Building Knowledge Management Capabilities
description
Transcript of Building Knowledge Management Capabilities
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CONFIDENTIAL
August 2001
Building Knowledge Management Capabilities
McKinsey Nonprofit Practice
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1CONTENTS
Why knowledge management (KM) is important
Framework for knowledge management
McKinsey Nonprofit Practice example
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2McKINSEY CORE BELIEFS ON KNOWLEDGE-BASED STRATEGIES
Source: "Strategy as if Knowledge Mattered" Brooke Manville and Nathaniel Foote, May 1996
1. Knowledge-based strategies begin with strategy, not knowledge
2. Knowledge-based strategies are not strategies unless you link them to measures of performance
3. Executing a knowledge-based strategy is not about managing knowledge, it is about nurturing people with knowledge
4. Organizations leverage knowledge through networks of people who collaborate, not through networks of technology that interconnect
5. People networks leverage knowledge through organizational pull, rather than centralised information push
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3Learning culture and orientation
Facts and informationare availableand used
Key lessons are captured and leveraged
Best practice is shared widely across the business
New leading edge thinking is created and shared
Possible performance impact
Use of learning
STAGES OF KM AND PERFORMANCE
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4COMMON SYMPTOMS OF KNOWLEDGE COMMON SYMPTOMS OF KNOWLEDGE COMMON SYMPTOMS OF KNOWLEDGE COMMON SYMPTOMS OF KNOWLEDGE MANAGEMENT PROBLEMSMANAGEMENT PROBLEMSMANAGEMENT PROBLEMSMANAGEMENT PROBLEMS
Symptom Consequences
Emphasis on gut feel in decision making
Over-reliance on a few key experts
Frequent "reinvention of the wheel"
Failure to generate new ideas and insights
Failure to attract/retain outstanding people
Insularity and inward-looking focus
Key decisions often turn out to be wrong Little transfer of knowledge between individuals
Potential bottlenecks in accessing existing knowledge Loss of institutional knowledge/memory when they leave
Same mistakes repeated; no learning from past experience Slow to roll out successful innovation
Erosion of existing core competencies Failure to generate new competencies, intellectual assets
Vicious circle of poorer performance leading to declining reputation, attracting weaker talent, and hence generating poorer performance
Failure to leverage external expertise Tendency towards organizational inertia and
intellectual sterility
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5Barriers to effective
use of knowledge
BARRIERS TO EFFECTIVE KM
IncentivesNo incentives to encourage knowledge building and sharingFocus on unit, not collective performanceFocus on short-term results
Knowledge infrastructure Lack of clear leadership
Patchy availability of IT tools
Networks not broadened/ deepened over time
Information cultureInadequate codification of knowledgeImportance of sharing not recognized
Problem solving cultureLack of standardization (where useful)Lack of problem solving discipline
People Lack of time to codify and share learning Rapid job rotations or high turnover Loss of institutional memory Little encouragement of specialist expertise
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6CONTENTS
Why knowledge management (KM) is important
Framework for knowledge management
McKinsey Nonprofit Practice example
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7Acquire/ create Codify
Share
KM HAS 3 KEY COMPONENTS
Clearly define knowledge needs and agendaDesign data input channel and forums for ease of useIncent contribution of knowledgeTie knowledge contributions to performance management
Create community of experts and identify First AlertsCreate knowledge based on todays learnings for use in future situationsDevelop process for updating and maintaining information and organization
Provide access to knowledge through multiple channelsOrganize information via easily understood taxonomy
Agree on what you need to know and incent contribution of knowledge
Ensure knowledge is up to date on what you know and who knows what
Establish wide access to people and databases and encourage wide use
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8KEY DRIVERS OF EFFECTIVE KNOWLEDGE CREATION
Maximize ease of inputLeverage existing collection mechanisms
Channels
Incentives
Establish minimum standards for expected contributionOffer rewards and/or recognition for outstanding efforts (e.g., most downloaded document)Provide quick, easy access to submitted knowledge as a tangible result of efforts
Performance management
Formally integrate knowledge contributions into the evaluation process, with clear metrics outlined and communicated
Acquire/ create Codify
Share
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9EXAMPLES OF EFFECTIVE KNOWLEDGE CREATION TOOLS
McKinsey: Practice Olympics motivates knowledge contribution through competition by offering consulting teams the opportunity to showcase key learnings
Channels
Source: McKinsey Organization Practice
Performance management
Buckman Laboratories: job descriptions and performance reviews are explicit about contributing knowledge
McKinsey: knowledge development helps establish the individual as an expert, which is formally integrated into the evaluation process for partner election
Incentives Buckman Laboratories: top knowledge sharers are recognized at
special company event
General Electric: established culture that discourages hoarding of knowledge; individual performance reviews stress skills that contribute to culture
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KEY DRIVERS OF EFFECTIVE KNOWLEDGE CODIFICATION
Institute a codification effort to categorize/prioritize/distribute information to make access as easy and fast as possible
Incorporate codification efforts into existing processes (vs. creating new work)
Perform periodic purges to prune outdated or superceded documents
Information Codification
People Network
Formalize the community of experts through a First alert or similar mechanism to leverage organizational knowledge
Integrate document and people network by providing a contact mechanism to link useful documents to their authors
Acquire/ create Codify
Share
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CODIFICATION: INTEGRATING INFORMATION AND PEOPLE
Texas Instruments: created a facilitator network of 200 people worldwide who spend part of their time helping collect best practices, populate databases, and codify knowledge
McKinsey Parsed knowledge into functional and industry practices Designated Practice members to coordinate knowledge efforts
Data Codification
People Network
Source: McKinsey Organization Practice
HP: established a knowledge management group which gathers and filters information, catalogs documents, and sets up best Practice databases
Chevron: maintains a Best Practices Resource Map organized by business process and explicitly delineates where expertise resides within the organization
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KEY DRIVERS OF KNOWLEDGE SHARING
Emphasize use of the knowledge management tools during training
Regularly audit training program to ensure use of latest knowledge
Training
Communities of practice
Institute regular events to encourage cross-organizational knowledge sharing
Emphasize sharing through support of informal communities
Maximize ease of accessing information or contacts when needed by establishing multiple channels (e.g., website, first alerts, knowledge-sharing meetings)
Channels
Acquire/ create Codify
Share
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SHARING: TRAINING AND COMMUNITIES OF PRACTICE
Intel Invests $75 million per year on training Established Intel University to serve as an opportunity to partner with
external experts as well as disseminate knowledge
McKinsey Provides training sequence for consultants (Basic Consulting
Readiness, Introductory Leadership Workshop, Engagement Leadership Workshop, Communications Leadership Workshop)
Selected topics are presented at regular knowledge-sharing meetings developed at the Practice, office, or firm-wide level
Training
Source: McKinsey Organization Practice
Communities of practice
ABB Maintains local peer review boards for its 5,000 profit centers, bringing
together experience and expertise relevant to the local companyChevron Nurtures informal networks through communities of practice and formal
regular conferences for best practice exchange
McKinsey Created the internal McKinsey intranet to provide easy and continuous
access to a database of sanitized cases and key insights
Channels
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CONTENTS
Why knowledge management (KM) is important
Framework for knowledge management
McKinsey Nonprofit Practice example
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THE PRACTICES PLAY A CRUCIAL ROLE IN KM AT McKINSEYPractices (>70) Role of practices Practice staff members
Practice review committee
For example:Nonprofit MarketingPharmaceuticalsBanking and securitiesOrganization
Capture information from teamsFind new knowledge from external sourcesHouse experts and R&I specialists who consult to teamsMaintain databases of documents and peopleOrganize information in Practice databases and on intranet websitesProvide first contact for teams to get up to speedReview knowledge, initiate efforts to improve in weak areasOrganize conferences/training sessions
Practice leaderPractice managersKnowledge experts/specialistsResearch and information specialists/analystsProfessional development coordinatorsAdministrative support
Composed of McKinsey partners and directorsReviews the work of the Practices (on an individual and collective basis)
Support infrastructure
Firmwide intranet, with customized Practice websitesDatabases to track engagements, people and expertise, internal and external knowledge/documents
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CASE STUDY: McKINSEYS NONPROFIT PRACTICE
Acquire/create
Codify
Share
Define knowledge gaps based on analysis of requests
Conduct new research and/or reach out to teams working in that area
By subsector, define knowledge agenda and assign people to develop new ideas
Send out team debrief survey that encourages knowledge codification
Collect team documents, sanitize key information, and build knowledge documents (if team does not codify themselves)
By subsector, periodically reach out to recent teams and synthesize learnings across engagements (leveraging practice Fellows)
Overall
Sent out bimonthly newsletter
Convene subsector knowledge-sharing days
Send short weekly updates on new engagements, resources, requests
Team specific
Answer research requests by providing existing resources or conducting new research
Provide CD with relevant expertise to support teams
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CASE EXAMPLE: CAPITAL CAMPAIGNS
New teams read PD and other internal and external resources sent by Practice
Teams call Practice-identified experts (e.g., members of Team 1)
Teams conduct new research and analysis
Teams develop hypotheses and recommendations for their clients
Teams add new client case studies and other tools to supplement Practice collection
Team 1 worked with client to develop a strategy for successful capital campaign, calling on practice for research support Practice debrief process
reached out to team post-engagement to ask about potential PD
Team worked with Practice to sanitize/ codify learnings
Several teams have since called Practice for help (or visited Web site) on capital campaigns and received new document
Learn
Apply/ build
Feed back
Acquire/create
Share
Codify
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LESSONS LEARNED ABOUT KNOWLEDGE MANAGEMENT
Defining objectives of the knowledge management systems in a clear and operational way is key; continually redefining knowledge gaps and proactively doing research to fill them enables Practice to be more valuable to teams over time
Physical systems and processes are critical; organizing and cross-referencing information is the other half the infrastructure battle
Connecting people to people is a major role personal networks are very important
Providing incentives for knowledge codification (and being persistent) is critical to building the knowledge base; success is much higher with teams who had already benefited from Practice support
Timeliness is key likelihood of codification declines steeply as time passes after an engagement or experience ends
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QUESTIONS TO ADDRESS WHEN BUILDING KM CAPABILITY
Why do you want to capture knowledge?
What knowledge is most important to capture and share?
How (i.e., with what systems) will knowledge be captured and shared?
Who will be responsible for capturing/managing knowledge?
How will knowledge management roles be established and rewarded?