Thursday, 19 May 2016

Quantified (estimated) KM value at Siemens - 100 million Euros (quantified value story #103)

Thanks to Simon Dückert for forwarding me this article on value delivery through KM at Siemens.

Image from wikimedia commons
The article describes a Question and Answer system known as Technoweb - a collaboration and networking technology used by about 40,000 technology staff in Siemens. One of the unique features of Technoweb is that when someone asks a question on the system, they also define a figure for the value of the answer.

As the author of the article, Manfred Langen, describes -

 Before posting an Urgent Request on TechnoWeb, it is required for the sender to select the estimated Business Impact (BI) of the answer to his Urgent Request with a slider. The Business Impact that has to be set ranges from € 1000 to € 1 000 000. The higher the Business Impact the less rigorous is the selection of recipients. 
If the Urgent Request has a Business Impact of just € 1 000, it is not appropriate to contact thousands of experts. In this case the Urgent Request is only sent to those experts which are directly associated to one of the tags of the Urgent Request. Here, we take the risk that we lose some experts in TechnoWeb which might have replied to the Urgent Request. As long as the sender gets support, this is acceptable. If the Urgent Request has a Business Impact of more than € 1 000 000, we do not want to take the risk that we lose a potential answer from an expert. In this case the Urgent Request is broadcasted to the whole TechnoWeb community. 
Every month an average of 25-40 requests are published. Each request receives an average of 8 replies – the first arriving within half an hour.

Measuring the estimated value of the questions, and assuming that every question is answered, gives us a proxy estimate of the value delivery through Technoweb. Given that not every question WILL be answered, this is an overestimate (or more accurately, an estimate of the potential value of the system).  Also the total figure depends on the accuracy of the individual figures for estimated value, but these figures are set by the questioners, who are the people most likely to know the value of getting their problems solved.

Manfred reports the value delivery as follows:
Summarizing the business values of answered Urgent Request over a month results in an average value of 3.5 million Euro per month. Since the introduction of the concept of business impact in October 2011 the cumulated business impact in three years exceeds 100 million Euro.

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