Transcript KM in Bossini

Building a Customer-focused
and Learning Culture with KM
Philip Fung
Vice Chairman of KMDC
July 2005
Agenda
Challenges to managers in the new
economy
 Building a new work culture
 KM practices in retail shops

Challenges to managers
in the new economy
Knowledge Based Economy

An economy in which the production,
distribution and use of knowledge is the main
driver of growth, wealth creation and
employment across all industries
Knowledge Workers

Knowledge workers will own the tools of
production because they own their knowledge and
will take it with them where ever they go.
Peter Drucker, Post Capitalist Society
Challenges





Globalization and competition
ICT has changed the way we work
Knowledge becomes obsolete quickly
Increased demand from customers
Low staff loyalty
Impact on Work Life




Work more with less
Stress
High staff turnover
Low morale
Building a New Work Culture
with KM
New Work Culture



Customer focus
Team work
Continuous learning
Value of Customer Knowledge

An important asset that companies own

Origin of most improvements in products and
customer service

Vital for companies to create and sustain their
competitive advantage
Sources of Customer Knowledge



Directly from customers
Indirectly through knowledgeable employees,
suppliers and partners
Systems that capture and analyze sales transaction,
customer profile, usage pattern and etc.
Acquisition of Customer
Knowledge
Market research
Company hotline
& web site
Customer user-group
Loyalty program
CRM program
Focus group
Involving
frontline staff
Problems with Customer
Knowledge





Gather by different business units for their specific
objectives
Not properly managed throughout the life cycle
Lack of a “central clearing house” and senior
executives to take quick and appropriate actions
Low participation from frontline staff
Focus on explicit knowledge and data
Customer Knowledge in
Fashion Retailing
Nature of Fashion Market




Short selling period- in months or weeks
Demand unstable- influenced by weather, mass
media or film stars
Low predictability- difficult to do accurate
forecast
High impulse buying- most buying decisions are
made in the store
What Retailers Do?
POS data
Loyalty
card
program
Market
research
What Retailers May Not Know?






The store traffic
Conversion rate- how many shoppers are
“converted” into buyer
The amount of time a shopper spends in a shop
The interception rate- the percentage of customers
who have some contact with sales staff
The waiting time
Why customers don’t buy
Customer Knowledge Strategy



Identify customer knowledge as the most
important knowledge to the business
Apply KM principles and practices to maximize the
value of customer knowledge
Build up a customer-focused and learning culture
Two Examples using KM


Use frontline staff to build a customer-focus
culture
Use AAR meeting to build a learning culture
Shop Customer knowledge
Management (CKM)
Why CKM?
We know that in order to gain competitive
advantages in this constant changing environment,
we will need superior customer knowledge, and
the ability to apply that knowledge to improve our
product and service delivered.
What is Shop CKM?
Our front-line staffs generate many insightful
knowledge through their day-by-day interaction with
the customers …
The question is : how do we manage all these
collective tacit knowledge?
Implementation Shop CKM
Support for the Front-line Staff:
Training on observation skills
Emphasis on their benefits when head
office better understand their difficulties
whilst selling products to the customers.
Benefits of Shop CKM
The Knowledge-transfer Process:
Discoveries
Through front-line staffs
observations and sharing own
tacit knowledge with team
member.
Learning
Codify collective knowledge
standard from. Fax to office for
storage and analysis.
Action
Relevant parties to develop
action plan according to the
learning discovered.
Shop After Action Review
(AAR)
U.S. Army’s After Action Review
A review meeting held after an action, with the
purpose to capture lessons and re-use in next battle
or mission.
Ground Rules of AAR Meeting





Discover the “ground truth”
Focus on issues, not people
No personal attack
Don’t blame for mistake or failure
Be Open, positive, constructive
4 Questions in AAR
Q1. What did we set out to do ?
Q2. What actually happened ?
Q3. Why did it happen ?
Q4. What are we going to do next time ?
AAR as a KM tool
Capture Lessons Learned
Experience
Knowledge
AAR as a KM tool
Knowledge Transfer
Individual
Team
How to start KM initiatives?
Three approaches to change



Top down
Bottom up
Middle-up-down
Middle-up-down



Middle managers are often attacked as the
obstacles to changes
In the knowledge-based economy, middle
managers are the key to innovation
Knowledge is created by middle managers who are
leaders of task forces
Stages of Implementation
Stage 1
Getting
Started
Stage 3
Pilots and
KM
Initiatives
Stage 2
Explore and
Experiment
Stage 5
Institutionalize
KM
Stage 4
Expand
and
support
Source: APQC