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Webizus Monthly Newsletter | |
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| One of the main reasons that Knowledge Management projects do not gain ready acceptance in boardrooms despite the gaining research in the field is the lack of proper measures or parameters to test its results. It is usually difficult to associate and relate benefits accruing
to an organization to its specific knowledge management activities.
Knowledge management projects work with a lot of intangible aspects
of an organization like individual employee knowledge, organizational
relationships and knowledge sharing culture which in turn result
in intangible results like improved customer knowledge and satisfaction,
quicker (and more informed) decision taking ability and more empowered
workforce. Why do we need metrics?Metrics act as parameters of success – Key Performance Indicators that show whether an activity has resulted in success or failure and to what extent. Metrics help measurement of an activity by giving a pre-determined numerical value to the performance. Performance metrics aid in repeated measurement and monitoring of performance over a period of time following a baseline unit. Critical Success FactorsIn every knowledge management project, a logical selection/ formulation of CSF (critical success factors) is crucial. The determination of the parameters for measurement of KM performance should be driven by business objectives and not by technological ambitions. The most common and the obvious parameters used often relate to the system usage – page hits, number of users signed up, the number of messages posted per user, number of documents uploaded per user. However these explain very little whether the basic business objectives for which the KM was taken place in the first place were achieved or not. Companies that are aware of this plan for business driven metrics like reduction in number of customer complaints, decrease in operational costs, increase in repeat contracts etc. When the IT company EMC implemented a Knowledge Management program, it started with measuring the number of knowledge building stories added to its database by its employees. However it soon found out that this was not proving very useful. The metric told nothing about the quality of 'knowledge' being added to the system and whether it was used by anybody else. So it improved its metric system to include the re-use of the documents by not only the person who added it (which still showed that he was saving his own time and gained him points on the organization scale) but also others in the company (more points as it displays usefulness of the document) and customers (maximum points as it is adding value) Its all in the numbers!Metrics are by definition quantitative. Metrical measurement involves assigning a numerical cut-off line to the Critical Success Factors to help in measuring them and influencing knowledge management performance. Simply stating that a Knowledge Management activity is expected to reduce operational costs is not enough. It has to be given a definite numerical estimate so that the result can be monitored, evaluated, and repeated. Thus the objective increased customer satisfaction is translated into a quantifiable metric by monitoring and measuring the number of customer complaints or repeat purchases, increased innovation as an objective is translated into the number of ideas generated in a time frame (and later sponsored by the company to distill ideas generated merely to meet a quota). Corporate objectives however 'qualitative' or 'soft' have to be converted into some number! Kaizen Times change and so do business challenges. This gives rise to
new business objectives to tackle the problems and opportunities
at hand. The changing scene should also be reflected in the KM practices
of the organization with modifications to the metrics to match the
current business dynamics. BaseliningWhile it is necessary to have metrical measurement to assess the success or failure, it is also necessary to make a note of the current situation. Only when one has the 'before' situation will the 'after' numbers make any sense. At all times, KM metrics need to be communicated to the users with
their meaning. The workforce of the organization has to understand
what the organization values and monitors. A basic point but it
is surprising how many organizations fail to take pains to clearly
lay down their plans to their users with all the implications and
benefits to the organization as well as to the employees themselves. |
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