Chapters 1 - 4

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Chapters 1 - 4
Written By Thomas H. Davenport and
Laurence Prusak
Presented by Nick Drewanz Shanthan
Garlapati Tracy Teeter
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Agenda
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Chapter -1

• What Do We Talk About When We Talk About
  Knowledge?

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1Entities in a company
Meaning
context
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1Data

• Data is a set of discrete, objective facts about
  events.
• In the organization point of view data is
  described as structured records of transactions
• Organizations usually store data in some sort of
  technology like databases .
• Organizations evaluate data both quantitatively
  and qualitatively.
• Quantitatively data management is evaluated in
  terms of cost, speed and capacity.
• Qualitatively data management is evaluated in
  terms of timeliness, relevance and clarity.

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1Information

• Information is usually described as a message in
  the form of document or an audible or visible
  communication.
• Information can be interpreted as data that makes
  difference.
• Information in organization moves around in two
  forms 1) hard network 2) soft network.
• Quantitative measures of information management
  include connectivity and transactions
• Qualitative measures include informativeness and
  usefulness.

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1Information ( cont)
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1Knowledge

• Knowledge is a fluid mix of framed experience,
  values, contextual information and expert insight
  that provides a framework for evaluating and
  incorporating new experiences and information.
• In organization knowledge is embedded not only
  in documents, repositories but also in
  organizational routines, processes, practices and
  norms.
• Knowledge exists within people, part and parcel
  of human complexity and unpredictability.

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1Knowledge ( Cont )
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1Knowledge In Action

• Knowledge is used to make wiser decisions about
  strategy, competitors, customers, etc.
• Drawback of knowledge is that it is hard to trace
  path between knowledge and action since people
  generally think about this internally.
• Knowledge moves up and down the value chain.

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1Key Knowledge Components
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1Experience

• Derived from Latin verb meaning to put to the
  test
• Experience refers to what we have done and what
  has happened to us in the past.
• The benefits of experience is that provides a
  historical perspective from which to view and
  understand new situations and events.

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1Ground Truth

• Derived from army phrase CALL
• Knowing what works and what doesnt in real life
  scenario.
• Relationship between business strategies
  (practical) vs. business teachings (theory)

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1Complexity

• Knowing more information usually leads to better
  decisions against knowing less information.
• Knowledge should have both certainty and clarity.
• What doesnt know can and in most cases will hurt
  you.

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1Judgment

• Knowledge judges and refines itself in response
  to new situations and information.
• Knowledge can be linked to living system, growing
  and changing as it interacts with environment.
• When knowledge stops evolving, turns into opinion
  or dogma

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1Rules of thumb and intuition

• Flexible guides to action that developed through
  trial and error and over long experience and
  observation.
• Shortcuts to solutions to new problems that
  resemble problems once solved by experienced
  workers.
• Researchers call intuition compressed
  expertise

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1Values and Beliefs

• Organizations are not neutral Instead people,
  values and beliefs have powerful impact on an
  organizations knowledge.
• Values and beliefs are integral to knowledge,
  determining in large part what knower sees,
  absorbs and concludes from his observation.

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1Knowledge as a Corporate Asset

• Companies hire for experience more often than for
  intelligence or education because organization
  understands the importance of knowledge .
• According to studies managers get two/thirds of
  their information and knowledge from face-to-face
  meetings or phone conversations.
• Knowledge as corporate asset is new concept.

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1Knowledge Management

• In global economy, knowledge may be a companys
  greatest competitive advantage.
• Knowledge and related intangibles not only runs
  business but are part or all of the products
  firms offer.
• A knowledge advantage is a sustainable advantage.
• Knowledge increases over time.
• Material Assets decreases over time

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Case Study ( BP virtual teamwork )

• The project started in 1993 by BP Exploration
• BP identified 42 separate business assets which
  is called a federation of assets
• Goal of the project was to have agility of small
  company with integrating resources of larger
  company.

Planning

• The initial idea of the project was to realize
  the idea of a federation .
• To create the possibility of Local
  connections.
• The project was named Virtual Teamwork Program

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1Execution

• The aim of the VTP was to let knowledge people
  talk to each other and not to try to capture it.
• The emphasis was on richness of the
  communication.
• Independent group should undertake this project.
• Change management -gt Knowledge management.
• The idea of technology as a tool, not an end in
  itself.

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1Results

• Project was a great success.
• Four out of five groups are successful.
• Save at least 150,000 a day.
• BP executives approved plans to expand to new
  units.

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1Lessons learned from case study

• Members were identified and put into teams, and
  were linked by technology
• Relationships built via actual and face-to-face
  face meetings
• Technology was used for collaboration ,
  communication and training emphasized goals
• Upper management encouraged project and supported
  funds
• 5 test groups allowed for variety and clear,
  limited goals
• Savings productivity increases quantified
  expanding VT needs qualitative
• Project left room for unexpected

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1Chapter Summary

• Knowledge originates in peoples minds
• Sharing knowledge asks for trust
• Technology allows new knowledge behaviors
• Sharing knowledge must be encouraged and rewarded
• Management support and resources are essential
• Knowledge initiatives should begin with a pilot
  program
• Quantitative and Qualitative measurements
  needed to evaluate initiative
• Knowledge is creative should be encouraged to
  develop in unexpected ways

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Chapter 2 The Promise and Challenge of Knowledge
Markets

• Key players in the knowledge market
• Buyers
• Sellers
• Brokers

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2 The Promise and Challenge of Knowledge Markets

• Who is a Knowledge Buyer?
• A person without the proper resources or
  knowledge to make an informed decision
• Common Characteristics
• Knowledge has a distinct value to the buyer
• Time is usually a factor
• Example someone who is trying to make a sale

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2 The Promise and Challenge of Knowledge Markets

• What is a Knowledge Seller?
• A person who has a reputation for having
  substantial knowledge about a process or subject
• A person who exchanges knowledge for a salary
• Examples
• Consultants, Lawyers, Doctors

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2 The Promise and Challenge of Knowledge Markets

• What does a Knowledge Broker do?
• Acts as a gatekeeper between knowledge buyers and
  sellers
• Example A Corporate librarian

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2 The Promise and Challenge of Knowledge Markets

• Price Systems and Knowledge Markets
• Allows value exchanges to be efficiently rendered
  and recorded
• Factors of the Price System
• Reciprocity
• Repute
• Altruism

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2 The Promise and Challenge of Knowledge Markets

• Reciprocity
• Example A knowledge seller will spend time and
  energy to share knowledge if he expects the
  buyers to be willing sellers when he is in the
  market for knowledge

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2 The Promise and Challenge of Knowledge Markets

• Repute
• Being known as a knowledge seller makes one a
  more effective knowledge buyer
• Examples
• Consultants bonuses are tied to demonstrated
  knowledge generation and transfer
• Investment Banking previous performance

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2 The Promise and Challenge of Knowledge Markets

• Altruism
• Passionate about knowledge
• Happy to share knowledge
• Willing to help others for a thank you

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2 The Promise and Challenge of Knowledge Markets

• Why is Trust Important?
• Without trust, knowledge initiatives will fail
  regardless of how thoroughly they are supported
  by technology and rhetoric and even if the
  survival of the organization depends on effective
  knowledge transfer.
• The Significance of Trust
• Trust must be visible
• Trust must be ubiquitous
• Trustworthiness must start at the top

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2 The Promise and Challenge of Knowledge Markets

• Knowledge Market Signals
• Definition information that indicates both where
  knowledge actually resides in the organization
  and how to gain access to it.
• Position and Education
• Informal Networks
• Communities of Practice

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2 The Promise and Challenge of Knowledge Markets

• Knowledge Market Inefficiencies
• Incompleteness of Information
• Asymmetry of Knowledge
• Localness of Knowledge

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2 The Promise and Challenge of Knowledge Markets

• Knowledge Market Pathologies
• Definition Distortions that drastically inhibit
  the flow of knowledge.
• Main Knowledge Market Pathologies
• Monopolies
• Artificial Scarcity
• Trade Barriers

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2 The Promise and Challenge of Knowledge Markets

• Monopolies in Knowledge Markets
• Knowledge comes at a high price because there is
  no competition.
• Important knowledge in a monopoly will not always
  be available when/where people need it to benefit
  them

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2 The Promise and Challenge of Knowledge Markets

• Artificial Scarcity in Knowledge Markets
• Downsizing eliminates employees whose absence
  shows them to be owners of important knowledge

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2 The Promise and Challenge of Knowledge Markets

• Trade Barriers in Knowledge Markets
• Arise when companies lack a good knowledge
  transfer infrastructure or effective market
  mechanisms

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2 The Promise and Challenge of Knowledge Markets

• How do companies develop effective knowledge
  markets?
• Using IT Wisely
• Building Marketplaces
• Creating and Defining Knowledge Market Value

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2 The Promise and Challenge of Knowledge Markets

• Benefits of Knowledge Markets
• Greater Workforce Morale
• Greater Corporate Coherence
• Richer Knowledge Stock
• Stronger Meritocracy of Ideas

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Chapter 2 Summary

• Buyers, sellers, and brokers all play important
  roles in knowledge markets
• Trust is important in knowledge markets
• Position and education, informal networks, and
  communities of practice are knowledge market
  signals
• Cause of Market Inefficiencies
• Incompleteness of information, asymmetry of
  knowledge, localness of knowledge
• Knowledge Market Pathologies monopolies,
  artificial scarcity trade barriers
• How companies develop effective knowledge
  markets
• Using IT Wisely
• Building Marketplaces
• Creating and Defining Knowledge Market Value

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3 Knowledge Generation

• Main Modes of Knowledge Generation
• Acquisition
• Dedicated Resources
• Fusion
• Adaptation
• Knowledge Networking

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3 Knowledge Generation

• Acquisition
• Acquired knowledge does not have to be newly
  created, simply new to the company
• Most effective way to acquire knowledge is to
  purchase it
• There may be cultural and political barriers to
  accepting the acquisitions knowledge entirely
• Example IBM purchase of Lotus (1995)

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3 Knowledge Generation

• Rental
• Common examples include institutional research in
  exchange for the promise to be first to use
  results
• Example Drug company, Hoeschst, supports
  Molecular Biology Institute at Mass. General
  Hospital, with the hopes of developing profitable
  new drugs

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3 Knowledge Generation

• Dedicated Resources
• A typical way to generate knowledge in an
  organization is to establish groups to
  specifically perform that task
• Example Research Development departments

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3 Knowledge Generation

• Fusion
• Brings people together with different
  perspectives
• Forces people to collaborate on a project and
  come to a uniform conclusion
• Also referred to as creative abrasion

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3 Knowledge Generation

• Five KM principles that help fusion work
  effectively
• Foster awareness of the value of the knowledge
  being sought and a willingness to invest in the
  process of generating it.
• Identify key workers who can be effectively
  brought together.
• Emphasize the creative potential inherent in the
  complexity and diversity of ideas, seeing
  differences as positive, rather than sources of
  conflict, and avoiding simple answers to complex
  problems.
• Make the need for knowledge generation clear so
  as to encourage, reward, and direct it toward a
  common goal.
• Introduce measures and milestones of success that
  reflect the true value of knowledge more
  completely than simple balance-sheet accounting.

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3 Knowledge Generation

• Adaptation
• Definition A firms ability to change
• Ability to use existing resources in new ways.
• Open to change or having a high absorptive
  powers.
• Firms that dont adapt to changing conditions
  will fail.
• Example
• Employees backgrounds that suggest an openness
  to change should be given hiring preferences

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3 Knowledge Generation

• Networks
• Knowledge is generated by formal and informal
  networks within an organization.
• Forming networks adds to the knowledge of the
  entire company.
• A good source for knowledge transfer.
• Act as a critical conduit for innovative thinking.

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3 Knowledge Generation

• Common Factors
• Need for adequate time an space devoted to
  knowledge creation or acquisition.
• Time is the most important corporate resource.
• Managers need to recognize that knowledge
  generation is both an important activity for
  business success, and a process that can be
  nurtured.

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Chapter 3 Summary

• Modes of Knowledge Generation
• Acquisition
• Dedicated Resources
• Fusion
• Adaptation
• Knowledge Networking
• Time is the most important corporate resource.
• Firms that are not capable of adapting will not
  be eventually cease to exist.

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Chapter 4

• What is Codification?
• Put organization knowledge into a form that is
  accessible to those who need it
• Basic Principles
• Decide what goals the codified knowledge will
  serve
• Identify knowledge existing in various forms
  appropriate to reaching goals
• Evaluate knowledge for usefulness and
  appropriateness for codification
• Identify an appropriate medium for codification

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4 Codifying Basic Principles

• Codification Dimensions of Knowledge

Tacit ______________________________________
Articulable Not teachable ________________________
_______ Teachable Not articulated
______________________________ Articulated Not
observable in use ___________________ Observable
in use Rich ______________________________________
Schematic Complex _______________________________
_______ Simple Undocumented ______________________
______ Documented
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4 Tacit Knowledge

• Knowledge that people carry in their minds
• Difficult to access
• Ex) Ted Williamss The Art of Hitting
• How do we codify rich tacit knowledge?
• Find someone with the knowledge
• Pointers seeking to the knowledge, encouraging
  interaction

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4 Mapping Knowledge

• What is a Knowledge Map?
• A Knowledge map points to knowledge but doesnt
  contain it. Its a guide, not a repository.
• Picture - represents where to find knowledge
  within an organization
• Tool evaluates corporate knowledge stock,
  revealing strengths and gaps
• Effective maps go beyond structural boundaries

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4 Mapping Knowledge

• Assembling the Map
• Surveys Ask employees what knowledge they have
  and where they get it from
• Snowball Sample Follow the knowledge paths for
  a group of employees
• Examples Time Magazine, Microsoft, IBM

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4 Mapping Knowledge

• Technology of Mapping Knowledge
• Organizations are dynamic constantly changing
• Computer technologies Lotus Notes, Web
  browser/Intranet systems
• Resume-Oriented Mapping extracting keywords
  from electronically submitted resumes

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4 Mapping Knowledge

• Politics of Mapping Knowledge
• The map is not the territory Maps can
  influence the territory, defining it as well as
  describing it.
• Political Wrangling A good thing shows that
  information matters within the company

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4 Modeling Knowledge

• Embedded Knowledge
• Formalized set of procedures constructed from the
  tacit knowledge of individuals
• Difficult to locate dividing line between
  embedded and tacit knowledge
• Represented in a product or service
• Evaluating Explicit Knowledge
• Patents one form of codified knowledge
• Unedited repository of intellectual material

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4 Case Study Monsanto

• Knowledge Management Architecture Project
• Goal Allow employees to share knowledge and
  information, making global knowledge locally
  available
• Evaluate existing knowledge information
• Structural Content Relational database
• Unstructured Content Lotus Notes web pages
• Create Enterprise Reference Data System
• Definitions of key terms within the organization
• Grounds for good communications
• Barriers Multiple or contradictory definitions
• Harmonize knowledge, dont homogenize it
• Only essential terms should be standardized

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Chapter 4 Summary

• Always keep four principles in mind
• Human mind is vital to knowledge codification
• Tacit knowledge is generally difficult to codify
• Knowledge maps
• Act as a guide to where knowledge is located
• Help influence and shape political boundaries

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Discussion

• IBM
• Deloitte
• Microsoft
• Accenture
• Ernst Young

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KM IBM

• A Lotus Development Corporation White Paper
  defines KM by its five technology pillars
• Business intelligence
• Collaboration
• Knowledge transfer
• Knowledge discovery and mapping
• Locating expertise
• Ancient Greeks differentiated between four kinds
  of knowledge
• Epistemeabstract generalizations, basis and
  essence of sciences scientific laws and
  principles
• TechneTechnical know-how, being able to get
  things done, manuals, communities of practice
• Phronesispractical wisdom, drawn from social
  practice
• Metis a form of knowledge which is at the
  opposite end of metaphysics, with no quest of
  ideal, but a search for a practical end an
  embodied, incarnate, substantial form of
  knowledge

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KM IBM

• Knowledge Management dimensions
• The technology dimensions
• The organizational or logistical dimension
• The social dimension

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KM Deloitte

• Implement Knowledge Management Solutions using
  Microsoft SharePoint Portal 2003
• Examples.) Large oil company, EPC companies
• What your getting
• Timely delivery of material
• Compliance to quality and specifications
• Savings for the organization

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MS SharePoint Server 2007

• An integrated suite of server capabilities that
  can help improve organizational effectiveness
• Comprehensive content management
• Enterprise Search
• Acceleration of shared business processes
• Simplify internal and external collaboration
• Empower IT to make a strategic impact
• One platform for intranet, extranet, and Web
  applications
• Tools for server administration, application
  extensibility, and interoperability.

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KM Accenture

• 2 Dimensions to KMA complexity and
  interdependence
• Transaction model Low interdependence and low
  complexity.
• Reliant on formal rules, procedures and training,
  typically routine
• Depends on a workforce that exercises little
  discretion.
• Integration model High interdependence and low
  complexity.
• Work is systematic and repeatable
• Relies on formal processes, methodologies and
  standards
• Depends on tight integration across functional
  boundaries.
• Expert model Low interdependence and high
  complexity.
• Work requires judgment and is dependent on "star
  performers."
• Collaboration model High interdependence and
  complexity.
• Work involves improvisation and learning by
  doing
• Work relies on deep expertise across functions
  use of flexible teams.

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KM Accenture
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KM Accenture
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KMErnst Young

• "Ernst Young has an award-winning knowledge
  management culture that supports our firm's goal
  of market leadership built on three pillars
  people, quality, and growth."
• Mala Garg, Americas CKO

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KMErnst Young

• E Y has been able to develop effective knowledge
  markets by networking
• Knowledge Networks
• Network coordinators align with specific
  communities of interest (by region, industry,
  service line, account, engagement) to connect
  them with the most relevant information and to
  advance our knowledge within each practice area.
  By focusing on specific areas of interest,
  network coordinators drive the acquisition,
  reuse, and creation of knowledge within those
  communities and on behalf of the larger
  organization.

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Sources

• Accenture
• http//www.accenture.com/Global/Research_and_Insig
  hts/Outlook/By_Alphabet/Knowledgevalue.htm
• Deloitte
• http//www.deloitte.com/dtt/article/0,1002,cid253
  D52453,00.html
• Ernst Young
• http//www.ey.com/GLOBAL/content.nsf/US/Knowledge_
  Management_-_Overview
• IBM
• http//www.research.ibm.com/journal/sj/404/dueck.h
  tml
• Microsoft
• http//office.microsoft.com/en-us/sharepointserver
  /HA101656531033.aspx