Transcript All Aboard! Take a knowledge journey

All Aboard!
Take a Knowledge Journey
Dr. Nick Bontis,
Ph.D.
Assistant Professor of Strategic Management, McMaster University
Director, Institute for Intellectual Capital Research
Associate Editor, Journal of Intellectual Capital
Chief Knowledge Officer, Knexa Solutions
Hamilton, Ontario, Canada
[email protected]
www.bontis.com
www.Bontis.com
© 2003 Dr. Nick Bontis
Entering a New Era?
• Agricultural Era
– Land as a scarce resource
• Industrial Era
– Natural resources and factory production
• Knowledge Era
– Knowledge as an abundant resource
– Cumulative codification knowledge base
– Industry displacement
© 2003 Dr. Nick Bontis
www.Bontis.com
Internet Research
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Internet users: 30 to 650 million in 2003
Internet traffic: doubling every 70 days
Canadian usage: 75% by year 2003
PCs surpass TVs in # of units sold in 1997
50% current storefronts closed in next 6 years
© 2003 Dr. Nick Bontis
www.Bontis.com
KM Research Highlights
• Canada: StatsCanada (348 organizations surveyed)
– 93% have KM initiatives, 25% dedicated budget
– Why have KM?
– competitive advantage, human capital, IC retention
• U.S.: Conference Board (surveyed Fortune 500)
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80% have KM initiatives in place
25% have CKOs, 53% have KM staff
6% have KM initiatives company-wide, 60% < 5 years
KM owned 32% Sr. Mng, 25% HR, 16% IT
• Government at all levels
• Institute for Intellectual Capital Research Inc.
– CKOs from 40% HR, 40% IT, plus other
© 2003 Dr. Nick Bontis
www.Bontis.com
KM Research Highlights II
• IDC reports Fortune 500 wasted $12 billion in duplicating work
• Ford reports $914 million savings due to KM from 1997 - 2000
• Chevron saved $650 million since 1991 due to KM
• Texas Instruments saves $1 billion cumulatively since KM
program launched in mid 1990s
• Gartner Group reports
– 90% of FORTUNE 500 working on KM
– 33% of FORTUNE 1000 had begun KM programs by 1999
– will rise to over 50% by 2003
• World Economic Forum
– 95% of CEOs feel that KM is critical to success
© 2003 Dr. Nick Bontis
www.Bontis.com
The Perspectives
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Human Resources – absorptive capacity, balance
Economics – the multiplicative effect of flow
Accounting – disclosure of intangibles
Training and Development – ROI & collateral
Technology – evasiveness of codification
Finance – Tobin’s q
Organizational Behaviour – telecommuting + free agents
Strategy – CKO, business process and economic value
© 2003 Dr. Nick Bontis
www.Bontis.com
Importance of Phenomenon
• Bontis (2002)
• Fitz-enz (2000), Choo and Bontis (2002)
• Max Boisot (1998), Choo (1998)
– Knowledge Assets, Knowing in Organizations
• Sveiby (1997), Stewart (1997), Roos et al. (1997)
– Organizational Wealth and Intellectual Capital
• Nonaka and Takeuchi (1995)
– The Knowledge Creating Company
• Druker (1993), Toffler (1990), Handy (1989)
© 2003 Dr. Nick Bontis
www.Bontis.com
Tracing KM’s History
• Egyptians, Greeks, Monks, Knights
• Taylor (1911)
– Evidence of codification of knowledge
• Simon (1945)
– Cognitive capacity “bounded rationality”
• Schumpeter (1952)
– Innovation from new combinations of knowledge
• Penrose (1959)
– Organization is a knowledge repository
© 2003 Dr. Nick Bontis
www.Bontis.com
Distinguishing the Terms
• Intellectual Capital
– Stock of knowledge at one point in time
• Knowledge Management
– Flow of knowledge from stock to stock
• Organizational Learning
– Stock and flow system
– Action to convert knowledge into behavioural
changes
© 2003 Dr. Nick Bontis
www.Bontis.com
Danger of KM
• Devil’s advocate says we are too busy
• Attention is still the scarce resource
• Balance between achievement oriented and
paternalistic organizations
• Institutionalize organizational slack
– Must send message from above that knowledge
codification is important and necessary
© 2003 Dr. Nick Bontis
www.Bontis.com
Level of Analysis: Individual
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Recruitment
Building competencies
Assessing weaknesses
Retention
Compensation
Satisfaction
– Level of individual knowledge organizations
actually leverage is too low
© 2003 Dr. Nick Bontis
www.Bontis.com
Level of Analysis: Group
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Sports analogies
Concerted team action
Collectively aligned mind sets
Individual feedback loops
Shared perception of the business
environment
© 2003 Dr. Nick Bontis
www.Bontis.com
Level of Analysis: Organization
• Strategy, Continuous Improvement,
Systems, Technology, Leadership, Structure
• Culture – collective values
• Trust – knowledge sharing versus hoarding
• Spiritual Soul of an organization
– WE versus I
© 2003 Dr. Nick Bontis
www.Bontis.com
IC Conceptualization
• 2nd order construct, multi-dimensional
• 3 sub-domains
– human capital, structural capital, relational
capital
• Drivers
– Trust, culture, leadership
© 2003 Dr. Nick Bontis
www.Bontis.com
Nonaka (SECI)
Tacit to Tacit – Socialization
Tacit to Explicit – Externalization
Explicit to Explicit – Combination
Explicit to Tacit - Internalization
Explicit
Tacit
Tacit
Socialization
Externalization
FROM
Explicit
Internalization
Combination
TO
© 2003 Dr. Nick Bontis
www.Bontis.com
Metaphors and Analogies
• Stocks and flows
– Production system
– Manufacturing process
– Capacity utilization, Throughput time, Bottlenecks
• Bathtub analogy
– Tap and leak (knowledge flow)
– Water level (knowledge stock)
– Water system (organizational learning)
© 2003 Dr. Nick Bontis
www.Bontis.com
Measure, Test and Evaluate
KM Diagnostic
• Multi-method approach (qualitative and quantitative)
IICR Knowledge Audit: survey design (Likert-type)
• Objective proxies (www.Saratoga-Institute.com)
– E-mail direction (IICR eFlow Audit)
– Knowledge sweeping (dynamic corporate yellow pages)
• Other tools to check out …
– SmartShadow.com, BrassRingSystems.com, Chrontech.com
OpenText.com
IntraKnexa at Knexa.com
• www.bontis.com/knexa/aboutintraknexa.pdf
– Talent websites
• Tango Simulation … www.Celemi.se
© 2003 Dr. Nick Bontis
www.Bontis.com
Conceptual Model
0.506
Managerial
Leadership
Retention of
Key People
0.442
R2 = 68.2%
0.530
Education
Human Capital
Effectiveness
R2 = 28.5%
- 0.337
Structural
Capital
0.751
Employee
Satisfaction
0.360
Relational
Capital
0.307
0.358
0.475
0.326
Human
Capital
0.734
0.456
0.491
Employee
Commitment
0.543
Knowledge
Generation
Business
Performance
0.327
R2 = 44.1%
0.439
0.429
Process
Execution
Employee
Motivation
0.430
Value
Alignment
Knowledge
Integration
- 0.372
0.394
0.262
Knowledge
Sharing
0.285
Human Capital
Depletion
- 0.233
R2 = 28.5%
© 2003 Dr. Nick Bontis
www.Bontis.com
e-KM
Continuum
KMGrowth
Continuum
IntraKnexa
Technology
Growth Stages
Cultural
Transformation
IICR KM Diagnostic
Stabilized
Systems
Enablers
Measurable
Outcomes
Targeted
Interventions
KM Seminars
Dedicated KM
Resources
Leadership
Commitment
Knowledge
Laggard
Beginner
© 2003 Dr. Nick Bontis
Knowledge
Loser
Value Net
Integration
Knowledge
Gatherer
Knowledge
Leverager
Knowledge
Innovator
Extended
Knowledge
Enterprise
Learning
Organization
Lack of Shared
Vision
Resistance to
Change
Ineffective
Management
Low Teamwork
Low Accountability
Hurdles
Lack of Focus
Lack of Resources
D. Cotey
www.Bontis.com
Critical Elements of Effective KM Programs
Elements of KM Programs
KM Organization
Communities of Practice
Virtual Teams
Knowledge Networks
Organizational Design
Business
Drivers
Strategy
Process Design
Knowledge Capture
Collaboration and Sharing
Innovation
Business Process Enablement
© 2003 Dr. Nick Bontis
Change Management
Executive Leadership
Performance Management
KM Support Tools
Knowledge Technologies
KM
Environment
Process
People
Organization Technology
Culture
Applications
Development
Results
Shareholder
Value
Systems Integration
Enterprise KM Systems
Portals
Knowledge Exchange
Organizational Learning
D. Cotey
www.Bontis.com
KM Applications Matrix
KM Applications Matrix
Individual
Work Group
Knowledge Worker
Business
Objectives
Community
Identify and capture
Locate expertise
Increase personal
capabilities
KM
Strategies
Applications
Critical
Enablers
Expected
Results
© 2003 Dr. Nick Bontis
Organization
Enterprise
Team/Community
Complex problems
Collaborate and share
Create new knowledge
Codify and reuse
Knowledge
Capture
Competency Models
Expertise locators
Personalization
Learning programs
Mentoring
Knowledge mapping
ValueValue
Network
Net
Transform business
Leverage proprietary
intellectual capital
Innovation
Transform industry
Co-opetition
Invention
Expansion
Knowledge
Products
Enterprise
Expansion
Knowledge
Creation
Knowledge
Transfer
Extended Enterprise
New Bus
Models
Sell ICAP
Communities of
practice/interest
Collaboratories
Innovation networks
Knowledge portals
Competitive
intelligence
Smart products
Knowledge-based
businesses
B2B knowledge
marketplaces
Merger planning
Virtual organizations
Leadership
Common Language
Measurement
Resources
Program Mgmt
Technology
Accelerated learning
Increased productivity
Employee retention
Increased innovation
Increased customer
satisfaction
Reduced rework
Accelerated product
introductions
Higher $rev/employee
Competitive advantage
Increase EPS
Increased mkt share
New business ventures
D. Cotey
www.Bontis.com
Arsenal of KM Tools
TACIT
EXPLICIT
EMBEDDED
Diagnose
Gather
Hypothesize
Awareness / storytelling
KM audit / survey
Values assessment
Customer focus groups
Data warehousing
Information navigation
Competitive Intelligence
Environmental scanning
Mathematical models
Neural networks
Knowledge discovery
Longitudinal forecasting
Contextualize
Categorize
Map
Expertise locators
Intranet yellow pages
Document management
Video teleconferencing
Taxonomy development
Intranet groupware
Text mining
Organizational libraries
Workflow analysis
Knowledge maps
Statistical flow timing
eFlow Audits
Communicate
Disseminate
Simulate
Apprenticeships
Job rotation
Organizational slack
Ba design/implementation
Distributed e-learning
Communities of practice
Knowledge portals
IC reporting / disclosure
Scenario planning
Expert systems
Virtual organization
KM Laboratories
© 2003 Dr. Nick Bontis
D. Cotey
www.Bontis.com
What can you do tomorrow?
• Conduct a knowledge audit / diagnostic (IICR)
• Tie KM into HR and performance evaluation
• Recruit and hire a leader responsible for
intellectual capital & knowledge management
• Classify your intellectual portfolio with a
knowledge map (e.g., corporate yellow pages)
• Reduce “don’t know what I don’t know”
© 2003 Dr. Nick Bontis
www.Bontis.com
What else can you do tomorrow?
• Use information technology tools for
externalization, transfer and generation
• Increase the ROI on training and development
expenditures (spy and new reimbursement process)
• Publish intellectual capital addendum
• Education: McMaster, U of T, Queens, Royal Roads
• World Congress: http://worldcongress.mcmaster.ca
• Research: www.bontis.com/research.htm
• Journal of IC: www.emeraldinsight.com/jic.htm
• Develop internal markets for knowledge exchange
© 2003 Dr. Nick Bontis
www.Bontis.com
Knexa.com Enterprises
• World’s first knowledge exchange and auction
Canadian technology company rated Top 100 in
World (Stock symbol: KNX on CDNX)
• An eBay for knowledge assets
A NASDAQ for intellectual capital
• IntraKnexa (ties in HR with IT)
– An internal knowledge exchange for corporate intranets
that provides incentive and rewards for employees to
share knowledge
• International partners: Europe and Australia
• Knowledge Agents and Vortals
• IntraKnexa - corporate knowledge exchange
© 2003 Dr. Nick Bontis
www.Bontis.com
Other Interesting Projects
• IICR KM Diagnostic Tool (business and government)
– Contact IICR for further information regarding causal mapping and KM audit
• IICR KM Seminars (business and government)
– Special customized presentations to managers and employees
• National KM Certification Program (Canadian Centre for Management Development)
– See: http://www.ccmd-ccg.gc.ca/events/workshops/KM/across_e.html
• KM Education (McMaster, Royal Roads, Tangonow, KMCI)
– See: www.bontis.com/p727.htm www.royalroads.ca www.tangonow.net www.kmci.org
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eFlow Audit (codified proxy of e-mail flow)
kFactory Assessment (capacity utilization, throughput, bottlenecks)
Ba best practices (office design, Steelcase), organizational slack
World Congress on Intellectual Capital and Innovation Hamilton Jan 14-16, 2004
– See: http://worldcongress.mcmaster.ca
• Get 30 day free trial of the Journal of IC (http://www.emeraldinsight.com/jic.htm)
• Books: 1 text Oxford U. Press with Choo, 2 compilations with BH KMCI Press
– See: www.bontis.com/research.htm
• Knexa.com (IntraKnexa - incentive methodology for ICUs and knowledge sharing)
– See: www.bontis.com/knexa/AboutIntraKnexa.pdf
© 2003 Dr. Nick Bontis
www.Bontis.com
Thank you!
Dr. Nick Bontis,
Ph.D.
Assistant Professor of Strategic Management
DeGroote Business School, McMaster University
1280 Main Street West, MGD #207
Hamilton, Ontario, Canada L8S 4M4
Tel: (905) 525-9140 x23918
Fax: (905) 521-8995
Director, Institute for Intellectual Capital Research Inc.
CKO (Chief Knowledge Officer), www.Knexa.com
Associate Editor, Journal of Intellectual Capital
[email protected]
© 2003 Dr. Nick Bontis
www.Bontis.com
www.Bontis.com