Companies create value with

Knowledge Management

By Dan Logan

Like blind men examining an elephant, everyone has a different take on knowledge management, or KM. And knowledge management is one big elephant.

“Some people call knowledge management a management discipline; others call it a buzzword,” said Bob Dumouchel, president of On With Learning, a computer training products provider in Arroyo Grande.

Many people who work in the field of knowledge management prefer to call it anything but knowledge management, which adds to the confusion.

KM is an abstraction because companies use the term to refer to a spectrum of organizational efforts and software tools. Perspectives on knowledge management come from many disciplines, including business, economics, education, information management, psychology and sociology, among others.

Basically, knowledge management is derived from the idea that knowledge is dynamically imbedded in a company’s networks and processes, as well as in the human beings that constitute and use them.

Karl-Eric Sveiby, a KM pioneer, defines knowledge management as “the art of creating value from an organization’s intangible assets.” Most of those assets are the employees. As Dumouchel puts it: “At five o’clock my inventory goes home.”

Knowledge is at the top of the food chain, where data become information after being organized, and information becomes knowledge when it’s placed in actionable context, as Steve Barth, editor-at-large for Knowledge Management magazine, puts it.

The theory is employees will operate more effectively and creatively if they can easily gain access to a broader spectrum of information held by the company and its other employees.

On another, more ambitious level, some KM technologists are attempting to come up with an organizational framework that encourages innovation in response to changing business conditions—but a framework that will itself change in response to new conditions.

That kind of sophistication could be lost to a small business.

“I mostly hear about knowledge management in the context of a strategy,” Dumouchel said. “KM is very applicable to small business. It’s reality in a small business. When you lose a person from a small business, you lose a much higher percentage of corporate knowledge than you do in a big business. To me, knowledge management means moving the corporate knowledge toward the corporate strategy. The skills inventory ought to be built around the strategy.

“When I had a consulting company, we toyed around with that approach. It would help us decide who to hire next, fill in our weaknesses. Particularly in little companies, people have a tendency to want to hire themselves. But if we had more than 50 percent saturation in a skill, we didn’t consider it important any more.”

Dumouchel said that a good analogy for hiring based on the corporate strategy is managing a baseball team.

“Would you want a baseball team with 27 pitchers? No, you need strong, complementary players,” he said. “KM involves balancing the team’s inventory of skills.”

From the perspective of coming up with ways for a company’s employees to create value for the customer, large corporations can pour millions of dollars into exotic approaches for implementing and encouraging a KM environment.

Smaller companies can use some simple, inexpensive tools to give employees better access to the information held in the organization. Either way, the company culture has to buy into it.

All the knowledge management software in the world won’t automatically turn data into knowledge. It’s tough to sort out what’s useful and what’s not when the term knowledge management is used.

“Some products sold as ‘knowledge management tools’ are very little different than they were before knowledge management came along,” said Dr. Franz Kurfess, an associate professor in computer science at Cal Poly who teaches a course in KM. “But some products are actually useful and not driven by marketing.”

Groups need to communicate across boundaries. People have to be talking about the same thing to communicate efficiently.

“It becomes critical when technical terms are involved,” Kurfess said. For example, the pharmaceutical industry uses brand names for products that have the same chemical name.

To overcome the inefficiencies bred by imprecise language, business communities are developing ontologies. Ontology is a linguist’s term for a tool that includes an enhanced dictionary, translator, thesaurus and a hierarchy of categories and sub-categories, Kurfess said.

As an example, the European police use ontology to track down stolen art objects. They have come up with a reliable way of describing art objects that is understandable to the many nationalities and in many languages in Europe.

Another aspect of KM is the search for information on the Internet or on an intranet. The comparison of a keyword to a database of keywords is a syntactical search that provides a relatively low level of search efficiency. More advanced search engines, Yahoo! for example, combine the syntactical search with ontologies.

The price Yahoo! pays for this level of sophistication is that its database requires a lot of human interaction, as linguists look at the keywords and compare them to the internal ontology. The linguists call this “disambiguation.”

If computers can be taught to learn from the searches they perform and carry out this disambiguation themselves, their effectiveness will increase.

Probably the most widely used product that uses context information to find a better match is the one is built on top of IBM’s Lotus Notes, Kurfess said. Another, Autonomy, tackles a search a bit differently. It looks at what you’re writing, then, in the background, it looks for related documents in a document collection. This works pretty well on an intranet, less well on the World Wide Web.

“For a small company, such enterprise level software might not be worth the investment because these products are expensive,” Kurfess said. “But even small companies can work to clarify their terminology. Simply writing down and defining the important terms used in one’s business can help within the company and with its customers.”

Another useful effort would be to create a directory of the company’s documents, so that everyone can use them. And third, install a search engine, such as Google, on your company’s intranet.

To find out more about KM

Autonomy (http://www.autonomy.com )

Defining Knowledge Management by Steve Barth (http://www.destinationcrm.com/dcrm_ni_article.asp?id=121&art= mag)

Gotcha (http://www.sims.berkeley.edu/courses/is213/s99/Projects
/P9/web_site/about_km.html )

Franz Kurfess Web site

(http://www.csc.calpoly.edu/~fkurfess/Courses/CSC-580/S01/Misc/Misc.html)

What is Knowledge Management? By Karl-Eirc Sveiby (http://www.sveiby.com.au/knowledgemanagement.html)