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Managing Codified Knowledge

Sloan Management Review, Volume 40, Number 4, Summer, 1999, pp. 45-58

Michael H. Zack
College of Business Administration
Northeastern University
214 Hayden Hall
Boston, MA 02115
(617) 373-4734
m.zack@neu.edu

ÓMichael H. Zack, September, 1998

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Abstract

To remain competitive, organizations must efficiently and effectively create,
locate, capture, and share their organization’s knowledge and expertise. This
increasingly requires making the organization's knowledge explicit and recording
it for easier distribution and reuse. This article provides a framework for
configuring a firm’s organizational and technical resources and capabilities to
leverage its codified knowledge. This knowledge management architecture is
illustrated with examples of two companies that are successfully competing based
on their ability to manage their explicit knowledge. The lessons these companies
have learned from their implementation experiences are summarized.

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INTRODUCTION

The concept of treating organizational knowledge as a valuable strategic asset
has been popularized by leading management and organization theorists(1).
Organizations are being advised that to remain competitive, they must
efficiently and effectively create, locate, capture, and share their
organization’s knowledge and expertise, and have the ability to bring that
knowledge to bear on problems and opportunities. Firms are showing a tremendous
interest in implementing knowledge management processes and technologies, and
are even beginning to adopt knowledge management as part of their overall
business strategy(2).

Although knowledge management is becoming widely accepted, few organizations
today are fully capable of developing and leveraging critical organizational
knowledge to improve their performance(3). Many organizations have become so
complex that their knowledge is fragmented, difficult to locate and share, and
therefore redundant, inconsistent or not used at all. In today’s environment of
rapid change and technological discontinuity, even knowledge and expertise that
can be shared is often quickly made obsolete. However, while the popular press
calls for effectively managing knowledge, almost no research has been done
regarding how to do it.

This article focuses on how to configure a firm’s resources and capabilities to
leverage its codified knowledge. I refer to this broadly as a knowledge
management architecture. The research on which the framework is based was
motivated by several questions. What are the characteristics of explicitly
codified knowledge and how should organizations think about managing it? What
role should information technology play? How are organizational capabilities and
information technology best integrated and applied to managing knowledge? What
lessons have companies learned in these endeavors?

To address these questions, I first describe the characteristics of explicit
knowledge and its relationship to competitive advantage. Building on research
and knowledge about the design of information products(4), I describe an
architecture for managing explicit knowledge. I use that framework to derive two
fundamental and complementary approaches, each of which is illustrated by case
study. I conclude with a summary of key issues and lessons learned.

What is Knowledge?

Knowledge is commonly distinguished from data and information. Data represent
observations or facts out of context, and therefore not directly meaningful.
Information results from placing data within some meaningful context, often in
the form of a message. Knowledge is that which we come to believe and value
based on the meaningfully organized accumulation of information (messages)
through experience, communication or inference(5). Knowledge can be viewed both
as a thing to be stored and manipulated and as a process of simultaneously
knowing and acting - that is, applying expertise(6). As a practical matter,
organizations need to manage knowledge both as object and process.

Knowledge can be tacit or explicit(7). Tacit knowledge is subconsciously
understood and applied, difficult to articulate, developed from direct
experience and action, and usually shared through highly interactive
conversation, story-telling and shared experience. Explicit knowledge, in
contrast, can be more precisely and formally articulated. Therefore, although
more abstract, it can be more easily codified, documented, transferred or
shared. Explicit knowledge is playing an increasingly large role in
organizations, and it is considered by some to be the most important factor of
production in the knowledge economy(8). Imagine an organization without
procedure manuals, product literature, or computer software.

Knowledge may be of several types(9), each of which may be made explicit.
Knowledge about something is called declarative knowledge. A shared, explicit
understanding of concepts, categories, and descriptors lays the foundation for
effective communication and knowledge sharing in organizations. Knowledge of how
something occurs or is performed is called procedural knowledge. Shared explicit
procedural knowledge lays a foundation for efficiently coordinated action in
organizations. Knowledge why something occurs is called causal knowledge. Shared
explicit causal knowledge, often in the form of organizational stories, enables
organizations to coordinate strategy for achieving goals or outcomes.

Knowledge also may range from general to specific(10). General knowledge is
broad, often publicly available, and independent of particular events. Specific
knowledge, in contrast, is context-specific. General knowledge, its context
commonly shared, can be more easily and meaningfully codified and exchanged,
especially among different knowledge or practice communities. Codifying specific
knowledge so as to be meaningful across an organization requires its context to
be described along with the focal knowledge. This, in turn, requires explicitly
defining contextual categories and relationships that are meaningful across
knowledge communities. To see how difficult (and important) this may be, ask
people from different parts of your organization to define a customer, an order,
or even your major lines of business, and see how much the responses vary(11).

Explicating Knowledge

Effective performance and growth in knowledge-intensive organizations requires
integrating and sharing highly distributed knowledge(12). Although tacit
knowledge develops naturally as a by-product of action, it is more easily
exchanged, distributed, or combined among communities of practice by being made
explicit(13). However, appropriately explicating tacit knowledge so it can be
efficiently and meaningfully shared and reapplied, especially outside the
originating community, is one of the least understood aspect of knowledge
management. Yet organizations must not shy away from attempting to explicate,
share and leverage tacit, specific knowledge. This suggests a more fundamental
challenge, namely, determining which knowledge should be made explicit and which
left tacit. The issue is important, as the balance struck between tacit and
explicit knowledge can effect competitive performance.

Knowledge may be inherently tacit or may appear so because it has not yet been
articulated, usually because of social constraints(14). Articulating particular
types of knowledge may not be culturally legitimate, challenging what the firm
knows may not be socially or politically correct(15), or the organization may be
unable to see beyond its customary habits and practices(16). And of course,
making private knowledge public and accessible may result in a redistribution of
power that may be strongly resisted in particular organizational cultures.
Knowledge also may remain unarticulated because of intellectual constraints in
cases where organizations have no formal language or model for its articulation.

Comparing the potential explicability of knowledge to whether or not it has
actually been articulated defines four situations regarding the balance between
tacit and explicit knowledge (Figure 1). Potentially explicable knowledge that
has not been articulated represents a lost opportunity to efficiently share and
leverage that knowledge. If competitors have articulated and routinized the
integration and application of similar knowledge, then they may obtain a
competitive advantage. In contrast, knowledge that is inherently inarticulable
yet which firms attempt to make explicit may result in the essence of the
knowledge being lost, and performance suffering. Articulable knowledge that has
been made explicit represents an exploited opportunity, while leaving
inarticulable knowledge in its native form respects the power (and limits) of
tacit knowledge. Both indicate appropriate management of the balance between
tacit and explicit knowledge.

Organizations often do not to challenge the way knowledge is stored, treated or
passed on. However, managers should not blindly accept the apparent tacitness of
knowledge. Mrs. Fields Cookies was able to develop process knowledge (baking
cookies) to a level sufficiently high to be explicated and articulated in a
recipe that produces cookies of consistently high quality(17). The cookies are
claimed to be almost as good as those originally baked by Debbie Fields herself.
Ray Kroc gained tremendous leverage in articulating and routinizing the process
of cooking a hamburger to produce a consistent (if not gourmet) level of
quality. But where imagination and flexibility are important, knowledge
routinization may be inappropriate. It is the manager’s responsibility to know
the difference.

To this point, I have defined explicit knowledge, discussed some of its
characteristics, and made a case for explicating knowledge. Although explicit
knowledge represents only a part of the intellectual landscape of the
organization, it plays a crucial role in the overall knowledge strategy of the
firm. Its management requires frameworks and well-considered architectures such
as that described below.

A Knowledge Management Architecture (18)

The management of explicit knowledge utilizes four primary resources (Figure 2):

 * Repositories of explicit knowledge;
 * Refineries for accumulating, refining, managing, and distributing that
   knowledge;
 * Organization roles to execute and manage the refining process; and
 * Information technologies to support those repositories and processes.

The Knowledge Repository

The design of a knowledge repository reflects the two basic components of
knowledge as an object: structure and content(19). Knowledge structures provide
the context for interpreting accumulated content. If the repository is conceived
as a "knowledge platform", then many different views of the content may be
derived from a particular repository structure(20). A high degree of viewing
flexibility enables users to alter and combine views dynamically and
interactively and to more easily apply the knowledge to new contexts and
circumstances. At this point, knowledge-as-object becomes knowledge-as-process.

The basic structural element is the knowledge unit, a formally defined, atomic
packet of knowledge content that can be labeled, indexed, stored, retrieved and
manipulated. The format, size and content of knowledge units may vary depending
on the type of explicit knowledge being stored and the context of their use. The
repository structure also includes the schemes for linking and cross-referencing
knowledge units. These links may represent conceptual associations, ordered
sequences, causality or other relationships depending on the type of knowledge
being stored.

To reflect the full range of explicit organizational knowledge, repositories
should strive to record significant and meaningful concepts, categories, and
definitions, (declarative knowledge), processes, actions and sequences of events
(procedural knowledge), rationale for actions or conclusions (causal knowledge),
circumstances and intentions under which the knowledge was developed and is to
be applied (specific contextual knowledge), and the linkages among them. The
repository should be indexed according to those concepts and categories,
providing access paths that are meaningful to the organization. It should
accommodate changes or additions to that knowledge (e.g., by linking
annotations) as subsequent authors and creators adapt the knowledge for use in
additional contexts.

A knowledge platform may actually consist of several repositories, each with a
structure appropriate to a particular type of knowledge or content. These
repositories may be logically linked to form a composite or "virtual"
repository, the content of each providing context for interpreting the content
of the others (Figure 3). For example, product literature, best sales practices,
and competitor intelligence for a particular market might be stored separately
but viewed as though contained in one repository.

The Knowledge Refinery

The refinery represents the process for creating and distributing the knowledge
contained in the repository. This process includes five stages:

 * Acquisition. Information and knowledge is either created within the
   organization or can be acquired from many different internal and external
   sources.
 * Refining. Captured knowledge, before being added to the repository, is
   subjected to value-adding processes (refining) such as cleansing, labeling,
   indexing, sorting, abstracting, standardizing, integrating, and
   re-categorizing.
 * Storage and Retrieval. This stage bridges upstream repository creation to
   downstream knowledge distribution.
 * Distribution. This stage represents the mechanisms used to make repository
   content accessible.
 * Presentation. The value of knowledge is pervasively influenced by the context
   of its use. Capabilities should be provided for flexibly arranging,
   selecting, and integrating the knowledge content.

Knowledge Management Roles

A common weakness in knowledge management programs is the overemphasis on
information technology at the expense of well-defined knowledge management roles
and responsibilities. Traditional organizational roles typically do not address
either knowledge management or the cross-functional, cross-organizational
process by which knowledge is created, shared and applied. The architecture
presented here suggests a set of organizational roles that should be explicitly
defined. First, knowledge management, as a cross-organizational process, should
be comprehensively "owned" and managed, and full-time responsibility assigned
for an organization’s knowledge management architecture. Organizations are
creating a Chief Knowledge Officer role to handle this responsibility. Many
organizations also cluster those responsible for knowledge management into
knowledge or expertise centers, each being responsible for a particular body of
knowledge. Their responsibilities typically include championing knowledge
management, educating the organization, knowledge mapping, and integrating the
organizational and technological resources comprising the knowledge management
architecture. Additionally, explicit responsibility should be assigned for each
stage of the refinery and the interfaces between them. Assigning responsibility
for the seamless movement of knowledge from acquisition through use, as well as
the interfaces between these stages, will help ensure that knowledge
repositories will be meaningfully created and effectively used.

The Role of Information Technologies

The information technology infrastructure should provide a seamless "pipeline"
for the flow of explicit knowledge through the 5 stages of the refining process
to enable

 * capturing knowledge,
 * defining, storing, categorizing, indexing and linking digital objects
   corresponding to knowledge units,
 * searching for ("pulling") and subscribing to ("pushing") relevant content,
 * presenting content with sufficient flexibility to render it meaningful and
   applicable across multiple contexts of use.

Information technologies such as the World Wide Web and Lotus Notes™ offer a
potentially useful environment within which to build a multimedia repository for
rich, explicit knowledge. Input is captured by forms for assigning various
labels, categories, and indices to each unit of knowledge. The structure is
flexible enough to create knowledge units, indexed and linked using categories
that reflect the structure of the contextual knowledge and the content of
factual knowledge of the organization, displayed as flexible subsets via
dynamically customizable views.

Effective use of information technology to communicate knowledge requires an
organization to share an interpretive context. The more that communicators share
similar knowledge, background and experience, the more effectively knowledge can
be communicated via electronically mediated channels(21). At one extreme, the
dissemination of explicit, factual knowledge within a stable community having a
high degree of shared contextual knowledge can be accomplished through access to
a central electronic repository. However, when interpretive context is
moderately shared, or the knowledge exchanged is less explicit, or the community
is loosely affiliated, then more interactive modes such as electronic mail or
discussion databases are appropriate. When context is not well shared and
knowledge is primarily tacit, communication and narrated experience is best
supported with the richest and most interactive modes such as video conferencing
or face-to-face conversation.

A Classification of Knowledge Management Applications

Based on this knowledge management architecture, knowledge processing can be
segmented into two broad classes: integrative and interactive (Figure 4), each
addressing different knowledge management objectives. Together, these approaches
provide a broad set of knowledge processing capabilities. They support
well-structured repositories for managing explicit knowledge while enabling
interaction to integrate tacit knowledge.

Integrative Applications

Integrative applications exhibit a sequential flow of explicit knowledge into
and out of the repository. Producers and consumers interact with the repository
rather than with each other directly. The repository becomes the primary medium
for knowledge exchange, providing a place for members of a knowledge community
to contribute their knowledge and views. The primary focus tends to be on the
repository and the explicit knowledge it contains, rather than on the
contributors, users, or the tacit knowledge they may hold.

Integrative applications vary in the extent to which knowledge producers and
consumers come from the same knowledge community. At one extreme, which I label
electronic publishing, the consumers (readers) neither directly engage in the
same work nor belong to the same practice community as the producers (authors).
Once published, the content tends to be stable, and those few updates that may
be required are expected to originate with authors. The consumer accepts the
content as is, and active feedback or modification by the user is not
anticipated (although provisions could be made for that to occur). For example,
the organization may produce a periodic newsletter, or the human resources
department may publish its policies or a directory of employee skills and
experience.

At the other extreme, the producers and consumers are members of the same
practice community or organizational unit. While still exhibiting a sequential
flow, the repository provides a means to integrate and build on their collective
knowledge. I label these integrated knowledge-bases. A best-practices database
is the most common application. Practices are collected, integrated and shared
among people confronting similar problems.

Regarding the organizational roles for managing integrative applications,
acquisition requires knowledge creators, finders, and collectors. Capturing
verbal knowledge requires interviewers and transcribers. Documenting observed
experiences requires organizational "reporters". Surfacing and interpreting
deeply held cultural and social knowledge may require corporate anthropologists.
Refining requires analysts, interpreters, abstractors, classifiers, editors, and
integrators. A librarian or "knowledge curator" must manage the repository.
Others must take responsibility for access, distribution and presentation.
Finally, organizations may need people to train users to critically interpret,
evaluate and adapt knowledge to new contexts.

Interactive Applications

Interactive applications are focused primarily on supporting interaction among
people holding tacit knowledge. In contrast to integrative applications, the
repository is a by-product of interaction and collaboration rather than the
primary focus of the application. Its content is dynamic and emergent.

Interactive applications vary by the level of expertise between producers and
consumers and the degree of structure imposed on their interaction. Where formal
training or knowledge transfer is the objective, the interaction tends to be
primarily between instructor and student, or expert and novice, and structured
around a discrete problem, assignment or lesson plan(22). I refer to these
applications as distributed learning.

In contrast, interaction among those performing common practices or tasks tends
to be more ad hoc or emergent. I broadly refer to these applications as forums.
They may take the form of a knowledge brokerage - an electronic discussion space
where people may either search for knowledge (e.g., "Does anyone know…") or
advertise their expertise. The most interactive forums support ongoing,
collaborative discussions. The producers and consumers comprise the same group
of people, continually responding to and building on each individual’s additions
to the discussion. The flow continually loops back from presentation to
acquisition. With the appropriate structuring and indexing of the content, a
knowledge repository can emerge. A standard categorization scheme for indexing
contributions provides the ability to reapply that knowledge across the
enterprise.

Interactive applications play a major role in supporting integrative
applications(23). For example, a forum can be linked to an electronic publishing
application for editors to discuss the quality of the contributions, or to offer
a place for readers to react to and discuss the publication. Best practice
databases typically require some degree of forum interaction, so that those
attempting to adopt a practice have an opportunity to discuss its reapplication
with its creators.

Regarding the organizational roles for managing interactive applications,
acquisition requires recruiters and facilitators to encourage and manage
participation in interactive forums so that those with the appropriate expertise
are contributing. The refining, structuring, and indexing of the content often
is done by the communicators themselves, using guidelines and categories built
into the application, supplemented by a conference moderator. Assuring the
quality of the knowledge may require quality assurance personnel such as subject
matter experts and reputation brokers. Managing a conference repository over its
lifecycle usually falls to a conference moderator. Others may be required to
work with users to help them become comfortable and skilled with accessing and
using the application.

Two Examples

This section presents two cases studies of managing explicit knowledge. TRI,
Inc.(24)provides an example of an integrative architecture for the electronic
publishing of knowledge gleaned by industry research analysts(25). Buckman Labs
illustrates the effective use of an interactive architecture for discussion
forums to support servicing their customers(26).

TRI, Inc.

Technology Research Inc. (TRI) is a leading international provider of market
information and industry analysis to information technology vendors and
purchasers. TRI employs more that 300 analysts and annually publishes more than
15,000 research reports addressing over 50 distinct subject areas (called
research programs). TRI’s knowledge management architecture is shown in Figure
5.

The online knowledge repository comprises a standard set of knowledge units
containing the executive summaries, abstracts, main text, graphics, tables, and
charts making up research reports. The repository is dynamic in that research
reports are being updated continuously. Knowledge units are indexed and linked
for flexible access, and users may sequentially navigate from one to the next
within a report, access similar units across reports (e.g. executive summaries
only), or access particular units directly. Standardization provides the ability
to integrate analysts’ explicated knowledge across research programs so that it
can be subjected to meta-analysis, creating new knowledge not possessed by any
one analyst. As technology changes, new research areas emerge that cut across
TRI's traditional research programs and internal organizational boundaries.
Building repositories using a flexible, yet standard – and therefore integrable
- structure has enabled TRI to respond by creating composite virtual research
programs. From its repositories, TRI derives standard monthly reports and more
frequent ad hoc bulletins for each research program in several electronic
formats (web, CD, fax, email).

TRI's refinery encompasses two stages: analysis and publishing. Analysis
involves collecting, analyzing, and interpreting market information, and
reporting the results. The analysts’ tacit knowledge of their particular
industry is applied to this information to produce an explicitly reported
interpretation. The process is similar to investigative reporting, in that
analysts try to get "the story behind the numbers."

In the publishing stage, editors convert analysts’ reports to a standard format
and decompose them into knowledge units, assigning standard document identifiers
and keywords and creating links among knowledge units. While perhaps less
efficient than having all analysts initially write to a standard format, TRI’s
approach preserves the analysts’ autonomy and creative, entrepreneurial spirit.
This tradeoff is one that TRI explicitly manages to foster a balance between
knowledge management efficiency and speed on the one hand, and knowledge worker
morale, commitment, and performance quality on the other. Distribution of online
documents is done primarily via web-enabled Lotus Notes.

TRI’s experiences illustrate how digitizing content is not, by itself, adequate
to exploit the opportunities for flexibility and innovation in the design and
delivery of explicit knowledge. Digitized documents must be structured as
knowledge units within a modular and flexible repository from which multiple
knowledge views can be rapidly and efficiently created as new user needs arise
in new contexts. Additionally, a robust, seamless and scalable technology
infrastructure has been key to enabling the flexibility required for an
integrative knowledge management refinery. It provides a wide range of
user-defined views of rich, multimedia documents, embeds hyperlinks, and
provides an efficient yet flexible distribution channel.

Implementing this new architecture has been as much an organizational and
social, as a technical, intervention. TRI has explicitly assigned and trained
people to perform new roles to shepherd the movement of knowledge from raw to
useable product, and this investment has been instrumental in their success.
However, existing roles and responsibilities of TRI’s analysts, editors, and IT
professionals have changed. The move toward process and content standards
reduced analysts’ level of autonomy and discretion regarding writing format and
style, while placing many of those decisions in the hands of editors and
production clerks. Ultimately, success with electronic publishing was based as
much on effectively managing organizational change as in implementing a sound
product architecture and electronic publishing technology.

Buckman Laboratories

Buckman Laboratories (BL), a $300 million international specialty chemicals
company employing over 1200 people (referred to as associates) and operating in
over 80 countries, is a recognized leader in knowledge management(27).

The basis for competition in BL’s industry has changed from merely selling
product to solving customers’ chemical treatment problems. This requires
knowledge not only of products and their underlying chemistry, but knowledge
about their application in various contexts. While many of BL’s associates have
college degrees in chemistry and related fields, selling and applying BL’s
products requires practical, grounded knowledge gained primarily via experience
solving particular customer problems in the field. This knowledge is tacit and
resides primarily within the field associates spread throughout the world.
Field-based knowledge is complex in that it has to account for many interacting
variables, often subconsciously, and can be specific to geography, a mill or
even a particular machine. It is dynamic, emergent, and continually evolving. BL
believes that in this new competitive environment, strategic advantage results
primarily from bringing the most recent practical knowledge and experience of
all associates to bear on every customer’s problem.

To accomplish this, Bob Buckman, Chairman of BL Holdings (BL’s parent company)
envisioned an online knowledge management capability founded on several key
principles. Individuals should be able to exchange knowledge with one another
directly. They should be given universal and unconstrained ability to contribute
to and access the knowledge of the firm without regard for time zone, physical
location, language, or level of computer proficiency. A record of the
conversations, interactions, contributions and exchanges should be preserved and
made easily accessible to and searchable by all. BL implemented this vision as
K’Netixâ , The Buckman Knowledge Network.

BL has placed much of its explicit knowledge about customers, products and
technologies into online electronic repositories representing a set of
integrative knowledge management applications. However, BL has progressed well
beyond integrative knowledge management. An online interactive forum, the Tech
Forum, supports the core of BL's knowledge strategy (Figure 6). The Tech Forum,
accessible to all associates, is used to locate, capture, distribute, share and
integrate the practical, applied knowledge and experience of all BL associates
in support of the customer(28). The forum uses a standard structure; comments
are "threaded" in conversational sequence and indexed by topic, author, and
date. The content typically comprises questions, responses, and field
observations.

Knowledge management roles at BL are explicitly defined and assigned. They are
of two broad classes, those that facilitate the direct and emergent exchange of
knowledge through the forum, and those that support refining and archiving the
record of those exchanges for future use. The first represents the interactive
aspect of the architecture, and the second the integrative. BL has successfully
integrated the two in terms of organization structure and knowledge flow.

Several knowledge management roles are organized under the Knowledge Transfer
Dept. (KTD). Subject experts assigned from around the company take the lead in
guiding discussions on their particular area of expertise and provide a measure
of quality assurance regarding the advice given by others. With the support of
KTD personnel, they periodically review Tech Forum to identify useful threads
for storage in an online repository. The threads are extracted, edited,
summarized, and assigned keywords. Thus, valuable, emergent content is collected
and integrated so that it can be made widely accessible, easily distributed, and
profitably reused. KTD personnel continually monitor Tech Forum, encourage
participation, and provide end-user support and training. Each operating company
throughout the world makes their most technically qualified person available for
offering advice via Tech Forum. Product Development Managers use the forum to
offer online technical advice to field personnel and to stay current with
applications issues arising in the field. Research Librarians assigned to
particular industries search for publicly available information about their
industries. An information technology group maintains the technical
infrastructure.

Customers have stated that BL’s ability to leverage its collective knowledge via
Tech Forum was instrumental in making the sale. However, the technology is not
proprietary or leading-edge. The process is not complex. The true source of BL’s
advantage is not in the technology or the process, which are easily imitated,
but in the culture and structure of the organization. The organization’s
willingness to create, share and reapply knowledge provides the context for
successfully executing BLs knowledge strategy and architecture.

Another important reason for the forum’s success is that it has become part of
the ongoing habits and practices of the organization(29). Everyone expects all
others to read the forum on a regular basis, to post their problems, replies and
observations there, and to contribute where and when possible. Consistent
collective compliance with these expectations creates and continually reinforces
the perception of the forum as a reliable and efficient means for sharing
knowledge and getting problems solved. Its use, supported by active management
of the architecture, has become self-sustaining. BL understands that the
confluence of culture, roles, norms, habits and practices leading to this
success are very difficult to imitate and, therefore, together with associates’
knowledge and the technology infrastructure, provides a true competitive
advantage.

Discussion

I have described explicit knowledge, proposed an architectural framework for its
management and presented two examples of its application. These companies and
others with whom I have done research provide insight into how to architect a
capability for managing explicit knowledge. The framework provides a coherent
approach within which to begin designing that capability. Additionally, they
have surfaced several key issues, discussed below, regarding the broader
organizational context for knowledge management, the design and management of
knowledge processing applications, and the realization of benefits that must be
addressed to be successful.

The Context of Knowledge Management

Knowledge architectures exist within four primary contexts that influence the
impact knowledge management will have on the organization's performance.

Strategic context. Strategic context addresses an organization’s intent and
ability to exploit its knowledge and learning capabilities better than the
competition(30). It includes the extent to which the members of an organization
believe that superior knowledge provides a competitive advantage, and how they
explicitly link strategy, knowledge and performance. The successful firms I have
studied are able to articulate the link between the strategy of their
organization and what the members of that organization at all levels need to
know, share, and learn to execute that strategy. This articulation guides their
deployment of organizational and technological resources and capabilities for
explicating and leveraging knowledge, increasing the probability of their adding
value.

Knowledge context. Knowledge context addresses the competitiveness of an
organization’s knowledge. Existing knowledge can be compared to what an
organization must know to execute its strategy. Where there are current or
future gaps, knowledge management efforts should be directed toward closing
them, assuring a strategic focus. Organizations must also assess the quality of
their knowledge relative to their competition to determine its strategic value.
To the extent that the bulk of a firm’s knowledge is common and basic, that
knowledge will provide less competitive advantage than if the firm’s knowledge
is unique and innovative. Explicating and leveraging that innovative knowledge
can provide the greatest competitive benefit.

Organizational context. Organizational context reflects the organization roles
and structure, formal and informal, as well as the socio-cultural factors
affecting knowledge management such as culture, power relations, norms, reward
systems, and management philosophy. Beyond the knowledge management roles
proposed earlier, effective knowledge creation, sharing, and leveraging requires
an organizational climate and reward system that values and encourages
cooperation, trust, learning, and innovation and provides incentives for
engaging in those knowledge-based roles, activities and processes(31). I have
consistently observed this aspect to be a major obstacle to effective knowledge
management.

Technology context. Technology context addresses the existing information
technology infrastructure and capabilities supporting the knowledge management
architecture. While the adage is that knowledge management is 10% technology and
90% people, without the ability to collect, index, store, and distribute
explicit knowledge electronically and seamlessly to where needed when needed,
the organizational capabilities and incentives will not be fully exploited.
However, as BL and TRI illustrate, the technology need not be complex or
leading-edge to provide significant benefit. Its absence, however, would have
prevented both from effectively managing their knowledge.

New Organizational Roles

The successful firms I observed have explicitly defined and rewarded roles that
facilitate the capturing, refining, retrieval, interpretation and use of
knowledge. Perhaps the most important role has been that of subject matter
expert, functioning as an editor to assure quality of content, and as a
repository manager, assuring quality of context by thoughtful abstracting and
indexing. TRI, in converting to online knowledge management, found the need for
a much greater investment in editors to perform these roles. Buckman Labs showed
its commitment by assigning some of its most knowledgeable people to these
roles.

Managing Knowledge Processing Applications

Interaction complexity. Knowledge management applications form a continuum from
low to high interaction complexity. Forums are the most interactive and complex
application because they tend to span the entire tacit/explicit knowledge
processing cycle. Establishing a well-defined social community and shared
context to support the use of the technology plays a key role in the success of
the application. Electronic publishing, in contrast, is perhaps the most
straightforward. It represents the one-way distribution of explicit knowledge to
a user community that may be loosely affiliated, related only by their need for
access to the same knowledge repository, but not necessarily supported by a
social community. The greater the interaction complexity, the more the
challenges become oriented toward social, cognitive, and behavioral rather than
technical issues, requiring well-managed organizational change programs.

Repository lifecycle. Knowledge repositories have a lifecycle that must be
managed. Once created, they tend to grow, reaching a point where they begin to
collapse under their own weight, requiring major reorganization(32). Their
rejuvenation requires deleting obsolete content, archiving less active but
potentially useful content, and reorganizing what is left. Content or topic
areas may become fragmented or redundant. Reorganizing requires eliminating
those redundancies, combining similar contributions, generalizing content for
easier reapplication, and restructuring categories as needed. Successful
knowledge management organizations proactively manage and reorganize their
repositories as an ongoing activity rather than waiting for decline to set in
before acting.

Composite applications. Complex knowledge management problems typically require
multiple repositories segmented by degree of interactivity, volatility of
content, or the structure of the knowledge itself. Each repository may have a
different set of processes and roles by which its content is created, refined
and stored. Long-cycle knowledge may have a more formal review and approval
process, while best practices may receive a more expedited editing, and
discussion databases for rapid exchange may have no review process other than
after-the-fact monitoring by a forum moderator. Further, use of knowledge
repositories typically causes knowledge creation and use to become separated in
time and space. Therefore the knowledge must be continually evaluated to ensure
that it applies to present context and circumstances. Repositories and their
underlying management processes may, therefore, need to be segmented based on
the volatility of their context as well as content. For example, the storage
structures and processes for managing product knowledge in rapidly changing
markets may differ significantly from managing that knowledge in stable markets.
Segmenting these repositories and identifying any significant differences in
their refinery processes is crucial for successful application, as is their
integration to provide seamless access to their knowledge.

Repository structure. For knowledge repositories to be meaningful, their
structure must reflect the structure of shared mental models or contextual
knowledge tacitly held by the organization. In most organizations, those
structures are neither well-defined nor widely shared. Yet their explication is
essential for effectively managing explicitly encoded organizational knowledge.
This requires defining what is meant by a knowledge-unit and how that collection
of knowledge units should be meaningfully indexed and categorized for ease of
access, retrieval, exchange and integration. Creating "semantic consensus" even
within common practice communities is often a difficult task, let alone across
an entire organization. TRI found developing standards to be a particularly
difficult challenge, yet one that had to be addressed for the publishing process
to function. For example, when TRI first migrated to online publishing, they had
no standard spellings for vendor names, technology keywords, or even research
programs, all essential for effective repository management. TRI even struggled
to create a standard and consistent definition of a knowledge unit. BL had more
flexibility within its forums, yet also found that developing a meaningful
indexing scheme for its file library was critical for its use. These experiences
are not unusual. Different lexicons naturally emerge from different parts of an
organization. Standards are in many ways counter to the culture of many
organizations. However, the ability to integrate and share knowledge depends on
some broadly meaningful scheme for its structure.

Integration of knowledge across different contexts opens an organization to new
insights. A practice community’s exposure to how its knowledge can be applied in
other contexts increases the scope and value of that knowledge. Often the
variety of experiences within a local community of practice is not great enough
to fully understand some phenomenon. By being able to combine experiences across
communities, the variation of experience is enlarged, as is the ability to learn
from those experiences. For example, a leading imaging firm with whom I have
worked created a standard means to capture and share sales techniques among its
market segments. By sharing knowledge of how customers in different market
segments made use of a particular product, salespeople in each territory were
exposed to patterns, insights and selling opportunities they might not have
perceived on their own.

Benefits

The nature of the benefits from managing explicit knowledge depends on the type
of application. Electronic publishing and other low interactivity,
high-structure applications tend to provide a significant cost saving or
increased efficiency. Publishing electronically is much less expensive than the
distribution of paper. In the case of distributed learning, distributing
pre-packaged knowledge (e.g., electronic textbooks and course notes)
electronically can save significant travel expenses. In contrast, the more
interactive or emergent-content applications tend to provide support for solving
problems, innovating, and leveraging opportunities. The greatest impact,
however, comes from combining the two. For example, Buckman Labs is adding a
distance learning capability to its other applications, rounding out its
portfolio. They are poised to reap the greatest benefit by integrating the
capabilities of all applications. The emergent knowledge developed through the
forum can be archived not only for searching by individuals in the field, but
edited and repackaged for use as training materials within the distance learning
application. Thus training will have more of a real-world feel and focus. Actual
problems can be presented to students who, after deliberating on their own, can
view how they were actually dealt with at the time. And formal training can now
take place in the field, giving the students the ability to directly apply or
integrate the training materials with their own day-to-day problems. In this
way, those materials become more relevant and interwoven into the student’s
tacit experience and the learning more meaningful and lasting. By integrating
the interactive, emergent forums with the structured content and distribution of
formal training, a continual cycle of knowledge creation and application can be
created. Tacit knowledge is made explicit via the forums, formally transferred
via distance learning, and tacitly reapplied in context. That new tacit
knowledge is now available for sharing with others via the same cycle. At each
turn of the cycle, the knowledge of the organization increases(33), providing
potentially greater competitive advantage.

To summarize these findings, organizations that managed knowledge effectively

 * understood their strategic knowledge requirements
 * devised a knowledge strategy appropriate to the firm's business strategy;
 * implemented an organizational and technical architecture appropriate to the
   knowledge processing needs of the organization; enabling them to
 * apply maximum effort and commitment to creating, explicating, sharing,
   applying, and improving their knowledge.

While some view knowledge management as merely the current business fad,
knowledge lies at the essence of humans as individuals and collectivities.
Respecting the role of knowledge and learning may be the most effective approach
to building a solid and enduring competitive foundation for business
organizations. Firms can derive significant benefits from consciously,
proactively and aggressively managing their explicit and explicable knowledge.
Doing this in a coherent manner requires aligning the firm’s organizational and
technical resources and capabilities with its knowledge strategy. It requires
mapping the firm’s organizational and technical capabilities and constraints to
its knowledge processing requirements. It may require significant organizational
and technical interventions. The knowledge management architecture provides a
framework for guiding this important effort.

Endnotes

1. For example, see J. S. Brown and P. Duguid, "Organizational Learning and
Communities-of-Practice: Toward a Unified View of Working, Learning and
Innovation", Organization Science, vol. 2, no. 1, 1991, pp. 40-57; T. Davenport,
S. Jarvenpaa, and M. Beers, "Improving Knowledge Work Processes", Sloan
Management Review, Summer, 1996, pp. 53-66; P. Drucker, "The New Productivity
Challenge", Harvard Business Review, vol. 69, Nov-Dec, 1991, pp. 69-76; B. Kogut
and U. Zander, "Knowledge of the Firm, Combinative Capabilities, and the
Replication of Technology, Organization Science, vol. 3, no. 2, 1992, pp.
383-397; Nonaka, "A Dynamic Theory of Organizational Knowledge Creation",
Organization Science, vol. 5, no. 1, 1994, pp.14-37; J. B. Quinn, P. Anderson
and S. Finkelstein, "Managing Professional Intellect: Making the Most of the
Best", Harvard Business Review, vol. 74, no. 2, March, 1996, pp. 71-82; and S.
G. Winter, "Knowledge and Competence as Strategic Assets", in The Competitive
Challenge: Strategies for Industrial Innovation and Renewal, ed. D. J. Teece,
D.J. (Cambridge: Ballinger, 1987), pp.159-184

2. For example: G. Rifkin, "Buckman Labs is Nothing But Net", Fast Company, vol.
1, no. 3, June-July 1996, pp.118; and Skandia Annual Report 1995, "Intellectual
Capital Value-Creating Processes", supplement to annual report

3. R. J. Heibeler, "Benchmarking Knowledge Management", Strategy & Leadership,
March/April, 1996, pp. 22-29; L W. Payne, "Unlocking an Organization's Ultimate
Potential Through Knowledge Management", Knowledge Management inPractice,
American Productivity & Quality Center, vol. 1, no. 1, April/May, 1996

4. Meyer, M. H. and M. H. Zack, "The Design of Information Products", Sloan
Management Review, vol. 37, no. 3, Spring, 1996, pp.43-59; M. H. Zack,
"Electronic Publishing: A Product Architecture Perspective", Information &
Management, vol. 31, 1996, pp. 75-86; and M. H. Zack and M. Meyer, "Product
Architecture and Strategic Positioning in Information Products Firms",
Proceedings of the First Americas Conference on Information Systems, Association
for Information Systems, M. K. Ahuja, D. F. Galletta, H. J. Watson (eds.),
August, 1995, pp. 199-201

5. D. G. Bobrow and A. Collins (eds.), Representation and Understanding: Studies
in Cognitive Science (New York: Academic Press, 1975); J. S. Bruner, Beyond the
Information Given, J. M. Anglin (ed.) (New York: W. W. Norton & Company, 1973);
C. W. Churchman, The Design of Inquiring Systems: Basic Concepts of Systems and
Organization (New York: Basic Books, 1971); F. I. Dretske, Knowledge and the
Flow of Information, (Cambridge, MA: The MIT Press, 1981); F. Matchlup,
Knowledge: Its Creation, Distribution and Economic Significance Vol. 1:
Knowledge and Knowledge Production, (Princeton, NJ: Princeton University Press,
1980); and D. M. MacKay, Information, Mechanism and Meaning, (Cambridge, MA: The
MIT Press, 1969)

6. F. Blackler, "Knowledge, Knowledge Work and Organizations: An Overview and
Interpretation", Organization Studies, vol. 16, no. 6, 1995, pp.1021-1046; Kogut
and Zander 1992; Dretske (1981); and J. Lave. J., Cognition in Practice
(Cambridge: Cambridge University Press, 1988)

7. Brown and Duguid 1991; J. Lave and E. Wenger, Situated Learning: Legitimate
Peripheral Participation, (Cambridge, England: Cambridge University Press, 1991
); Nonaka 1994; and M. Polyani, The Tacit Dimension (Garden City, N.Y.:
Doubleday, 1966)

8. P. Romer, "Beyond the Knowledge Worker", World Link, January/February, 1995,
pp. 56-60

9. J. R. Anderson, Cognitive Psychology and Its Implications, 2nd Edition, (New
York: W. H. Freeman and Company, 1985); Schank, R. C., "The Structure of
Episodes in Memory", in D. G. Bobrow and A. Collins (eds.), Representation and
Understanding: Studies in Cognitive Science, (New York: Academic Press, 1975),
pp. 237-272

10. H. Demsetz, "The Theory of the Firm Revisited", Journal of Law, Economics
and Organization, vol. 4, no. 1, Spring, 1988, pp. 141-161; and R. M. Grant,
"Toward a Knowledge-Based theory of the Firm", Strategic Management Journal,
vol. 17 (Winter Special Issue), 1996, pp. 109-122

11. See, for example, Zack 1996

12. This line of reasoning is addressed in the works of Demsetz 1988; R. M.
Grant, "Prospering in Dynamically Competitive Environments: Organizational
Capability as Knowledge Integration", Organization Science, vol. 7, no. 4, 1996,
pp. 375-387; Kogut and Zander 1992; and E. T. Penrose, The Theory of the Growth
of the Firm (New York: Wiley, 1959)

13. Nonaka 1994

14. C.Argyris and D. A. Schon, Organizational Learning : A Theory Of Action
Perspective (Reading , Massachusetts: Addison-Wesley Publishing Co., 1978); T.
H. Davenport, R. G. Eccles, and L. Prusak, "Information Politics", Sloan
Management Review, Fall, vol. 34, no.1, 1992, pp. 53-65; and E. H. Schein,
Organizational Culture and Leadership (San Francisco: Jossey-Bass, 1992)

15. Argyris and Schon 1978

16. C. J. G. Gersick, "Habitual Routines in Task-Performing Groups",
Organizational Behavior and Human Decision Processes, vol. 47, no. 1, 1990, pp.
65-97; and R. Nelson and S. Winter, An Evolutionary Theory of Economic Change
(Cambridge: Belknap, 1982)

17. R. E. Bohn, An Informal Note on Knowledge and How to Manage It, Harvard
Business School, Publishing Division, Boston, Massachusetts, 1986; and J.
Schember, "Mrs. Fields' Secret Weapon", Personnel Journal, vol. 70, no. 9, 1991
pp. 56-58

18. For an extended discussion of information product architectures see Meyer
and Zack 1996. For an extended discussion of the refinery aspect, see M. H.
Zack, "An Information Infrastructure Model for Systems Planning", Journal of
Systems Management, vol. 43, no. 8, August, 1992, pp. 16-19, 38-40

19. MacKay (1969)

20. Meyer and Zack 1996

21. M. H. Zack, "Electronic Messaging and Communication Effectiveness in an
Ongoing Work Group", Information & Management, vol. 26, no. 4, April, 1994, pp.
231-241

22. Although distributed learning applications are typically supplemented with
electronically published course materials and assignments (an integrative
application), distributed learning refers primarily to the student/instructor
interaction (an interactive application).

23. While these approaches are conceptually distinct, they could be implemented
within the same software platform, and in fact, common technology will enable
smoother integration.

24. pseudonym

25. This information resulted from 12 hours of interviews with the Senior Vice
President responsible for information and consulting services, the Director of
Information Systems Strategy responsible for the electronic publishing project,
the lead architect of the application, and a senior analyst/consultant to the
project. Archival documentation including design documents, a discussion
database used to support the project team, and related electronic mail messages
were also reviewed.

26. This information resulted from approximately 100 hours of interviews and
focus groups with senior executives and managers of various departments at
Buckman Labs.

27. Buckman Labs has won several awards for their knowledge management
infrastructure including winning in 1996 the Arthur Andersen Enterprise Award
for Sharing Knowledge and, in 1997, the ComputerWorld/Smithsonian Award -
Manufacturing Section.

28. As part of its broad effort to be a truly international firm, BL produces a
version of the Tech Forum for Latin America called Foro Latino. BL is in the
process of translating its forums, web pages, and other knowledge repositories
into several other languages.

29. M. H. Zack 1994

30. M. H. Zack, "Developing a Knowledge Strategy", forthcoming, California
Management Review; J. H. Grant and D. R. Gnyawali, "Strategic Process
Improvement through Organizational Learning", Strategy & Leadership, vol. 24,
no. 3, 1996, pp. 28-33; G. Hamel and C. K. Prahalad, "Strategic Intent", Harvard
Business Review, vol. 67, no. 3, 1989, pp. 63-76; Kogut and Zander 1992; C. K.
Prahalad and G. Hamel, "The Core Competence of the Corporation", Harvard
Business Review, vol. 68, no. 3, 1990, pp. 79-91; and A.V. Roth, "Achieving
Strategic Agility Through Economies of Knowledge", Strategy & Leadership, vol.
24, vo. 2, 1996, pp. 30-37

31. Nonaka 1994; and M. H. Zack and J. L. McKenney, "Social Context and
Interaction In Ongoing Computer-Supported Management Groups", Organization
Science, vol. 6, no. 4, July-August, 1995, pp. 394-422

32. Marshall et al 1995

33. Nonaka 1994