Opportunities for Knowledge Management

When determining if or when you should incorporate Knowledge Management (KM) in your organization you must first look for opportunities where KM can be used. In addition where KM can bring about visible results that can be communicated throughout your organization. An immediate KM initiative that can be leveraged is what is called no or low budget KM. These initiatives include conducting, capturing and distributing "lessons learned" on projects and other corporate initiatives, writing a "trip report" and conducting a presentation to your team when you go to a conference and/or attend an important corporate function (this promotes knowledge sharing), and conducting "brow bags" presenting a topic of interest. These activities all address one of the central themes of KM, Knowledge Sharing and Transfer. Keep in mind that when I say no or low budget there may be no cost to the organization or very little cost. An important factor in these challenging economic times.

I also mentioned distributing this knowledge throughout your organization. One simple way to do this is to make the trip reports and presentations, lessons learned and brown bag presentations available on the corporate intranet and send out the appropriate communication to let everyone know that this information is available along with the principle person(s) contact information. You should encourage people who leverage this knowledge to send the principle person(s) an email letting them know how it has made a difference for them. All of the emails should be documented and presented to management to show how KM can bring about visible results and that an official KM initiative (with budget) should be examined and launched.

This is one effective way in looking for opportunities for Knowledge Management. I look forward to your comments and contributions on this subject.

Realizing ROI in KM Initiatives

I know it's been some time since I written an entry into the Knowledge Management Depot blog. I have been working with a number of clients keeping busy during these tough economic times. One of these clients is the United States Air Force. During a briefing with Randy Adkins the Air Force Knowledge Now (AFKN) Program Manager (AFMC/A8C at Wright-Patterson AFB) he mentioned that ROI (Return On Investment) for knowledge management initiatives at Wright Patterson are not measured in a traditional sense, however it is measured by how well it supports the mission. Taking this into account at the end of the day what maters is did the KM initiative increase the performance of its users or how well did it support the strategic mission of the organization.

When we are looking at achieving a return on our KM initiatives historically it can take a considerable amount of time to show results or visible ROI for an organization. However, there is an approach by Mark Clare who originally presented this in the KM Review, Volume 5 Issue 2, May/June 2002, to estimate the value of the intangible benefits of KM. This approach , the Knowledge Value Equation (KVE) simple states that the value created from managing knowledge is a function of the costs, benefits and risks of the KM initiative. Thus mathematically stated: KM Value = F (cost, benefit, risk), which equals Total Discounted Cash Flow (DCF) created over the life of the KM investment. This formula attempts to quantify the intangible impacts of KM relating it back to cash flow. This includes improved problem solving, enhanced creativity, and improved relationships with customers and other performance related activities.

Knowledge Management projects produce a stream of benefits over time. This will enable KM projects to be evaluated based on a series or stream of cash flows. However eliciting feedback from the KM user community in your organization, asking if and how something they leveraged as a result of practicing the KM policies, practices, procedures and technology contributed to thier performance will be a key indicator on how well the KM initiative is working. This will provide feedback on a more timely manner than quantifying results using KVE and allow for adjustments to be made to improve the KM environment.

I am particularly interested in what others have done to demonstrate the value a KM initiative has brought to their organization. I look forward to your comments.