Consulting firms play a key role in context of KM

This article appears in the issue January 2006 [Volume 15, Issue 1]
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Recent figures from INPUT, a market research firm specializing in analysis of government business, indicate that federal spending on knowledge management (KM) will reach $1.3 billion per year within the next five years. The INPUT figures include data warehousing, data mining and analytics but do not include some categories such as enterprise content management and customer relationship management (CRM). A main driver for this growth, according to INPUT, will be the demand for improved information sharing among different government agencies.

Consulting firms will be active participants in this growing market because of the key role they play in creating KM applications for large organizations such as federal agencies. Typically, they conduct a needs assessment and then provide analytical, design and implementation services for a solution to a business problem. In the context of KM, consulting firms often form the link between the client's need and a technology solution, providing objective advice on the best options.

One of the most challenging aspects in the early stages of a project is simply to identify the real problem. "Often the stated problem is a symptom, not a cause," says John Druitt, senior associate of the business process management practice at Booz Allen Hamilton. "For example, a backlog in completing a process might stem not from a poor process, but from poor training."

Alternatively, the client may have so broad a view of the problem that it cannot be solved as defined. "Usually when customers label their issue as a ‘KM problem,' we like to have them relabel it as a specific business problem," says Rick Wallace, senior program manager for KM at SAIC. "We view KM as a way to solve that problem."

Many clients seek help from consulting firms in improving their records management (RM), either to address the burgeoning amount of information they must handle or to respond to compliance requirements. "There is a much greater recognition now of the need to manage greatly increasing volumes of data, with a growing need to effectively deal with privacy issues," says Russell Records, a technical director for the Consulting Group at Computer Sciences Corporation (CSC). "In the private sector, Sarbanes-Oxley is a very hot topic."

After the problem is defined, consulting firms conduct an audit of the client's assets to find out what is present and what is missing with respect to people, process and technology. "In one case, a military group had an excellent knowledge management portal," says Wallace, "but people did not know how to use the collaboration site, which was based on Lotus Notes." After the staff was trained how to use it in the context of KM, utilization went up dramatically.

Although technology is no panacea, it is often an ingredient in the solution. "Many issues relating to disparate data simply can't be solved in cost-effective ways without technologies like Web services and XML," says Druitt. In addition, he points out, software tools such as BPM and customer relationship management (CRM) can model and gather data that builds the foundation and can allow better diagnostics.

Consulting firms can help organizations break down barriers that are based on historical patterns of operation. In an example from the private sector, CSC helped an oilfield service company deal with a dwindling group of experts in operating and maintaining sophisticated drilling equipment. "The client brought the experts back from the field into a centralized service location," says Records, "and CSC helped develop the processes, data structures and systems for them to support less experienced people on the front lines."

CSC and the oilfield service company shared the work of developing a performance support system, which included a procedure for logging inquiries and a taxonomy for classifying them once they were answered by the experts. CSC maintained the system for two years, after which the oil company took it over. The system cost $12 million, but saves more than $200 million per year, according to reports published by the client company.

Another important task that consulting firms take on is developing methods for evaluating the impact of changes. Regular assessments should be built in so that organizations know if they have been successful in achieving their goals.

"Only about a third of large CRM programs have techniques for measuring success before the project begins," observes Paul Singer, senior associate for CRM at Booz Allen. "Within that group, only a small percentage go back and measure to see if they met their goals." Singer recommends that metrics be defined and measured every six months, to validate the work and to prompt modification if necessary.

In order to have a lasting impact, whatever solution is put into place must integrate into the organization's way of working. "When knowledge is used effectively to continuously improve performance," says Wallace, "it is not seen as ‘knowledge management' but as part of the way the organization does business."

The philosophy of having KM be part of daily business is reflected in the way the SAIC collects and uses information for its own projects as well as for the guidance of clients. "We believe in pulling organizational learning into a normalized business processes so it is ‘baked in,'" says Wallace. Key learnings evolve from project work. Projects and teams are where the real learning is happening, according to Wallace. "Our goal is to spend more time on its reuse than its capture," he adds.

Harvesting knowledge on a daily basis promotes its diffusion and legitimizes it because the source is project practitioners. For example, if someone on a project develops a checklist that could be valuable in future project work, it gets put into a knowledge assets database. Some interactivity and documentation is done in person, but in situations where groups are geographically dispersed, having a documented set of learnings is valuable. He advises developing a taxonomy to organize the captured knowledge, and follows the same practice within SAIC.

"We follow up on project activities," says Wallace, "and compare what was supposed to happen with what did happen." The team then looks at any discrepancies and tries to identify their sources. SAIC prefers terminology typically used in learning rather than that of knowledge management. The important thing, according to Wallace, is to have a feedback loop that allows new information to be incorporated into future activities.

When a prospective client first approaches SAIC for help, the SAIC team evaluates the project against five criteria. These criteria will sound familiar to anyone who has evaluated an enterprise project:

  • Advocacy: The project needs a champion, a business owner, who has the pain point and who will help them overcome barriers in implementing the project.
  • Transferability and reach: A KM project should have the potential to affect multiple parts of the organization. It should not be so customized that it applies only to the initial user.
  • Feasibility: The first KM project should not attempt to address the organization's biggest and most complex problem, or it may never be completed.
  • Relation to the organization's strategic plan: The project should have a direct correlation to major goals.
  • Business impact: The KM project should be able to have a significant positive effect on performance.

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