Tuesday, 16 October 2012

Understand the value of KM

GIANT VALUEThe most important thing you can do for KM within your company, is help people to understand the value. If they understood the value, they would know what to invest.

Organisations which apply knowledge management really well, report huge value. Mars, with their billion dollars of knowledge-enabled value, Texas Instruments with their "free fabrication plant" through KM, Shell with their $200m value per year.

The value is delivered through giving people access to better knowledge, so that they can make better decisions. Knowledge can be transferred from good performers to poor performers, or carried forward from one project to another, in order to improve business results. If you know the value, you can justify the investment.

In one drilling program, we anticipated that KM could save in the order of $100m (in the end, we saved $83m). So when management challenged investment in three full-time learning engineers, the KM team were able to justify this investment by pointing to the scale of the potential savings.

 The converse, of course, is that if you don't know the value, you can't justify the investment.

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