5 activities of Information Resources Management (Willard –
1993) ;
Identification: What information is there? How is it identified and
coded?
Ownership: Who is responsible for different information entities &
coordination?
Cost and Value: What is a basic model for making judgments on
purchase and use?
Development: How can we increase the value of information or
stimulate demand?
Exploitation: What is the best way to proactively maximize the value
for money?
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The result of KM audit:
Identification of core knowledge assets and flows—who creates,
who uses.
Identification of gaps in information and knowledge needed to
manage the business effectively.
Areas of information policy and ownership that need improving.
Opportunities to reduce information-handling costs.
Opportunities to improve coordination and access to commonly
needed information.
A clearer understanding of the contribution of knowledge to
business results
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KM audit provides evidence-based information about current
knowledge status (knowledge health).
As a basis to set up new knowledge management program.
KM audit function as a regular review and assessment of
existing knowledge management practices in the company.
KM audit must be focused on people
Once the ―as is‖ portrait of the organization has been completed
through information gathering and the knowledge audit, a gap
analysis can be performed
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The difference between the organization‘s existing and desired
KM state is analyzed in terms of enablers and barriers to
successful KM implementation
Gap analysis should consider these points ;
What are the major differences between the current and desired KM
states of the organization?
List barriers to KM implementation (e.g., culture where ―knowledge is
power‖ or where individual possession of knowledge is consistently
rewarded).
List KM leverage points or enablers (e.g., existing initiatives that could
be built upon)
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Gap analysis should consider these points ;
Identify opportunities to collaborate with other business initiatives
(e.g., combine knowledge continuity goals with succession planning
initiatives in Human Resources).
Conduct a risk analysis (e.g., knowledge that will soon ―walk out the
door‖ due to imminent retirements or knowledge that is at risk
because only a few individuals are competent in this area and very
little of their expertise exists in coded or tangible knowledge assets).
Are there redundancies within the organization (e.g., the case of the
right hand not knowing what the left hand is doing)?
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Gap analysis should consider these points ;
Are there knowledge silos (e.g., groups, departments, or individuals
that hoard knowledge or block fluid knowledge flows to other groups,
departments, or colleagues)?
How does the organization rank with respect to others within the
industry? (e.g., are they early adopters of KM, KM leaders who are
emulated by others, or are they just becoming aware of KM needs
within their organization?)
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This analysis can then be used to list and prioritize KM
objectives to be addressed by the organization.
The results of the gap analysis should be validated by returning
to the stakeholders who were initially involved in the
information-gathering and needs analysis phases.
The priorities should be determined by a consensus of the
organization‘s key stakeholders.
The result will be a KM strategy document that can be used as
road map to implement KM within the organization.
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A knowledge audit, is a more of a qualitative evaluation.
A sound investigation into an organization knowledge
‗health‘. KM audit will look at ;
What are the organization‘s knowledge needs?
What knowledge assets or resources does it have and where are
they?
What gaps exist in its knowledge?
How does knowledge flow around the organization?
What blockages are there to that flow (to what extent do its
people, processes and technology currently support or hamper the
effective flow of knowledge?
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The knowledge audit provides an evidence-based
assessment of where the organisation needs to focus its
knowledge management efforts.
It can reveal the organization‘s knowledge management
needs, strengths, weaknesses, opportunities, threats and
risks.
If properly done, it would provide accurate identification,
quantification, measurement and assessment of the sum
total of tacit and explicit knowledge in the organization (Ann
Hylton, 2002)
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Knowledge audit may also identify the following (Wiig, 1993) :
Information glut or scarcity
Lack of awareness of information elsewhere in the
organization
Inability to keep relevant information
Significant ‗reinventing‘ the wheel
Common use of out of date information
Not knowing where to go for expertise in a specific area (Knowledge Management Methods: Practical Approaches to Managing Knowledge)
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Knowledge audit is the process to identify
Every knowledge produced by an organization,
Who produce and use it,
How frequent is the knowledge used, and
Where is the knowledge stored
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Intellectual assets are intellectual materials that have been
formalized, captured, and leveraged to produce higher value
for the firm
Intellectual asset classified as ;
Body of tacit and explicit knowledge about a task, person, or
organization.
The capital resources (human, structural, and relational) that
augment this body of knowledge.
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3 categories of knowledge assets (p. 267)
Human Capital brainpower that left after 5 pm
Structural Capital brainpower that stay after 5 pm (procedures,
system, software, policies, patent)
Customer Capital relationship value (current & future)
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Organization can take inventories of the IC/IA, or even sell
them (training, consultancies)
Example of IA inventories ;
Product formula
Business plan
Marketing strategies
Vendor terms
Employee lists
Product composition
New services process
SWOT analysis
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4 dimensions of business that form Skandia Navigator model
Financial focus, represented in monetary terms.
Customer focus, a financial and nonfinancial measure of the value
of customer capital.
Process focus, address the effective use of technology within
organization
Renewal and development focus, attempts to capture the
innovative capabilities of the organization.
All related to human capital
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3 popular approach for measuring KM are ;
Benchmarking
Balance scorecard
House of quality
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Originated from Xerox in 1970‘s, when it learn the logistic of
LL Bean (p. 272)
Learn from the best to become one
Internal – comparison against other unit
External – comparison with other companies/industries
3 types of benchmarking (grasp the idea in p. 273)
Industry group measurement
Best practices studies
Cooperative / collaborative benchmarking
Competitive benchmarking
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Industry group measurement
Measurement of various aspects of the operation and compare to
similar industry measurements.
Best practices studies
Studies and lists of what works best.
Useful to benchmarking research, but they are not useful as
metrics.
What works best for an entity in its specific environment may not
work the same way in another environment.
Book, consulting, research
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Cooperative benchmarking
the measurement of key production functions of inputs, outputs,
and outcomes with the aim of improving them.
Performed with the assistance of the entity being studied (the
benchmark ―partner‖).
The entity selected as a benchmark must be the one that has
―best practices‖ in the area of interest or has won a major national
or international quality award.
Collaborative benchmarking
Both entities study each other and work together to improve.
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Competitive benchmarking
The study and measurement of a competitor without its
cooperation for the purposes of process or product quality
improvement.
A version of competitive benchmarking is the commisioning of a
third party to study a group of competitors and share the results.
The third party consultant is might knows what data belong to
which entity.
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Comparison with key leader in the industry to identify any
best practices that can be applied in other organization
Avoiding wheel reinventing, by looking at what has worked
and what has not worked for other companies operating in
comparable environments or industrial sectors
Lack of sufficient value & flexibility in the future, leads to
other measurement tools and techniques to measure the
effectiveness of KM
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The key steps ;
1. Determine what to benchmark: which knowledge processes,
products, services? Why? With what scope?
2. Form a benchmarking team.
3. Select a benchmarking short list—which companies will you be
benchmarking against?
4. Collect and analyze data.
5. Determine what changes should be made as a result of the
metrics obtained
6. Repeat when an appropriate amount of time has lapse to
measure progress
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The potential benefit ;
Overall productivity of knowledge investments.
Service quality.
Customer satisfaction and the operational level of customer
service.
Time to market in relation to other competitors.
Costs, profits, and margins.
Distribution.
Relationships and relationship management.
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A measurement and management system that enable
organization to clarify its vision & strategy, then translate
them into action
Provides feedback on both the internal business processes
and external outcomes in order to continuously improve
strategic performance and results.
A conceptual framework for translating an organization‘s
vision into a set of performance indicators distributed among
four dimensions – Financial, Customer, Internal Business
Process, Learning & Growth
See p. 275 for the illustration of BSC
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The BSC keep the balance between ;
Internal & external measures
Objective & subjective measures
Performance result & driver of the future results
Financial indicator ;
Operating income
ROI
Economic value added
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Customer indicator ;
Satisfaction
Retention
Market share
IBP indicator ;
Cost and quality
Time and resources
L & G indicator ;
Employee satisfaction & retention
Skills set
Career management
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BSC can be expanded to include ;
Objectives the major goals to be achieved (e.g., profitable
growth).
Metrics parameters that will be monitored in order to measure
progress toward these stated goals (e.g., growth in net margin).
Targets specific thresholds to be met for each metric (e.g., 2%
or greater growth in net margin).
Initiatives describe the actions, projects, programs, and so on
to be put into place in order to be able to meet the stated goals.
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Develop to show the connection between true quality,
quality characteristics, & process characteristic
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