My co-workers and I accidentally lost our clients almost $100,000 in revenue.
I’m not kidding.
I was a struggling college student, just trying to make ends meet. So, I got a part-time freelance gig writing emails for a marketing agency. I was one of three writers hired a few weeks before Black Friday – one of the year's biggest online retail sales events.
And let’s just say, in all of the pre-sales havoc, our supervisor opted for a more “learn as you go” approach instead of providing us with formal training.
Now, this informal approach to training was okay at first… that is, until Black Friday weekend.
Our account manager got sick and took a few days off. No big deal, right? We completed our writing assignments and submitted them.
Of course, we didn’t know the unwritten company policy requiring copywriters to schedule their own emails when their account manager was unavailable.
I wish I could tell you we easily remedied this small lapse in communication. But the truth is, this lack of knowledge sharing meant none of our clients’ Black Friday emails went out.
And they collectively lost about $100,000 in revenue as a result.
Now imagine if this information was available during an employee onboarding course or as performance support.
It could’ve saved clients’ money, a company their reputation, and three bright-eyed teenagers their jobs.
If you’ve read any of my articles, you already know this isn’t just an amusing walk down memory lane. But instead, it’s a real example of why organizational knowledge management is critical.
Effective knowledge management strategies can help your organization identify, capture, share, and leverage your knowledge assets to achieve your business and learning goals. So, in this article, we’ll take a closer look at knowledge management and explore topics like
However, before exploring how knowledge management can impact your organization, we must first discuss what knowledge management means.
In simple terms, knowledge management is the process of gathering, organizing, storing, sharing, and updating knowledge within an organization. It includes identifying the knowledge and skills that your employees need to acquire, developing instructional materials and resources, and creating effective learning experiences that facilitate knowledge acquisition and retention.
Effective knowledge management requires a focus on both content and process:
Knowledge management typically involves leveraging technology to support learning and development, like online courses, virtual classrooms, and digital resources. It can also include strategies for evaluating and improving the effectiveness of knowledge-sharing, such as collecting and analyzing data on learner performance and engagement.
Overall, knowledge management is an ongoing process that requires a holistic approach to information management and a commitment to continuous learning and improvement. Organizations can improve productivity, retain critical information, and gain a competitive edge in their industry by effectively capturing, managing, and utilizing their workforce's collective knowledge and expertise.
Of course, to implement a knowledge management strategy, you need to understand the different kinds of knowledge. So let’s break them down!
We can categorize organizational knowledge into three categories: explicit, implicit, and tacit.
Explicit knowledge is formal and codified knowledge that can be easily documented, transmitted, and communicated through various channels, company policies, standard operating procedures, work instructions, best practices, manuals, and online training courses. It is objective, easily articulated, and can be quantified, measured, and analyzed.
Explicit knowledge management is particularly useful in industries such as manufacturing, where standard procedures and quality control are critical.
Implicit knowledge, on the other hand, is not easily expressed or codified but is gained through personal experience, intuition, and reflection. This knowledge is often rooted in the culture, beliefs, values, and attitudes of an organization and its employees.
Some examples of implicit knowledge include problem-solving skills, judgment, decision-making abilities, individual expertise, and emotional intelligence.
Organizations typically acquire this knowledge through observation, trial and error, and fostering an environment that focuses on informal communication and collaboration among employees.
Think about it like this:
Let’s say you work in the healthcare industry. Your team of doctors and nurses have knowledge that is critical for patient care, and yet it isn’t something you can’t capture or duplicate in a training course because it’s gained through their individual experiences. So how do you pass that valuable information along to other employees?
You can compile formal medical documentation, case studies, research papers, and journal articles that capture implied experiential knowledge and translate this scientific data into valuable textbook training. In addition, you can encourage more informal knowledge sharing through social networking and collaboration within the workplace.
Tacit knowledge management refers to knowledge deeply ingrained in an individual's skills, experience, and intuition. This type of knowledge is difficult to formalize, codify, and transfer because it is often based on personal experiences, insights, and emotions. Your learners can acquire tacit knowledge through observation, practice, and reflection.
Examples of tacit knowledge include creativity, innovation, leadership, and expertise. Tacit knowledge management creates an environment that encourages employees to share their tacit knowledge through storytelling, mentoring, and knowledge-sharing events.
While I admit tacit knowledge can be challenging to capture and codify, this type of knowledge management can be highly effective, particularly in industries like technology, where innovation and creativity are essential for success.
Now that you know what knowledge management is, the real question is: “Why does it matter to my organization?”
Before I answer your question, let me first ask you one:
Have you ever had an employee retire or leave your organization – only to find yourself scrambling because they took their knowledge and expertise with them?
Employees come and go; without a system for capturing and sharing knowledge, the organization risks losing valuable information and experience. Even if your employee churn for new hires is low, there are still an estimated 10,000 baby boomers who are still retiring every day across the U.S. alone. But with proper knowledge management, that information is captured, stored, and shared with others, ensuring that the organization can thrive even after key players depart.
Of course, you don’t just want your organization to survive - you want it to thrive. Knowledge management can assist in this endeavor by improving your workplace's quality and consistency. When everyone is working from the same playbook, following the same processes, and using the same best practices, you can ensure that outputs meet or exceed expectations.
Additionally, implementing effective knowledge management processes can reduce duplication of effort and avoid errors and misunderstandings – saving your organization time and money and improving overall employee performance.
When your employees have access to the right information, tools, and resources, they can make informed decisions, solve problems faster, collaborate more efficiently with their colleagues, and do their jobs more effectively.
Ultimately, better-performing employees lead to higher staff retention and even higher ROI.
The thing is, knowledge management is more than just beneficial for your team members. Its impact can extend to your organization as a whole. Effective knowledge management can help organizations:
A study by the McKinsey Global Institute found that employees spend nearly 20% of their time searching for information they need to do their jobs. By centralizing knowledge and making it easily accessible, employees can spend less time searching for information and more time completing tasks.
Access to knowledge like past successes and mistakes can help decision-makers make informed decisions based on facts rather than assumptions.
Let's face it – nothing is more frustrating than spending hours working on a project only to discover that someone in the organization has already done something similar. By managing your organization's knowledge effectively, you can avoid this kind of duplication of effort. Instead, you can leverage the knowledge and expertise that already exists within your organization to work more efficiently and effectively.
Effective knowledge management is about more than just storing and sharing information. It's also about identifying areas where your organization or employees need more knowledge or expertise. By analyzing your organization’s existing knowledge and identifying the information gaps, you can focus your learning and development efforts on filling those gaps. Better learning programs can help you build a more well-rounded and capable workforce.
Capturing and sharing knowledge about best practices, emerging trends, and new technologies can inspire your workforce to think creatively and push the boundaries of what's possible – helping you stay ahead of the competition and drive real business value.
Remember what happened when my manager didn’t share important information with my co-workers or me? Catastrophe ensued. Organizations identify, manage, and reduce risk by effectively capturing and sharing critical knowledge. Effective knowledge management can also help organizations to become more agile, enabling them to respond quickly to changes in their environment.
Despite the benefits of knowledge management, it can come with some potential challenges, mainly when gathering, implementing, and updating knowledge.
Sure, it may feel like knowledge management requires significant time and energy. But with the right approach, your organization can overcome these challenges and create a continuous learning and improvement culture.
Speaking of the right approach to knowledge management…
To optimize your chances for knowledge management success, I’ve compiled this list of recommended steps you should include in your knowledge management process.
The first step in any knowledge management process is to identify the sources of knowledge within your organization. Your knowledge sources could include everything from existing documents and databases to the expertise of your team members.
Once you have identified the knowledge sources, your next step is capturing and documenting the knowledge. This process involves creating a system for collecting and storing information, such as a database or knowledge repository. You also need to establish procedures for updating and maintaining this information.
To make the knowledge easily accessible for your team, you must organize and categorize it. You can create a taxonomy or classification system that allows users to find the information they need quickly and easily. (Remember, accessibility and ease of use are critical to knowledge management success!)
The next step is to share the knowledge with your workforce. Implementing eLearning programs and conducting regular corporate training sessions is one of the best ways to standardize learning and ensure your team has the information they need to succeed.
Finally, you must continuously evaluate and improve your approach to ensure your knowledge management efforts are effective and practical. This process could involve soliciting feedback from team members, tracking metrics like training completion rates, and making adjustments as needed.
Of course, behind every great knowledge management process is an even greater collection of tools working together to help create the most significant learning impact.
In addition to following the steps listed above, a comprehensive knowledge management strategy should include a variety of assets that can help capture, store, and share knowledge within an organization. Some examples of these assets are:
Now that we've covered what knowledge management is, why it’s essential, and some best practices for your strategy, let’s dive into some practical uses of knowledge management you may encounter in your organization!
Effective leadership can inspire and motivate employees to achieve their goals and objectives. But great leaders aren’t born; they’re made – through consistent training and development. Knowledge management can help you build a strong leadership team by capturing and sharing employee feedback, case studies, success stories, and best practices of leaders within your organization.
Now onto the practical application.
You can interview successful leaders to capture their insights, experiences, and advice. Then use this knowledge to develop a leadership training program focusing on the critical competencies required for success. Informed and strategic learning will help leaders in your organization learn from each other and leverage their collective knowledge to lead effectively and improve performance across your organization.
New hires are a valuable asset to any organization but can also be a liability without proper onboarding. Knowledge management can help you streamline the onboarding process by providing new employees with the information they need to hit the ground running.
Creating an onboarding portal with training materials, company policies, and key contacts can help new hires feel more connected to the organization, understand what you expect of them, and ensure they have everything they need to succeed.
Frontline employees are the backbone of any organization. They’re the ones who interact with customers, manage operations, and deliver products and services. But they also face unique challenges, such as high turnover rates and a lack of consistent training. Knowledge management can help you overcome these challenges by providing frontline employees with the information they need to perform their jobs effectively.
Whether you work in the retail or healthcare industry, information requirements constantly change, and missing crucial information could have dire consequences. In some cases, errors can literally mean life or death.
Knowledge management ensures that your frontline team is always up-to-date on new policies, products, and procedures — keeping them prepared to meet customer needs.
In today’s highly competitive market, customer service can make or break your business. But providing consistent, high-quality service can be challenging, especially when dealing with a diverse customer base.
Knowledge management can help you provide exceptional customer service by capturing and sharing customer feedback, customer profiles, and industry trends.
Say you manage a team of call center representatives. You can provide them with a centralized repository of FAQs, troubleshooting guides, and customer service scripts, which makes it easy to access the information they need to deliver exceptional service.
Listen – I completely get it: implementing a knowledge management process can seem like it requires a lot of time and effort. But if my first job faux pas is any indication, knowledge management is critical to organizational success. By implementing effective knowledge management practices, organizations can enhance their overall performance, improve decision-making, foster innovation, and boost productivity – saving you time and money in the long run!
Across Fortune 500 companies, it’s estimated that 31.5 billion dollars a year are lost by failing to properly gather, document, and disperse their employees' knowledge related to their jobs. But through effective knowledge management practices and strategies, the majority of organizations estimate that productivity can be increased by 10-40 percent. The bottom line is knowledge management can help protect your organization from aging employees or a high turnover rate.
Well, your next step is to conduct an audit of your existing corporate training program! Using your new database of knowledge, you can pinpoint information gaps, update training material, and curate a more relevant and effective eLearning experience for your employees.
If you’d like to do a little more exploration first, you can always head back to our Learning Hub. It is full of free resources and articles about custom online training concepts and techniques to help you meet your business objectives and training performance goals!