Knowledge management strategies that create value

There is no one-size-fits-all way to effectively tap a firm's intellectual capital. To create value, companies must focus on how knowledge is used to build critical capabilities.

A firm that had invested millions of dollars in a state-of-the-art intranet intended to improve knowledge sharing got some bad news: Employees were using it most often to retrieve the daily menu from the company cafeteria. The system was barely used in day-to-day business activities.

Few executives would argue with the premise that knowledge management is critical—but few know precisely what to do about it. There are numerous examples of knowledge-management programs intended to improve innovation, responsiveness and adaptability that fall short of expectations. Researchers at the Accenture Institute for Strategic Change have been exploring the roots of the problem and have developed a method to help executives make effective knowledge management a reality in their organizations.

Knowledge management is still a relatively young field, with new concepts emerging constantly. Often, it is portrayed simplistically; discussions typically revolve around blanket principles that are intended to work across the organization. For example, companies are urged to emulate knowledge-management leaders such as British Petroleum and Skandia. And most knowledge-management initiatives have focused almost entirely on changes in tools and technologies, such as intranets and Lotus Notes.

These approaches have little relevance for executives contending with the day-to-day reality of running a company. Knowledge management is complex and multifaceted; it encompasses everything the organization does to make knowledge available to the business, such as embedding key information in systems and processes, applying incentives to motivate employees and forging alliances to infuse the business with new knowledge. Effective knowledge management requires a combination of many organizational elements—technology, human resource practices, organizational structure and culture—in order to ensure that the right knowledge is brought to bear at the right time.

Many companies have implemented sophisticated intranets, common repositories and other systems, largely ignoring the complex cultural issues that influence the way people behave around knowledge. By and large, those companies have seen little improvement in their ability to manage knowledge. Too often, companies implement state-of-the-art technology and then discover that culture and behavior are slow to change.

In short, simplistic solutions and "one-size-fits-all" approaches leave executives with little in the way of practical advice about how to transform the entire knowledge-management system. What's more, this fuzziness makes it difficult for executives to see a clear link between their knowledge-management investments and business value. Click here to read the full article.