CXO

How knowledge management saved millions and how you can too

If you are an IT manager involved in a knowledge management project, you'll want to read <I>Common Knowledge</I> by author Nancy M. Dixon. Read how several major corporations found success managing corporate knowledge.



By Nancy M. DixonPublished by Harvard Business School Press, March 2000Hardcover, 174 pp. plus notes and indexISBN: 0875849040
Price: $23.20 at Fatbrain.com.



Consider these success stories:
  • Chevron saved $816 million on capital projects by shifting knowledge that already existed to different areas of the corporation.
  • Ford Motor Co. saved $34 million in one year by transferring ideas between factories.
  • Texas Instruments saved enough to pay for a new facility by moving knowledge between wafer fabrication plants.

Author Nancy M. Dixon refers to existing knowledge within a corporation as “common knowledge.” It is “the knowledge that employees learn from doing the organization’s tasks.” Examples include knowing how to decrease assembly time in an auto plant and how to market a new drug. External knowledge about clients and competitors is important, but common knowledge is vital to maintaining a competitive advantage, according to Dixon.

Her ideas will be of interest to IT professionals involved in knowledge management or those involved in creating an intranet or similar knowledge transfer systems.

Among the conclusions that an IT manager will find fascinating, Dixon advises that the team leading an organization’s knowledge efforts should “not be a committee chaired by someone from the technology or Information Systems group. Regardless of the reality, if IS is prominent, the perception will be that IS owns the effort…”

Dixon explains that under certain conditions, an IT-led knowledge management project would probably fail. Instead, she believes that technology should be considered only one small component of a knowledge management system

Five types of knowledge transfer
Dixon is an Associate Professor of Administrative Sciences at George Washington University. Before writing Common Knowledge, she studied knowledge transfer in several organizations, including Chevron, Texas Instruments, Ford, Ernst & Young, Bechtel, British Petroleum, and the U.S. Army.

Her work led her to two important conclusions, which also serve as two key takeaways from the book:
  1. There are many very different ways to transfer knowledge.
  2. Knowledge is transferred most effectively when the transfer process fits the knowledge being transferred.

To help you determine the perfect fit for almost any situation, Dixon offers models for five types of knowledge transfer:
  • Serial Transfer: “The knowledge a team has gained from doing its task in one setting is transferred to the next time that team does the task in a different setting.” An example would be a group that replaces a power generator in a chemical plant and uses the knowledge it gains to replace a generator in a refinery.
  • Near Transfer: “Explicit knowledge a team has gained from doing a frequent and repeated task is reused by other teams doing very similar work.” An example is a team at an auto plant in Chicago that learns how to install brakes more efficiently by studying the methods used by a team in Atlanta.
  • Far Transfer: “Tacit knowledge a team has gained from doing a nonroutine task is made available to other teams doing similar work in another part of the organization.” For example, workers with experience in oil exploration travel to meet with colleagues who are dealing with a unique exploration project.
  • Strategic Transfer: “The collective knowledge of the organization is needed to accomplish a strategic task that occurs infrequently but is critical to the whole organization.” For instance, one company acquires another; six months later, a different team in a different location uses the information learned during the first acquisition to help with a second.
  • Expert Transfer: “A team facing a technical question beyond the scope of its own knowledge seeks the expertise of others in the organization.” An example would be a technician who sends an e-mail to a network of colleagues and asks how to increase the brightness on out-of-date monitors.

The bulk of the book consists of detailed explanations of the five knowledge transfer types. Dixon provides plenty of examples and guidelines, including the three criteria that must be considered in order to determine how a transfer method will work. The three criteria include:
  • The type of knowledge that will be transferred.
  • The nature of the task.
  • Who the receiver of the knowledge will be.

The final chapter provides a framework for building an integrated knowledge transfer system.

Real-world knowledge management
Although Dixon’s background is academic, the book also includes a lot of real-world observations. For example, she notes that “a sure way to kill any interest in transferring knowledge is to tell those who have done really innovative work that they now have to spend half a day writing it up for others.”

Dixon offers advice for anyone who has helped implement a database of corporate information only to find that it was promptly ignored by almost everyone: “A database is only one of many interdependent elements that have to be in place for Near Transfer to work. Other necessary elements include:
  • A well-defined business driver (a specific goal established by management).
  • Identified knowledge that is directly related to the business driver.
  • Face-to-face meetings that serve to warrant the knowledge.
  • A way to publicly monitor usage and goals.
  • Designated people responsible for input and retrieval.

Whether you play a prominent or a supporting role in your organization’s knowledge management efforts, you would be well armed if you went to the next team meeting with ideas from Common Knowledge.
What would happen if you wanted to take Dixon’s advice and you decide that IT should not lead the knowledge management project at your shop? Post a comment below or send us an e-mail.

Editor's Picks