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Defining knowledge management - The British Journal of Administrative Management
Abstract: For the past eighty-five years, the Institute of Administrative Management has been at the forefront of influencing the role and practice of Office Administration. It started with the effective handling of office equipment and related personnel issues, moving on to address the practice ofwork study, organisation and methods, the concept of Total Quality Management, Business Process Re-engineering and the issues surrounding the increasingly wide range in electronic communications. More recently, the IAM has addressed the development of Knowledge Management. In action, Knowledge Management is a conscious decision on the part of an organisation to bring its staff together to help transform well structured information into an intellectual asset. It is not the technical economy or the information age. It is about harnessing people's intellectual capability. It could even help to bring together the aspirations of education, business and government. Copyright Institute of Administrative Management Jul/Aug 2001Full Text:
[IMAGE PHOTOGRAPH] Introduction For the past eighty-five years, the Institute of Administrative Management has been at the forefront of influencing the role and practice of Office Administration. It started with the effective handling of office equipment and related personnel issues, moving on to address the practice ofwork study, organisation and methods, the concept of Total Quality Management, Business Process Re-engineering and the issues surrounding the increasingly wide range in electronic communications. More recently, the IAM has addressed the development of Knowledge Management. The link in these developments is most evident between IT and Knowledge Management, but the key word is 'use'. Information only becomes 'knowledge' when it is usefully applied. Virtually all organisations are hugely dependent on their use ofInformation Technology (LT). The problem we face today is that whilst many ofthe new offerings clearly provide some major benefits to the way we run organisations and enhance our own lives, many such initiatives fail to achieve their full potential as they are not supported by sound and effective modem Administrative Management, good interpersonal skills and teamwork Invariably expectations are not matched by deliverables. These points only serve to emphasise the Institute's publicly stated commitment to promote best practice in the management of information through people. However, it should be said at the outset that there is nothing new about the concept of Knowledge Management. Recent hype about this subject, which some people regard as nothing more than a new fad or the repackaging of established principles, makes it worthy of debate and critical analysis. The Nature of Knowledge Management It has long been recognised that information is a key asset for any organisation. The same applies to Knowledge Management. In action, Knowledge Management is a conscious decision on the part of an organisation to bring its staff together to help transform well structured information into an intellectual asset. it is not the technical economy or the information age. It is about harnessing people's intellectual capability. It could even help to bring together the aspirations of education, business and government. "Knowledge management involves the creation, evolution, exchange and application of new ideas into marketable goods and services for the success of an enterprise, the vitality ofa nation's economy and the advancement of society" (D.M. Amidon) An early recognition of the concept of harnessing knowledge in the workplace is attributed to the distinguished management guru Peter Drucker who, in the 1960s, introduced the concept of the knowledge worker. In his book The Post Capitalist Society, he referred to knowledge as displacing capital natural resources and labour as a basic economic resource. As such this represents a break from the past. Proactive or Reactive Organisations? [IMAGE CHART] It is said that there are three types of organisation: those that make things happen, those that watch things happening and those that wonder what has happened! There are too many goods and services around the world chasing too few customers. The differentiation between various offerings is mainly limited to providing superior customer service (for which there is plenty of scope) and management's ability to learn faster than its competitors, to accumulate and disseminate information - in other words the effective use of knowledge. It is the way we manage knowledge that matters, rather than how we generate it. Recent research from the University of Southern California concluded that despite companies making substantial investments in technology and hiring the best talent available, the majority are still struggling with how to make the transition to a truly knowledge enterprise. For some people there is a feeling that the bigger the organisation and the more it relies on computing facilities, the further away it gets from providing real customer service. It should be remembered that computers do not run businesses. They provide information for managers to make decisions to help make profits or achieve some effective social benefit. In parallel, the advent of personal computing, which is now used by one third of the population of the UK, has brought with it the beginning of a major revolution in the way we live and work. At the present time the focus is on exploiting use of the Internet and digital communications. These backbone technologies are really all to do with the passing and receiving of information and our ability to translate that into knowledge. How does this technological approach influence our business processes? Customers dictate relationships We seem to have moved from a true one-to-one personal relationship of many years ago to an unfocused impersonal use of computers in an attempt to cut overhead costs. The effect has been to annoy many customers who may feel alienated. In order to redress this situation we now have the concept of Customer Relationship Management (CRM). Yet in reality there is only a relationship if the customer says so. Herein lies a real opportunity to use knowledge. The customer needs to feel there is real concern and interest being taken. Low value customers do not wish to feel left out. We sometimes forget that a small purchase well handled represents the best reference for future business and recommendation to others. As we appear to be diving headlong into e-- everything we are in danger of taking leave of our senses and forgetting some basic human communicating and social skills. The problem is that we do not always manage these facilities to best advantage. One example which typifies this, is the Call Centre. Call Centres are intended to help reduce the overhead costs of an organisation by automating the customer interface with routine tasks. They also seek to provide customers with sound knowledge about a product, service, resolution of a problem or simply some information from which the customer can make an intelligent decision. The technology is well established in the form of automated call dialling systems, complex networking and sophisticated databases, the use of expert systems and maybe some artificial intelligence. Call Centres employ one million people [3% ofthe UK workforce]. The best are excellent, but regrettably a significant number of payable telephone calls from the customer take far too long to be connected. Poor Administrative Management can negate any potential advantage from the technology. (See Figure i for an analysis of this process.) No Guarantees [IMAGE ILLUSTRATION] Captioned as: FIGURE 1 Call Centres are not the only manifestation ofthis problem. We could of course, pick on other e-- commerce and business examples, but the point is, I think, obvious. Technology is supposed to deliver the right information to the right people at the right time. However, it cannot guarantee who is the right person at the right time, let alone what constitutes the right information. Information generated by computer systems is not a very rich carrier ofhuman interpretation It lacks intangible broad, lateral input or any interpretation of nuances. Few realise that if we experience a bad service we will statistically tell twelve people. If the story is a good one, it may then be embellished by a recipient, who in turn will tell another group of people and so on. Hierarchical bureaucracy and far too much reliance on automation through the use ofinformation technology without the social human dimension can be a deadly antidote to good initiatives. A key to success lies in the ability to store and use knowledge of good and bad experiences which could be used to do better in the future. Doing better in the future relies heavily on planning a Knowledge Management strategy. The Action Plan should involve everybody in the organisation - from senior management to the part-time staff, and ensure information audits guide organisation structure and development.
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