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KM past and future-Changing the rules of the game

This article appears in the issue January 2004 [Volume 13, Issue 1]

By Eric Woods

In the last decade, knowledge management has developed into a substantial body of insight into some of the fundamental challenges facing modern organizations, including the management of intellectual and social capital, the promotion of innovation and support for new forms of collaborative working.

It is generally accepted today that knowledge management is entering a new phase in its evolution. Views differ on the detailed characteristics of this phase but there is also broad agreement on many of the main themes. Going forward, the task facing the knowledge management movement is to engage at both higher and deeper levels within organizations. Developments in areas such as knowledge management and complexity theory, social network analysis, knowledge process design and organizational narrative will all play a key role in that evolution.

But as part of the development, knowledge management also needs to address changes in information technology. Many writers would like to see next-generation KM move away from technology issues. The reasoning behind that view is easy to see. There have been considerable technology issues for KM specialists to digest in the last few years--content management, Web-based collaboration, advanced search capabilities and enterprise portals, to name a few. It is understandable that KM practitioners would be glad to leave the messy (and often self-serving) world of technology out of their equations.

But to attempt to split KM off from the development of information technology is naive. Only a full engagement with the issues raised by the "information age" will allow KM to realize its full potential. Likewise only a mature and sophisticated understanding of KM issues can allow a full utilization of the capabilities of new information technologies. We need to develop a new dialogue between KM and IT practitioners—a two-way conversation that should challenge, provoke and support on both sides. In particular, it is important that those involved in KM projects understand the impact of current changes in the strategic direction of enterprise IT. That will enable KM practitioners to better communicate with the IT department and to have greater influence on IT strategy. And for CIOs and their teams, KM projects continue to offer some of the best opportunities to show how IT can make a real contribution to business improvement, support innovation and reduce inefficiencies. It is a dialogue with mutual benefits.

The changing IT agenda

The IT industry is going through a period of major change. Across the board we are seeing market consolidation among suppliers, but at the same time significant innovation is taking place in areas as diverse as Web services, business process integration, multichannel access and usability. IT departments are having to function in a world of flat or reduced budgets but also one in which the demands on IT from the business continue to grow rapidly.

So what are the key strategic concerns of IT managers? An Ovum (ovum.com) survey of CIOs early in 2003 found the same issues being raised again and again, irrespective of industry or country. Four common themes dominate the CIO's agenda today:

  • Cost reduction. Working under tight budget conditions, today's CIO mantra is "do more with less." Spending for most CIOs is flat or down in 2003, and the signs are that 2004 will be little different. The two largest budget holders in our survey—both with $1.5 billion or more in IT budget—were planning to take 5% or more out of their budgets. We are now talking about second-generation cost reductions, which are more painful than first-generation cuts—and many organizations see cost reduction continuing in future years.

  • Enterprise architecture renewal. With the relaxation of pressure on new projects, IT shops are taking the opportunity to re-evaluate IT architecture. The type of re-evaluation depends on priorities. For some, it's developing an integration framework, a common data model or moving toward a Web services environment. Many IT organizations are trying to lay a new foundation for the services they will offer to the business in coming years.

  • Rationalization. Rationalization is occurring right across the board--infrastructure, application portfolio, business processes and suppliers. Decentralization, coupled with the pressure to install new systems quickly at the end of the 1990s, has resulted in an IT soup in most organizations. The disorder is now being sorted out as a priority. In most organizations, IT (or at least IT decision-making) is becoming more centralized again.

  • E-business and e-government. The main focus is on projects that began during the last five years, and need to be completed and rolled out. They include CRM, portals and business intelligence. The action is mostly at the edge of the business--the intersection between the business and its customers, suppliers and partners. In the public sector, the move to e-government has the same high priority. Knowledge management projects will also be affected by those priorities. Forward-thinking organizations are adopting a double perspective on their investment in information and knowledge management technologies. On one hand, they are identifying core infrastructure capabilities (for example, enterprise content management capabilities and portal infrastructure software) and ensuring that those match the strategic IT direction of the organization. They also recognize the ongoing need for innovation and experiment, but those will take place within that strategic framework and will need to be in harmony with core standards and infrastructure.

The new enterprise architecture

The down-to-earth problems facing CIOs, however, should not obscure the fact that at the same time a revolution is occurring in the underlying enterprise software environment.

At the heart of the changes is a new, open information exchange platform based on standards such XML, SOAP, HTTP and HMTL. The emergence of that Web services infrastructure is raising demand for information from all levels within organizations and stimulating companies to share information and collaborate electronically with customers, partners and suppliers.

The development of flexible IT architectures should free KM projects from many of the technical constraints that have hampered them in the past. In general, the tools and functions necessary to support knowledge management initiatives will become much easier to access and configure.

One area, closely involved with knowledge management initiatives, where we already are seeing the impact of the new platform is that of enterprise portals. The growing use of Web services to access a wide range of applications and information sources means that it is becoming possible to assemble new functionality from small software components. It thus becomes much easier for users to access information and to define application processes on the fly. The prospect is for enterprise portals that offer a highly personalized space for communication, collaboration and information management. Such an environment offers an ideal platform for supporting knowledge management initiatives.

How KM can influence the IT agenda

Does that mean that KM can start to ignore technology as some KM gurus would like to see? It doesn't, but it does change the nature of the relationship between KM and IT. KM practitioners should aim to influence IT development at a much more strategic level and in areas where their expertise is most valuable.

There are three key areas where that influence will be most beneficial and where KM competencies are highly relevant. They are critical areas for the development of better IT services and improved business capabilities. The three include:

1. Breaking down barriers: information integration

The lack of integration of information across applications, across departments and between a company and its customers, suppliers and partners is arguably the biggest barrier to effective use of information technology. It is also one of the biggest challenges for many knowledge management projects. A number of symptoms of that will be familiar to anyone looking at the problems of information sharing in a KM setting, including:

  • Data is everywhere, but exploiting it is very difficult. While data is plentiful, executives complain about a lack of usable information.

  • Current applications are not quite able to provide the information that users need, in the way that they need it.

  • IT integration is a priority, but there is a complicated web of technologies available that all claim to help, and understanding which technology fits a particular integration requirement is difficult.

  • Pulling together information across multiple applications is time-consuming and error-prone, and users often resort to manual methods of aggregating information. The Web service-based architectures being developed today address those issues by offering a much more flexible, loosely coupled framework for sharing and integrating information. They aim to separate the deep engineering problems that are the concern of the IT organization from the process design and information access requirements that are the concern of the business.

But we know that technology issues are only a small part of the problem when addressing the issue of information integration. Recognizing how information flows (or doesn't flow) across technical and organizational boundaries is a vital part of business improvement.

However, too often the problems are shifted between technical and organizational challenges--and too often it is in the knotty intermingling of those issues that the real problem lies. A knowledge management perspective can identify often intangible barriers of culture and organizational politics that reinforce technology barriers. Therefore, it can help the IT function identify those area where it can bring most value to the business and also those areas where an IT solution is either premature or irrelevant because of the organizational barriers.

Knowledge management practices have an opportunity to bring a holistic view to the problems of information integration, help define priorities and create a link across the IT and business divide.

2. The evolution of the semantic enterprise

Information integration addresses the barriers to information sharing--it has little impact on the quality or value of the information exchanged. One of the most important developments in the next five years will be the increasing richness of information in terms of our understanding of its context, relevance, provenance and meaning. Organizations are putting increasing investment into their overall information architecture to provide a framework for that increasingly semantic-rich information. The growing value being placed on corporate taxonomies, metadata management and XML-based standards for information description are all part of that trend. But those solutions need also to be implemented in the light of a deep and rigorous understanding of the information needs of an organization. That means that knowledge management methodologies and practices have a vital role to play in guiding the evolution of the new generation of information architectures.

The semantic richness of an organization's information and knowledgebase is an appropriate concern for the knowledge management function. Only by raising the value inherent in our over abundant information flows can we address some of the critical issues around information overload.

3. People-centric design

The issues of good design and usability are important points where the concerns of knowledge management and technology intersect.

Whether it is in the design of a corporate taxonomy or a user-friendly collaboration environment—the human factor is paramount. KM professionals can bring valuable insights to those issues in terms of their experience and the use of formal methodologies. That does not mean that KM practitioners need to be ergonomic or design specialists, but rather they should be able to provide the link between the demands of IT systems and human systems--in order to improve the usefulness of both. KM techniques such as social network analysis, for example, or the understanding of the dynamics of collaboration can provide a more realistic context for improving communication and collaboration within an organization, which in turn can guide IT development and design.

One area in particular is ripe for input from knowledge management experts. Business process management (BPM) is one of the hot IT and business topics of the moment. There is significant excitement at how a new generation of open architectures and Internet-based technologies can allow businesses to re-engineer internal and external processes. However, there is a real danger that once again the people side of process design will be ignored or underestimated. If that is the case, BPM will repeat many of the mistakes of business process re-engineering (BPR) in the 1990s. Bringing the insights of over a decade of KM work to the initiatives and technologies to business process design is one way to avoid the mistakes of the past.

KM and IT—on the frontline together

The three areas highlighted are ones where the insights of knowledge management can have an important impact on how we design and implement effective IT solutions. Knowledge management does not have to be either constrained by or subordinate to technology requirements. Instead it should be a strong influence for the improvement of technology.

Above all, knowledge management should reinforce the need for human values in an increasingly automated world. The frontline of the modern organizational change is where people, information and technology come together--knowledge management as a movement needs to be on that frontline.


Eric Woods is research director at Ovum (ovum.com), e-mail exw@ovum.com.


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