Know-how sure to rise

By ESTELLE SARNEY

Remember how Grandma baked the best scones you've ever eaten? Maybe you got her recipe, but no matter how many times you tried, your scones never turned out as good.

Believe it or not, this little story encapsulates the essence of a new trend in business: knowledge management. The name sounds dull, and experts agree it is a passive misnomer for active sharing of knowledge to make a company more efficient, effective and innovative.

So what's with the scones? Knowledge management consultant Carl Davidson says it shows how knowledge can be categorised as explicit and tacit.

Grandma gave you only explicit knowledge by writing down instructions. What you also needed was her tacit knowledge of how she worked in the butter and milk, how she kneaded the dough. You would get this only by talking to her face to face, watching her, or making a batch alongside her.

More companies are now hiring knowledge managers to collate, sort and share their explicit knowledge and map where their tacit knowledge resides. Who would you go to if you had a problem of this sort or that? Who knows what about what? Knowing this will prevent staff having to reinvent the wheel, so saving time and money, and make the company look more attractive against its competitors.

This can happen in big ways or small. Davidson cites BP as an example of a company sharing knowledge on a global scale by setting up broadband video networks between its oil rigs. Whenever someone has a problem they can hook up and find out who has already solved it.

Or it could be as simple as walking upstairs. Virginia Numans is a year into setting up a knowledge management system at law firm Hesketh Henry. The former lawyer turned knowledge manager points out that in any company spread over several floors, knowledge is duplicated as people work through the same issues in isolation.

"We're finding that the tacit knowledge isn't where you might think it would be," says Numans. "If someone gets stuck on a particular problem, they don't necessarily go to their direct supervisor, but maybe to someone two doors down. There is also a lot of knowledge among support staff who have been with the company for a long time."

So, is sharing knowledge really just about people talking to each other more? Well, yes. Davidson says sceptics often comment there's nothing new in knowledge management, and he agrees. It's simple communication that we let slide when we became caught up in the logistics of computer-driven chores. Now, the main reason people don't take it seriously is cultural - they don't think it is important, they don't think they have the time, and they think they might lose power or remuneration if the company rewards individual effort.

Numans says her managers addressed these concerns by including time spent on knowledge management initiatives in workers' key performance indicators, so making it a legitimate activity when filling out their timesheets.

"We did start out with some employees wondering if this was just another fad," says Numans. "Senior practitioners in particular had been operating in their own way for a long time, so the challenge was in influencing them about the benefits of knowledge management, not just to them but also to their clients. Law is an increasingly competitive environment, and people expect a far quicker turnaround of their business at lower cost."

She started out by distributing a questionnaire to every staff member, which helped to identify where the explicit and tacit knowledge was in the firm.

Numans and her team are now spending time with every staff member, extracting documents gathering dust in their offices that might be useful to others, finding out what they know that others could consult them on, and where they go for help.

They already have a knowledge management computer system up and running, including an expertise database, which lists internal and external specialists.

Numans estimates it will be another six to 12 months before all the firm's knowledge is mapped and staff are sharing it effectively.

Fonterra's new knowledge manager is approaching his task in a different way. Tim Kannegieter, who arrived from Australia three months ago, prefers an approach he calls continuous improvement.

"Identify a big business problem, then ask why it's a problem from a knowledge viewpoint. Are people not communicating? Is there a lack of skill? Is there a technology mismatch? Then put a solution in place that addresses all those issues, but is still focused on the problem."

The result, says Kannegieter, is that you get immediate benefits while also finding out what kind of knowledge management strategy the company needs. And the staff involved in solving the problem will feel so good about it that they will help to promote knowledge management to colleagues.

Those colleagues may not be just in their own department. Kannegieter's methods also rely on building "communities of practice" - groups of people right across the company who will benefit from sharing knowledge. For example, a problem in distribution could be solved by talking to people in sales, but the two areas don't communicate because they're physically separated, their computer systems don't link, or they speak in different languages, describing the same problem in different ways.

Knowledge managers identify what the spheres of practice are, build a sense of community among the people in them, and give them the tools they need to share knowledge. Those might include better technology, staff education to establish common languages, and regular meetings to get together and thrash out issues.

All of this becomes more complex when staff are spread across different countries. Ashley Barratt, a former electrical engineer, is three months into setting up a knowledge management system for engineering consultancy Beca Carter. The company has about 1200 staff throughout New Zealand, Australia and Singapore.

"We could create experts in all three countries who had complementary skills who could then collaborate - it would be a better use of the staff we have," says Barratt.

He's turning staff on to the idea by starting from the bottom up - asking them what would make their jobs easier. Universally, they say they want to know who knows what about what, so they don't waste time and effort reinventing the wheel.

"In the early days of knowledge management people thought they were creating knowledge banks by putting information into computer networks," says Kannegieter. "They were creating knowledge cemeteries, because nobody ever looked at it again. That's why I go with the communities of practice approach."

Davidson says managers have to create the space and time for these communities to develop. A water cooler located between departments will create an informal space at which people can gather, regular meetings and half-yearly conferences will create events where they do.

And it can have a direct effect on the bottom line. Simple communication between management and shop-floor workers saved one company nearly $1 million a year by reducing waste.

The time to introduce workers to the concept is day one, Davidson says.

"Most companies do inductions very poorly. It's a half-day or a day and all about the OSH policy. They should be thinking about the fundamental knowledge areas this person needs to do their job, and who they can go to to source that knowledge."

If Davidson had his way, he would install an old-fashioned Zip water boiler.

"I remember having one of those in my first workplace, and it was great. You pulled the cord and everyone sat around and chatted for 10 minutes until it whistled. What a great opportunity to share knowledge."

Signs you need better knowledge management

* Effort is duplicated

* The same mistakes are made in different parts of the company

* The company repeats past mistakes

* People feel overwhelmed by information

* People don't talk face to face

* People don't know what or who to consult if they strike a problem

* Decisions aren't made on the best information available