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Friday, March 15, 2002


Knowledge is Empowering. I've been discussing competitive intelligence and its relationship to business intelligence in recent entries here and in Notes from the Field. When you strip away the motives, processes and activities it all comes down to knowledge. It makes little sense to engage in competitive intelligence operations, or to use business intelligence as the basis for solutions to give competitive advantage if knowledge isn't effectively managed.

Information and Knowledge. Information by itself is of marginal value. It must be turned into intelligence (see Mike's 28 February 2002 entry for details), and intelligence provides decision makers with the basis for decisions and action.

Managing information is the easy part - it's stored as data in databases and extracted, aggregated and transformed into information using queries, tools such as spreadsheets and more specialized tools. At some point the information that is derived from the data becomes intelligence. Decision support systems and multidimensional databases and other technology are routinely employed to either enable this, or to actually provide raw intelligence.

The hard part, however, is capturing and managing the knowledge that is a byproduct of the data-information-intelligence flow. In too many organizations knowledge, unlike information and intelligence, resides inside heads. The disadvantage is that when the executive or key employee leaves the knowledge locked in their brains leaves too.

One reason for this is implementing effective knowledge management systems is difficult and expensive. This is slowly changing, due in no small part to portal technology.

Realistic Concerns. Technology alone is not the solution. There has to be a strategy for capturing, organizing, disseminating and maintaining the knowledge.

There are hurdles to overcome, one of which is the politics of information sharing. Yes, sharing information empowers and strengthens. Making it happen often requires a sweeping change in corporate culture. Even then, there will be pockets of resistance.

There also has to be a strategy for securing knowledge. For all of the talk about learning organizations, how knowledge empowers and knowledge capital, a lack of controls would result in a disaster.

Need to know, is a time tested rule for managing sensitive information that could cause damage if it falls into the wrong hands. Therefore, in addition to capturing, organizing, disseminating and maintaining knowledge, you need to include compartmentalizing knowledge.

Full Circle. Knowledge has value. The critical issue is how to quantify that value as it relates to your organization, and how can it be leveraged. The driver is simple: business imperatives. The approach is straightforward: investigate, develop a business case, evaluate options and alternatives, decide on a solution that best supports business imperatives with the most attractive ROI.

Make no mistake, the approach to leveraging organizational knowledge may be straightforward, but it is not easy. It also requires commitment at the highest level, both for vision and for funding.

Read Intellectual Capital ROI to gain an understanding of how to determine the value of knowledge, and this article about data waste for additional supporting information for your business case. Outer issues and factors can be derived from Principles of Knowledge Management, which will give you the big picture.