Benefit of Knowledge Management: Why KMWhat is the benefit of implementing Knowledge Management program in any organization? What is the advantage of KM? The answer to such questions requires through understanding of KM and its expected ROI ( Return on Investment). As eighty percent of organization knowledge is Tacit Knowledge so calculating the ROI is very difficult and it may not be possible also. The impact of a successful knowledge management program can be seen in terms of new and better product developments, higher customer satisfaction, reduce in input cost, higher productivity etc. There are many organizations who achieve all these without having a formal knowledge management program. These organizations have strong culture of innovation and sharing and must be spiraling through the knowledge creating process without even knowing the SECI model. These organizations have strong culture or sharing and innovating within their organization. A formal KM program accelerates this knowledge creating process in a structured way. For other type of organizations it facilitates the SECI model of knowledge creation. Let us know discuss the benefits of a formal KM program.
Geography is history
Our competitor is not far off from our place. With the global nature of today's business, companies are setting up their units and opening new marketing offices in any part of the world. The advantage of being local does not exit any more. Internet has give opportunity by providing a level playing field to all create and operate new business without having a office near the customer or consumer. These opportunities are to be tapped to enter into a new market or customer segment. At the same time one has to innovate and improve to protect the existing market with a knowledge driven business management process.
Knowledge workers carry their product.
An organization can become learning or innovative one because of its intellectual assets and knowledge workers. These knowledge workers are key to the success and can bring tremendous improvement and change to the organization. But these knowledge workers do not need the traditional ways of providing motivation like financial rewards. Better financial package are must but not the one which will bring result. They prefer better challenging jobs and peer respects. So the organization has to provide or facilitate better knowledge creation process to motivate knowledge workers. Ultimately the organization gets maximum ROI on its efforts.
KM depends on culture not on IT
Many Knowledge Management programs fail because of excessive dependence on technology. So to get the maximum out of any KM program the organization should focus on culture building. Technology just provides a platform for exchange of knowledge but it itself can't be called as knowledge management program. A strong culture of sharing and innovating is what brings success to a KM program. So through KM program a culture is developed which can't be copied by any competitor.
Decision support system
KM creates a platform for extensive data mining and triggers many trend analysis and business intelligence knowledge. It assists today's managers with better decision supports systems. With sharing of data and information across the organization and getting the details from customers and suppliers, managers can forecast the future trend and take better decision.
Collaboration across the industry
Knowledge creation process does not limit itself within the organization. Customer or supplier knowledge and its feedbacks create or trigger a new knowledge creating process. Conference and seminars brings new learning to the organization and introduces ones knowledge and expertise to others. It encourages partnership and collaboration to develop new products and services leveraging the experience of different organizations. Many academicians joins hand with technocrats to develop or improve existing or new process.
Why to re-invent the wheel
One company after a through research found the solution for a problem and when thy have gone to patent office to take the patent on their name, to their surprise they found that four years back the same solution has been patented by them. Many time precious resource and time gets wasted on finding a solution which is already done before. KM provides platform in the form of community of practices, discussion boards, ask expert system, yellow pages etc to provide or build the existing successful solutions. Such tools assist knowledge worker in developing and sharing such best practices and innovation across the community.
Leader in change management
Through innovation and sharing KM helps in developing new products and services or improves the existing practices. Some of these innovations or an improvement sets a new trend in the market and the organization takes the lead role among the peers. Knowledge driven organization always takes a leaders role and set a new standard for others to follow. It develops a new trust among its customers and suppliers and gets the confidence of them as a innovative organization.
Flexible business approach
Because of the strong networking culture Knowledge Management creates it helps in developing collaborative decision making and threat analyzing capability of any organization. The organization faces new challenges successfully and became a flexible organization to adopt new business environment. New product and services development in new areas became easy as Knowledge Management encourages collaboration among customers and suppliers by frequent interactions. Organizations inters into new line of business with their knowledge and collaborations with others.
Knowledge intensive not capital intensive
Today's business is not located near availability of raw materials or capital. They are flowing to the areas where knowledge is available. Companies future valuation heavily depends on its future market potential based on today's knowledge creating capability. Equipment or the capital is not the key differentiator among the organizations. Capital flows to the areas where knowledge is available to create more business product and services.