“What’s Your Strategy for Managing Knowledge?” by Hansen, Nohira, and Tierney.
I found it lacking. Some of the links here are to the (non-public) class wiki for my knowledge management class, if you’re reading this post and you’re curious about the references, feel free to comment as such and I’ll post the references.
- Hansen M, Nohria N, Tierney T:
- What’s Your Strategy for Managing Knowledge?:
- Harvard Business Review:
The authors studied several knowledge management consulting companies and real-life knowledge management projects as a basis for this paper. They separate knowledge management techniques into two classes (codification vs personalization) and discuss which approach is most viable given an organization’s culture, purpose, and competitive strategy. They discuss some lessons learned and properly aligning incentive programs with knowledge management projects.
Hansen and Nohira talk briefly about the adoption of Knowledge Management from the early 1990s until the present, discussing how advances in technology have opened up the ability to capture and codify knowledge.
Codification vs Personalization
Hansen and Nohira compare codification to personalization by explaining that codification occurs when knowledge is stored and quantified in a collection where it can be retrieved in an easy fashion by members of an organization, and personalization occurs when information technology is instead used to facilitate communication between knowledge sources, rather than storage and retrieval. Codification, then, involves taking existing explicit knowledge or capturing implicit knowledge and storing it in a system which is referenced by users, and personalization involves social networking or other methods of reducing barriers between users to enable them to better transfer knowledge between each other.
KM in the Context of Business Strategy
Hansen and Nohira posit that different corporate drivers dictate different approaches to knowledge management. The three big drivers they examine are:
- Creating Value for Customers
- Turning a Profit
- Managing People
For each driver, they discuss the implications of the different approaches (personalization vs codification).
Internal Project Examples vs Consulting
Several KM project examples are presented to illustrate the approaches in relation to the business context. In each case, the advantage of the approach given the business context and the particular problem is illustrated well. For example, Dell Computer’s codification strategy to maintain machine configurations is shown to be a particularly apropos use of codification for the purpose of turning a profit. In contrast, the example of Hewlett Packard’s personalization strategy works for creating value for customers due to a more complex level of knowledge that does not lend itself to codification.
Disadvantages of Straddling
Hansen and Nohira summarize their examples as, “companies that use knowledge effectively pursue on strategy predominantly and use the second strategy to support the first. We think of this as an 80-20 split: 80% of their knowledge sharing follows one strategy, 20% the other. Executives who try to excel at both strategies risk failing at both” (Hansen 112).
Regardless of strategy, the authors stress that “real incentives – not small enticements” (Hansen 113) are required for knowledge management to succeed. However, the method of providing proper incentives should be linked to the codification or personalization strategy. A codification strategy must reward people for creating useful content, and a personalization strategy must reward people for communication skills.
The authors provide three questions to assist executives in choosing the right strategy:
- Do you offer standardized or customized products?
- Do you have a mature or innovative product?
- Do your people rely on explicit or tacit knowledge to solve problems?
Standardized and mature products benefit from a codification approach to KM, by leveraging reuse. Customized or innovative products, on the other hand, benefit more from personalization strategies.
Knowledge management is considered isolated when it takes place in a business unit rather than part of a coordinated effort on the part of HR, IT, and the corporate strategy with CEO leadership. The authors argue that “only strong leadership can provide the direction a company needs to choose, implement, and overcome resistance to a new knowledge management strategy” (Hansen 116).
Although the article itself has several interesting points, it seems to suffer overall from an implied emphasis on top-down decision making, which is not wholly surprising in an article from Harvard Business Review. Although virtually all of the articles we’ve reviewed thus far have agreed that CEO-level support is required for knowledge management initiatives to succeed, a great many of them have as well pointed out that top-down design in KM projects leads to failure. This article seems to be written partially with the intent to “sell” the concept of knowledge management to C-level executives, and as a result there are areas where one can argue too much emphasis is placed upon executive leadership vs executive support. In particular, the section on “Isolation” with the quote given above, suggests that KM needs to be something that is guided by the CEO, as opposed to something that is designed from the bottom up with CEO support.
In addition, the section on Corporate Strategy is too limited and focused mainly upon bottom-line short term results. There are several other corporate strategies that could be major drivers for KM initiatives; for example, a company may want to establish an industry position as an innovator, or they may want to establish themselves as an industry leader in quality. It could be argued that these fall under the same strategic vision as “creating value for customers” or “turning a profit”, but there is a subtle difference in emphasis that can lead to a major difference in corporate tactical decision making in the short run.
Finally, there is little in the way of discussing the practical methods of KM adoption. As we’ve seen in other articles, knowledge management can succeed quite well on the small, business-unit or community of practice scale, which in turn can lead to an atmosphere of acceptance of KM principles organizationally. Here, however, there is a quite vivid and stark stance that KM’s best value is at the organizational level. While true, this discounts the process of adaptation and acceptance, and focuses entirely on the end state of a knowledge-enabled organization.