Quantified KM Value story #144 - $1.4 million at Goodyear

 From a post on Linked-In, and with permission of the author, here is another quantified KM value story.

Jim Clarke,  Knowledge Management Project Leader at The Goodyear Tire & Rubber Company, posted the following on Jan 13, 2023

"My KM team has deployed a customized Rapid Learning Cycle (RLC) methodology based on the writings of Katherine Radeka. Our version of the method deployed within the Global Technology division at Goodyear involves the inclusion of the scientific method for prototype testing. We've documented reusable learnings for 26 technological innovation project cycles thus far, and we've measured $1.4 million in project cost avoidance. By December, the total project cost avoidance may exceed 10 million".

Quantified KM Value story #143; $10 million per year at Grant Thornton

The latest in my continuing series of KM value stories.

This one comes from this interview with Balaji Iyer; head of KM for Grant Thornton INDUS. 

Balaji states that 

"KM has positively impacted both the top line and bottom line for the firm. Just a conservative estimate of the value the KM programme adds over a normative five-year period is over $50 million in revenue and savings. Our KM programme has hit all the right notes in terms of improving speed to market and talent, vastly improving our internal efficiency play, significantly enhancing the employee experience, and driving innovation at an accelerated pace. And, we believe we are just getting started". 

"As an example, our tax technical research capabilities have resulted in multiple clients wins, grossing over millions of dollars. Our recently-launched knowledge product is the Tax Client Update tool (T-CUT) — a methodology that provides an automated agenda, populated with nationally reviewed technical updates for quarterly meetings with clients and prospects. It has contributed significantly to revenue generation".

For more quantified value examples from other organisations, see here.

 

Quantified KM value story number 142; 7-figure increase in sales revenue from simple knowledge sharing meetings

 HBR have published a case study showing the impact of simple structured knowledge sharing meetings. 

Although the article is entitled "how virtual teams can better share knowledge", the study was held using face to face knowledge transfer meetings, pre-Covid.

The study attempted to test whether incentives or structure were more important drivers of knowledge transfer. The researchers worked with 3 groups of sales staff;

• The first group were incentivised to improve their sales performance by working in pairs, but without providing and structure to the knowledge transfer.

• The second group were not given any incentives, but were provided with a structured knowledge transfer approach, where each of the pairs created a "self-reflection" worksheet which was then shared in the pairs to identify knowledge which could be shared, and the pairs were then encouraged to interview each other.

• The third group were given the same structure AND incentives as well. 

The study claims that 

The second and third groups realized a 24% increase in sales productivity, on average, during the four weeks that the meetings took place. Worker pairs who only received explicit incentives (group 1) saw a 13% lift in performance during these same weeks.

Several months later, workers who participated in these meetings averaged 18% higher sales production than those who had not. By contrast, the group that received incentives alone had no long-term gains.  The greatest beneficiaries of the meetings were employees who had been paired with high-performing peers. 

"Over the 24 weeks that we tracked sales data, the firm realized a 7-figure (>$10 million)  increase in revenue among those who participated in the guided meetings. The implementation cost was less than $15,000".

They also conclude that the role of management is to ensure that reflection and knowledge transfer is expected and structured by creating "opportunities and directives" within routine work. 

Quantified KM success story #141 - After Action reviews deliver 25% performance increase in health teams.

The text below is from an article entitled  Getting the most from after action reviews to improve global health security

Image from wikimedia commons

"Tannenbaum and Cerasoli conducted a systematic review of findings from 46 studies. Limiting their analysis to studies that reported on the impacts of AARs on “quantifiable aspects of performance” (e.g., in simulators, games, personnel records, self-ratings, performance appraisal ratings) they found that, on average, after action reports/debriefs improved effectiveness over a control group by approximately 25%. The results were similar across a wide variety of contexts, including teams versus individuals and medical versus non-medical situations".

Please note that this an increase in effectiveness of the teams, rather than an increase in effectiveness of the organisation through across-team knowledge sharing.  The referenced Tannenbaum and Cerasoli  study, a meta-analysis of published material, is also an interesting read, suggesting that AARs on average take 17 minutes, involve about 5 people, and are three times more successful when facilitated.

Here's a bit more text from the original article

"Both the United States Department of Veterans Affairs (VA) and the Joint Commission which monitors hospitals review incidents in their own form of after-action reporting. Each uses a systematic approach that incorporates root cause analysis into a review after a sentinel or adverse event has occurred where things did not go as expected. While limited evaluation has occurred of the effectiveness of the after-action reviews, at the VA, comparison of these reviews with prior approaches to reviewing adverse events showed a shift in the root causes identified, blaming individuals less and increasingly attributing the problem to systemic causes like communication and policies or procedures"

So not only do AARs improve team effectiveness, they start to change culture as well. 

Quantified KM value case story 140 - construction time saved at AFCONS

This story describes how AFCONS Infrastructure saved 100 days in a big construction project

Chenab bridge, an AFCONS project
Image from wikimedia commons
By bhisham pratap padha from Jammu, India -
IMG_7770b, CC BY-SA 2.0, 

AFCONS Infrastructure is an infrastructure company, we work on large public infrastructure projects like ports, metros, expressways, bridges, and tunnels. AFCONS won the MAKE award in 2016 and 2017, and the MIKE awards at Global, Asia, and India levels in 2019 and 2018. The AFCONS KM model is a traditional practice-based one, including

• Learning Before, During and After
• Lesson Learning
• Best Practice development
• Best Practice portal
• Communities of Practice

In a recent article, Rudolf D'Souza, the CKO at AFCONS, describes the value KM has brought to the organisation as follows:

"We do have big impact stories to share of how KM has benefited the company. The completion of India’s first twin underground metro tunnels under the Hooghly River 100 days before time is an example. Until a few years back, the typical life cycle of a project was five years. Today, characteristically the time frame is three years, and in some cases even 24 months. This time frame includes the lean period when work is reduced because of the weather". 

Quantified KM value case studies numbers 130 through 139

In the embedded video below you can find 10 case studies which illustrate the value delivered by health librarians, who are a main component in the KM systems used in the UK National Health Service.

The video is entitled "Health Librarians and Knowledge Specialists Impact Case Study Vignettes" and is provided by HEE Knowledge for Healthcare. As the YouTube page says,

Health librarians and knowledge specialists ensure that decisions are based upon the best available evidence and encourage knowledge to be captured, shared and re-used. Multiple benefits are possible for NHS staff and organisations when they work closely with health librarians and knowledge specialists. This selection of case studies gives a flavour of this work.  

These case studies include:

130. £16,800 savings from reduction in length of hospital stay for a patient, due to decision based on summarised evidence provided by health librarian 
131. Librarian alerts clinician to innovative treatment leading to effective cure (potentially 9 lives saved)
132. £100,000 savings on agency costs due to evidence provided by specialist librarian
133. 303 hours of a senior midwife's time released (worth £12389) by using the expertise of a clinical librarian
134. Librarian input essential to achieve £1.9 million savings
135. Change in practice leading to 2-week reduction in waiting times from using summarised best practice from a specialist librarian
136. Cost savings (no value quoted) and reduction in risk by changing practice informed by evidence provided by a specialist librarian
137. Transformed approach to discharge of frail elderly patients, as a result of evidence summary provided by the librarian (no value quoted)
138. £48500 savings and improved patient experience by implementing a change based on evidence supplied by the specialist librarian
139. Low-cost intervention leading to a "significant" reduced length of stay for critically ill patients, informed by evidence provided by a specialist librarian (no value quoted).

Librarians and Knowledge Specialists are therefore a core part of the knowledge supply chain in the health sector, bringing the evidence to inform healthcare decisions and saving time, increasing efficiency, and improving practice.

The value of mentoring programs in KM - quantified story number 129

Mentoring is a valuable component of KM when it comes to onboarding new staff. A recent article tells us just how valuable it is. 

Image from wikimedia commons

The article is entitled "The secrets of leveling up junior employees", is written by Miriam Kharbat, and it deals with the software industry (but is applicable to other industries as well. Miriam describes the value of mentorship in transferring knowledge to new staff, and makes the following points:

• Mentorship can be beneficial for both parties Miriam quotes a  2006 Sun Microsystems study which found that mentors were promoted six times more often than those not in the program, and mentees were promoted five times more often than those not in the program. 
• They also found that retention rates were 72% higher for mentees and 69% higher for mentors than for employees who did not participate in the mentoring program.
• Start mentorship by giving the junior staff real tasks. Miriam describes asking new staff to download the source code, run it on their local machine and update any dead links or new issues to the knowledge base or ReadMe file.
• Listen carefully, explain simply, and beware of the curse of knowledge.
• Teach them where to look for, and ask for, answers. Show them the knowledge base and get them into the community of practice. 
• Conduct reviews of real work. Miriam suggests code reviews, and says that "Code reviews can be an excellent opportunity for knowledge sharing. They are a great way to teach best practices and good programming patterns. During a code review, ask questions and suggest alternatives. If you think something is not correctly implemented, explain why you think your way is better. Learn to understand the difference between personal preference and essential changes."
• Let the mentee drive the schedule of mentorship, but if you haven't heard from them in a while, check in to see if everything is OK. 

Mentoring new staff, as a component of the KM framework, therefore not only benefits the organisation by getting new staff up to speed quickly, it also benefits the mentor and the mentee as well. 

Quantified Knowledge Management success story number 128; €136 million in one year at Continental

Here is another in our series of success stories quantified benefits, this time from Continental. 

The Tyre manufacturer Continental has a number of Knowledge Management initiatives under way, including

• The collaboration platform ConNext, which links wikis, blogs, and community forums.
• More than 16,000 communities, some of which are more like small working groups, while others have several thousand members.
• Lesson learning
• The innovation platform Contivation, for collaborative development of new ideas.

Innovation is one of Continental's three value creation streams, and gets a lot of attention. As their knowledge management page reports regarding the use of Contivation,

Some 420,000 suggestions were received in 2017, for example, of which more than 360,000 were implemented. This not only resulted in savings of more than €136 million, but is also a testament to the active engagement of our employees with the company and its values.

One of the things to note here is the rate of implementation - nearly 86%. This is at the high end of implementation rates for schemes such as this.

Quantified KM value example number 127

In this job advertisement, found on LinkedIn, we find an example of quantified value delivery from KM.

Image from wikimedia commons

The job advertisement, posted a week ago, is for a "KM Manager" for Shell, based in the Hague, who will run KM for Shell's Projects and Technology business. It contains the following paragraph.

Over the past 6 years, we have built a comprehensive set of structures, processes and applications supported by Working Out Loud behaviors, and implemented this Solution across Shell’s Technical Functions and C&P. This program has touched approximately 43,000 Shell staff in Technical Functions. A total value of over US$480 million has been delivered through application of key practices in Shell’s business activities. Our ambition is to achieve US$ 1 bln by the end of 2020.

Thats a lot of value in 6 years, and an ambitious target!

Quantified KM value stories 125 and 126

This post contains two more entries in a long series of examples of quantified value delivery from KM.

The two examples below come from the article "Knowledge management in a steel company : a case study of the Gerdau Group" written in 2009 by Marcelo Kuhn, and both refer to value resulting from exchanges of knowledge in communities of practice. 

"Some good results have been reported and improvements in processes have been obtained based on knowledge sharing. In the Reheating Community, for instance, members from the AZA plant in Chile were unsure about a current procedure and posted a question: "Is it economically favorable to turn off the furnace when there are shutdowns in the production line for short periods of time (less than 8 hours)?"

Members from four different plants in Brazil, Chile and U.S. debated the subject for thirteen days and concluded that the best option was to keep the furnace in operation at a temperature around 13300F. Calculation proved that the fuel consumption to reheat the furnace was larger than the fuel saved. Moreover, previous experiences in some plants showed that constant changes in the internal temperature of the furnace damaged the refractory bricks which are the raw material of the internal walls, reducing wall life by 25% which represent losses of  US$ 25,000 by furnace. In December 2008, Gerdau had fifty Rolling Mills that were operating with shutdowns periods and could take advantage of the suggested strategy"

"Another example comes from the Rolling Community. Workers from the Riograndense plant in Brazil were having problems with the operation of the Laying Head (a machine which forms the wire coils in the Rolling Mill process). They asked for help in the community forum and received answers from members of three other plants. The Agominas plant, also in Brazil, showed how they operated the machine with fewer problems. Workers from Riograndense visited Agominas' plant in order to find out what was being done differently. After observing a day of operation and maintenance procedures, the workers noticed a difference in the shape of one internal component. This change was implemented in Riograndense's laying head, leading to a better performance of the equipment. Product quality was improved and the shutdowns in the production line were reduced, generating a gain of US$ 70,000 / year."

Quantified KM value story 124

Another example of quantified value delivered from KM - number 124 in a continuing series

image from wikimedia commons

This story comes from the same article from HBR I referenced yesterday, entitled "What managers need to know about social tools".  It shows some of the value in seeking and sharing knowledge in a networked world. Here's the story.

"At the insurance company we studied, one employee, Sheila, was asked by her manager to put a hold on her current project and perform an urgent analysis for a new vertical market. She told her manager that the analysis would most likely take two weeks, pushing her current project past the deadline and over budget. The manager was willing to pay that price.

"As Sheila began to dig into the problem, she remembered a series of exchanges on the internal social tool among colleagues in another department about a project they were working on in that same vertical market. With this metaknowledge, she sent them a note asking if they could suggest where to start. They replied that they had completed a market analysis and asked if she would like to see it. Sheila said that when she received the report, “I couldn’t believe it. It was exactly what my boss asked me to do. This just saved me two weeks, and it saved my project over a million dollars. I had no idea they were working on this. Neither did my boss.”

Quantified KM Value stories numbers 121 to 123 - ROI of knowledge retention

From this published article comes three examples of quantified value from KM.

Image from wikimedia commons

The article is entitled "Assessing the Business Value of Knowledge Retention Projects: Results of Four Case Studies", and much of it comes from the work of Larry Todd Wilson, who operates a Knowledge Harvesting service.

Larry always tries to determine the ROI of the work he does, and he and his co-authors share the following 3 case stories:

The business result of harvesting (a senior forestry manager) expert’s knowledge was a single source for understanding how to manage delinquent accounts and how to respond to bad debt events, e.g., bankruptcy, collections, etc. The final deliverable was an interactive tool that was developed to capture and disseminate the key decisions relating to the management and response to delinquent/bad debt events. The estimated cost of developing the project was approximately $33,000, with a recognized benefit of $150,000. The immediate benefits to the company included not only improved productivity gains due to bad debt management practices being deployed, but also the ability to move forward without replacing the senior manager. The total estimated benefit over a three-year timeframe is approximately $450,000, with a net present value of approximately $334,000. Therefore, the return on investment of this project was approximately 10:1.

The deliverable captured the expertise from the technical (call-centre) expert and developed an interactive tool around the key decisions relating to the call center, eGain. The estimated cost of developing the project was approximately $12,000 with a recognized benefit of $41,000. The total estimated benefit over a three-year timeframe is approximately $124,000, with a net present value of approximately $89,000. Therefore, the return on investment of this project was reported as approximately 6:1. The efficiency gains from this project would include transferring 60% of the work from a high-cost employee to a lower-cost employee. 

The deliverable captured the expertise from the Senior Systems Analyst and developed an interactive tool around the key decisions relating to troubleshooting the (IT portfolio management) tool. The estimated cost of developing the project was approximately $13,000 with a recognized benefit of $69,000. The total estimated benefit over a three-year timeframe is approximately $207,000, with a net present value of approximately $156,000. Therefore, the return on investment of this project was reported at a greater than expected ratio of 10:1. Since the expert quickly adapted to the harvesting process, it took less time for the harvester to capture his valuable information; hence, reducing the time and cost required for the harvesting process.

Quanitified KM value story #120 - Petroleum Development Oman

Our list of KM Value stories reaches number 120, with this story from Petroleum Development Oman (PDO). See the complete list.

Image from wikimedia commons

The story was presented last week at the UK KM Summit by Hank Malik, who gave an excellent presentation on how standard project-based Knowledge Management has been developed and deployed at PDO.  The elements of KM Hank described included 

• Lesson Learning, 
• Best practices, 
• Knowledge Assets, 
• Content Management, 
• Knowledge Retention and 
• Communities of Practice; 

in fact all the core elements of project-based KM, plus a complete Governance layer and a Processes toolbox.

Hank described a whole set of acheivements from the KM program, including the following quantified benefits delivered to date:

• 5,554 Lessons Learned captured to date across over 50 projects,
• Over $740 M savings,  and $80M realised for in-country value.

Well done to Hank and the KM team at PDO!

Quantified KM value story number 119 - finding knowledge at Accenture

One of the ways in which KM adds value is through helping people do work faster and better.  Here is a story of howAccenture estimated that value.

Accenture make documented knowledge available to their staff through a portal known as KX. IN order to estimate the value delivered through KM they decided to focus on one component of Knowledge Management –the use of KX - and to focus on one single benefit - the savings in time delivered through the use of knowledge gained through the KX portal.

They estimated these savings through a survey, which asked the following question

"Please estimate the amount of your time that you saved during the last two weeks as a result of this knowledge.

"During the last 2 weeks, this information saved me AT LEAST:"
"During the last 2 weeks, this information saved me AT MOST:"

The results from this survey were used to calculate average time savings, and thus average cost savings.  They found that for annual KX costs to the sample population of $170,000 they were delivering savings of $2,400,000.

This equates to a 2500 percent Return on Investment

Quantified value story number 118 - saving patient cost in healthcare

Here is a reference to a great story about the value of simple KM in healthcare

The story is taken from a California State University blog on KM, and references an earlier Times Magazine story, available to subscribers. The Time magazine is ostensibly about doctors' pay, but also describes how sharing and institutionalizing good practices (although they don’t call them that) can significantly reduce costs, improve outcomes for patients…and keep doctors happy.

The blog quotes the following example of a very simple KM practice, which shows how much difference even a best-practice checklist can make (and also how unpopular this was, until it began to deliver benefit).

The first thing he (the head of surgery at Geisinger) and his team did was take 20 general steps all surgeons follow throughout a bypass episode and try to sharpen them in a way that would remove as much chance and variability as possible, going so far as to spell out the specific drugs and dosages doctors would use. The result was an expanded 40-step list that some surgeons balked at initially, deriding what they called “cookbook medicine.” 

Once doctors began following the expanded checklist, however, they grew to like it. After the first 200 operations — a total of 8,000 steps — there had been just four steps not followed precisely, for a 99.95% compliance rate. A total of 320 bypasses have now been performed under the new rules. 

“There are fewer complications. Patients are going home sooner. There’s less post-op bleeding and less intubation in the operating room,” says Casale. What’s more, the reduced complication rate has cut the per-patient cost by about $2,000.

Quantified value stories in KM - numbers 115, 116 and 117

As part of our series of stories and examples of quantified value from KM, please find below three examples from a 2015 article in the UAE National, entitled "Knowledge management is power for companies"

An example of KM in action is the case of El Paso Corporation – a 5,000-employee North American provider of natural gas and related products. To maximise the benefits of a new organisational structure and encourage communication, El Paso decided to try a KM programme focused on business opportunities and challenges. Its aim was to foster expertise within the workforce and share technical knowledge with a scorecard used to measure and report on the programme. Its elements included: savings, improvements, successes, costs and milestones. In the first year, the goal was to save the organisation US$500,000, but it delivered $1.2 million in savings.

“A recent best-practice transfer between KOC and other k-Companies in Kuwait, where technology and know-how have been transferred between companies resulted in savings of several million Kuwaiti dinars,” (Abdul Jaleel Tharayil, project leader of Knowledge Management Practice for Kuwait Oil Company) says.

“Another example is an internal collaboration between deep drilling and development drilling, which brought forth a reduction in non-production time by introducing a change in casing design, leading to savings of around 250,000 dinars.”

The Kuwaiti Dinar is currently worth about  3.3 US Dollars.

Quantified value stories 112, 113 and 114; three examples from customer service

From a blog post called "In praise of Knowledge Management" come the following examples of quantified KM value, all from customer service centers;

Image from wikimedia commons

• "A leading European mobile phone retailer saw a stark increase in contact deflection of 27.3 percent while markedly improving NPS  (Net Promoter Score) by 12 base points after implementing a knowledge management system".
• "One of the largest global insurance providers realised a massive decrease in agent training costs by 50 percent, and a sharp drop of 30 percent in complaints".
• "An Australian Government agency saw its customer satisfaction levels surge to 93 percent as well as raise agent satisfaction and reduce handling time by 53 percent".

The article concludes that "it is these kinds of success rates and improvement which make knowledge management a serious contender for inclusion in any list of top ten contact centre technologies".

Quanitified value story number 111, multiple benefits at Goodyear Tire company

As the 111th entry in our ever-growing list of examples of Quanitified Benefit from Knowledge Management, here is a story on value and value measurement at Goodyear Tire Company, described by KM World Magazine.

Gooryear Blimp by Mark Turnauckas on Flickr

Goodyear use what they call "value pyramids" for each key KM initative, to track knowledge impact on delivery results, Using this approach, they have identified the following KM value impact:

• a 50 percent reduction in development cycle time;
• associates using KM-developed Learning Journals achieve competency three months faster, 
• project teams using the Knowledge Sweep method/service have saved up to eight weeks in development time, and 
• the ACE Lessons Learned method has resulted in numerous updates to design standards.

This has been delivered through:

• findability skills, 
• online collaboration habits, 
• expertise definition and location, 
• lessons learned definition and sharing, 
• use of and benefits of tagging, 
• cross-functional and cross-geographical valuation, 
• knowledge worker recognition methods and 
• multigenerational team approach. 

Quantified KM value story 110 - cutting development cycle time by 2-3 years at NASA

As the 110th entry in our ever-growing list of examples of Quanitified Benefit from Knowledge Management, here is an example from NASA

Image from wikimedia commons

The example is given by Jim Rostohar; the CKO of NASA's Johnson Space Centre.

In the Space Centre, KM is used mainly to support programs and projects, and the Engineering Directorate. One of the tools used in this support is a new contextual search engine.  Jim describes the benefit as follows:

If this tool wasn’t available, the Orion team would have had to decide what level of program resources should be applied to develop and certify contingency measures for the Orion capsule. According to the Engineer, development of a test article would take two to three years and add an additional cost of several million dollars.

Quantified KM value story 109 - Navidad Energy

The best place to find KM value stories is in well-metricated environments, where the effects of learning are easily measured. 

Image from wikimedia commons

Oil drilling is the ideal environment for seeing KM value. Drilling is very well metricated, and the time between learning something and measuring the results of that learning is measured in weeks and months rather than years. Drilling is also an expensive operation, so the value of KM tends to run into millions of dollars.

This slideshare from a 2015 presentation looks at organisational learning and KM in oil drilling, and the effects of learning curves on performance. Slide 12 discusses how the steepness of the learning curve affects overall performance, as we discussed here, and slide 14 makes the point that learning typically accounts for 55% of the cost of the first 6 wells in a drilling program.  This 55% can be reduced through good knowledge management. 

Navidad Energy introduced a KM program to address this potential value. They introduced a KM coach, captured lessons, created a lesson management system, developed and continuously improved operational best practices, and discussed lessons when planning and when changing shifts.

As a result, over a 13 month program, they delivered direct savings from their learning initiative of $9,2 million, with an ROI of 10:1.