Strategy-Driven Knowledge Management

In a Harvard business review article (March - April 1999), Hanson, Nohria, and Tierney asked, "What's your strategy for managing knowledge?" That question is still critical today.

In that article, Hanson et al. described two types of knowledge management (KM) systems: codification and personalization. Which one is best? It depends. What your decision depends on is your strategic plan.

Does your strategic plan focus on customers who pay for very expensive solutions that are highly customized? If so, you should consider a personalization KM system. A personalization KM system invest large amounts of resources (time and money) into getting your professional staff members together face-to-face. In these meetings high-level tacit knowledge is exchanged for the customer’s benefit. Tacit knowledge (gained through years of experience) is difficult to capture in computerized databases. It is difficult to separate tacit knowledge from professional who has the knowledge.

Does your strategic plan focus on customers who only pay for low-cost "canned" solutions? If so, you should consider a codification KM system. A codification KM system invests large amounts of resources (time and money) into capturing codifiable knowledge in electronic databases. The key to this strategy is re-use. What works for one customer must be separated from the creator of the knowledge, codified, and placed in an electronic database that organizational members can access.

For more information on knowledge management systems read the entire Hanson, Nohria, and Tierney article, or refer to Chapter 5 of my book "Strategic Organizational Learning."