Knowledge – The New Business Asset

Technology with Integrity

By Tim Torian, Torian Group, Inc.

Knowledge, not money or technology, is now the primary economic unit of business.

In 1997 Fortune magazine editor Thomas Stewart said that:

“Money talks, but it does not think; machines perform, often better than any human being can, but [machines and technology] do not invent…[The primary purpose of human capital is innovation – whether new products or services, or of improvement in business processes.”

Managing knowledge in this new economy provides companies with new opportunities to improve productivity and to gain substantial competitive advantage. Knowledge management (KM) has become a new field of study – one which small businesses can benefit from as much as large corporations have.  Knowledge in a company exists in individuals, in workgroups, and in the company. The goal is to move valuable information out of individuals, and share it with others where it will do the most good. Individual knowledge can be explicit or implicit. Skilled experts often develop skills to the point that they forget that they know – much of what they do comes from unconscious mastery of their job. Workgroups share information through business processes, informal communications, and the business “culture”. Corporate knowledge is information maintained by the company – client lists, company files, procedures, training materials, etc. It doesn’t depend on any person or group of people.

Companies can encourage or discourage the sharing of knowledge – through attitudes, the way people are paid and rewarded, and the degree of formality and “red tape” that employees face when presenting or sharing ideas.

The goal of KM is to reveal and map the work activities, behaviors, and knowledge sources within an organization. A knowledge asset is created when a potentially valuable process, insight, or specific information becomes available to and is used by those within the company who can benefit from it.

Technology is the enabler of KM – It allows users to store, publish, subscribe to, and reuse knowledge. KM tools enable communication and collaboration, speeding up the business process.

The first step in KM is enabling the storage and retrieval of information. This can be a paper filing system, or a file system or web site on a computer. Establishing standards (Taxonomies in KM lingo) for how things are named, and how they can be indexed adds accessibility, which adds value. If it is useful and accessible enough, the right people will use it.

Business processes can be designed to capture important knowledge. Selling to a new client, for example, includes gathering information about billing. By thinking about the kinds of information that are valuable, you can incorporate ways to capture the knowledge into business processes. Ideally the information is accessible in as many ways as people need to access it, but it is stored and updated in only one place. The client address should not have to be updated in the accounting system, and again in your contact manager, and again in your PDA.

The next step in KM is enabling collaboration. This can include email, Intranet team portals, discussion boards, etc. The goal is to make it easy to share information and collaborate on projects, while capturing the valuable information generated. For many companies, an important aspect of this is enabling access from outside the office – being able to get the information needed and communicate with co-workers from where the work gets done – at the client’s, or in the field.

There are many affordable tools for small businesses. The challenging part of implementing them is not the technology; it is the change in behaviors that are needed to make it work. It all starts with recognizing the value of the assets that walk out the door when your employees go home at night.

Tim Torian has taught computer networking at the College of Sequoias and Cal Poly Extension. He has a BS in Computer Science, and has been consulting on computer networks for the past 18 Years. His industry certifications include: Cisco CCNA and CCNI, Microsoft MCSE, and Novell CNE.  He is president of Torian Group, Inc. which provides a full range of Technology Consulting services to local business, including computer services, networking, and custom software development. They can be reached at (559) 733-1940 or on the web at http://www.toriangroup.com