Tuesday, July 16, 2013

Evaluating the Value of Knowledge Management

Past experiences have proven knowledge management KM systems to be costly, difficult to deploy with meaningful knowledge, and challenging to achieve satisfactory levels of adoption.  Organizations struggle to properly evaluate KM initiatives and may be somewhat hesitant to pursue initiatives when past efforts failed to deliver the desired benefits.

Justifying a KM initiative can be tricky.  We need to have a sound method to determine the effectiveness of a KM solution for the organization.  While a magical ROI algorithm may not exist yet there are other methods to evaluate the benefits of a KM solution.

I recently came across an article that included a quantitative method for evaluating the relative effectiveness of social business and collaboration solutions.  This model uses rated evaluation factors to determine a relative scores for business value and strategic alignment.  This relative rating system is then applied to each functional area in the organization to determine which areas benefit the most from this type of KM solution.

Although this proposed evaluation criteria does not provide any insight into the actual savings or new revenue from the KM solution it does help prioritize KM efforts for organizations that see value in social and collaborative systems.  While this method helps provide some structure in determining a focus for the KM efforts, I'm not satisfied with the premise for using social and collaborative systems.

I can buy into the benefits of collaborative systems but the author of the article did not help me appreciate tangible benefits to the organization.  The author acknowledged the challenges in measuring success and then tried to use the logic that everyone is doing it so you should too.  This competitive disadvantage argument is only valid if it is proven that competitors adopting social/collaborative systems have an appreciative competitive advantage.

The article provides evidence that we need still need to find a way to demonstrate, quantitatively, the benefits of KM solutions.  By doing so, we can better justify the expense and then we can use this new model to determine the priority for our KM efforts.

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