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Why Being Data Driven Is Not Enough

by / May 16, 2016

When the only certainty is uncertainty, knowledge is power. With technology changing faster than most of us can keep up, globalization keeping markets in flux and competitors multiplying, companies that can not only create new knowledge, but share it within their organization and transform it into viable products, will be the ones left standing.

The ability to streamline knowledge management to create continuous innovation is the key to staying competitive, can result in substantial savings to the bottom line, better customer relationships and more productive teams.

So what is knowledge management? A knowledge spiral? How does this concept work in actuality? And how can you use technology to disseminate knowledge around an organization to inspire innovation?

Read on to learn the answers and discover how to turn these ideas into a regenerative well of knowledge, innovation and success.

The difference between Data, Information and Knowledge

Before discussing knowledge management, we must understand the difference between data, information and knowledge. Wait, there’s a difference?

The difference is similar to working in one dimension versus three dimensions. Knowledge represents 3D, the full picture of what is happening in the company, rather than data or information, which represent a more flat, 1D or 2D picture.

DATA - A specific figure or fact that does not include context. For example the number 367 or the name “Jane Doe.” These two items are meaningless without anything to define them or relate them to something tangible.

INFORMATION - Organized data. Building on the example – “367 computers” or “Jane Doe, CEO.” The data starts to make some sense now that it includes more details.

KNOWLEDGE – Builds a more complete picture of data and information. “Jane Doe is the CEO of our biggest client, a company that ships 367 computers per day.”

Again, the key difference between data, information and knowledge is that knowledge is something we can use. It gives us the power to take action.  

What is knowledge management?

The term knowledge management (KM) originated about two decades ago. As its name suggests, it is the practice of managing the knowledge and information of and in a company.

For a more official definition, according to research and advisory firm Gartner Group KM is “a discipline that promotes an integrated approach to identifying, capturing, evaluating, retrieving, and sharing all of an enterprise’s information assets. These assets may include databases, documents, policies, procedures, and previously un-captured expertise and experience in individual workers.”

How do we manage knowledge?

The term knowledge management has been around since the nineties. Ikujiro Nonaka and Hirotaka Takeuchi, Japanese business experts, were some of the first, and most famous, to delve deeply into the philosophy and concepts of how to merge the art and science of KM in their book, The Knowledge-Creating Company.

The authors split knowledge into two kinds:

  1. Explicit knowledge - manuals, procedures, shareable data and information
  2. Tacit knowledge - learned only through experience and can only be communicated through analogy and metaphor

Nonaka and Takeuchi argue that in the West, businesses depend mostly on explicit knowledge whereas the Japanese, have learned how to use both, transforming tacit knowledge into explicit knowledge and vice versa. This, they say, is the reason for the major success and advancement of many Japanese businesses although “not terribly efficient, entrepreneurial or liberated.”

The reason this process is so intuitive for the Japanese is a bit complicated (i.e. structure of the Japanese language and influence of Zen Buddhism), but the take home for managers is simple. Knowledge creation knows no rank and begins with a culture and the individual. A more equal vision gives teams more freedom and autonomy to set goals.

This process involves a fresh way to think about organizational practices and roles and responsibilities. It is best illustrated by a real life example from the book:

The Osaka-based company Matsushita Electric Company was hard at work on a new home bread-making machine. Engineers couldn’t get the machine to knead dough correctly – the crust was overcooked and the inside was raw. They tried and tried and even got an x-ray of dough from the machine and compared it to a handmade dough, but still could not get any meaningful data.

Finally, Matsushita software developer, Ikuko Tanaka, apprenticed herself to a master baker and after a year was able to come up with product specs to match the technique of the master baker and share them with her team.

The bread-making machine went on to break sales records for kitchen appliances in its first year.

The Knowledge Spiral

Knowledge management, according to experts Nonaka and Takeuchi, involves four steps:

1. Socialization - tacit to tacit

EXAMPLE: When Tanaka, the software developer apprenticed herself to the baker she was “socialized” to the skill of making bread through imitation, practice and observation.

2. Externalization - tacit to explicit

EXAMPLE: When Tanaka turned her experience with the master baker into the specs – data – that could be shared with her colleagues.

3. Combination - explicit to explicit

EXAMPLE: Once Tanaka shared the new specs with her colleagues, they could compare old to new specs and further perfect the data, perhaps even making a manual, before sending it to manufacturing.

4. Internalization – explicit to tacit  

EXAMPLE: Once Tanaka’s knowledge was shared in the organization and employees internalized the new information, they could broaden and reframe their own tacit knowledge.

The repetition of these steps creates what Nonaka and Takeuchi call the knowledge spiral – building a culture of knowledge creation and innovation.

Within the Knowledge-Creating Company Senior Managers set the vision of “what ought to be,” and ask questions like, Who are we?,” “Where are we going?and defining strategic initiatives. Frontline workers ask, What is?” and How can we get there?Middle managers ask, What do we need to get there?

In this culture, no one department or group has the sole responsibility to create new knowledge – every employee takes part. Knowledge is valued on more than just quantitative measures of ROI, efficiency and the bottom line, it also is run through the filter of strategic goals and company vision – a more holistic approach, according to the Japanese style of KM.

Empower your team with knowledge

The Knowledge-Creating Company and its ability to innovate is dependent upon participation, culture, vision and knowledge sharing. The sharing of knowledge extends to access to information. In Japanese KM practices, management insists on free access to information at all levels. Experts in this concept argue that if members cannot see known information within the company, internalization is limited (the #4 step in the Knowledge spiral). Storing information and projects in a single integrated database, they say, is crucial for managing and creating knowledge.

Project management applications like Taskworld are the perfect database for the Knowledge-Creating Company according to KM experts. They allow for knowledge and information sharing through project and task creation, file sharing and storage, task comments and chat. Access can be granted across teams so they can view different projects and work in the company and build on their explicit knowledge and find ways to turn their tacit experiences into shared conversations and collaboration. Privacy is also customizable and goes a step further – managers can make projects public or private, in case there are any secret company recipes, HR issues or projects that freelancers or clients should not access. To read more about how to create a knowledge center in your company.

Knowledge is power and without it, companies and teams are left in the dust of those companies that can harness ideas and create a culture of knowledge creation. Practiced well, knowledge management can make for happier teams, customers and substantial savings to the bottom line.

Start managing your knowledge center now and sign up for your free trial of Taskworld

REFERENCES:

HBR

KMworld

TLU

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