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Knowledge Management in the Business Sector


Knowledge Management in the Business Sector Al Berg Practice Director/Collaborative Computing AMC Computer Corporation New York City, NY USA – PowerPoint PPT presentation

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Title: Knowledge Management in the Business Sector

Knowledge Management in the Business Sector
  • Al Berg
  • Practice Director/Collaborative Computing
  • AMC Computer Corporation
  • New York City, NY USA

Businesspeople know Knowledge has Value!
  • If HP knew what HP knows, we would be three
    times as profitable. -- Lew Platt, CEO of
    Hewlett Packard

KM is Job One
  • According to the American Management Association
    (12/98), Knowledge-Based Management is the
    number one ranked IT concern of executives

Business KM Trailblazers
  • Arthur Andersen
  • Chevron
  • Dow Chemical
  • Hughes Space Communications
  • Kaiser Permanente
  • Price Waterhouse
  • Sequent Systems
  • Scandia AFS
  • Texas Instruments
  • USAA according to the American Productivity

KM Saves Real Money
  • Dow Chemicals initial Intellectual Property
    management projects saved 40 million
  • Chevrons KM efforts led to 170 million in
  • TI shared information on increasing semiconductor
    yields - and saved 500 million

  • Chief Knowledge Officer
  • Builds a knowledge culture
  • Builds the needed infrastructure
  • Makes it all pay off!
  • Only 14.9 of companies responding to a recent
    survey have a Chief Knowledge Officer

Top Management Involvement
  • According to the same KM World survey
  • 59.5 of respondents noted that KM initiatives
    were driven by top management
  • 40.5 did not see initiatives as driven by
    corporate management
  • Successful KM adopters have top management as a

Cultural issues
  • The most difficult part of implementing KM in
    business (and other) settings It must be
    considered that there is nothing more difficult
    to carry out, nor more doubtful of success, nor
    more dangerous to handle, than to initiate a new
    order of things. Niccolo Machiavelli - The
    Prince - 1513

Information Overload - A major driver of KM
  • The average businessperson in the US, Canada and
    UK receives approximately 190 messages per
    day according to a May 1998 survey by Pitney

Three Kinds of KM Projects...
  • Creation of knowledge repositories
  • Improving access to knowledge
  • Building the knowledge culture

Knowledge Repositories
  • External knowledge
  • Competitor intelligence
  • Structured internal knowledge
  • Reports, databases
  • Informal internal knowledge
  • Discussions

Repositories External
  • Competitor and client intelligence
  • Competitor sales information
  • Industry/competitor news
  • Analysis of products developed and patents filed
    by competitors

External Repositories at AMC Computer Corporation
  • Access to external news sources for client,
    vendor and customer news
  • Links to competitor web sites
  • Demos
  • The AMC news database
  • Inquisit

Repositories Structured/Internal
  • Document management
  • Capture knowledge as it is created
  • Leverage existing documents generated in course
    of business by making them easily accessible
  • Very common in the legal profession since its
    data is already document based

Repositories Structured/Internal
  • Data Warehousing
  • Slice and dice access to data already being
    collected throughout an organization -
    accounting, customer service, etc.
  • New ways of looking at analyzing existing data
  • Data ----gt Information

Repositories Informal/Internal
  • Hewlett Packards Traders Training Post
  • Links trainers and educators throughout HP world
    wide using Lotus Notes
  • Captures tips, tricks, insights and experiences
    and makes them globally accessible
  • Informal discussion database

Improving Access to Knowledge
  • Yellow Pages which connect information
    consumers with information sources
  • Codifying the map of knowledge in the

Microsofts SPUD
  • Skills Planning Und Development
  • Missions
  • Improve matching of employees to jobs and teams
  • Plan for future employee skills development

How SPUD Works
  • Each Information Technology job at Microsoft is
    rated by a manager in terms of the 40 - 60
    knowledge competencies needed to perform it
  • Each workers competencies are evaluated by
    him/herself, their supervisor and co-workers

Kinds of Knowledge
  • Foundation knowledge (entry level)
  • Unique knowledge needed for a job/task
  • Global knowledge for a particular
  • Universal knowledge for the company

SPUD Skill Categories
  • Within each knowledge type, workers can possess
  • Explicit competencies in specific tools and
  • Implicit competencies such as leadership,
    abstract reasoning

SPUD Skill Levels
  • Competencies can be categorized as
  • Basic knowledge
  • Working knowledge
  • Leadership
  • Expertise

SPUD allows...
  • Managers to find the workers with the skills
    needed for a particular task/project
  • Workers to find assistance on specialized tasks
  • Workers to determine what type of training they
    need to advance their careers

Improving Access to Knowledge
  • Knowledge may exist in the organization - but may
    be difficult to find
  • KM tools can be used to make knowledge available
    to new internal markets

Case in Point Chevron
  • Best Practice Sharing Sharing information on the
    best, most profitable ways to do business
  • Knowledge Sharing Conferences
  • Intranet

Chevron Initiatives
  • Benchmarking costs for oil/gas drilling and using
    that information to predict and reduce future
  • Designation of process masters whose job it is
    to share knowledge
  • Looking at competitors best practices - as well
    as those from outside the energy industry

The Result
  • 30 percent productivity gain
  • 50 percent safety gain
  • 2 billion in cost reduction in the 1990s

Creating a Knowledge Environment
  • This is the hardest part for many companies
  • Traditional business practices may not reward
    information sharing - even in the same company!

Leveraging What Is Already There
  • Dow Chemical owned 29,000 patents - and did not
    know what they contained!
  • KM helped them...
  • extract lost knowledge
  • sell patents that were not being used
  • abandon patents that were obsolete
  • Bottom line US4 million in savings

Nine Keys to KM Success
  • Knowledge friendly culture
  • Technical/organizational infrastructure
  • Senior management support
  • Links to economic benefits/success

Nine Keys to KM success
  • Process perspective
  • Clarity of vision and language
  • Powerful incentives
  • KM structure
  • Multiple channels for knowledge xfer

Microsoft and Knowledge Management
  • Microsoft Exchange
  • Internet Information Server
  • Databases

KM Demo from Lotus Development and IBM
  • This 9 minute movie shows IBM/Lotus
    Developments vision for Knowledge Management
  • Scenario a new employees first day on the job
    at a biotechnology firm...

The Book on KM in Business
  • Working Knowledge How Organizations Manage What
    They Know Thomas H. Davenport Laurence
    Prusack Harvard Business School Press

The Other Book on KM in Business
  • If Only We Knew What We Know The Transfer of
    Internal Knowledge and Best Practice Carla
    ODell Free Press

Knowledge Management on the Web
  • Knowledge Management Magazine http//
  • Knowledge Inc. http//
  • American Productivity Quality
    Center http//

Thank You!
Al Berg Practice Director/Collaborative
Computing AMC Computer Corporation 129 West 27th
Street New York City, NY 10001 Telephone 1-212-6
20-0700, extension 1243 Facsimile 1-212-656-1785
Web Email