude to knowledge sharing: “knowledge is power” vs. cooperative knowledge exchange? “Each to his own” vs. team

oriented approach?

• What is the relationship like between colleagues? How do they communicate with each other? Relationship/communication

between staff and management?

• How does interdepartmental communication work?

• How are groups formed? (age, experience, personality, etc.)


Recommended ReadingAnsoff, H. I. (1984): Implanting strategic management, 2nd edn;Englewood CliffsSchein, Edgar H. (1997): Organizational culture and leadership. 2ndedn; San Francisco


Page 17


Corporate Culture and StrategicKnowledge Management

Corporate culture includes all the values,traditions, rituals, standards and beliefs thatdetermine how people act in an organisation.

We know from chemistry that catalystsactivate and accelerate processes. Corporateculture assumes the role of the catalyst inknowledge management, thereby playing a keyrole in all analysis and design activities. Inanalogy to knowledge management, it cantherefore be assumed that corporate culturealso needs to be lived and constantly drivenand promoted by management.

Corporate culture can be determined bycarrying out periodic reviews of the basicelements of corporate culture illustrated inFigure 32. The resultant “gaps” between theactual culture and a target culture open toknowledge management form the startingpoint for strategic management intervention.Indeed, management is in a unique positionto create, steer and change corporate culture.

A strategic orientation in knowledgemanagement should not only ensure that allrelated activities are based on generalcorporate goals; it should also help tocontinually improve and institutionalise theknowledge management processes themselves.This requires the following steps:

• Setting knowledge management goals

• Establishing and implementing design measures

• Initiating change processes

• Periodic assessment reviews.

All these activities form part of a typicalmanagement process. To ensure knowledgemanagement activities are fully integrated

into actual working practices, managementmust continually observe any cause-effectrelationships. In practice, evaluations based onthe business indicators “effectiveness” and“efficiency” have proved highly successful (seeFig. 33).

Using effectiveness as an indicator of thedynamic relationship between knowledgemanagement goals and design measuresdetermines the strategic gap (i.e. if thecorrect measures have been implemented).

Assessing efficiency as an indicator of theeffect any measures have had on the changeprocess provides the operating gap (i.e. if themeasures have been implemented correctly).

The cycle of strategic knowledgemanagement thus allows a company to adaptappropriately to any dynamic changes in itsenvironment, yet at the same time remain trueto its knowledge-oriented goals.

Management SummaryCorporate culture assumes a central role in knowledgemanagement and requires constant impetus frommanagement. Strategic knowledge managementconsiders all corporate goals and allows continuousimprovement of knowledge management processes.

(e.g. architecture of its physical environment,

atmosphere, customs, rituals, …)

easy to observe, hard to decipher

(e.g. ideologies, company philosophy, taboos, …)

provide justification for all actions

(e.g. about the environment, interpersonal relationships, …)

ultimate source of values and actions

Artifacts

Espoused Values

Basic Underlying Assumptions


Corporate Goals


Goals

Effectiveness (doing the

right things)

Design Measures

(cause)

Efficiency (doing things

right)

Change Process (effects)


Review

Fig. 33: Cycle of strategic knowledge management

Fig. 32: Basic elements of corporate culture according to Schein


Recommended ReadingBuchanan, M. (2002): Nexus: Small Worlds and the GroundbreakingScience of Networks; W.W. Norton & CompanyCastells, M. (2000): The Rise of the Network Society; BlackwellPublishersWenger, E.C./Snyder, W.M. (2000): Communities of Practice: TheOrganizational Frontier. In: Harvard Business Review, January-February, pp.139-145


Page 18


The Knowledge-basedNetwork Organisation

One of the main requirements for effectiveknowledge management is an organisationalframework that supports the optimal acquisitionand networking of knowledge. The knowledge-based network organisation is one suchpossibility.

Since knowledge is intrinsically linked to people,location plays an equally important role forknowledge as it does for other factors ofproduction. In “topographical” terms, anorganisation can be described as the sum of itslocations and departments (see Fig. 34).

However, if the focus is placed on “knowledge“,the change in perspective yields a totallydifferent picture. The organisation now appearsas a network of individual knowledge domains.This can be seen clearly in Figures 34 and 35,which depict the same organisational structure,but in two different forms.

A knowledge domain is not a subject area in thelexical sense: It is a social system that concernsitself with a common area of interest. Knowledgedomains can also be thought of as virtualdepartments “set up” to enable collectiveknowledge creation. Since the individualmembers of a given knowledge domain can bespread across different departments or locations,they will require support to ensure effectivecommunication. This can be achieved with anappropriate organisational framework, e.g. virtualdepartments with the same status as “traditional”departments.

Knowledge domains can also encompassmembers of other organisations. These mightinclude research staff at universities and researchinstitutions, or the employees of customers andsuppliers integrated in value creation processes.

One good example of this is the innovationprocess. New, innovative products are often theresult of close cooperation work with customersand suppliers. Some innovation activities mayeven be outsourced to external partners. Forexample, companies often finance researchprojects, dissertations or doctoral theses.

The network of internal and external knowledgedomains is described as a knowledge-basednetwork organisation. The responsibility forcoordination of the individual knowledgedomains lies with management, who need tomake two decisions based on the organisation’sbusiness strategy:

• Which knowledge domains to set up and develop internally (core competencies) and which to outsource

• The knowledge goals for the individual knowledge domains (see Fig. 36).

Management SummaryNetworking knowledge adds a new dimension toorganisational design. In addition to internalnetworking and links with other companylocations, increasing importance is now beingplaced on networking with external partners.

External knowledge domains

Self-organisation

Coordination

Organisation

Management

Knowledge holder

Production factorLocation 3

Location 2Location 1

L 1

L 3

L 2

Fig. 35: The organisation from a “knowledge” perspective

Fig. 36: Model of a knowledge-based network organisation

Fig. 34: The organisation from a “topographical” perspective

Locations L1, L2

Locations L1, L3

Locations L1, L3

Locations L2

Locations L3

Knowledge holder

Knowledge domain L

Knowledge domain J

Knowledge domain GKnowledge domain B

Knowledge domain M

Strategy Implementation with theIntellectual Capital Report

The process selected for the implementation ofan intellectual capital report will depend verymuch on the way an organisation currentlyoperates (management approach, businessindicators, etc.). However, the first step willalways involve examining existing businessprocesses to identify any relevant (anddocumentable) input. Emphasis should be placedon those business processes that most affect thedefined stakeholders. The indicators selected forthese processes describe the output. The effectof this output on the stakeholders can also beillustrated using relevant indicators or qualitativedescriptions. These initial steps establish theintellectual capital report model for theorganisation in question.

When implementing strategy, it is important toevaluate the individual main areas of focus andestablish activity (efficiency index) and quality(effectiveness index) indicators. If the intellectualcapital report is to be used as a steeringinstrument, output indicators that affect thetotal result of each individual selected area (e.g.product quality, reliability) must be chosen tocalculate the activity. Activity is thus anaggregated value made up of selectedcontributory factors from the individual businessprocesses (output).

In the same way, only selected process indicatorsshould be used to determine the qualityindicator. To consolidate the indicators for eacharea, the individual business processes areweighted according to their contribution tobuilding up expertise in a particular field.

The calculated activity can be combined withdefined employee skills and plotted on aknowledge map or included in anactivity/quality portfolio (see Fig. 38).

The activity/quality portfolio provides valuableinformation on the actual situation in anorganisation and illustrates current activitiesacross all selected areas. This can be used todefine future goals and draw up a target profileof activities (see Fig. 38).

This type of aggregation offers organisations ameans of breaking down their strategic goals to adepartmental or individual employee level.Appropriate changes in the activities carried outor quality levels achieved in individual areas canalso be initiated. For example, existing staff mayneed further training or additional staff mayneed to be recruited to increase activity in aparticular area. To improve quality, customersatisfaction must be measured and the resultsanalysed to identify appropriate measures.

Management SummaryIf an intellectual capital report is to be used as astrategic steering instrument, it must be carefullyplanned and include clearly defined indicators. Anactivity/quality portfolio provides information on thespecific business activities in an organisation.

An Illustrated Guide to Knowledge Management Strategic Knowledge Management


Recommended ReadingGraggober, M. (2002): Intellectual Capital Statement an instrumentto control strategic topics of an University Institute. In: 3rdMultinational Alliance for the Advancement of OrganisationalExcellence Conference; Scotland: University of Paisley; Emerald

Processes

Identification of relevant input(quantitative and qualitative description)

Selection of relevant stakeholders

Definition of processes

Allocation of output andimpact indicators to processes

Selection ofaggregation indicators

Weighting of processesacc. to relevance for main divisions

Quality

Act

ivit

y

Input Output Effect

Fig. 38: Derivation of strategic measures through target/actual comparison of work profiles

Fig. 37: Intellectual Capital Report: Implementation Process

Act

ivit

y

Quality

Act

ivit

y

Quality

The difference between target and actual affectsboth departmental and personnel development.

Example calculationfor a main division:

ProductionSalesInnovationNetwork

actual target

Main division X

Main division Y

Main division X

Main division Y

Knowledge Markets as StrategicInterfaces between Organisations

What function do organisations perform in asociety in which mobile knowledge workers arefaced with the choice of working freelance (i.e.independence) or adapting themselves to fit in anestablished organisational structure (i.e. financialsecurity)?

Even small, highly specialised companies have tochoose between pooling their resources andusing the synergetic effects of larger (virtual)organisations, or remaining independent andretaining their flexibility.

Can knowledge really be exchanged as fairly andeffectively in this kind of (often instable andunclear) marketplace as it is in the clearlydefined, stable processes common to anorganisational environment?

Markets use price mechanisms to regulate supplyand demand. However, some of thecharacteristics of knowledge make it difficult to“barter with”. This can force a company trying toestablish a long-term position on the competitiveknowledge marketplace to have to make animportant strategic decision.

Depending on both the market situation andtheir internal requirements, organisations orindividual bidders have two alternatives: Eitherintensive, long-term cooperation with a strategicpartner (insourcing) in a stable, specialisedenvironment, or flexible cooperation and evenbuying in knowledge on a short-term basis viamarkets or outsourcing partners in a highlydynamic environment.

At least three problems arise when negotiatingnon-standard services such as knowledge:

• Describability: Buyers do not always knowwhat they want and may find it difficult to

determine whether they have received what theywanted, even after having been provided with adescription of what to expect.

• Assessibility: Due to the difficulties involved inpredetermining the quality of the services, buyerscannot assess a fair price prior to receipt of theknowledge.

• Transfer: Once knowledge has been transferred“on a trial basis”, this cannot be reversed.Transferred knowledge might then not be paid for(e.g. if it were to become clear that the “wrongproduct” had been supplied).

These problems lead to the followingconsiderations for strategic protection ofknowledge resources:

The closer the link to core competencies, thegreater the focus should lie on internalknowledge; the greater the distance, the morefeasible it becomes to acquire the requiredknowledge via the marketplace. However, itremains unclear how these kinds of marketsmight best be organised to ensure effective andfair knowledge transfer. Regulatory measures andlegal restrictions will be necessary to minimisethe risks of a loss of company-sensitiveknowledge via (free) markets.

Management SummaryFrom a strategic point of view, it would appear wise tobuild up the core knowledge an organisation requiresto remain competitive internally, and only drawsupplementary knowledge from free markets.


Page 20

Recommended ReadingSkyrme, D. J. (2001): Capitalizing on Knowledge: From e-business tok-business; Butterworth-Heinemann,URL: http://www.kikm.org/portal/page2.htm

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Relevance and Overview ofTechnologies

Information and communication technologies(ICTs) offer valuable support for knowledgemanagement activities. Indeed, many tasks inknowledge management (e.g. communicationacross geographical boundaries and time zones)only really become feasible through the use ofappropriate technologies.

However, to ensure that they provide the supportrequired, the decision for any technology-basedsolution(s) should be driven by knowledgemanagement needs and not by technicalconsiderations. Discussing specific technicalsolutions before the actual knowledgemanagement goals have been set, or evenadjusting goals to suit technical constraints (andwithout considering people-oriented alternatives)are clear warning signals.

Establishing an overview of the differenttechnologies available and the activities theysupport can be very useful in the knowledgemanagement implementation process. The examplegiven in Figure 39 considers different technologieswith a view to seven basic knowledge managementactivities. Knowledge planning activities includethe definition of knowledge management goalsand strategies. Knowledge creating focuses on thedevelopment of new knowledge, whilst knowledgeintegration makes existing (internal or external)knowledge available throughout the company. Therole of knowledge organisation is to bringstructure into all this knowledge. Knowledgetransfer includes both planned, institutionalisedtransfer as well as spontaneous knowledgeexchange. Knowledge maintenance activitiesensure obsolete, out-of-date knowledge isidentified, updated or even "forgotten". Finally,assessing knowledge provides an overview of theknowledge available and determines how it has

developed over time. It also indicates the extent towhich knowledge goals have been reached.

Figure 39 gives an overview of the support that thedifferent technologies available can provide forknowledge management activities. An overallconsideration shows that knowledge planningactivities benefit least from information andcommunication technologies, and that they alsoonly provide limited support in knowledgeassessment. They are, however, particularlyeffective in knowledge transfer activities and alsoprovide sound support for knowledge integrationand organisation.

However, if all seven knowledge managementactivities are considered as a whole, the actualdifferences in the extent of the contributions madeby the individual technology groups are lesspronounced. Furthermore, the relevance offormats, standards and content generation toolsshould not be overlooked. They play a remarkablyimportant role, yet are often neglected. Documentmanagement systems continue to play a major rolein information technology based support forknowledge management. Figure 40 describes themost important contributions each of the differenttechnology groups makes to the individualknowledge management activities.

Management SummaryInformation and communication technologies canprovide a wide range of support for knowledgemanagement activities. However, technology shouldbe seen as an enabler and any knowledgemanagement initiatives should not be primarilytechnology driven.

An Illustrated Guide to Knowledge Management Information and Communication Technologies


Recommended ReadingRollett, H. (2003): Knowledge Management: Processes andTechnologies; Boston: Kluwer Academic PublishersShariq, S.Z. (1998): Sense making and artifacts: An exploration intothe role of tools in knowledge management. In: Journal ofKnowledge Management, 2(2), pp.10-19

Fig. 39: Extent of support provided by technology for knowledge management activities

Communicationtechnologies

PlanningKnowledge

CreatingKnowledge

IntegratingKnowledge

OrganisingKnowledge

TransferringKnowledge

MaintainingKnowledge

AssessingKnowledge

Collaborationtechnologies

Documentmanagement

Adaptation andpresentationtechnologies

E-learningenvironments

Content generationtools

Personal KM tools

Artificialintelligence

Networkingtechnologies

Formatsand Standards

Hardware

… this technology can make a major contribution to this activity

... this technology can often support this activity

... this technology makes little contribution to this activity

Information and Communication Technologies

Recommended ReadingMarwick, A. D. (2001): Knowledge management technology.In: IBM Systems Journal, 40(4), pp.814-830Smith, R.G./Farquhar, A. (2000): The road ahead forknowledge management. In: AI Magazine, 21(4), pp.17-40

Fig. 40: Contribution made by IC technologies to knowledge management activities

Communication technologies such as e-mail andvideo conferencing are particularly useful forknowledge transfer activities. They can also make asignificant contribution to knowledge creationactivities, where success often depends oncommunication between many people and/or acrossdifferent locations.

Collaboration technologies combine differentcommunication technologies with other tools (such asvirtual whiteboard and brainstorming tools) and makethem available in one single interface. Consequently,they can also contribute significantly to knowledgetransfer and knowledge creation activities. Workflowmanagement systems support structured forms ofcollaboration, in particular knowledge maintenance.

Document management and content managementsystems play a major role in integrating content, sincethey act as a collection point for all documentedknowledge. Classification schemes are one way oforganising this content. Search mechanisms facilitateknowledge transfer. One of the core functions of thesetypes of systems is the simplified maintenance of largeamounts of data.

Adaptation and presentation technologies includepersonalisation tools, visualisation tools and automaticrecommendation tools that forward relevant content.All these tools help facilitate knowledge transfer.Visualisation techniques also help to give a betteroverview of the complex structures involved inknowledge organisation.

The strengths of eLearning environments lie primarilyin the integration of different content and in helpingusers both to understand this content andcommunicate with each other, leading ultimately tofurther knowledge transfer. The testing componentsincluded in eLearning systems make them one of thefew technologies that can help with a detailedassessment of non-explicit knowledge.

Content generation tools include authoring tools andtechnologies for automatically generating newcontent. They provide support for knowledge creationand knowledge integration. Specialised tools are alsoavailable to help with the handling of the complexstructures encountered in organising knowledge. Mostof these technologies are not only useful for generatingcontent, they also provide support for knowledgemaintenance activities.

There are still relatively few personal knowledgemanagement tools available, but solutions do existto support activities like mind mapping or bibliographymanagement. These tools focus more on thedevelopment, organisation, integration andmaintenance of knowledge for personal use than onknowledge transfer.

Artificial intelligence is now being increasingly usedin knowledge management applications. Thesetechnologies are of most benefit to knowledgeorganisation activities, for example, the automatedclassification of documents. Agent technologies alsosupport knowledge integration and transfer.

Networking technologies rarely take centre stage inknowledge management initiatives. However, theyprovide the necessary infrastructure for many activities,and are particularly important for knowledge transfer.

The formats and standards relevant for knowledgemanagement range from file transfer formats and meta datastandards to common classification schemes. These are anecessary requirement for the efficient integration, organisation,and maintenance of content within an organisation and play aspecial role in knowledge transfer across corporate boundaries.

Last, but not least, hardware provides the necessaryinfrastructure for all the other technology groups alreadymentioned. Suitable input and output devices are becomingmore and more important for knowledge transfer activities, withaudio/video equipment and mobile devices playing an everincreasing role.

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Selection Procedure

Information and communication technologiescan obviously make a significant contribution tooperative knowledge management. However, itmakes little sense to focus on the actualtechnologies to be used before work processeshave been analysed and the relevant linksbetween data and knowledge identified. Thetechnical selection process should always bebased on the goals a company has set for itsknowledge management activities. This, ofcourse, requires a detailed consideration of allaspects involved.

A strengths/weaknesses analysis of the existingcomputer infrastructure determines thetechnical starting basis in the organisation. Theresults of this analysis can then be used to drawup the list of criteria for the remainder of theselection process. Additional requirements canalso be identified by holding personal interviewswith selected potential users (this process of"involving the involved" is highly recommended).In a subsequent two-stage evaluation process,the most appropriate information andcommunication technologies can then beselected from the wide range available.

The fact that there is no need to actually test theproduct in the first stage of the evaluationprocess increases the efficiency of the selectionprocess. At this stage, a cost-benefits analysisusing appropriate, predefined criteria should besufficient. Figure 41 lists some possible analysiscriteria.

Only three to five of the "top" software productsfrom stage one should be selected for inclusion inthe second stage of the evaluation process.Possible selection criteria in this stage includeuser-friendliness and the time and costs that arelikely to be involved in implementing the solution(incl. customising). The results of the evaluation

can then be plotted on a portfolio analysis grid(Fig.42). User-friendliness can be evaluatedusing a number of scenarios designed to test theproduct in realistic day-to-day business cases. Acost-benefits analysis can also be used to assessuser-friendliness. In this phase, it is particularlyimportant to compare the test products with anyexisting solutions in the organisation to establisha clear picture of the potential improvementsthey could bring. Implementation costs includeboth hardware and software costs. The time andeffort required to implement the chosen solution(training courses, internal implementation)should also be calculated as part of theimplementation costs.

Any costs incurred in the evaluation process(primarily in phase two, including the costs ofdefining test scenarios, operational tests,software costs, etc.) should be seen as anecessary investment in a comprehensiveselection process. These costs should later beamortised by the selection of a tool that bestsuits company requirements.

Management SummaryA systematic and methodical approach to theselection process enables an organisation to select thetechnology best suited to support their knowledgemanagement activities. This requires a holisticapproach and must begin with an analysis of theexisting situation in the organisation.

An Illustrated Guide to Knowledge Management Information and Communication Technologies


Recommended ReadingStallings, W. (1992): Operating Systems; New York

Main criteriaSubcriteria

Knowledge ManagementDocument ManagementContent ManagementProject Information SystemCommunicationWorkflow

Main focus of application

Web presenceHomepage initial impressionCommunication policy

Support/Services

Updates via InternetNewsgroups and Discussion BoardsSupport HotlineFunctions availableDemo version available

System requirementsHardwareSoftwareNetwork protocol

Program/data interfaces

Import formatsExport formatsInterfaces to other softwareHardware interfaces

General product characteristics

ManufacturerVersionTest reports (magazines/newspapers)ReputationLanguage versions

Basic knowledgeAvailable basic knowledge

CostsBasic LicenceFull LicenceStandard LicenceDiscount possibilities

Licencing termsMaintenance contractsLicence costsUpward compatibility

References Reference sites

Subcriteria

Fig. 42: Portfolio for visualising evaluation results

Fig. 41: Possible criteria for evaluating software products

Implementationefforts

Use

r-fr

iend

line

ssH

igh

Low

Implementationcosts

High Low

Product X

Product Z

Quadrant forbest solution

Currentsolution

Product Y

Linking Innovation and KnowledgeManagement

Innovation means renewal and change, but intoday’s business world it has come in particularto mean the development of new corporateservices, products, processes and structures. Thedevelopment and application of new knowledgeis the basis of innovation, emphasising the stronglinks between innovation and knowledge.

The core competence of a company can bedivided into several levels (Fig. 43). Activities at aknowledge domain level focus on the continueddevelopment of the core knowledge domains. Ingeneral, this involves a variety of differentknowledge holders and can also include externalknowledge domains and expertise fromcooperation partners.

Combining the factors of production (including inthis case knowledge) leads to the development ofcore competences, core products and, ultimately,end products. In other words, returns aregenerated from any knowledge created.

This can be a long process and it may well takeseveral years from knowledge development untila response is received from the target market forthe products and services. Organising this processis one of the tasks of professional innovationmanagement. Effective innovation managementsteers the process from knowledge developmentto realisation and commercial exploitation of theresults.

The market therefore acts as an externalevaluator of innovation and knowledgemanagement. An internal evaluation can becarried out by visualising the development of thecompany’s core competences and culture in formof a core competence tree. Ideally, the corecompetence tree should be constructed in such away that the same knowledge can be used torealise any number of different customer

solutions (Fig. 44).

Individual customer demands and requirementscan be taken into consideration throughcustomisation and diversification at an endproduct level. This can only really be achieved byfocusing on a standardised, modular range ofcore products. Many companies neglect thisfactor and are instead forced to invest heavily innew development to meet customer orders.

Management SummaryThe core competence tree forms the basis for theplanning and implementation of innovation projectsand emphasises the close links between innovationand knowledge management.

An Illustrated Guide to Knowledge Management Knowledge and Innovation Management


Recommended ReadingHamel, G. (1999): Competing for the future, 11th edn; Boston:Harvard Business School PressPorter, M.E. (1998): Competitive strategy: Techniques for AnalyzingIndustries and Competitors; New York


Business sector 1 Business sector 2 Business sector 3 Business sector 4

PF 1PF 2

PF 3 PF 4

KD 3 KD 5KD 1

KD 2 KD 4

Marketing/Sales/Customer Relationships

Knowledge Management/Alliance Management

Core product 1

P = End products and services PF = Production Factor KD = Knowledge Domain WT = Knowledge Holder

Core product 2

Innovatio

n man

agem

ent

Fig. 44: Managing the core competency tree

Fig. 43: Innovation management turns knowledge into profit


Business sector 1 Business sector 2 Business sector 3 Business sector 4

PF 1PF 2

PF 3 PF 4

KD 3 KD 5KD 1

KD 2KD 4

Diversification

Focus on and fostering ofcore knowledge domains

P = End products and services PF = Production Factor KD = Knowledge Domain WT = Knowledge Holder

Standardisation and Modularisation

Inclusion of

external subject a

nd

method expertise

Core product 2Core product 1

Supporting Innovation withKnowledge Management

The impetus for innovation projects can comefrom two different sources (Fig. 45): Unplannedinnovation occurs directly in day-to-day businessactivities and is often the incremental result of anew customer project. Planned innovation onthe other hand actively utilises the knowledgeresources available both in and to the company indeveloping new value-creating projects.

Periodic innovation checks serve to analyse thestatus of a company’s core competence tree, aswell as relevant trends and developments in itsenvironment. The results can then be used todevelop or modify an innovation strategy anddefine the scope and aims of innovation projects.

In practice, it has proved effective to split aninnovation process/project into the followingphases:

• Developing ideas

• Testing ideas

• Realising ideas

• Exploiting ideas

The development phase focuses on applyingcreativity methods (e.g. brainstorming) to identifyor unlock creative potential. The most promisingideas (success rate approx. 12%) are then filteredout in the testing phase. The ideas should nowbe researched in detail to ensure they are notalready covered by existing intellectual propertyrights. New knowledge can by protected bystrategic patenting.

Promising ideas that pass the testing phase arethen developed in the subsequent realisationphase. Project management, knowledge logistics,

business planning and innovation marketingactivities are all key elements in this phase. In theexploitation phase, the new products, servicesor licences must be turned quickly into profits.

Knowledge management forms the basis foreffective and efficient innovation management.In line with the Basic Model of KnowledgeManagement described in Figure 11, this involvesinteraction between three different levels (Fig.46). The project level must be clearly structuredinto the four innovation phases described above.The experts (with their professional andmethodological knowledge and social skills) arelocated on the knowledge level andcommunicate directly with the project level. Allthe data and documents relevant to innovationare collected at the data level. These can bemade available throughout the innovationprocess using modern information andcommunication tools. Smooth integrationbetween the knowledge and data levels is a keyfactor in successful innovation projects.

Management SummaryA clear definition of the individual innovation phasesand optimal links between the knowledge, data andproject levels form the basis for successful innovationprocesses.



Recommended ReadingHamel, G. (1999): Competing for the future, 11th edn; Boston:Harvard Business School PressPorter, M.E. (1998): Competitive strategy: Techniques for AnalyzingIndustries and Competitors; New York

Planned innovation Unplanned innovation

Developingideas

Testingideas

Realisingideas

Exploitingideas

Innovation check

Environment 89%

Company 11%

Trigger

Innovation strategy

Product search fields

Fig. 46: Knowledge processes in innovation projects

Fig. 45: Different innovation activities in a company

Wissensebene

Knowledge of methodsProfessional knowledge

Social factors

Developingideas

Testingideas

Realisingideas

Exploitingideas

Data level

Process descriptionsLessons learnedStatistics

Knowledge level

Optimising Problem-solvingProcesses

Despite the appearance of a large number ofelectronic support tools, there have beenrelatively few other changes in the way problem-solving processes are carried out. A process-oriented approach to problem-solving can greatlyimprove efficiency and effectiveness. A focus onthe knowledge perspective in the organisation ofsuch processes emphasises the potentialsynergies between process and knowledgemanagement, as the procedure shown in Figure47 clearly illustrates. Problem-solving processeshave to be designed to suit the actual businesscase and should make use of existing companyknowledge. For example, involving the actualstaff affected in the design of problem-solvingprocesses can turn acceptance into a successfactor and can lead to radical improvements inthe way problems are solved. The following listshows some common examples of weaknessesin actual problem-solving processes:

• No problem-solving process is defined.

• “Bad experiences” were suffered with existing problem-solving processes.

• Experiential knowledge is not used to improvethe process (e.g. databases or expert groups).

• Problem-solving does not form part of day-to-day business routines. No additional resources (time/staff) are allocated to problem-solving and no motivation systems exist.

• No systematic analysis of the cause of a problem is carried out and more emphasis is placed on curing the symptoms. Problems are assessed subjectively “by instinct”.

• A problems database with a complicated user

interface and bureaucratic access restrictions blocks information and documentation processes.

• Knowledge requirements are not identified forthe individual phases in the problem-solving process. Staff are allocated to a problem according to availability (and not for their expertise or knowledge).

• No consideration is given to the possibility of integrating external knowledge holders in the problem-solving process.

• Developing the solution is not seen as part of the problem-solving process.

• The development of the solution is not planned in advance, which causes delays in the whole process.

If an organisation demonstrates more than twoof the above weaknesses, it would be urgentlyadvised to review and improve its problem-solving processes. Some possible suggestions forimprovement are given in Figure 48.

Management SummaryAs the number and complexity of problems continueto grow, an optimisation of problem-solving processesbecomes increasingly essential. The degree of urgencycan be determined by evaluating a few key factors.



Recommended ReadingBateson, G. (1972): Steps to an ecology of mind; New York

Knowledge-basedproblem-solving process

Solution

Analysis ofproblem

Target ≠ Actual

Development ofsolution TargetTarget Actual

Realisation ofsolution

Target =Actual

DataKnowledge

Anal

ysis

Des

ign

Process

Knowledge management

Stakeholder managementProcess management

Demands

Weaknesses

Fig. 48: Design suggestions for problem-solving processes

Fig. 47: Analysis and design of problem-solving processes

Detailed problem analysis using thefollowing steps:�Problem prioritisation�Problem structuring�Specification of the knowledge neededto solve the problem

Introduction of process management inproblem-solving processes:�Definition of process owner and processmanager�Definition of process control measures

Integration of external knowledge holdersin problem-solving processes

Introduction of Problem Practice Groupsfor transfer of experience

Homogenisation of knowledge aboutproblems in general and problem-solvingmethods (training courses)

Evaluating Problems

One of the key issues in problem-solving isdetermining the potential threat an unresolvedproblem could pose to the company. This factorcan be used to prioritise problems and allocateappropriate resources to find a solution. Thethreat potential is a non-dimensional indicator ofthe extent to which an actual problemjeopardises company survival. The ability of anorganisation to survive depends primarily on itscapacity to meet stakeholder requirements. Froma knowledge management perspective, thisrequires acquiring appropriate knowledge on thestakeholders and their requirements, which canthen serve to determine the possible effect aproblem might have on the organisation’s abilityto meet these requirements and, ultimately, tosurvive. One possible method for determining thethreat potential is illustrated in Figure 49.

From symptom to problem: The term “problem”is generally used to refer to any deviationbetween the target/actual situation or desiredsituation/reality. A systematic approach toproblem-solving looks to differentiate betweenthe symptoms (i.e. the problem in the broadersense) and the roots of the problem (i.e. theproblem in the narrower sense). The followingexample clearly illustrates the relevance of thisdifferentiation: A gearbox manufacturer realisedthat a ball bearing was breaking down after onlya few hours of operation, causing enormousproblems for its customers. The urgency of thesituation prompted the manufacturer to take theimmediate action of adjusting the tolerance ofthe bearing. Although this was a slightimprovement, it did not solve the actual problem,and the gearbox manufacturer found itself facedwith huge costs as a result of the continuedbreakdowns. No attempt was made to determinethe root cause of the problem, and the measurestaken only really addressed the symptoms, not

the problem itself. In this example, acomprehensive assessment of the threatpotential would, however, have uncovered theurgent need for a detailed analysis of theproblem.

In addition to tried-and-tested methods (e.g. theIshikawa diagram), analysing the factorsinvolved is an excellent way of determining thecause of a problem, since it isolates the "main"cause (i.e. the problem in the narrower sense)from the larger number of possible causes(Fig. 50).

Management SummaryPrioritising problems according to their threatpotential is a particularly effective method of ensuringappropriate resources are allocated to company-wideproblem-solving activities. The identification of theroot cause of the problem must play a central role inany problem-solving process.



Determine the relevantstakeholdersStep 1

Rank the stakeholders by thefollowing criteria:a) Possible powerb) Will to use this power

Step 2

Step 3Determine the value generators(reflect the degree to which stakeholderrequirements are met and can beinfluenced)

Step 4Weight the value generators takingthe stakeholder rankings into account

Step 5Grade the effects of a problem onthe value generators

Multiply the effects and weightingof a value generator to calculate thepartial extent of a threat

Step 6

Add up the partial threats tocalculate the total extent of a threatStep 7

Fig. 50: Determining a problem in the narrower sense

Fig. 49: Determining the possible extent of a threat

1. Determinepossiblecauses

Cause A“body”

Cause B“shaft”

Cause C“nut”

Cause D“cog”

Cause E“bearing”

Cause F“shaft”

Cause A“body”

Cause B“shaft”

Cause C“nut”

Cause D“cog”

Cause E“bearing”

Cause F“shaft”

Symptoms“concentricity

deviation”

Problem in thenarrower sense

Problem in thebroader sense

2. Linking ofpossiblecauses

Explanation of Point 2:Analysis is carried out to determine theinfluence of possible causes on eachother. The level of influence is

measured in three stages (thickness ofarrows). Adding these up determinesboth the influence a cause has and howit is influenced by other possible

causes. Those with the greatestinfluence and which can themselves beinfluenced most can be considered tobe the problem in the narrower sense.


Recommended ReadingEdvinsson, L./M.S. Malone. (1997). Intellectual Capital: Realizing YourCompany's True Value by Finding its Hidden Brainpower; New York:HarperBusinessEdvinsson, L. (1997): Developing Intellectual Capital at Skandia. In:Long Range Planning. Vol. 30, Nr. 3: pp.366-373Stewart, Th. (1998): Intellectual Capital, The New Wealth orOrganizations; Bantam BooksSveiby, K.E. (1997): The New Organizational Wealth. Managing andMeasuring Knowledge Based Assets; San Francisco

Measuring Knowledge

Page 28


Basics of Measurement

A closer look at the issues involved in “knowledgemeasurement” requires a broader definition ofknowledge than given at the beginning of this guide.There are two main reasons for this: The problemsinvolved in embedding knowledge in operationalprocesses and the complexity of knowledgeprocesses. Consequently, no single measuringmethod will be suitable for all processes.

Intangible assets can be divided into a number ofcategories (see Fig.51), with each category posing itsown challenges. These include intangible assetsprotectable by law (e.g. by patents, trademarks,copyrights, etc.) and those for which no legalprotection is available. This distinction is particularlyrelevant for creditor protection.

Although intangible assets are often referred to incontrolling or accounting terms as "intellectualcapital", "intellectual assets" is in fact a moreaccurate term. Intellectual capital is made up of threecomponents: Human capital, structural capital andcustomer capital. In the past, these were not includedin financial statements, and are therefore oftenreferred to as the "invisible" balance sheet (Fig.52).

There are a number of reasons for measuring theproductivity of knowledge and intangible assets. Therelative proportion of intangible assets (Fig.53) toboth total corporate assets and the goods andservices that constitute gross national product hasbeen on the rise for many years and currently standsat 60%. This increase comes at the expense oftraditional resources such as capital and (manual)labour, and continued observation of this trend willbecome increasingly important in the future.

Intangible assets show a positive marginal utility, thuscontradicting the classic rules of economics (i.e.although the development costs of knowledgeproducts are only incurred once, the productsthemselves can be sold over and over again). Thisincreases profits and, ultimately, corporate value.

The vast majority of organisations now usecomprehensive cost calculation methods todetermine production costs and establish pricinglevels. The challenge in the future will be to determineand assess intangible assets, thus enabling them toalso be taken into account in pricing calculations.Some of the best examples of this can be found in theservices sector, where soft factors (e.g. creativity,working atmosphere, communication flows,organisational culture, etc.) play a far more importantrole in the development of new products or servicesthan material flows.

However, the most important reason for addressingthe issue of measurement is that it will inevitablydirect the discussion back to questions of corporatestrategy, internal communication, organisationalgoals, etc. This initiates an organisationaldevelopment process, which, in turn, promotesincreased awareness of the new rules of business. This“detour”, which in itself would usually be sufficientgrounds to merit a project, will almost always have apositive (soft!) effect on overall productivity.

Management Summary"If it's not measured, it can't be managed". However,effective measurement requires appropriate indicatorsand transparent cause-effect relationships. Neither ofthese are always readily available, particularly in thecase of intangible assets. As an added benefit, boththe actual process of measuring and thecommunication initiated by measurement processeshave a positive influence on the organisationalknowledge base.

Protectable by Law

Not Protectable by Law

PatentsTrademarks

PatternsCopyrights

Intellectual CapitalCore Processes

Corporate CultureClimate of Innovation

Your organisation Other organisation

Fig. 52: New balance sheet dimensions

Fig. 53: Decoupling of market and book value

Fig. 51: Classes of intangible assets

In addition to the "visible” or tangible assets that are well documented in classic financial accounting, Sveiby also refers to an "invisible” part, which analogously represents the roots below the (earth’s) surface for the financial gains that it grows.

Tangible Assets Visible Assets

Intangible Assets Invisible Capital

Fixed assets

Variable assets

Structural capital

Human capital

Customer capital

Short-term liabilities

Long-term liabilities

Equity

Invisible equity

Obligations

Company Value

Book valueMarket value

Time


Recommended ReadingMouritsen J./Larsen H.T./Bukh P.N.D. (1998): Intellectual Capital andthe ‘Capable Firm’: Narrating, Visualising and Numbering forManaging Knowledge; Copenhagen Business School and AarhusSchool of BusinessReinhardt R./Bornemann M./Pawlowsky P./Schneider U. (2001):Intellectual Capital and Knowledge Management: Perspectives onMeasuring Knowledge. In: Dierkes M./Berthoin Antal A/ChildJ./Nonaka, I.: Handbook of Organizational Learning; London

Measuring Knowledge

Page 29


Measurement Methods

Based on the knowledge processes defined inFigure 68, key areas important to each relevantissue (e.g. the effectiveness of knowledge transferprocesses) are identified. Barriers to knowledgetransfer may also emerge at this stage (e.g.communication problems, organisationalpeculiarities or privileges).

Once the key areas have been determined, a detaileddiscussion of what they involve will usually sufficeto determine potential bottlenecks or indicators.This discussion leads to the creation of a completeset of indicators or financial metrics, which thenneed to be made manageable. It is extremelyimportant that the indicators chosen make senseboth to the people involved and to managementand that a consensus is reached on any definition(s).Although not essential at this stage, it can also beuseful to consider their compatibility with externalbenchmarks.

Typically, gaps will be identified between the targetsituation (e.g. knowledge goals or design measures)and the actual situation, and measures will have tobe introduced to address these gaps (e.g. additionaltraining courses, organisational changes, processredesign). This is when the complete spectrum ofmeasures available to knowledge managementcomes into its own. Furthermore, these gaps aregenerally an excellent source of further relevantindicators. There is now a wide range ofmeasurement methods available, although notevery method is suitable for every purpose.

There are basically two approaches to measuringintangible assets (see Figure 55):

a) Monetary: Using financial indicators such asmarkets, costs or discounted cash flows (DCF)

b) Non-monetary: Using other indicators drawnperhaps from balanced scorecards or strategicplanning.

Whilst both these approaches are in essence equallyeffective, they are not always interchangeable for anumber of reasons, including:

• The lack of a market to act as a basis for measurement

• Costs do not reflect value: Either no real value was generated (i.e. a loss) or positive scale effectsled to multiple returns on investment not relevant for measurement

• No accurate prediction can be given of the possible return on investment (the basis for calculating amortisation)

• Problems with the discount factor when applying DCF methods

Similarly, many of the indicator systems designed todetermine company-specific, relevant intangibleassets are open to the following criticisms:

• The indicators used are not comparable with those used by competitors or other industry branches,

• Intangible assets indicators have to be interpreted in a complete corporate context (i.e.take into consideration factors such as the market, product life cycles, degree of corporate development, etc.).

Management SummaryTraditional measurement methods are no longerproving adequate in today’s “new economy”. Newindicators must be found and adapted to suitcorporate requirements. In addition to the selection ofan appropriate measurement method, an accurateinterpretation of results is of primary importance forsubsequent strategic decisions.

Marginal utility of tangible assets vs. intangible assets

Obsolete knowledge

Utility

Time

Tangible Assets = decreasing marginal utility Intangible Assets = increasing marginal utility

Fig. 55: Measurement methods

Fig. 56: Half-life of knowledge

Fig. 54: Increasing marginal utility of knowledge

Monetary• Market-based• Cost-based• Discounting of future revenue• Real options

Non-monetary• Structural models• Balanced Scorecard• Process models• EFQM

Type of knowledge

Learning effort

Rapid economic benefits

Long Half-life

Theoretical, Basic, Scientific

High – months, years

No Yes

Short Half-life

Professional, Experience

Low – days,

weeks or months

Half-life of knowledge

Knowledge development Loss in value

long half-life short half-life

Time

Intellectual Capital Report Model

There is no longer any doubt of the increasingimportance played by knowledge in value-creating processes. The challenge now faced ishow to make the most effective use ofintangible assets. This requires bothrepresentation and measurement of theorganisational knowledge base, which in this caseincludes not only human capital, but also otherfactors such as existing organisational structuresand customer relationships. The intellectualcapital report has already established itssuitability as a representation and measurementtool and is an effective method ofcommunicating corporate goals, strategy andbusiness activities to both external and internalaudiences. However, its more importantapplication lies in its use as a strategicinstrument in the steering of key organisationalareas and in supporting personnel development.

Figure 57 shows a basic model for producing anintellectual capital report focusing on thefollowing components: General requirements,input, work processes, output and effect. Generalrequirements can be set externally bystakeholders and market requirements andinternally by corporate strategy and goals. Theyinfluence the focus of the key areas of corporateactivity and also have an effect on any personneldevelopment measures directly related to theseactivities.

The input indicated in the model represents theintellectual capital available to an organisation tocarry out its business objectives. Intellectualcapital is divided into human, structural andcustomer capital, and each of these threecategories are generally described either in termsof quantity (using indicators) or quality. Theseassets are actively applied in the company’sbusiness processes. If key processes havealready been defined (e.g. as part of quality

management procedures), they will generallyonly need to be marginally adapted for use in anintellectual capital report. The results are thenallocated as output to the individual processesand are usually described quantitatively usingindicators. The input is then compared with therelevant output to draw conclusions on howefficiently the company’s intellectual capital isbeing put to use.

The effect of this output on society, industry andthe environment is represented by impactindicators, collected, for example, throughsurveys or by measuring customer andstakeholder satisfaction. This is probably the mostdifficult and time-consuming factor to assess. Itis represented in terms of quality, e.g. thesubjective opinions of customers, and ismeasured using a standard scale. Figure 58shows a simplified model of this process andincludes some example indicators and companyprocesses.

Management SummaryAn Intellectual Capital Report supports anorganisation in the identification and effective use ofits intellectual capital. A process-oriented, structuredapproach can be used to assess how efficiently thiscapital is being invested. Impact indicators describethe effect of the organisation’s products and serviceson its environment.

An Illustrated Guide to Knowledge Management Measuring Knowledge


Recommended ReadingDanish Agency for Trade and Industry (2003): Intellectual CapitalStatements - The New Guideline; Copenhagen: Danish Agency forTrade and Industry. URL: http://www.vtu.dk/icaccountsEdvinsson, L./Malone, M.S. (1997): Intellectual Capital: Realizing yourcompany´s true value by finding its hidden brainpower; New York:HarperCollinsSveiby, K.E. (1997): The New Organisational Wealth: Managing andMeasuring Knowledge-Based Assets; San Francisco: Berrett-KoehlerPublishers, Inc.

Human capitalStructural capitalCustomer capital

Activity(internal view)

Quality(external view)

Input Output Impact

Intellectualcapital Work processes Effects

PoliciesStrategiesGoals

Generalrequirements

Fig. 57: Basic model for an Intellectual Capital Report

Input Output Impact

Intellectualcapital Work processes Effects

Fig. 58: Intellectual capital model showing processes and example indicators

Fig. 59: Practical hints for implementing and using an intellectual capital report

•Choose a simple, clear and transparent model for the intellectual capital report

• Integrate and use it in existing management systems

• Involve as many employees as possible in the development process andcommunicate results throughout the organisation

•Avoid multiple collection of the same data

•Don’t simply use the method to produce a report once a year, use it internally inday-to-day work

Human capitalInternal staffStaff satisfaction (%)Training days peremployee

Structural capitalManagement systemICT investment per year

Customer capitalAlliance partners

ProductionProduct quality(specification deviations)

SalesReliability (%)

InnovationNew products per year

Network activitiesMulti-companyprojects per year

MarketingProposals per year

Follow-on projects (%)Customer satisfaction (%)No. of complaints per year

Customer satisfaction (%)

No. of patents per year

No. of multi-companyprojects per year

No. of orders per yearNo. of company visits per year


Recommended ReadingBornemann, M./ Leitner, K.H. (2002): Measuring and ReportingIntellectual Capital. The case of a Research Technology Organisation.In: Singapore Management ReviewChoo, C.W. / Bontis, N. (2002) The Strategic Management ofIntellectual Capital and Organisational Knowledge; Oxford

Measuring Knowledge

Page 31


Learning Effects

The Austrian Research Center Seibersdorf hasdeveloped an excellent, integrated model formeasuring intangible assets. Their "IntellectualCapital Report" addresses all stages of thecorporate life cycle: From definition of vision andstrategy, setting of knowledge goals andindividual operational processes, through toexploitation of results.

Knowledge processes and intangible assets aredifferent to traditional (material-based) businessprocesses. Appropriate measurement indicatorscan be defined at all points where these value-creating and knowledge processes meet. Theseindicators can then, in turn, be integrated intothe organisation’s management processes.However, a correct interpretation of the results isfar more important than the actual indicatorsthemselves. This is by no means an easy task,since (unlike financial indicators) there is a

distinct lack of standard reference modelsavailable for measuring intangible assets.

The intellectual capital report follows the modelillustrated in Figure 61 and is the result of 18months of intensive research. A number ofvaluable lessons were learned in the course ofthis project, and some of the most importantlessons learned have been summarised to formthe list of failure criteria for knowledgemanagement shown in Figure 60.

This project further confirmed both theimportance of organisational culture inknowledge management and the relevance of the(time-consuming, yet worthwhile)implementation process. Real value can only becreated in a culture that is open to knowledgesharing and in which knowledge managementforms an integral part of day-to-day business.

Fig. 60: Failure criteria

Fig. 61: IC model used at Austrian Research Center Seibersdorf

HOW TO FAIL AT KNOWLEDGE MANAGEMENT

• Redefine your organisational goals at regular intervals

• Restructure your organisation at regular intervals

• Start several unrelated projects and label them all “knowledge management”

• Use a model that is far too complex

• Keep indicators as vague as possible

• Use indicators that neither hurt nor interest anyone

• Get several project groups or departments to collect the same data at the same time

• Organise long meetings just to discuss definitions (goals, strategy, etc.)

• Focus on qualitative indicators and change the people involved on a regular basis

• Don’t explain the benefits to either management or staff

• Consider knowledge management as a one-man-show and avoid discussing it with others

• Don’t discuss results or set any actions

• Let your tax advisor, PR agency, journalists or management consultants draw up your assessment

models.

Corporate goals

Value creation potential

Core processes Results

Financial results

Intangible results

Knowledge goals

Human capital

Structural capital

Customer capital

Customer projects

Research programme

Vision

Knowledge Management Assessment

The aim of a knowledge management assessmentis to measure the benefits to the organisation ofany knowledge management activities. The basisfor this assessment is a selected range of relevantmeasures derived from the basic model ofknowledge management. These measures can bepresented in a matrix diagram (Fig. 62) consistingof four individual levels (the knowledge, process,data and goals levels) and four differentperspectives (human, communication/ interaction,organisation and organisational environment).

The purpose of the assessment is to evaluate theextent to which an individual measure influencesthe organisation's ability to meet stakeholdergoals. In this way, the organisation is able todetermine the actual contribution a particularknowledge management activity makes tomeeting stakeholder expectations and, at the sametime, illustrate the real benefits generated byknowledge management.

The analysis takes the form of a self-assessment ofthe organisation (or an individual division) by anassessment team. The makeup of this team isextremely important and to ensure that highquality, wide-ranging results are achieved, careshould be taken to select members with a widespread of knowledge and experience of allactivities, processes and relationships/context inthe area to be assessed. It is also advisable toinvolve members of the management team andrelevant subject experts.

The assessment is carried out in seven steps:

1. Identify target assessment area: Select thetarget area for the knowledge managementanalysis.2. Establish target criteria: Define the relevantstakeholders for the area to be assessed andestablish target criteria to describe theirexpectations.

3. Define the ideal situation: Define the desiredideal situation for the goals, knowledge, processand data levels based on stakeholder expectations.

4. Determine factors of influence: Determinethe factors that influence the ideal situation fromthe human, communication/interaction,organisation and organisational environmentperspective on each of the four levels.

5. Identify drivers: Identify the most importantdrivers for each of the sixteen fields of action.

6. Prioritise fields of action: Assess the influenceof these drivers on the target criteria and use theresults of this assessment to prioritise the fields ofaction.

7. Set measures: Set specific measures to be takenin each field of action, taking into considerationthe main factors of influence for each area.

The result is a prioritisation of all sixteen fields ofaction (Fig. 63). This enables the organisation to setknowledge management priorities and decidewhether it would, for example, be more beneficialto introduce measures in the field of personneldevelopment or to opt for the implementation ofa new software tool. This is extremely important if,as is often the case, the organisation only has alimited budget for knowledge managementactivities and has to select from a large number ofproposed, bottom-up projects.

Management SummaryA knowledge management assessment offersorganisations a systematic method of determining therelevance of individual fields of action and settingpriorities for knowledge management activities.

An Illustrated Guide to Knowledge Management Implementation


Recommended ReadingBornemann, M./Sammer, M. (2003): Assessment Methodology toprioritize Knowledge Management related activities to supportOrganizational Excellence. In: Measuring Business Excellence. Vol. 7,No. 2,URL:http://www.knowledgecheck.net/download/km_assessment.pdf

Human CommunicationInteraction Organisation Organisational

environment

Knowledge level

Process level

Data level

Strategy level

Personneldevelopment

Enablecommunication

Organisationaldevelopment

Strategicalliances

Knowledge-basedrole division

Systematic useof methods

Processdesign

Networks,Start-Ups

Documentationsystems,

intelligent agents

Communicationservices,

Yellow Pages

Databases,IT solutions

Externaldata sources

Staff assessmentmeetings,

target agreements

Intellectual CapitalReports,

Communication of goals

Definitionof

corporate goals

IntellectualCapital Reports

Fig. 62: Grid and examples of possible fields of action

Target criteria

DriversFields of action

∑

Customers

HumanCommunication/Interaction

OrganisationOrganisational environment





Knowledge level

Process level

Data level

Goals level

Open to new knowledgePromotion of teamwork

Communication structuresUse external knowledge sources

Staff assessment meetingsEnsure goals convergeClear corporate goals

Consider customer goals

…………

…………

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1211

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1201

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1111

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1100

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4623

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2143

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No.

Owners

Lead

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imal

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ent

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t

Last

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incr

ease

inm

arke

t sh

are

… …

0 ... no influence1 ... limited influence2 ... strong influence

Assessment of influence between drivers and target criteria:



Fig. 63: Prioritisation of fields of action

Approaches to IntroducingKnowledge Management

Two of the key factors in the successfulimplementation of knowledge management arewillingness on the part of the employees involvedand a methodological approach to any initiatives(Fig. 64). If either of these aspects is ignored,there is an increased risk that the project will notachieve its goals. Willingness comes from thoseaspects of corporate culture that allow themembers of an organisation to act appropriatelyin a given situation, such as motivation andvalues. Methodology, on the other hand,highlights the use of particular procedures andconcepts in knowledge management.

A culture-driven introduction of knowledgemanagement (quadrant 1) is characterisedprimarily by a high degree of voluntary action,rather than deliberate application of specificmethods. It focuses on raising awareness of theimportance of knowledge in all aspects of work.In this kind of environment, sharing knowledgewith others and actively reflecting on knowledgeis considered second nature. “Sharing knowledge”becomes far more important than the idea that“knowledge is power”.

A targeted, methodical implementation(quadrant 2) looks to actively steer the “flow ofknowledge” between all members of staff. In thiscase, appropriate methods are introduced tofocus creative potential on the organisation’sstrategic goals. This type of approachconcentrates on generating, developing,distributing and evaluating knowledge in linewith company strategy.

A management-driven introduction (quadrantIII) focuses on the targeted and continueddevelopment, adaptation and application ofspecific knowledge management methods inpilot projects or areas.

Unfortunately, the lasting success of any effortswill remain nothing more than an unrealisablewish (quadrant IV) if people are not willing toparticipate and no concrete methods are used. Itwould appear impossible for knowledgemanagement to make a positive, lastingcontribution to company success without takingcultural aspects into consideration or withoutmethodological support. What can be done toimprove the situation if staff are neithermotivated nor open to knowledge managementand no concrete methods are available?

Figure 65 shows some examples of possiblemethods and suitable projects for each of thethree different approaches described above. Theintroduction of such methods will increase thechances of success of any knowledgemanagement implementation.

It is important at this stage to mention the roleof information and communicationtechnologies (ICTs) in the portfolio of measuresdiscussed. ICT tools cannot be placed definitivelyin any one particular quadrant, since they canplay a key role in each of the possible approaches.ICTs assume an important support function, butshould not be the primary focus in theintroduction of knowledge management.

Management SummaryWillingness of staff to participate and the specific useof appropriate methods are two of the key factors inthe introduction of knowledge management.



Recommended ReadingKolb, D.A. (1984): Experiential Learning: Experience as The Source ofLearning and Development; Englewood Cliffs (NY)Nonaka, I./Takeuchi, H. (1995): The Knowledge-Creating Company;Oxford University Press

Management-driven

Unrealisable wish

Targetedmethodical

Culture-driven

e.g.Safeguarding experience

eLearningKnowledge-oriented

process analysis

e.g.Creativity techniques

InnovationBohm Dialogue

Communities of Practice

e.g.efficient teamsopen culturemutual trust

acceptance of mistakes

?

structured(with method)

unstructured(without method)

rules Self-evidentVoluntary

Met

hodo

logy

Willingness

Fig. 65: Example of how to introduce knowledge management

Fig. 64: Approaches to introducing knowledge management

Pilot project

Initiation

Orientation

Follow-onprojects

Degree establishedDepartments and peopleinvolved, target groups,“customers”

1999 2000 2001 2002

• Presentations• Sensitisation

• External consulting• Situation analysis• Introductory

scenarios

• Patent activities• Structured

problem-solving(FMEA)

• Supplier management• Virtual libraries• Networked search

• Skills managementand expert search

• Documentation ofexpert knowledge

• Networking ofinternal projects

• Documentclassification

• Storing LessonsLearned

• Development of basicknowledgemanagementmethods

The Individual Working Environment

In general, the success of the work we do is oftenmeasured in terms of the amount of cooperation itinvolves and the degree of recognition andacceptance it receives from other people in theorganisation.

However, in most cases people do not haveenough personal knowledge to fully meet theknowledge requirements of the work they do.This means that they have to generate theknowledge necessary to successfully completetheir task(s) as quickly and effectively as possible.

Of course, in an ideal situation, each employee in acompany would know which activities and tasks allthe other members of the organisation wereinvolved in and could align his/her own activitiesappropriately to best meet corporate requirements.However, the larger the organisation, the morecomplex this process becomes (see Fig. 66).Furthermore, people only have a limited capacityto process all that they perceive. One result of thisis that the maximum number of people withwhom a person is able to cooperate directly liesbetween five and nine people.

From an individual knowledge managementstandpoint, this makes it all the more importantfor individual employees to identify their ownrelevant working environment.

A task/environment analysis (Fig. 67) helps staff toidentify and establish the environment relevant foreach of their tasks and make this informationavailable both to themselves and to others. Inother words, it brings together the appropriateknowledge holders for a particular task.

The task(s) that a particular employee is involved inwill be set by their job description, in their staffassessment, as direct requests from management,etc. Each individual task must fulfil a range offunctions within the organisation, and each of

these functions brings, in turn, a defined addedvalue for other people (both internal and external).

The potential members of a person’s individualworking environment include the people whorepresent any related internal organisational orproject units, as well as members of externalorganisations.

Task holders initially identify their relevant workingenvironments by assessing the influence of anypotential members on the desired function of oneof their tasks: Those people with the strongestinfluence should make up the relevant workingenvironment. The identification process isrepeated until all members of the workingenvironment see themselves as “stakeholders” forthe task, thus basically ensuring their support in itscompletion. If more than 7 + 2 people areidentified as stakeholders, this is a strongindication that the task can no longer becompleted by one person alone. In this case,responsibility for the task should be spread over alarger group.

Management SummaryA task/environment analysis supports staff in thesystematic identification of their relevant workingenvironment. This enables them to locate theknowledge required to complete the task and,consequently, to increase the value of their results.



Recommended ReadingAckoff, R.L./Emery, F.E. (1972): On purposeful Systems; New York:Aldine Athertonvon Foerster, H. (1984): Principles of Self-Organization - In a Socio-Managerial Context. In: Ulrich, H./Probst, G.J.B. (Ed.): Self-Organization and Management of Social Systems - Insights,Promises, Doubts, and Questions; Berlin: Springer-Verlag, pp.2-24Herschel, R.T./Nemati, H./Steiger, D. (2001): Tacit to explicitknowledge conversion: knowledge exchange protocols. In: Journal ofKnowledge Management, Volume 5, Number 1; MCB University Press,pp.107-116Javitz, H.S./McEachron, N.B. (1983): Improving White CollarProductivity - Strategies for meeting tomorrow's competitiveChallenge, Research Report No. 687, Business Intelligence Program;SRI International

Group withfour members

Group withten members

Fig. 67: Example task/enviroment analysis

Fig. 66: Complexity of communication in groups of different sizes

Organisational unit“project”

Organisational unit“line management”

Externalorganisational unit

Functions ofeach individual

task

People as representativesof organisational units

KW G B DF

Enable strategic managementof intellectual capital

Reduce the effortinvolved in finding experts

Enable access totechnical knowledge

Initiate socialisationprocesses

On

By

Assessment of the influenceof the people involved on thetask function0 = no influence / 3 = strong influence

The relevant business environmentfor each individual is the result

of the 7 + 2 highestcolumn totals

…Job

description

Staf

f as

sess

men

tm

eeti

ng

Requests fromline manager

2 3 2 3 2 3 1

3 0 3 0 3 0 2

1 1 0 1 0 1 0

1 2 0 2 0 2 2

Influence


Implementation

Page 35


Initiation Phase

This section describes the knowledgemanagement implementation processillustrated in Figure 68. Knowledgemanagement can be introduced either forhistoric reasons or to plan for the future, i.e. asa direct consequence of the urgency of asituation (e.g. ever increasing informationoverload), or as a strategic managementdecision. Whatever the reason, everyoneshould be informed of this decision before anydefinite steps are taken. This could be throughan article in the staff newspaper or anintroductory presentation or workshop. It canalso be beneficial to enlist external support inthe initiation phase, since this also providesaccess to additional relevant experiencegained in comparable projects.

The first definite step towards knowledgemanagement often takes the form of a pilotproject. Since pilot projects can have both apositive and a negative influence on anysubsequent company-wide roll-outs, theyshould be carefully planned and include aclear distribution of roles (see Fig. 69).

A pilot project should ideally be targeted at aparticular division or group of employees thatis comfortable dealing with change and newchallenges. It should also directly involveeveryone who will play a part in or might beaffected by any measures introduced. In thisway, the project “involves the involved” fromthe start and can take advantage of theirexperience in determining possible solutionsand measures.

In general, the selection of any key areas forknowledge management should concentrateprimarily on knowledge-intensive processescritical to company success (Fig. 70).

The next stage is then to set the goals for the

pilot project. These might include:

• Improving knowledge transfer in selected areas

• Improving access to data and knowledge

• Encouraging the use of creative potential

• Activating previously untapped or unused knowledge.

The following questions need to be askedwhen implementing knowledge management:

• Which business processes are particularly knowledge-intensive and critical to company success?

• In which processes is it extremely difficult to support knowledge transfer through documentation?

• Are there knowledge-intensive areas that can only be covered by a few (individual) members of staff?

• Are there any areas in the company where knowledge is particularly stable or unstable?

• Which areas will readily accept and are in urgent need of change?

Management SummarySetting clear goals and involving everyone concernedare two major success factors in the introduction ofknowledge management. Quick wins generated in aneffective, yet manageable pilot project can be of greatsignificance for the success of any subsequent largerscale initiatives.

• Strategy• Impetus

• Set goals• Kick-off

• Tasks• Knowledge content

• Find solutions• Implementation

• Follow-on projects• Diffusion

• Assessment• Steering

Motivation Information

Analysis

Design Institutio-nalisation

Evaluation

Pilot project

Routine Processes Knowledge-intensive Processes

• low complexity• frequent repetition• contextual knowledge available• can be adequately predetermined• limited degree of novelty• little experiential knowledge required from experts• sufficient data available• concerns a manageable number of familiar knowledge domains• required knowledge can be easily documented

• several knowledge holders in the company

• high complexity• few repetitions• little contextual knowledge available• cannot be adequately predetermined• high degree of novelty• experiential knowledge required from experts• little data available• links many, often new, knowledge domains

• required knowledge is difficult/impossible to document• few knowledge holders in the company

Fig. 69: Tasks and members in a pilot project

Fig. 70: Differentiating between routine and knowledge-intensive processes

Fig. 68: Knowledge management implementation process

Steering team

Project team

Corporate environment

Management

External consultant

Project manager

Members of the pilot team

Other company employees

• Make data available• Provide feedback• Make decisions• …

• Methodic support• Project coaching• ...

• Collect, prepare and structure data• Define procedures (team meetings, one-to-one meetings, …)• ...

• Make data available• Provide feedback• Active involvement in one-to-one and team meetings• …

• Make data available• Provide feedback• …

(customers, suppliers, society, …)


Implementation

Page 36


Analysis Phase

The pilot project begins with a kick-off meeting.At the end of this meeting, the following pointsshould be clear:

• The expectations of everyone involved with the project and the project goals

• The project plan, the required resources and the milestones.

In the analysis phase (see Fig. 71), selectedprocesses are analysed with a view to the goalsset. In this way, the introduction of knowledgemanagement does not simply become the end initself: It ties in directly with the company’sbusiness activities and processes.

This requires a detailed representation andsegmentation of the processes involved (seeFig. 72). The existing process organisationhandbook or, if no such document is available, adescription of the processes planned in thequality management system are good points ofreference here.

The following questions should be considered inthe detailed analysis:

• Which sub-processes are particularly knowledge intensive and/or complex?

• Are there any areas in which knowledge transfer is known to be problematic?

• Which areas of the process are essential for value creation?

• Which knowledge forms the basis of the skillsand expertise in this division?

The analysis grid proposed in Figure 73 can beused in most companies, regardless of theirstructure (e.g. primarily by function or as aprocess organisation). This grid establishes anoverview of existing knowledge domains, tasks,task holders, knowledge holders and any supportsystems used. Three central questions play a key

role in the analysis phase:

1. Action level: Which knowledge is required forprocess X?

2. Knowledge level: Who has this knowledge?

3. Data level: Which support systems and data are used?

The best way of establishing an overview is byconducting interviews with the task andknowledge holders concerned. This ensures thatonly relevant data is collected. Furthermore, thelevel of detail should be kept to the minimumrequired to draw up a qualified overview and toavoid too much concentration on unnecessarydetails. The following results can be drawn fromthe overview:

• A clear picture of the tasks and knowledge holders involved in each individual process

• A reconstruction of the knowledge base and key knowledge domains

• An overview of any tools or support systems used

• A list of weaknesses.

In the final stage of the analysis phase, the resultsshould be presented to all those involved in oraffected by the knowledge managementactivities. Subsequent steps and measures shouldthen be defined.

Management SummaryA process oriented representation of businessactivities is an excellent point of reference in theanalysis phase. The analysis should focus onknowledge-intensive value-creation processes. Theresults of the analysis phase should provide specificideas for subsequent knowledge managementmeasures.

Step 1

Step 2

Identification of knowledge-intensive business processes

Identification of knowledge content and knowledge holders

R e

s

u

l t

What knowledge is required to carry out process X?

Who has this knowledge?

Which support systems are used?

Clear picture of the tasks and people involved

Relevant knowledge content and knowledge domains

Support systems used

List of weak points

Business process

Knowledge-intensive main process

Sub-process

Processes

No. Task Task holder Department Knowledge content Knowledge domain Knowledge holder Department Data content Medium Support system Location/Department

Knowledge requirements and available knowledge Data requirements and available data

Fig. 72: Example of process segments in industry

Fig. 73: Analysis grid for evaluating business processes

Fig. 71: Steps involved in the analysis phase

Material Selection and Verification Process

Knowledge-intensive main process

Select materials

Sub-processes

Tasks

Update and define product requirements specification

Chemical and physical product selec-tion acc. to character-istics profiles

Definition of requirements for raw materials from external sources

Request specifications from customer

Analysis of samples

Add customer specifications to internal product specifications

Material selection

Determine process (processing)

Set chemical and physical values (target values)

Define chemical and physical requirements

Check security protocols

Select containers (batch size)


Implementation

Page 37


Design Phase

In the subsequent design phase, the resultsobtained in the analysis phase can be turned intospecific measures (see Fig. 74). If the weaknessesoutnumber the possibilities open to the projectteam and its defined framework, a joint decisionmust be made by everyone involved in the projecton the areas that are most relevant or urgent.This should take into consideration the work theywill involve and the potential benefits they offer(see Fig. 75).

This weighted list of measures forms the basisfor the implementation schedule. In theimplementation phase, it is also extremelyimportant to involve everyone concerned with oraffected by the project in the identification ofany possible solutions, as this will increaseacceptance of any solutions proposed. Thisidentification process can be seen as a creative,team-based knowledge generation phase. Theproject should aim to produce “noticeable”improvements as quickly as possible.

To ensure that this is achieved, a timeframeshould be established and a person nominatedas responsible for each measure. The membersof the project team should profit most from theseactivities and receive some form of response orrecognition for their efforts. Possible benefitsinclude an increase in personal satisfaction or animprovement in their working situation. Designmeasures can be grouped into three maincategories:

• Human

• Organisation/culture

• Support systems/tools

It is unfortunately common in knowledgemanagement that the only measures ultimatelyintroduced are on a support system level. For thisreason, it should once again be noted that whilst

tools and software can provide excellent supporton a data level, knowledge managementactivities should under no circumstances only belimited to measures of this kind.

Support for and acceptance of knowledgemanagement activities – and the extent to whichthey can ultimately be extended andinstitutionalised through subsequent projects –will depend very much on the success of any pilotprojects. Experience shows that the followingsuccess factors and barriers must be considered inany knowledge management initiatives:

Success factors

• Management must fully support the project (role models)

• Obvious benefits both for staff and the company

• Focus on pilot activities in manageable areas

• Motivated project team and rapid, noticeable improvements

• Sound project management and clear goals.

Barriers

• Lack of time/motivation

• Power barriers/authoritarian style of management

• Lack of basic understanding of the concept ofknowledge management.

Management SummaryPriority should be given in the initial stages tomeasures that can be implemented quickly and easily,yet which yield high returns. Sound projectmanagement helps achieve the goals set. Theacceptance and success of a pilot project forms thebasis for subsequent knowledge managementmeasures.

Step 3

Step 5

Step 4

Result

Weighting and targeted selection of weak points

Search for solution (involving task and knowledge holders)

• Understanding of problem• Design goals• List of measures

Implementation of measures• Tasks/responsibilities• Deadlines• Resources

Fig. 75: Selecting design measures

Fig. 74: Steps involved in the design phase

high

high

low

low

Effo

rt

Benefits

Priority 1 Measures

Priority 2 Measures

Implementation of design measures

• HOW?• WHO?• WHEN?

Lessons Learned in Implementation

A knowledge-oriented analysis should be carriedout at the beginning of any knowledgemanagement initiatives and should provideinformation on how ready an organisation is forknowledge management. This degree ofmaturity can be with respect to organisationalculture, existing management systems ortechnological requirements. If the degree ofmaturity is too low, knowledge managementprojects will quickly be abused to resolve deficitsin other areas and knowledge management itselfthen becomes little more than a “pretext”. Aqualitative indication of the degree of maturity is,for example, the way quality managementrequirements (e.g. employee suggestion schemes)are implemented.

In most cases, the lasting effects of a successfulknowledge management project (see Fig. 65) willnot be immediately apparent. As a result, it isimportant to generate some quick and visibleresults, to ensure that employees do not come tosee knowledge management simply as an end initself. These “quick wins” should address some ofthe more urgent issues and provide directbenefits for the people concerned. One possibleexample is the setting up of a “virtual library” (i.e.administration of books and periodicals via theIntranet). Communicating these results is alsoessential to any implementation efforts,confirming the importance of project marketingas a critical success factor in knowledgemanagement projects.

Knowledge management projects must also payparticular attention to the actual peopleinvolved. They should not be given the impressionthat what they did in the past was inefficient andthat knowledge management has come along tochange all that. The use of buzzwords and jargonlike “the knowledge manager” or even the term“knowledge management” itself can often cause

real problems if they are communicated orinterpreted wrongly. Passive resistance can have aseriously detrimental effect on the success of anylong-term knowledge management initiatives.The goal should not be to turn all employees intoknowledge management experts. In general,employees are rarely interested in theoreticalmanagement models; they want to see solutionsthat will resolve their problems.

The long-lasting success of knowledgemanagement requires an evolutionary changeprocess with an undefined beginning and end.There is no such thing as “out-of-the-box”knowledge management, and the operativeimplementation should take the form of pilotprojects. Figure 65 illustrates the introduction ofknowledge management over a period of severalyears using pilot projects in various differentareas.

Management SummaryThe successful introduction of knowledgemanagement will involve many individual stages,from knowledge-oriented situational analysis through“quick wins” to pilot project implementation.



Fig. 76: Questionnaire for analysing knowledge transfer

HUMAN RESOURCES

• Can potential knowledge holders be contacted easily?

• How can existing contextual knowledge be assessed in knowledge transfer processes?

• Is it likely that some people will deliberately hold back knowledge (“knowledge is power”)?

• Are the knowledge holders in the company under too much pressure?

• Are knowledge holders frequently asked the same questions?

• Where are the knowledge gaps, e.g. among young or new members of staff?

• Are there any personal barriers to knowledge transfer (e.g. animosities, likes or dislikes)?

ORGANISATION

• How is knowledge transferred (in meetings, by phone, etc.)?

• How efficient and effective is knowledge transfer?

• How effective is the knowledge transfer framework?

• Are there any Communities of Practice in the organisation?

• Do organisational structures support knowledge transfer?

• What effect does location have on knowledge transfer?

• What could be done to make knowledge transfer more effective and efficient?

• Have any organisational barriers to knowledge transfer been encountered?

TECHNOLOGY

• Which information and communication technologies are used for knowledge transfer?

• Is there a (computer) network that works well? Is there an Intranet?

• Are the information and communication systems user-friendly?

• Is company data updated regularly?

• Are staff happy with existing IT systems?

• Are there any other barriers to knowledge transfer?

CULTURE

• Is it standard practice to share information?

• Is there a climate of openness and trust in the organisation?

• Do management act as role models in knowledge transfer and sharing?

• How do knowledge holders react to requests for help?

• Are cooperation and knowledge sharing activities rewarded and promoted?

• What is done to promote informal knowledge exchange in the organisation?

• Are there any cultural barriers in the organisation?

http://www.wm-forum.org Page 39


Declarative knowledge

Knowledge of facts (issues, processes, etc.) andobjects (people, things, etc.). Also described as“knowing something” or “know what”.

Experience

In general terms, experience refers both toexperiential knowledge and the process ofexperiential learning.

Experiential knowledge

A subset of human knowledge strongly linkedto people and situations.

Experiential learning

The process of creating experiential knowledgefrom experiencing a situation.

Explicit knowledge

Knowledge a person is aware of and canarticulate.

Function

The individual effects of the object to bedescribed. The function is described using anoun and an infinitive verb.

Human capital

The expertise and motivation of employeesand their ability to learn.


An individual person’s knowledge that can alsobe separated from a specific context butremains at the disposal of that particularperson.

Individual knowledge management

Centres on an individual employee but has afocus on corporate goals.

Innovation services

Specific potential of a particular supplier tosupport corporate innovation processes.

Intellectual capital

Intangible assets not included in traditionalfinancial statements, yet of considerable valueto a company. Intellectual capital is made upof human, structural and customer capital.

Intellectual capital report

Instrument used in the representation,assessment and steering of an organisation’sintangible assets (employees, structures,relationships, etc.).

Knowledge

Knowledge is created through an individualprocess of changing cognitive structures andenables people to act. Knowledge isintrinsically linked to people.

Glossary

Action level

All the actions required to complete anorganisation’s tasks or business activities.

Available knowledge

The knowledge represented by the knowledgeholders in an organisation. Corresponds to theorganisational knowledge base.

Business process

Interaction between means (employees,machines, materials, etc) and activities withthe goal of turning the input into an outputthat meets customer requirements. Businessprocesses begin with the receipt of a customerorder and end with delivery and are acombination of routine and knowledge-intensive processes.

Core competence

The ability of an organisation to solve specificproblems. Core competences are the result ofthe unique combination of knowledge andresources in an organisation and represent itscompetitive advantage.


Knowledge that is only relevant in a specificenvironment (e.g. a company or club).

Collective knowledge management

The actors form a group; the focus is onpersonal goals.

Context, contextual knowledge

Prior knowledge of a particular knowledgedomain.

Corporate culture

The values, traditions, rituals, myths, standardsand beliefs that provide the members of anorganisation with purpose and guidelines fortheir behaviour.

Cost-benefits analysis

Method of including qualitative criteria indecision-making processes. Relevant criteriaare determined and weighted, and possiblealternatives assessed. The “result” of theassessment is multiplied by the “weighting” ofthe criterion to determine its utility anddemonstrate the merits of a particularalternative.

Customer capital

Relationships to customers, suppliers, ownersand staff as well as alliances and networkswith research institutes, public organisations,etc.

Data level

All systems (e.g. databases, documentation,etc.) capable of incorporating, storing,transferring, processing and exchanging data.



Organisational knowledge base

The knowledge created and/or developedeither individually or collectively by allemployees in the course of their work. Datadoes not form part of the organisationalknowledge base.

Outsourcing

Using external sources to expand theknowledge available to an organisation orimprove its ability to act.

Personal knowledge management

Knowledge management with a focus on theindividual employee and his/her personalgoals.

Procedural knowledge

Describes the way cognitive processes andactions are carried out. Also described as“ability” or “know how”.

Reflection

Deliberate consideration of the purpose andsuccess of one’s own actions or the observedactions of others.

Stakeholders

Groups of people (e.g. employees, customers,suppliers, top management) with a stake in theorganisation (e.g. an employee’s entitlementto a fair salary).

Structural capital

The infrastructure and processes that allowthe organisation to operate productively (e.g.information and communication systems,administrative processes, laboratoryequipment, office furniture).

Tacit knowledge

Knowledge a person is unaware of andtherefore either cannot record or articulate, orcan only record or articulate indirectly usingspecial observation or interview techniques.

Threat potential

A non-dimensional indicator of the extent towhich an unresolved problem could jeopardisecompany survival. Can be quantified bycarrying out a cost-benefits analysis of similarprocedures.

Transfer of experience

A special form of knowledge transfer. Aims toavoid unnecessary repetition of learningprocesses through “trial and error”.

Knowledge creation

Internal expansion of available knowledge byutilising the creative potential of employees.

Knowledge domain

Knowledge related to a specific area ofinterest or subject matter and formed by aparticular group of people.

knowledge-intensive process

A process that is difficult to standardise andrequires significant effort to document.

Knowledge level

The knowledge needed to carry out the actionsrequired by a particular task. Also described asthe organisational “memory”.

Knowledge logistics

The management of knowledge requirements,available knowledge and knowledge transfer.

Knowledge management

Not the “managing of knowledge”, but theestablishing of a relevant framework tosupport and promote the application ofavailable knowledge in value creatingprocesses. Can also be described as themanagement of the organisational knowledgebase.

Knowledge requirements

The sum of the knowledge required to carryout business activities or implement corporatestrategy.

Knowledge transfer

Satisfying knowledge requirements throughavailable knowledge. Knowledge can beconsidered to have been transferred when thereceiver reaches the same basic level ofunderstanding of the knowledge as the sender.

Knowledge workers

Knowledge workers are (formally) trainedexperts who (primarily) develop, apply andshare knowledge in value creating processes inthe course of their professional activities.

Organisational learning

Organisational learning is based on individuallearning processes and leads to a change inthe organisational structure and/or culturewith the aim of guaranteeing survival in adynamic environment.

Organisational knowledge management

Knowledge management realised by and for agroup of employees with a focus on corporategoals.

Page 40

Imprint

Publisher:Wissensmanagement ForumWeb: http://www.wm-forum.org

Contributing Authors:Manfred BornemannMarion GraggoberErich HartliebBernd HumplPhilipp KoronakisArthur PrimusKarl RitschHerwig RollettMartin SammerJosef TuppingerReinhard WillfortKurt Wöls

Project coordination:Martin Sammer

Layout and Production:Heri Pistotnig

Translation:Angela Dickinson

Place and Date of Publication:Graz, Austria, 2003

http://www.knowledgecheck.nethttp://www.omv.comhttp://www.magnasteyr.comhttp://www.bohler-uddeholm.com http://www.wissensmanagement.com http://www.innovation.at

praxishandbuch v n kc...declarative and procedural knowledge. whilst declarative knowledge r efers...

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