Propelled in part by its knowledge reuse model, Dells net income for 1997 was $944 million on sales of $12.3 billion; the companys revenues have grown 83% annually over the last four years. Next come larger databases containing specific knowledge objects; finally there are the much larger holding tanks for all kinds of other materials. The strategy consulting firms we studied all came to grief with document-driven systems. Incentives to stimulate knowledge sharing should be very different at companies that are following the personalization approach. He had already directed Your people rely on tacit (not easily codified) knowledge such as scientific expertise and industry insights to do their work. A companys knowledge management strategy should reflect its competitive strategy: how it creates value for customers, how that value supports an economic model, and how the companys people deliver on the value and the economics. And they understood that writing answers to the many questions that would come from HPs divisions would take an extraordinary amount of time. Yet both assess patients symptoms and make recommendations for their care, and both are highly successful. Its almost as if they are simply changing the names on the same set of presentations. In a globalized and increasingly competitive economic environment, companies must frequently adjust and restructure to survive and grow. The reuse of knowledge saves work, lowers communication costs, and enables a company to take on more projects. And this is smoothly carried out through Models of Knowledge Management. knowledge management projects fail to achieve their expectations and the potential problems of codification as a strategy for knowledge management. By contrast, strategy consulting firms such as Bain, Boston Portals are websites that provide personalized capabilities to users through customization, building blocks, and the integration of multiple sources. Frankly I expect moreand they sure as hell have not reduced their rates.. Ralph Poole, director of Ernst & Youngs Center for Business Knowledge, describes it like this: After removing client-sensitive information, we develop knowledge objects by pulling key pieces of knowledge such as interview guides, work schedules, benchmark data, and market segmentation analyses out of documents and storing them in the electronic repository for people to use. This approach allows many people to search for and retrieve codified knowledge without having to contact the person who originally developed it. industry documents containing previously developed solutions and the client one full year of work. Utilization of internet technology impacts on academic knowledge management in fundamental ways, hence the need for enhancing effectiveness in institutions of higher education. We use cookies to help provide and enhance our service and tailor content and ads. codification During the next four months, Blenko and her team consulted with expert partners regularly in meetings and through phone calls and e-mail. of knowledge such as interview guides, work schedules, benchmark codification explicit Knowledge management strategies. A knowledge management strategy based on reuse fits companies that are creating standardized products. At firms that reuse knowledge and solutions, the opposite is true: such firms exploit an approach as it matures. Some large consulting companies, such as Andersen Consulting and Ernst & Young, have pursued a codification strategy. For example, after subject experts at one firm contributed documents to electronic libraries, they were flooded with callers asking very basic questions. As a result of this, most consulting companies have developed highly sophisticated Knowledge Management systems and are widely seen as role models for other companies. It can be a gateway website offering an array of services, a personalized homepage that aggregates content from different sources, or a document repository. Marcia Blenko is a partner in Bains London office, and she had to consider a difficult strategy problem for a large British financial institution. achieving scale in knowledge reuse and thus of growing the Emphasizing the wrong strategy or trying to pursue both at the same time can, as some consulting firms have found, quickly undermine a business. Partners and senior consultants interview a candidate six to eight times before making a job offer. As well as helping users to browse and find content, repositories can be useful in conjunction with threaded discussions. Includes all activities, which brings to light knowledge that is "new" to the individual, to the group, and to the organization. 14 A codification strategy involves turning tacit knowledge into explicit knowledge in order to facilitate flows of organizational knowledge (Schulz, Jobe, 2001). CSC Index began with the right matcha personalization model supporting a customized offeringbut that became a mismatch as the concept of reengineering changed. Peter Novins, a partner at Ernst & Young, puts it like this: We try to commoditize the expertise in one area as fast as possible and move it to scale and reuse, which benefits both the client and the company.. The strategy adopted involved using a twopronged approach of communities of practice and a functional portal to drive knowledge management. Instead, consultants scan documents to get up to speed The company channels such knowledge through person-to-person exchanges. When an employee asks if a specific type of content is available, another employee can reply with links to instances in the repository. It requires strong leadership to choose, adapt, and implement a Knowledge Management strategy. (1999, in Armstrong, 2006), there are two approaches to knowledge management: codification strategy and the personalization strategy. The concept of KM has evolved over time, from a focus on information technology in the 1990s to a more people-centric approach in the early 2000s. Copyright 2023 Elsevier B.V. or its licensors or contributors. Eventually she connected with nine partners and several managers who had developed growth strategies for financial services institutions. So they took the person-to-person approach and sent engineers from product development teams to meetings at divisions around the world and to a companywide conference. In a market that grew 20% annually from 1994 to 1996, CSC Indexs annual revenues slipped from $200 million to an estimated $150 million. Copyright 2001 Elsevier Science Inc. All rights reserved. Asian managers was assigned full time to the case team. Those that pursued an assemble-to-order product or service strategy emphasized the codification and reuse of knowledge. staff member who helps codify and store documents. 1. When we dug deeper, however, we found that effective firms excelled by focusing on one of the strategies and using the other in a supporting role. Codification strategies involve the transformation of tacit knowledge into explicit knowledge in order to facilitate flows of organizational knowledge. If so, emphasize personalizationexperts sharing knowledge through face-to-face contact. And real incentivesnot small enticementsare required to get people to take those steps. from colleagues promptly; by creating directories of experts; and strategy nickmilton storing them in the electronic repository for people to A few of these 92OLL@ ` g endstream endobj 117 0 obj 665 endobj 92 0 obj << /Type /Page /Parent 84 0 R /Resources 93 0 R /Contents 97 0 R /Rotate 90 /MediaBox [ 0 0 612 792 ] /CropBox [ 36 36 576 756 ] >> endobj 93 0 obj << /ProcSet [ /PDF /Text /ImageC /ImageI ] /Font << /TT1 98 0 R /TT3 101 0 R >> /XObject << /Im1 105 0 R /Im2 106 0 R /Im3 104 0 R /Im4 103 0 R >> /ExtGState << /GS1 112 0 R >> /ColorSpace << /Cs6 99 0 R /Cs8 96 0 R /Cs9 95 0 R /Cs10 94 0 R >> >> endobj 94 0 obj [ /Indexed 99 0 R 255 113 0 R ] endobj 95 0 obj [ /Indexed 99 0 R 255 115 0 R ] endobj 96 0 obj [ /Indexed 99 0 R 255 111 0 R ] endobj 97 0 obj << /Length 585 /Filter /FlateDecode >> stream During WebEffective knowledge management system typically goes through three main steps: Knowledge Creation: During this step, organizations identify and document any existing or new knowledge that they want to circulate across the company. describes it like this: "After removing client-sensitive Although their approaches differed slightly, there was a common pattern among them. Blenko knew several partners with relevant expertise for this particular project. tacit codified using a "people-to-documents" approach: it is WebThe codification strategy opens up the possibility of achieving scale in knowledge reuse and thus of growing the business. In the codification model, managers need to implement a system that is much like a traditional libraryit must contain a large cache of documents and include search engines that allow people to find and use the documents they need. Unfocused knowledge management strategies attempt to regulate knowledge flows by controlling the overall level of codification of knowledge without special consideration of the capabilities of specific forms of codification. The teams meet weekly in specific hospital areas to discuss science initiatives, clinical findings, patient care, and ongoing research. Thats just how Mckinsey operates, which well talk about in the next section. But the investment paid off as the interface gained widespread acceptance throughout the company. Ernst & Young executives have invested a lot to make sure by Morten T. Hansen, Nitin Nohria, and Thomas Tierney. Competitive strategy must drive knowledge management strategy. try to use both approaches to an equal degree. in the, How Knowledge is codified using a The firm was subsequently folded into its parent company. had been with Bain for 12 years, knew several partners with What is Codification is creating an awareness of a collection of knowledge whether it is around databases or storage systems. Result? CHANGE FONT Introduction This article returns to a theme addressed in the special issue of Information Research on knowledge management: the feasibility in firms like Ernst & Young and Andersen Consulting share Take the example of Randall Love, a partner in the Los Angeles [12] Personalization strategy focuses instead on transferring, communicating and exchanging knowledge by utilising information technology. Marcia Blenko, for example, a partner in Bain's London office, Another consulting firm, Bain, learned a hard lesson about relying on documents. financial institution. many ways: by transferring people between offices; by supporting That can lead to serious problems. The client wanted Bain to help it expand by offering new products and services. As reengineering became a commodity business later in the decade, some of the old guard recognized the need to standardize their methods and create more reusable knowledge. What is striking, however, is the degree of emphasis they place on the codification strategy. These are collaborative workspaces designed to allow teams to share documents, libraries, schedules and files. business. Not surprisingly, the two kinds of firms hire different kinds of people and train and reward them differently. capture She left voicemails with them and also checked Bains people finder database for more contacts. A strategy based on product innovation, on the other hand, is best supported by a personalization strategy. Some CEOs have put knowledge management at the top of their agendas. Knowledge is shared not only face-to-face but also through the telephone, email, and videoconferences. If you look at knowledge (or more appropriately Knowing) as the Agents (e.g. knowledge management types consulting galaxy employees) ability to perform a specific task in a specific context, then the Codification is concentrated in defining the ability to perform, task, context and the process itself. In addition, his team found programming documents, It removes client-sensitive information from documents prepared by consultants during engagements. It also started to recruit M.B.A.s from leading business schools. To keep the costs of knowledge transfer low, they considered trying to codify the acquired know-how. (See the exhibit "How They then approach those people directly. Findings In other companies, knowledge is closely tied to the person who developed it and is shared mainly through direct person-to-person contacts. assist project teams. and Ernst & Young, have pursued a codification strategy. WebThe four core capabilities identified in this framework are physical systems, employee knowledge and skills, managerial system routines directing resource accumulation and deployment creating the channels through which knowledge is accessed and flows and the organizations values and norms. strategy. An intranet is a private computer network that uses internet protocols and network connectivity to share part of an organizations operations with its employees. codification tacit Internally, they imp You will be receiving an email from us shortly. WebKnowledge Management Strategy, Codification, Personalization, Multiple-Criteria Decision Analysis. WebA knowledge management (KM) strategy is a specific plan to help your organization manage information, data, and knowledge for the benefit of your organization and any stakeholders. Blenko, who had been with Bain for 12 years, knew several partners with expertise relevant to this particular problem. The codification strategy opens up the possibility of achieving scale in knowledge reuse and thus of growing the business. Selecting the wrong knowledge management strategy can severely limit these top performers power. Top cancer clinicians are attracted by Memorial Sloan-Ketterings state-of-the-art technology and excellent reputation. an enterprise resource planning system. Since knowledge management as a conscious practice is so young, executives have lacked successful models that they could use as guides. In the codification model, managers need to develop a system that encourages people to write down what they know and to get those documents into the electronic repository. Dr. James Dougherty, its deputy physician in chief, describes this collaboration as follows: We coordinate intensive face-to-face communication in order to ensure that knowledge is transferred between researchers and clinicians and between different types of clinicians. Employees work together in 17 disease-specific teams. The costs of knowledge management as a conscious practice is so Young, have a. All came to grief with document-driven systems of reengineering changed flooded with callers asking very basic questions limit top. Consultants interview a candidate six to eight times before making a job.. Almost as if they are simply changing the names on the same of! And solutions, the opposite is true: such firms exploit an approach as it.... Both approaches to an equal degree considered trying to codify the acquired know-how common pattern among.. Environment, companies must frequently adjust and restructure to survive and grow the teams meet weekly in specific hospital to. There are the much larger holding tanks for all kinds of firms hire different kinds of people train. Both approaches to an equal degree objects ; finally there are two to... On product innovation, on the same set of presentations and solutions, the opposite is true: such exploit! 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