The librarys purpose was to help consultants learn from work done in the past without having to contact the teams that did the work. And second, it means that its difficult to hire many new consultants in a short period because every new person needs so much one-on-one training. Although their approaches differed slightly, there was a common pattern among them. This makes it possible to achieve scale in knowledge reuse and the ability to grow the business. Companies that follow a codification strategy rely on the economics of reuse. Once a knowledge assetsoftware code or a manual, for exampleis developed and paid for, it can be used many times over at very low cost, provided it does not have to be substantially modified each time it is used. 1. To help fill that gap, we have recently studied the knowledge management practices of companies in several industries. In the end she connected with nine partners and several managers who had developed growth strategies for financial services institutions. Dell, for instance, maintains an electronic repository of computer components and their specific configurations. The paper sees that a manager should be aware of the objectives and business processes of the organizational unit and chooses the knowledge management strategy and Objective in accordance to the business strategy and objective and enhances understanding about the influence of organizational environment factors on the success of knowledge manufacturers in other industries, but he hadn't yet worked on a In a globalized and increasingly competitive economic environment, companies must frequently adjust and restructure to survive and grow. Our investment in knowledge also helps advance the practice of management.. Users can store meeting minutes, reports, discussions and plans. Because these documents were available, Love and his team did not have to spend any time tracking down and talking with the people who had first developed them. When we dug deeper, however, we The codification of such knowledge saved the team and the client one full year of work. She left voice mail messages with them and checked Bains people finder database for more contacts. Internally, they imp You will be receiving an email from us shortly. Consultants retrieve codified knowledge without having to contact the person who originated it. By contrast, the personalization strategy relies on the logic of expert economics. Strategy consulting firms offer their clients advice that is rich in tacit knowledge. Benefits of Diversity Management The These firms have also developed electronic document systems, knowledge management projects fail to achieve their expectations and the potential problems of codification as a strategy for knowledge management. We study markets, trends, and emerging best practices, in every industry and region, locally and globally. Ernst & Young and Andersen Consulting hire undergraduates from top universities and train them to develop and implement change programs and information systems. These clinicians are highly paidmost receive salaries that place them in the ninety-fifth percentile or above relative to their counterparts at other academic institutions. Your business strategy hinges on product innovation. That can lead to serious problems. much money the client would save by implementing the system. At first, the process of reengineering required unique solutions, but it wasnt long before a step-by-step approach was needed. If you look at knowledge (or more appropriately Knowing) as the Agents (e.g. Because knowledge is the core asset of consultancies, they were among the first businesses to pay attention toand make heavy investments inthe management of knowledge. Over the last five years, they have developed elaborate ways to codify, store, and reuse knowledge. [12] Personalization strategy focuses instead on transferring, communicating and exchanging knowledge by utilising information technology. One employee, Randall Love, was preparing an important bid for a large industrial manufacturer who needed help installing an enterprise resource planning system. That opens up the possibility of achieving scale in knowledge reuse and thus of growing the business. They did not Marcia Blenko, for example, a partner in Bains London office, had to consider a difficult strategy problem for a large British financial institution. Ernst & Young have pursued a codification strategy for their Knowledge Management efforts they have devised elaborate ways to codify, store, and reuse knowledge. While some of their advice is useful, I am not sure if thats enough. and GDPR. Knowledge management captures the knowledge communicated, often involving data, documents, and manuals. e-mail. And each of Ernst & Youngs more than 40 practice areas has a staff member who helps codify and store documents. In fact, the level and quality of employees contributions to the document database should be part of their annual performance reviews. Each practice area has a staff member who helps codify and store documents, and a network links area databases. Companies that follow a standardized product strategy sell products that do not vary much, if at all. In the 1980s, before electronic document systems became fashionable, managers at Bain developed a large paper-based document center at its Boston headquarters; it stored slide books containing disguised presentations, analyses, and information on various industries. Management consulting firms have run into serious trouble when they failed to stick with one approach. The firm was subsequently folded into its parent company. At firms that reuse knowledge and solutions, the opposite is true: such firms exploit an approach as it matures. Codification is creating an awareness of a collection of knowledge whether it is around databases or storage systems. Knowledge management captures the knowledge communicated, often involving data, documents, and manuals. He knew other Ernst & Young teams had, so he searched the electronic knowledge management repository and found several helpful documents. projects for implementing information systems for several For those two reasons, strategy consulting firms find it difficult to grow rapidly without sacrificing the customized approach. meeting of the financial services practice. Employees can easily reuse the same codified knowledge on many different projects. If so, emphasize personalizationexperts sharing knowledge through face-to-face contact. Because Love reused this material, Ernst & Young won the Some companies automate knowledge management; others rely on their people to share knowledge through more traditional means. When someone calls the center, a registered nurse uses the companys clinical decision architecture to assess the callers symptoms, rule out possible conditions, and recommend a home remedy, doctors visit, or emergency room trip. Using the knowledge management repository, the consultants work through scenarios designed to improve business processes. Marcia Blenko is a partner in Bains London office, and she had to consider a difficult strategy problem for a large British financial institution. knowledge management projects fail to achieve their expectations and the potential problems of codification as a strategy for knowledge management. Or they may get paint-by-the-numbers advice when they really need help with a unique problem. You offer standardized products or services. had to consider a difficult strategy problem for a large British extracted from the person who developed it, made independent of Access more than 40 courses trusted by Fortune 500 companies. CSC Index began with the right matcha personalization model supporting a customized offeringbut that became a mismatch as the concept of reengineering changed. Based on an empirical study consisted of 310 Spanish organisations and structural equations modelling, results show that both KM strategies (codification and personalisation) impacts on innovation and organisational performance directly and indirectly (through an increase on innovation capability). The first 300 algorithms that Access Health developed have each been used an average of 8,000 times per year. codify, store, and reuse knowledge. As well as helping users to browse and find content, repositories can be useful in conjunction with threaded discussions. On a much smaller scale, Access Health initially invested $16 million in its knowledge management system when its revenues were a modest $20 million; later it spent another $40 million on the system in order to have sufficient scale to generate $100 million in revenues. strategies and using the other in a supporting role. Singapore and Sydney, and made a quick trip to Boston to attend a It requires strong leadership to choose, adapt, and implement a Knowledge Management strategy. Unnecessary innovations are expensive: programming and then debugging new software, for instance, eats a lot of resources. Michael Earl: 2001: Knowledge management strategies: Toward a Taxonomy employees) ability to perform a specific task in a specific context, then the Codification is 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. 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. Tacit knowledge can be managed in a number of different ways. But as one partner commented, The center offered a picture of a cake without giving out the recipe. The documents could not convey the richness of the knowledge or the logic that had been applied to reach solutionsthat understanding had to be communicated from one person to another. problems they need to solve. Consulting Firms Manage Their Knowledge. Do you compete by offering highly customized services or innovative products? We started by looking at management consulting firms. Executives wanted to be sure that other divisions understood and applied the interface. Selecting the wrong knowledge management strategy can severely limit these top performers power. Access Health provides a prime example of the benefits that come from reusing codified knowledgein this instance, software algorithms. Codification can act as an aspect of knowledge management. Earn badges to share on LinkedIn and your resume. WebKeywords: Knowledge acquisition; codification strategy; personalization strategy; innovation 1. The same knowledge cant be applied across different types of problems. 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. The codification of such knowledge saved the team a culture in which consultants are expected to return phone calls with nine partners and several managers who had developed growth Specialists write reports and analyses that teams use. Organizations can stay ahead of the competition by implementing a knowledge management strategy and model. WebCreate a process of applying a systematic approach to capture, structure, manage, and disseminate knowledge throughout an organization. 1. Your business strategy is based on mature offerings. (See the exhibit "How any time tracking down and talking with the people who had first Knowledge is codified using a Managing Knowledge?" Bains management eventually developed an entirely new system, but the failed approach wasted time and money. Ernst & Youngs worldwide consulting revenues, for example, increased from $1.5 billion in 1995 to $2.7 billion in 1997. technical specifications, training materials, and change from colleagues promptly; by creating directories of experts; and Ernst & Young have pursued a codification strategy for their Knowledge Management efforts they have devised elaborate ways to codify, store, and reuse Take the example of Randall Love, a partner in the Los Angeles The codification strategy opens up the possibility of achieving scale in knowledge reuse and thus of growing the business. The founders of what was originally known simply as Index had strong backgrounds in IT systems. This paper develops four categories of knowledge management strategies used by multinational corporations (MNCs). Dell has invested heavily in an electronic repository that contains a list of available components. Not surprisingly, the two kinds of firms hire different kinds of people and train and reward them differently. Consultants, we found, do not take a uniform approach to managing knowledge. It includes scientific expertise, operational know-how, insights about an industry, business judgment, and technological expertise. The chief purpose of computers at such companies is to help people communicate knowledge, not to store it. As a consequence, firms such as Andersen Consulting and Ernst & Young have been able to grow at rates of 20% or more in recent years. Or do you compete by providing superior solutions to common problems or offering low-cost, assembled-to-order products? Soon the firm had two populations: an old guard that focused on IT systems and had strong implementation skills, and a new guard that focused on corporate strategy and had strong conceptual skills. At Bain, 1 out of 60 applicants gets an offer. By better understanding the two strategies and their strengths and weaknesses, chief executives will be able to make more surefooted decisions about knowledge management and their investments in it. that the codification process works efficiently. project and closed the sale in two months instead of the typical These firms have also developed electronic document systems, but the purpose of the systems is not to provide knowledge objects. It then stores key pieces of knowledgeinterview guides, work schedules, market analysesin an electronic repository. Over Knowledge Management is a key part of consulting firms as their product is knowledge. But the investment paid off as the interface gained widespread acceptance throughout the company. staff member who helps codify and store documents. and the client one full year of work. To make person-to-person communication easy, a teams members are all located in the same area of the hospital. During Copyright 2001 Elsevier Science Inc. All rights reserved. WebPremising on the conversion of explicit knowledge to explicit knowledge, this generation of KM primarily relied on codification strategy. But it wasnt until the 1990s that chief executives started talking about knowledge management.
She left voicemails with them and also checked Bains people finder database for more contacts. Because these Copyright 2023 Elsevier B.V. or its licensors or contributors. Rather than limiting travel budgets, executives encourage such travel. But it turned out that technicians could not solve problems using the system by itself. Each team has several face-to-face meetings per week that everyone attends. Technology should enhance communication and not become a barrier to effective collaboration. The Memorial Sloan-Kettering Cancer Center opted for a people-to-people knowledge management strategy to create 17 disease-specific teams. business. The level of IT support a company needs depends on its choice of knowledge management strategy. Diversity management is the practice of creating an inclusive and welcoming work environment where everyone feels respected and valued, regardless of their differences. By managing diversity effectively, organizations can create a more inclusive and productive workplace, improve employee satisfaction and retention, and enhance their strategy. shared not only face-to-face but also over the telephone, by It removes client-sensitive information from documents prepared by consultants during engagements. 92OLL@
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Young teams had, however, so he searched the electronic knowledge storing them in the electronic repository for people to Blenko, who HBS Professors Morten T. Hansen and Nitin Nohria and colleague Thomas Tierney of Bain & Company set out to fill the gap and found two key knowledge management strategies among which companies should choose: codification, based on knowledge codified and stored in databases, and personalization, in which knowledge is shared mainly That level of reuse allows it to charge low prices per call. Knowledge codification. Codification strategies involve the transformation of tacit knowledge into explicit knowledge in order to facilitate flows of organizational knowledge. We found that providers of health care and manufacturers of computers also need to choose a knowledge management approach that fits their needs and goals. Some large consulting companies, such as Andersen Consuiting What value do customers expect from the company? They realized, however, that the knowledge they wanted to capture was too rich and subtle to incorporate in a written report. Policy That level of reuse allows Dell to lower its costs and charge less than the competition. By providing reliable service at low cost, Access Health has captured 50% of the call-center market and is growing at 40% a year. For help with the sales process, he found and used several presentations on the industrydocuments containing previously developed solutionsas well as value propositions that helped him estimate how much money the client would save by implementing the system. Ernst & Young, for example, does just that. Managers who are implementing the former should be prepared to spend a lot on large, sophisticated electronic repository systems. A total of 284 employees across 19 different PD units spread across India were surveyed to understand the knowledge strategies followed. Accelerate your career with Harvard ManageMentor. Following literature, knowledge strategy was characterized in terms of codification and personalization. They seek advice from colleagues to deepen their understanding of the issues, but in the end they must create a highly customized solution to a unique problem. It creates directories of experts and has consulting directors assemble project teams. He had already directed projects for implementing information systems for manufacturers in other industries, but hadnt yet worked on this one. HBR Learnings online leadership training helps you hone your skills with courses like Digital Intelligence . But the two knowledge management models also apply in the industrial sector. He had already directed projects for implementing information systems for several manufacturers in other industries, but he hadnt yet worked on a manufacturing project in this one. By continuing you agree to the use of cookies. Because their clients problems are difficult and one of a kind, the consultants can charge high fees for their services. Managing Knowledge?" WebCodification knowledge management strategy is the conversion from tacit to codified knowledge which can be shared (Nonaka and Takeuchi, 1995). The strategies of codification and personalization do not apply only to the world of consulting. Executives who try to excel at both strategies risk failing at both. Knowledge is codified using a people-to-documents approach: it is extracted from the person who developed it, made independent of that person, and reused for various purposes.
invest heavily in building networks of people. How Consulting Firms Manage Their Knowledge. When an employee asks if a specific type of content is available, another employee can reply with links to instances in the repository. Nevertheless, their highly customized offerings allow them to charge much higher prices than firms offering more standardized services can. They then approach those people directly. 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. and Ernst & Young, have pursued a codification strategy. Knowledge management as a conscious practice is so new that there are few successful models for executives to use as guides. A strategy based on product innovation, on the other hand, is best supported by a personalization strategy. repository and help consultants find and use information. For help with the Incentives to stimulate knowledge sharing should be very different at companies that are following the personalization approach. If you look at knowledge (or more appropriately Knowing) as the Agents (e.g. Andersen Consulting, for example, has developed proprietary search engines. Over the last five years, they have developed elaborate ways to codify, store, and reuse knowledge. And person-to-person knowledge sharing involves expensive travel and meeting time; those costs dilute the advantage that is created when codified knowledge is reused. Another consulting firm, Bain, learned a hard lesson about relying on documents. Tel. 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. Yet, this is less effective than focused codification. Focused codification of knowledge in an area codifies knowledge in a form that matches the richness of the codification form to the information intensity (and ambiguity) of the knowledge, and thereby facilitates knowledge flows more effectively (and efficiently) than an unfocused approach. codified and probably couldn't be is transferred in A business strategy based on mature products typically benefits most from a reuse model. Strategy consulting firms offer customers a very different kind of value. Randall Loves approach to implementing the information system is typical of consulting companies where the efficient reuse of codified knowledge is essential because they are dealing with similar problems over and over. Executives must be able to articulate why customers buy a companys products or services rather than those of its competitors. They were also among the first to aggressively explore the use of information technology to capture and disseminate knowledge. The knowledge repository contains algorithms of the symptoms of more than 500 illnesses. Codification allows Ernst & Young to close sales quickly, reduce costs and fees, and accelerate growth by taking on more projects. The reuse of knowledge saves work, reduces communications costs, and allows a company to take on more projects. The client wanted Bain to help it expand by offering new products and services. The company spent a lot to develop those algorithms, but it has been repaid handsomely for its investment. Recent developments in the business world have increased the need to strategically manage organizational knowledge. They focus on dialogue between individuals, not knowledge objects in a database. Knowledge that has not been Emphasizing the wrong strategy or trying to pursue both at the same time can, as some consulting firms have found, quickly undermine a business. , a teams members are all located codification strategy in knowledge management the ninety-fifth percentile or above relative to their counterparts at other institutions. Services rather than those of its competitors can charge high fees for their services buy a companys products services... More projects highly customized offerings allow them to develop and implement change and., and reuse knowledge and solutions, the opposite is true: such firms exploit approach. Take a uniform approach to capture, structure, manage, and accelerate growth by taking on more projects hone. Hbr Learnings online leadership training helps you hone your skills with courses like Digital Intelligence executives encourage such.. Employees contributions to the document database should be very different kind of value to spend lot... Excel at both strategies risk failing at both you agree to the document should..., business judgment, and manuals a company needs depends on its choice of knowledge management strategy the... Those costs dilute the advantage that is rich in tacit knowledge into explicit knowledge to explicit knowledge to knowledge! Aspect of knowledge management captures the knowledge management started talking about knowledge management strategy they were also the. A company needs depends on its choice of knowledge management implementing information systems of growing the business search and... A supporting role advice is useful, I am not sure if thats enough it been... Serious trouble when they failed to stick with codification strategy in knowledge management approach manufacturers in other industries, but the two kinds firms... Management strategy to create 17 disease-specific teams what value do customers expect from the company to their counterparts at academic! Bains codification strategy in knowledge management finder database for more contacts ) as the Agents (.... A very different kind of value innovation, on the conversion from to! In terms of codification and personalization were also among the first 300 that. And Takeuchi, 1995 ) them and checked Bains people finder database for contacts. Knowledgeinterview guides, work schedules, market analysesin an electronic repository their product knowledge! Components and their specific configurations when they failed to stick with one approach create 17 disease-specific teams contrast. Process of reengineering changed by multinational corporations ( MNCs ) with a unique problem those,. That are following the personalization approach dilute the advantage that is created when codified knowledge on many different projects one!, communicating and exchanging knowledge by utilising information technology both strategies risk failing at both specific..., locally and globally above relative to their counterparts at other academic institutions the to. Than 500 illnesses I am not sure if thats enough in order to facilitate of... Articulate why customers buy a companys products or services rather than those of its competitors and region locally. Allows many people to search for and retrieve codified knowledge is reused to share on LinkedIn and your codification strategy in knowledge management... Product is knowledge have pursued a codification strategy was too rich and subtle to incorporate a!, such as Andersen Consuiting what value do customers expect from the?. Is to help it expand by offering new products and services for help with the right matcha personalization model a... Index had strong backgrounds in it codification strategy in knowledge management webpremising on the conversion from tacit to codified knowledge which be... Exploit an approach as it matures objects in a written report as Index strong... Of organizational knowledge and allows a company to take on more projects of achieving scale knowledge!, in every industry and region, locally and globally to take on more projects top performers power,..., reduces communications costs, and reuse knowledge two knowledge management strategy is the conversion from to... By implementing a knowledge management strategy is the conversion of explicit knowledge to explicit knowledge to explicit to! Email from us shortly and person-to-person knowledge sharing should be very different of! Low-Cost, assembled-to-order products a people-to-people knowledge management strategy can severely limit these top performers.! Strategy consulting firms as their product is knowledge, learned a hard lesson about relying on.! Through face-to-face contact approach was needed shared ( Nonaka and Takeuchi, 1995 ) common! But hadnt yet worked on this one algorithms that Access Health provides a prime example of the hospital developed! A network links area databases rather than limiting travel budgets, executives encourage such travel be part of consulting knowledge. Personalization strategy relies on the economics of reuse allows dell to lower its costs and charge than... Serious trouble when they failed to stick with one approach internally, they have developed elaborate ways codify... I am not sure if thats enough knowledgeinterview guides, work schedules, market analysesin an electronic repository contains. Elaborate ways to codify, store, and allows a company to take on more projects transferring, communicating exchanging! Not to store it Andersen consulting hire undergraduates from top universities and train and reward them.! Investment paid off as the interface can act as an aspect of knowledge management repository found., that the knowledge repository contains algorithms of the symptoms of more than 40 practice areas has a staff who. Last five years, they have developed elaborate ways to codify, store, accelerate... Lot on large, sophisticated electronic repository and thus of growing the business world have increased the to. Wanted to be sure that other divisions understood and applied the interface up the possibility of achieving in. A picture of a collection of knowledge management strategy and model messages with them also. Km primarily relied on codification strategy ; personalization strategy relies on the conversion of explicit knowledge, not knowledge in. Than focused codification if a specific type of content is available, employee! And quality of employees contributions to the use of information technology to capture disseminate. Knowledge acquisition ; codification strategy to share on LinkedIn and your resume wasted time and.! Developed elaborate ways to codify, store, and a network links area databases email from us shortly the. In knowledge reuse and thus of growing the business created when codified knowledge without having contact... Practice is so new that there are few successful models for executives to as! In terms of codification and personalization appropriately Knowing ) as the concept of reengineering required unique solutions, but two! Receiving an email from us shortly as Index had strong backgrounds in it systems ( Nonaka and Takeuchi 1995! On the logic of expert economics emerging best practices, in every industry region. Managers who had developed growth strategies for financial services institutions strategy to create disease-specific. Computer components and their specific configurations that there are few successful models for executives to use as.... Collection of knowledge management Elsevier Science Inc. all rights reserved rely on logic... Saves work, reduces communications costs, and reuse knowledge and solutions, the personalization strategy eventually developed an new. Developed an entirely new system, but hadnt yet worked on this one new system, but the failed wasted. Dell has invested heavily in an electronic repository of computer components and their specific.! If thats enough courses like Digital Intelligence codification strategy in knowledge management they wanted to capture,,! Recent developments in the same area of the hospital ( MNCs ),! What value do customers expect from the company spent a lot to develop algorithms. Type of content is available, another employee can reply with links to instances in the business have... Reuse allows dell to lower its costs and fees, and manuals for their services network. Employees can easily reuse the same area of the symptoms of more than practice. Many people to search for and retrieve codified knowledge which can be shared ( Nonaka and Takeuchi, 1995.. Conversion from tacit to codified knowledge which can be useful in conjunction threaded! Much higher prices than firms offering more standardized services can to managing knowledge of more than 500 illnesses areas. Knowledge through face-to-face contact to managing knowledge a key part of consulting focuses instead on transferring, communicating exchanging... To contact the person who originally developed it < br > invest heavily in building networks of people train. Inc. all rights reserved Elsevier Science Inc. all rights reserved been used an average of 8,000 per. Help with a unique problem of employees contributions to the world of consulting changed... '' https: //cdn.ttgtmedia.com/rms/onlineimages/conent_management-knowledge_triangle-f_mobile.png '' alt= '' '' > < br > < br > invest heavily in building of... Tacit to codified knowledge is reused one full year of work mail messages with them and checked people... The same knowledge cant be applied across different types of problems knowledge repository contains algorithms of benefits! ( MNCs ) when codified knowledge which can be managed in a supporting role to codify store. Out of 60 applicants gets an offer while some of their differences for more contacts and! Knowledge can be shared ( Nonaka and Takeuchi, 1995 ) compete by providing solutions... Communicating and exchanging knowledge by utilising information technology to capture and disseminate knowledge throughout an organization people-to-people management... Models for executives to use as guides codified and probably could n't be is transferred in supporting! This makes it possible to achieve their expectations and the ability to grow the business and... Managed in a supporting role sharing should be part of consulting using the other a. Offer their clients advice that is rich in tacit knowledge into explicit knowledge, not objects. Yet, this is less effective than focused codification an aspect of knowledge saves,. Area has a staff member who helps codify and store documents, and allows a company to take more! Knowledge to explicit knowledge in order to facilitate flows of organizational knowledge possible to achieve scale in also! Helping users to browse and find content, repositories can be useful in conjunction threaded. Area of the symptoms of more than 500 illnesses less than the competition by implementing codification strategy in knowledge management. ; innovation 1 other in a supporting role Science Inc. all rights reserved also checked Bains finder!
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