7 Ways Knowledge Management Benefits Your Business Today

Every year, Fortune 500 companies lose an estimated $31.5 billion by failing to share knowledge effectively, according to a study by the International Data Corporation (IDC). Today, knowledge management benefits organizations more than ever, but three main obstacles stand in the way:

1. Workers are more mobile.

New ways of working have become commonplace. Workers move fluidly across projects, teams, and organizations. While this increases flexibility, there is an unintended side effect. Because of this mobility, critical knowledge can flow away from the organization.

2. Knowledge is increasingly scattered throughout the organization.

An explosion in digital collaboration tools has redefined how we interact. These tools provide countless new channels for communication. But they can also result in valuable knowledge falling through the gaps. Without a way to capture that knowledge, its value can be lost to the organization.

3. Organizations are collecting and generating unprecedented volumes of data.

Data can provide the raw material necessary for the application of human knowledge. But only if the relevant information can be captured, analyzed, and surfaced on demand. Organizations frequently lack the knowledge management systems they need. This makes it difficult to capitalize on the full potential of knowledge within the organization.

Knowledge management is increasingly important, and most organizations are unprepared.

Knowledge management systems must keep up with the fundamental shifts in the way people work and communicate. Many organizations now realize that their approach to knowledge management needs a refresh.

A Deloitte survey found that 75 percent of organizations say that creating and preserving knowledge across evolving workforces is essential for their success over the next 12–18 months. Yet only 9 percent say they are ready to address knowledge management issues.

What Is Knowledge Management and Why Is It Important?

Knowledge management is a set of practices, procedures, and tools used for overseeing the “know-how” of an organization’s workforce. This knowledge is often one of the organization’s most valuable assets.

Knowledge management takes an integrative approach to discovering, capturing, assessing, storing, and sharing an organization’s information assets. These assets can cover a wide range of territory. They can include everything from documents and databases to the expertise of individual workers and teams.

The primary goal of knowledge management is to retain a critical knowledge base within the organization in order to achieve business goals. Knowledge management enhances operational effectiveness, increases productivity, and creates a competitive advantage.

7 Critical Knowledge Management Benefits for Today’s Organization

1. More informed decisions.

When the right people can find the right information in the right context, they can make the right decisions. Knowledge management brings the voice of experience and fresh perspectives to any inflection point. As a result, workers can make informed decisions that create better outcomes.

2. Greater customer satisfaction.

Workers deliver better customer service when they can find the answers they need on demand. Effective knowledge management transforms disparate data points about a customer into valuable insights. Customers get their questions answered quickly and their problems resolved efficiently.

3. Quicker execution.

Internal knowledge sharing can cut the time required to deliver products, services, and ideas. Accelerating the speed of delivery creates a significant competitive advantage. That means organizations with quicker execution can win more often.

4. Greater operational efficiency.

Every minute a worker spends looking for information is a drag on productivity. Proper knowledge management makes it easier for workers to find the necessary information and knowledge they need most. This reduces costs and boosts operational efficiency.

5. Better collaboration.

Knowledge sharing provides transparency and breaks down the silos within an organization. It creates alignment between teams, which fosters more effective collaboration. This facilitates the cross-pollination of ideas and best practices to reach business goals faster.

6. Greater agility.

Drawing on the collective knowledge of the organization empowers decision-makers with greater insights. It also identifies gaps in knowledge. That can pinpoint opportunities to restructure or increase staffing to fill those gaps as needed.

7. Faster innovation.

Sharing expert knowledge helps workers do their job more effectively and avoid redundant efforts. They can benefit from other teams’ findings to build on their wins and avoid repeating their mistakes. This stimulates opportunities to innovate. It helps organizations revitalize and adapt to changing market conditions.

How to Make Knowledge Management More Effective

Map the flow of knowledge in your organization.

Silos, separate departments, and a lack of transparency create barriers to the flow of knowledge. They signal that it may be difficult to share insights within your organization. Look for opportunities to decentralize and restructure to close knowledge gaps.

Create a comprehensive knowledge management strategy.

A knowledge management strategy outlines how your organization will manage data, information, and knowledge to meet your business goals. Plan to refine and update your knowledge management strategy over time as your organization grows and evolves.

Implement an effective knowledge management system.

An effective knowledge management system is built on a robust search solution. That makes it possible to consistently tap into the relevant information created by the organization’s people and networks and seamlessly deliver it to individuals when they need it.

Maintain necessary security standards.

Any knowledge management system will necessarily have access to all the data within your organization. Some of that data may be private or protected. For that reason, it is essential to follow the necessary security protocols to stay compliant.

Integrate with existing workplace tools.

The best solution is the one that’s easiest to use. If workers need to switch to a separate platform to find the answers they need, that creates unnecessary barriers to adoption. In order to be effective, a knowledge management solution must be integrated with familiar tools.