In late 2013 Amazon hosted a working group to discuss challenges around organizational knowledge management, as well as current best practices. It was attended by some pretty heavy hitters including; Chevron, GE, Microsoft, Proctor & Gamble, and Shell. This is a great (and relatively short) read. I highly recommend checking it out here.
With that said, the discussion touched on the business case for knowledge management, the roles that structure, information technology, leadership, and culture play in facilitating knowledge management, and finally the importance of understanding how to measure knowledge management (establishing its impact and if the company is getting a return on the investment).
Tackling all of these today would take more time than I have this morning (30 minutes), so instead today I just want to touch on the business case for knowledge management and then open this one up for thoughts in the comments section.
The business case for knowledge management is (mostly) centered around the facts that:
- Knowledge transfer improves organizational performance by diffusing learning, connecting unique ideas, and spurring innovation
- Effective knowledge transfer accelerates the capability development of new hires (both entry level and experienced), positioning them to more quickly add value to the firm.
Breaking these out, if there is poor knowledge management in an organization the consequences can manifest themselves long-term in several forms, including diminished team performance as talent exits the organization (via voluntary turnover such as resignations or retirements).
Knowledge management failure penalties can also come in the form of increased replacement costs – if the knowledge transfer process hasn’t been optimized then an organization has to spend more money hiring an experienced replacement (as opposed to hiring one or two levels lower and training a less senior employee, reducing headcount costs and leaving more room for promotion).
In some instances, an organization simply can’t afford to lose an employee because his/her internal knowledge can’t be replaced internally. This often means having to pay well above market rate to retain said talent in cases of resignation, and having to ask an employee to delay retirement (often with expensive extrinsic incentives or sub-optimal intrinsic ones in the form of flex schedules/extra days off etc.) while replacements are trained in cases of aging workers exiting an organization.
Conversely, by diffusing knowledge across departments we not only cultivate a more effective workforce, but we also can increase engagement by developing a larger percentage of the labor force (many employees love intra-departmental and cross-functional developmental opportunities).
…I am literally out of time, so please give this one a read and share your thoughts in the comments section below.