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How can I squeeze more value from my people using IT?

This is not a question of interest to all business leaders. Some have decided to reduce their headcount as swiftly as possible, either through outsourcing, by using information technology or a combination of both.

Others have yet to realise that, unless they sweat their human assets more effectively, their competitiveness in the global arena will rapidly diminish.

Both groups have yet to become aware of intellectual capital, the currency of knowledge management.

The emergence of knowledge

Let us take a look at the emergence of knowledge as a theme in relation to IT.

In the beginning there were data. Phone numbers and birth dates are examples. Data are the oxygen of IT. Computers exist to process data, even though data per se are useless to the user. Data management was a big theme of the 1970s.

However, information is useful. This can be thought of as processed data. A pile of invoices has no value, but the answer to the question: ”Which debtors have become late payers?” will be of interest to someone.

It can be said that computers convert data into information. Information management was the theme of the 1980s.

Information is open to interpretation or opinion. We have concluded that information is data processed by a computer. We can also say that knowledge is information that has passed through a human brain.

Thus knowledge is opinionated and is largely resident in the heads of your staff though it may well be transcribed in part into some form of document.

It was intended that knowledge management (KM) would be the big theme of the 1990s. But it did not catch the attention of business leaders and fizzled out. This perplexed IT market analysts and futurologists in general.

What is KM?

Before we move on, it is fairly safe to say that no two people can agree on a definition for KM. My own perspective is that KM is the harnessing of what people know, coupled with what they have produced in respect of that knowledge, so that the organisation can truly operate as a cohesive team.

KM is important because many organisations are not truly “hunting as a pack” and are thus not getting a decent return on their people’s knowledge – or intellectual capital.

Organisations that have grown by acquisition are in many cases nothing more than a federation of looselycoupled, and often antagonistic, units. Hence they are not punching their true weight, which is good news for smaller competitors, and bad news for shareholders. KM is the key to resolving this.

What went wrong?

So why did KM not take off in the 1990s?

In my view, KM was hijacked by the IT industry. As a result it was seen as a technology solution rather than a people issue.

The IT industry pushed data warehousing, groupware and workflow-type solutions at users.

Unfortunately, these did not address the root problem of people not being able to or not wanting to communicate across the business.

IT is only part of the solution

The nature of knowledge is such that IT can only contribute to good KM.

Good KM needs to involve the Personnel department (first generation), Human Resources (second generation), Talent Management (third generation), or Wetware Aggregation Services (sometime in the future?).

Until staff give the IT department permission to insert a USB port in their temple, the extent to which the IT department can manage knowledge is limited.

Knowledge Management Systems thus need to embrace more than technology.

Towards better KM

IT does have a role to play in achieving this goal. It should:

■Ensure that there is one universal intranet, so that everyone can communicate by email;

■Create an online directory of areas of expertise so that subject matter specialists can be easily sought out.

Finding the right person quickly can save an organisation repeatedly reinventing the wheel, and also repeating the associated failures.

■Reduce the number of customer relationship management systems to one.

This is likely to cause political convulsions, so the IT department will need boardroom sponsorship.

■The technology should also encourage the use of workflow and groupware software.

In addition, once the business processes have been optimised/re-engineered, the information techology function should:

■Provide tools to empower staff to search for and mine the data stores around the organisation.

This will enable them to create valuable knowledge.

The HR department needs to be involved, as the managers of the organisation’s intellectual capital, so as to provide incentives and …

■Reward knowledge sharing.

This can cause an allergic reaction in sales people, so the department should also:

■Promote the concept of the business as a team, rather than a collection of fiefdoms;

■Invest in staff to ensure that their interpersonal skills, both written and oral, are of a standard that promotes rather than hinders the distribution of knowledge. Many technologists will benefit from this.

■Invest in the staff to ensure that their knowledge is up to date and their decision-making skills are refined.

In conclusion

Notwithstanding the view of some that KM is passé as a theme, it has yet to be given appropriate attention in many organisations.

CIOs and HR directors should be encouraged to talk. Together they could significantly improve your balance sheet simply by distilling what your people already have.

Ade McCormack (ade@auridian.com) is founder of Auridian (www.auridian.com), a people-development business focused on helping organisations get best value from their IT investment.

He is also author of IT Demystified – The IT handbook for business professionals, available via www.auridian.com/book.

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