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META Group Report: Starting From Where We Left Off

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Our research indicates an ever-increasing interest in knowledge management (KM) across every vertical market
represented in Global 2000 enterprises. Frequent employee movement/turnover, staff cuts, focus on time to
market and volume, information overload, and desire to learn more about customers have all conspired to
recreate a KM market that many thought had expired a few years ago. Instead, KM had only been “hibernating,”
awaiting organizations seeking an edge or making the best of reduced staffs, etc.

Still, a consistent theme tends to run through most of our KM inquiries – where does one start? Evidently,
there is quite a bit of confusion about what KM is. The confusion is generally not vendor induced, as it had
been previously, because most “KM vendors” have since moved on (typically to CRM, portals, etc.). During
2001/02, organizations will (finally) begin defining KM on their terms, organizing and creating appropriate
management incentives to support KM. During 2002-04, they will implement portal frameworks (chiefly, which
will result in a >$6 billion portal market by 2004) as well as other mechanisms that support their
organizational and business objectives, thereby extending KM principles to drive innovation, service, and
employee quality of life beyond 2005.

For organizations seeking the keys to the elusive “KM kingdom,” we suggest the following steps:

1. Define KM on the organization’s terms: The first trap that organizations can fall into is accepting
someone else’s definition (and application) of KM principles (e.g., from a vendor or another end user). KM
success begins with understanding the basic KM tenets of collaboration, retention/persistence, and learning,
but these must quickly include an organization’s application of these tenets in its own environment.
Innovation can mean one thing for a process manufacturing company and another for a consulting company, but
each can apply KM-supporting technologies to deliver on its own version of KM principles. Managers of these
projects must also understand that the definition of KM is often “in the eye of the beholder,” and therefore
its definition may change by group and individual as well.

2. Garner executive support and drive acceptance: Because most KM experiences involve changing behavior
and (encouraging) employees to act certain ways or perform certain tasks (everything from entering
taxonomy-supporting metadata to submitting best practices), executive buy-in and support is key. This is true
whether the KM initiative spans a department, a division, or the entire organization. Moreover, technology
implementations cost money, and in KM, these costs typically are great enough to require senior executive
sign-off. Thus, even grassroots KM efforts soon require a sale to management. However, the reverse is true as
well – education about KM value (at an individual and a group level) must occur to ensure broad acceptance. HR
staff must also (often) be brought into the loop, either to enact incentive (carrot and/or stick) plans or to
communicate KM intent throughout the organization. It is important to remember that little of what it takes to
succeed is technical, making business support critical for the people and process requirements. The IT group
cannot own KM projects because of this.

3. Seek/determine business processes to attack: In the midst of the KM heyday, we suggested that KM
efforts – even those intended to move organization-wide – begin within a single department or function. That
belief has not changed, and the current economic times support it. Even senior executive-blessed “enterprise”
KM efforts, of which we have seen none of late, should start by attacking a particular business process in
pain. One could also consider “best-practice contribution, archive, and retrieval” as a particular area of
focus, even though its use might be enterprise-wide. In addition, such a path enables others across the
organization to watch the effort gel, gain experience, and then accept KM on their terms (cultural or
technological) afterward. In addition, organizations must consider whether their KM focus should be tacit (in
the minds of employees and not formally recorded) versus explicit (on paper or electronically created, etc.
but tangible), realizing that often a specialized product will be required to support a tacit KM focus (which
we see increasingly with best-practice management).

4. Determine and implement appropriate technology: After each of the above steps has been taken, or
perhaps in concert with them in some cases, technology choices can be made. This has always been the single
most difficult aspect of KM for organizations to overcome – how not to fall into the trap of starting KM
efforts with a particular technology. Clearly, once each of the previous three steps is considered,
particularly the third (determining the business processes to attack), a decent picture of required technology
should exist. Moreover, this will have given the IT group (or the responsible KM organization – see following
step) a chance to farm the organization for either existing KM solutions or applicable technologies
used/licensed elsewhere; for example, in pharmaceuticals, the best-practice repository for an electronic lab
notebook supported by document management technology is already used for NDA submissions. We do believe,
however, that the enterprise portal will be the main delivery vehicle for KM initiatives, regardless of the
business processes required to support it.

5. Death of the CKO: This is not an order, merely a statement of fact. While we saw some chief
knowledge officer (CKO) positions created two years ago, we see almost none now. This does not mean existing
CKOs must go, but most organizations new to KM are sticking with a team/committee model. The team typically
includes IT (often architecture, possibly metadata/database, unstructured information and content management,
etc.), HR, and business representation.

Given the current climate, particularly the pressure organizations are under to do more with less (read: less
human resources, dollars, etc.), we expect KM to remain popular for the next several years. Moreover, the
strong enterprise portal market is playing a “chicken and egg” game with KM, because it is both driving KM
interest (the thought being that now there is a fairly generic technical framework that supports KM) and
receiving benefits from a resurgent KM “market.” We expect this to continue through 2004 as well, driving a $6
billion-plus enterprise portal market by that time. Longer term (after 2004), KM technology will become
embedded as a standard part of enterprise portal offerings, and the people and process issues will become
standard operational best practices.

Business Impact: Organizations intent on reviving (or commencing) knowledge management initiatives must
proceed through four or five basic steps to ensure the appropriateness of the undertaking, regardless of its
intended size.

Bottom Line: Knowledge management (KM) is back, but organizations often are still mystified. Planning must
take place prior to technology selection, with a focus on business processes, but most importantly, KM must be
defined on the organization’s terms, according to business (or organizational) priorities.

Copyright 2001 META Group Inc. 208 Harbor Drive, P.O. Box 1200061, Stamford, CT 06912-0061. Web: Telephone: (203) 973-6700. Fax: (203) 359-8066. This publication may not be reproduced in any form or by any electronic or mechanical means, including information storage and retrieval systems, without prior written permission. All rights reserved. Reprints are available.

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