CHAPTER 6: KNOWLEDGE MANAGEMENT IMPLEMENTATION
6.3 Interdependency between business strategy and knowledge
A knowledge management implementation effort is not a project that is undertaken on its own without any link to the overall business strategy. The literature consistently emphasises the importance of the link between the business strategy and knowledge management strategy (Duffy, Jooste & Whittaker 1999; Snyman & Kruger 2002;
Tiwana, 2000; Zack, 1999a, 1999b).
According to Zack (1999a: 126) a business strategy can be defined as” a high-level, flexible plan that oversees the birth and development of a business initiative”.
To ensure the success of the business objectives, any business development within the organisation must be aimed at furthering the goals of the organisation. A knowledge management implementation strategy must be a function of the business strategy, or else the knowledge management initiative will fail to accomplish goals that are tangible to the organisation (Snyman & Kruger, 2002).
A knowledge management strategy can thus be defined as a high-level plan that aims at supplying the organisation with the knowledge resources that it needs to carry out its mission, vision, goals and objectives.
As a result, the knowledge management strategy must be closely linked to the overall business strategy, and must produce a tangible result to the organisation as a whole.
When such a link between the knowledge management strategy and the business strategy is clearly established, the knowledge management initiative is moving in a direction that holds promise for long-lasting and enduring competitive advantage (Tiwana, 2000: 104). According to Snyman and Kruger (2002: 269): “ A knowledge management strategy should not be managed parallel with the business strategy, but should be an integral part of the business strategy.”
Zack (1999a: 30) states that a knowledge management strategy expresses the overall approach an organisation intends to take to align its knowledge resources and
capabilities to the intellectual requirements of its strategy. Tiwana (2000) argues that knowledge management strategies are unique to the organisations which devise them.
According to Saint-Onge (cited in Chatzkel, 2000) a knowledge management strategy provides the framework within which an organisation manages new initiatives aimed at leveraging the intangible assets of the organisation. Furthermore, the strategy outlines the processes, the techniques and technology required for knowledge to flow effectively.
In summary the business strategy guides the development of a knowledge management strategy and both strategies should be linked to development plans, business plans or future projects. The Chief Knowledge Officer heading the
knowledge management implementation initiative needs to be fully acquainted with all aspects of the business strategy, whether it is the vision, mission or goal of the company, the flow of internal or external information, employees that represent the tacit knowledge of the organisation or the explicit knowledge assets of the company.
6.4 Findings of a literature survey of current knowledge management approaches
In order to develop and constitute an appropriate strategy to implement a knowledge management project an international literature survey has been conducted of the different approaches to knowledge management implementation frameworks taking the classification of Rubenstein-Montano et al. into consideration.
Rubenstein-Montano, et al. (2000) classify knowledge management implementation frameworks in three different categories: descriptive, prescriptive, and hybrid.
• Descriptive frameworks describe knowledge management, and identify attributes of knowledge management that can influence the success or failure of the initiative.
• Prescriptive frameworks provide direction on the different types of
knowledge management procedures without providing specific details of how these procedures can or should be carried out.
• Hybrid frameworks are a mixture of both the descriptive and prescriptive frameworks.
Rubenstein-Montano et al. (2000) also recommend that a knowledge implementation management framework should comply with the following attributes:
• Be both prescriptive and descriptive and consistent with systems thinking.
• The organisational goals and strategies must be linked to knowledge management strategies.
• Planning should take place before any knowledge management implementation activities.
• The cultural aspects of the organisation must be acknowledged and must be compatible with knowledge management strategies.
• Knowledge management must be directed by learning and feedback loops, both single and double.
An analysis of current knowledge management implementation frameworks reveal that four can be classified as descriptive (Bhatt, 2000; Carlson, 1999; Skyrme, 1998b;
Skyrme, (1999); three as prescriptive (Liebowitz, 2000; Macintosh, 1999; Wiig, 1999) and one as a hybrid framework (U.S. Army, 1999).
While analysing these frameworks, three main characteristics were observed:
• The four descriptive frameworks do place emphasis on the alignment of the knowledge management strategy with the business strategy (Bhatt, 2000;
Carlson, 1999; Skyrme, 1998b; Skyrme, 1999).
• The three prescriptive frameworks do not place any emphasis on the
alignment of the knowledge management strategy with the business strategy (Liebowitz, 2000; Macintosh, 1999; Wiig, 1999).
• The hybrid framework, which is a mixture of descriptive and prescriptive frameworks, places a very high emphasis on the alignment of the knowledge management strategy with the business strategy (U.S. Army, 1999).
What is suggested by the authors in two of the framework categories is that the hybrid framework is in line with what other authors (Duffy, 1999; Snyman and Kruger, 2002; Tiwana, 2000 and Zack, 1999a) agree upon: that a knowledge management strategy should be closely linked with the overall business strategy, and provide the organisation with a competitive and innovative edge.
All of the descriptive frameworks (Bhatt, 2000; Carlson, 1999; Skyrme, 1998b;
Skyrme, 1999) also emphasise the importance of people and their contribution towards the knowledge management initiative
In only one of the prescriptive frameworks analysed (Macintosh, 1999) was the focus on technology extremely high in comparison with the focus on employees of the organisation. In three of the descriptive frameworks (Carlson, 1999; Skyrme, 1998b;
Skyrme, 1999) the emphasis was strong on both the technological and human factors.
In the hybrid framework (U.S. Army, 1999) the emphasis was strong on the technological and human factors as well as on the alignment of the knowledge management strategies with the overall business strategy.
The literature survey also revealed that when organisations first initiated a knowledge management effort, some of them tended to over-emphasise the role of technology at the expense of the human factor. However, many of the same organisations, at a later stage, focused on the human factors as well as the technology factors. This change of focus has forced organisations to rethink the way they manage business since the focus in no longer on tangible assets but on people’s abilities and experience.
This study proposes a hybrid framework that will address a focus on the human factor, address technology as an enabler to manage and share knowledge, the management of business processes as well as the alignment of the knowledge management strategy with the overall business strategy.
6.5 Proposed framework for knowledge management implementation
Currently, there are a number of different types of organisations mentioned in the literature for their unique approaches to knowledge management implementation, for example British Airways, BP Amoco, Celemi, Chevron, Honda, and IBM. In Chapter 7, a case study will be presented on three well-known South African financial
institutions’ knowledge management activities.
Notwithstanding the fact that various knowledge management initiatives emerge, no best practice, standard methodology, or plug-in solution will solve every
organisation’s knowledge management needs. Knowledge uniqueness within different organisations and the knowledge management discipline demand a steep learning curve from organisations to refine the art of managing the intangibles.
Based on the conducted literature survey and on the recommendations of Rubenstein- Montano et al. (2000), a theoretical framework has been constructed to address knowledge management implementation strategies of an organisation.
The proposed framework consists of four main interlinked subsystems:
• Management of the organisation.
• Management of the people.
• Management of the processes, and
• Management of the infrastructure.
Rubenstein-Montano et al. (2000) proposed a framework with three main interlinked components, namely management of the organisation, management of people and management of infrastructure and processes. Infrastructure and processes have been combined in one subcomponent.
This study adapted the framework from Rubenstein-Montano, et al. and their
recommendations; however, the three components have been split to four interlinked subsystems. The fourth subsystem consists of the infrastructure (techniques and technologies) for enabling knowledge sharing. The organisation needs to achieve a
balance between these four subsystems in order to achieve a successful knowledge management implementation initiative, as shown in Figure 6.1.
Figure 6.1 Framework for knowledge management implementation (Adapted and modified from Rubenstein-Montano et al., 2000)
6.5.1 Management of the organisation
Management of the organisation in the framework deals with the overall activities that need to be performed in the organisation during the knowledge management effort. At this level, the organisation needs to carry out the following high-level activities:
• Perform a knowledge-based SWOT analysis of the organisation (strengths, weaknesses, opportunities, threats). According to Tiwana (2000) and Zack (1999a), using the SWOT analysis to identify the organisation’s knowledge gap and help it define its knowledge strategy is the best way to achieve a clear
Management of the organisation
Management of the
people Management of
the infrastructure (techniques &
technologies)
Management of the processes KNOWLEDGE MANAGEMENT STRATEGY
BUSINESS STRATEGY
strategy for the business. It is important to identify the knowledge gaps in terms of tacit and explicit knowledge.
• Create a vision for the knowledge management initiative and identify a Chief Knowledge Officer. The vision is the long-term strategy that will drive the knowledge management initiative and provide the scope within which the knowledge management initiative and the organisation will grow. The main responsibilities of the Chief Knowledge Officer as a leader should be to help integrate the four sub-systems of knowledge management effort, namely the organisation, the people, processes and the infrastructure.
• Align the knowledge management initiative with the business strategy. The knowledge management effort is not a project that is undertaken on its own without a link to the overall business strategy (Snyman and Kruger, 2002;
Tiwana, 2000; Zack, 1999a).
• Manage the organisational culture and manage change(s). This study recommends that the objective of the change is not to change the
organisational culture drastically, but to modify the behaviour of people in a way that suits the demands of knowledge management in the organisation.
• Manage with a holistic approach (include stakeholders, competitors, internal environment and external environment). The organisation must take in
consideration its customers, suppliers, shareholders and competitors to collect and analyse knowledge about them. This will provide the organisation with the opportunity to become proactive in meeting customer needs.
• Create and manage organisational learning. This study argues that
organisational learning will generate innovative knowledge and allow the organisation to produce innovative products and business processes.
6.5.2 Management of the people
At the management of the people level in the framework, the focus is on managing people, their behaviour, their expectations, and their potential to contribute to the success of the knowledge management effort. There should also be an active effort to encourage employees to share and use knowledge in the workplace, and to reward people who do so.
The framework proposes the following activities to achieve this:
• Manage people as individuals and as part of a team. Organisational learning takes place through individual and team learning. However, management must consider each individual’s opinion and input. This will ensure that employees are more willing to accept change if they feel part of that change.
• The appropriate organisational structures must be in place, so that people are motivated to share and use knowledge in the workplace. McDermott and O’Dell (2001: 76) propose three ways in which sharing knowledge can be made an important factor in a business:
- Make sharing knowledge a direct part of the business strategy.
- “Piggyback” sharing of knowledge onto other business initiatives.
- Share knowledge commonly as part of normal work.
These practices have proved their worth in the organisations that have adopted them. The study recommends using these methods to encourage people to share and use tacit as well as explicit knowledge in the workplace.
• Encourage learning and innovative thinking in the organisation. This can be done in a variety of ways, as discussed in Chapter 4. The easiest way would be to demonstrate how sharing knowledge with other employees and learning from each other can result in improved products and services and time and cost reduction.
6.5.3 Management of the processes
The process component of the knowledge management framework involves the establishment of an effective knowledge creation and retention process in the organisation. The term process is used in a variety of ways in the context of knowledge management. Knowledge processes support the flow of knowledge between business processes and between business units.
Business processes should be re-evaluated, to enable employees to create, identify, verify, capture, organise, disseminate and use knowledge easily throughout the organisation. However, sometimes business processes need to be modified to suit the knowledge management implementation effort, i.e. the sharing of knowledge.
For the abovementioned processes to be effective, a continuous feedback from the application of knowledge must exist in the framework to ensure that the knowledge is maintained and renewed. Therefore, an important aspect of managing knowledge management processes is the measurement of the impact of knowledge management on the organisation. The Chief Knowledge Officer or leader of the knowledge management initiative is responsible for devising suitable metrics to measure how effective the knowledge management effort is to the organisation ( Duffy, Jooste and Whittaker, 1999).
Although it may be difficult, it is vital to measure the intangible assets of the organisation. Growth in an organisation’s intellectual capital is an indication of the degree to which the knowledge management implementation initiative has been successful. In addition, these results assist in the identification of problem areas and give management an indication of the return on investment.
Knowledge management achievements cannot be quantified in monetary terms. The Chief Knowledge Officer should therefore ensure that other metrics are devised to represent progress accurately, for example, using the balanced scoreboard method.
6.5.4 Management of the infrastructure
In order to be successful, management and the Chief Knowledge Officer have to plan thoroughly what type of techniques and technologies the knowledge management effort needs. The study recommends technique and technology infrastructures, which will allow easy communication between employees, in other words the collaborative techniques and technologies discussed in Chapter 5.
It is also important that the infrastructure of the organisation should be able to link easily with that of the customers and suppliers, in order to allow a seamless flow of information between the organisation and its partners. This will allow the organisation to collect knowledge about its business partners and vice versa.
An over-emphasis on the role of information technology creates a real danger for organisations that delegate the responsibility for their knowledge assets and the ability to think to traditional information technology “databases”. Despite technological advances, the company’s meeting point (coffee bar) – where team members share ideas – still surpasses the information technology system when it comes to harnessing the knowledge that gives business its competitive advantage.
While it is true that the technology infrastructure allows information sharing in the modern organisation and, in fact, is essential in the codification, distribution and the storage of information, information technology falls short in the creative application of knowledge. Knowledge is about how information is applied to leverage the core competencies of the organisation, whereas technology is only an enabler of the knowledge creation process.
The application of knowledge still relies on the organisation’s knowledge workers and emphasises the critical role of the human element in the knowledge management implementation initiative.