Knowledge management is, arguably, the practice of sharing, codifying and leveraging content for cost savings and innovation. I say arguably because each knowledge management organization seems to have its own definition(s). The young social media market seems to be foreshadowing what Peter Drucker, Alvin Toffler and other futurists predicted: an effective knowledge economy.
In 1959, Drucker coined the term “knowledge worker,” which easily applies to any social media user today. Microblogging sites like Twitter, Plurk, and friends allow real-time communication, but not yet a way to leverage the shared information. They also offer a way for customers to reach a company – if the company is looking.
In the late 90s and early 00’s, companies like Siemens AG, Intel and General Electric were on the speaking circuit demonstrating tens of millions of dollars in real savings, mostly cost reductions from call center deflections to online tools, internal training and new patents. New patent opportunities were frequently identified by engineers or knowledge managers who saw potential in postings between several groups. This is not much different than getting a unique idea based on social networking.
Despite the gains, budget-cutting caused many of these programs at a variety of companies to either scale back dramatically or collapse.
“Selling” the process to the executives was tough, even with the proven savings. Like social media, knowledge management is culture and technology driven. New infrastructure investments and staffing were required, and thus unacceptable. Besides, any process change that blends culture and technology is generally hard to sell to senior managers who may be compensated for short gains more than long-term profits.
A second problem came with finding relevant content. Problems using tags or other taxonomies developed when different groups, for example sales, marketing and engineering, had different names for the same concept. It was not unusual for knowledge teams to overdevelop search taxonomies as a “translator” between the groups.
The third problem was business culture and the economy. European and Australian companies were generally better at knowledge sharing than American companies. In the US, this was a fundamental shift from “Knowledge is Power” to “Play Nice in the Sandbox.” When undertaken, this transition was difficult.
When an economy soured, employees, regardless of their geography, would keep their information closer to their team (creating “knowledge silos”), as if it could protect them from layoffs. Ultimately, these issues combined with the increased need for short-term profits, and caused numerous KM programs to be cut or restricted.
“Finally, the toughest problem,” wrote Peter Drucker, “will probably be to ensure the supply, preparation and testing of top management people. This is an old and central dilemma for the general acceptance of decentralization in large businesses in the last 40 years.”
Social Media shares these problems. What they do have is active masses of users and Open Source software to support them. Millions of bloggers, “tweeters” and the like have now developed into, as Gartner calls it, Generation Virtual (or GenV). They are a generation without an age demographic or geography. They are comfortable sharing and using online information from others, who they perceive as being trusted sources. Perhaps most important, many of them try to be a trusted source.
This is why, in my opinion, social media will prevail, and why slow business adopters will be … well … remember those companies we had before the Internet “fad?”
At the end of the day, the rules are still the same: Being relevant and generating sales, avoiding costs and making happy customers while growing profits.
Wayne Kurtzman is a senior marketing analyst who loves the shiny toys of technology and online communities. He has led knowledge management and web analytics practices for startups and larger companies including Intel. Wayne also is active at the international level of Destination ImagiNation, a not-for-profit organization that fosters teamwork, innovation and creative problem solving skills in students from kindergarten through college.