Monday, 2 November 2009

Business focus for KM – the wisdom of 12 years ago

Originally uploaded by Tiago Rïbeiro
Looking in my archives today, I found an old article from CIO magazine in 1997, where John Cross, the head of IT for BP, was talking about Knowledge Management, back in the early days. I think it is very interesting to look back, after 12 years, and see the outcome of the approach he described
This is what he said

“[At British Petroleum], we think there is another level of performance that can be extracted by a more powerful utilization of the knowledge inside an organization. I think the challenge is, well, what does that mean? And how does it translate into practice?

Rather than talking about it, we're simply running a lot of pilots in and around it. We have been looking at the key processes of the business, testing them for their "knowledge intensity" to see if we would create some significant new change in the performance of that particular process if we managed knowledge in a more profound way. The concept has not been difficult to sell to the top executive team.
The chief executive of our aviation business said, "I know that getting the next 10 percent of performance out of this business is going to be entirely dependent on my ability to manage knowledge." That was quite an interesting observation because knowledge is what executives really work with when you think about it. It's not a techie thing.

In the oil business, we spend a lot of money trying to punch holes in the ground in drilling. We reckon that, broadly, we should be able to halve those sorts of costs. And we know that knowledge management is one of the key strategic levers to performance in drilling. Absolutely. We can track our performance and improve our drilling rates, and it is almost all due to incremental buildup of knowledge about the management of the drilling process. So we're concluding that this would be one of those knowledge hot spots with high financial leverage.”

Wow. Look at that. Look at his focus –

“Knowledge Intensity”
“Knowledge hot spots with high financial leverage”
“significant new change in performance”
“10 percent ….. halve those costs”

This degree of focus on business need, on knowledge-intensive hotspots, and on performance improvement was behind BP’s early success in KM, and the embedding of processes and approaches that have survived for over a decade. The focus was not on introducing groupware, or on setting up portals, or on building communities; it was on business performance.

This is an approach that all KM initiatives can learn from. Focus on the knowledge-intensive hotspots and on performance improvement, and then work out what you need to put in place to deliver this. Let the solutions fit the need, rather than letting them drive the program.

For more on this theme of business focus, see my post "are you putting a man on the moon, or trying out a new mop"

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