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Knowledge Management
Taking Control of the Information Age

Few Would deny that we exist in an age of information. Yet how many managers and organizations are fulfilling the responsibilities and responding to the opportunities inherent in our information-intensive business environment? The question is: what are we doing with all this data? Are we using information well - to grow, to improve, to learn, to better serve customers? Do we have command of information or does its growing volume only confuse and therefore limit us? Are we navigating forward or awash in minutia?

At issue here is the concept of knowledge management - the strategic application of collective company knowledge and know-how to build profits and market share. Knowledge management is a key facet of corporate intellect processing, which enables management to 'mine the corporate mind' through the collection, storage, linking, repackaging and dissemination of data, information and knowledge. Through knowledge sharing come knowledge assets - ideas and know-how that breed wisdom and/or wise decision-making. Sure, it all sounds great, but it's not easy.

"To be able to take advantage of the information and knowledge age and advanced technologies means being able to gather, sort, store, cull and disseminate data, information and knowledge," explains Amy Zuckerman, principal of A-Z International, Amherst, Mass., and a knowledge management consultant. Ms. Zuckerman adds, "We have to be able to analyze and break out information into useful units to be applied strategically. All sorts of data and information is meaningless if you can't apply it," says Zuckerman. "You have to know the questions to ask and how to do it."

We're Not There Yet
Today, the need for better knowledge management is clear. Powerful new technologies are constantly building our capacity for data collection, sharing and manipulation. At the same time, today's quality-oriented corporate mindset continues to heighten competitive fervor and our thirst for insight-based strategic advantages. What all organizations need are knowledge management skills and processes to help them turn data into information, insights, strategies and, ultimately, beneficial actions.

Although quality system compliance processes, such as ISO 9000, are valuable for documenting work processes and organizing information, attention must be paid to how skillfully such systems are employed. Zuckerman suggests many aren't reaching their potential. "Many companies lack the skills to do information-based work properly. They lack the skills to take advantage of the technologies they've implanted in their organization. The technology revolution is emerging at a time when Americans have stopped reading, let alone writing." The basic lesson here is to not underestimate the need for strong human systems and skills - writing, editing, organizing, communicating, perceiving, etc. - as a foundation to the vast array of technological capabilities now available. In our rapidly advancing society, the basics still matter.
So who manages knowledge well? Zuckerman cites several examples. Pfizer, Inc. traces shipping patterns to collect data that is then used to improve customer service. Johnson & Johnson, through electronic access to retail inventory counts, is able to fine tune sales forecasts on a weekly basis. At Phillips Lighting, shipping employees are used to gather information to be applied to marketing strategies. But how does knowledge management actually work? What are the steps?

The Knowledge Management Process
First, a definition of terms according to Zuckerman:

• Knowledge is created when information is processed (e.g., when we think).
• Knowledge assets are the actual ideas, insights, concepts, etc..., that are formed.
• Know-how "spins from the repeated application of knowledge throughout the operation."
• The more people think and use ideas, the more they know how to do. "In a corporate setting, profits are created when know-how is applied strategically."

Beginning with documentation of work procedures and knowledge sharing, which many organization have already accomplished through quality system compliance activities (e.g., ISO 9000, QS 9000), the next step is knowledge processing. Basically, it requires that knowledge be pooled - through meetings, memos, projects - and shared - memos, telephones, more meetings, personal communication. This pooling and sharing process in turn creates even more knowledge assets and know-how, subsequently improving the bottom line. Advanced forms of knowledge processing involve the use of emerging technologies to gather, store, share, quantify and link an organization's knowledge pool. It enables personal knowledge to quickly become company knowledge, and makes it available for selectively sorting, analyzing and applying individual knowledge assets to business objectives for competitive results. At this stage, knowledge management is being fully utilized.

And why is all of this beneficial? Because it actually contributes to profitability. When a company can define their need for knowledge throughout the organization, when it teaches employees to apply knowledge strategically, the following beneficial results can occur:

• Cost effective procedures and practices
• Avoidance of costly mistakes
• Better product quality
• Improved employee morale
• Gain of additional know-how

The lesson to be learned: when knowledge is applied strategically, it can become a profit breeding tool. Knowing how to sort, cull and link knowledge - then analyzing how to best strategically apply it - is what underlies the practice and the potential successes of knowledge management.