In Greek mythology, the character Sysiphus is condemned to spend eternity pushing a boulder up a hill, only for the boulder to roll back down as soon as he nears the top.
When organizations lack capability to manage and preserve their institutional knowledge, in the form of documented procedures, expertise, and know-how, their staff may experience a similar sentiment: doomed to repeat tasks that have already been accomplished, and solve for issues that have already been solved for by others. This needless repetition of work results in wasted time and resources, and represents a tangible opportunity cost: teams become unable to dedicate their attention and efforts to improving and innovating.
Conversely, organizations that harness innovation can edge out advantages over their competitors. Research has found evidence that “perceived innovativeness improves the attractiveness of firms to consumers” (Keiningham et al., 2023). The Norwegian Innovation Index furthermore argues that increased innovation correlates to increased customer loyalty (NII, 2021). The Drucker Institute goes a step further, explaining how innovative companies “deftly use data and technology to ferret out evolving customer wants and needs—and respond by devising new products and ways to deliver them” (Wartzman & Tang, 2021).
In this blog article, we’ll discuss the opportunity cost to innovation represented by the loss of institutional knowledge, and what can be done to solve this challenge.
Poor Knowledge Management as a Barrier to Innovation
A few years ago, we had the opportunity to partner with a Silicon Valley firm. They initially sought our help to establish consistent approaches to share knowledge more effectively. This engagement started with an assessment of their current Knowledge Management (KM) maturity. As our discovery efforts progressed, we uncovered a fundamental challenge facing the organization: limited innovation due to immature KM practices.
Periodic reductions in their workforce had exacerbated these problems. With these layoffs, the cracks in their foundational knowledge management practices illuminated additional burdens. Remaining employees not only had to pick up where their departing colleagues left off, but in many cases had to recreate their work altogether because it wasn’t properly captured in the first place.
Looking closer at the root causes of hampered innovation, we found:
- Institutional knowledge was not being consistently captured. Teams lacked established approaches to capture knowledge across the flow of day-to-day work, diverged in how they documented that knowledge, and often stored it in different knowledge bases.
- Knowledge bases were poorly curated and hard to navigate – instead employees became the most reliable source of information.
- Staff had limited access and visibility into the work that others were doing. Knowledge bases were siloed across the organization, and staff were unable to search for things across multiple repositories.
- Staff had limited opportunities for cross-functional collaboration and exchange of ideas. While the organization had several Employee Resource Groups (ERGs), these weren’t geared towards sharing expertise and strengthening shared business capabilities.
Maximizing Knowledge Management Capabilities to Unlock Innovation
Established knowledge management practices within an organization contribute to both promoting innovation and removing barriers to it. We can summarize this into three overarching outcomes:
Ability to reuse institutional knowledge. When organizations are able to retain and reuse institutional knowledge, their people can dedicate their efforts towards bringing new ideas to life, enhancing existing products and services, and improving processes. While there are no single practices nor tools that guarantee this outcome, there are several things that organizations can do to encourage knowledge capture and reuse: having designated places for different types of knowledge, making the most of high-value moments of knowledge capture by collecting key documentation and lessons learned on projects, and enabling staff to search and discover knowledge resources that have been produced in the past. At a large Sovereign Wealth Fund, we successfully incorporated these concepts and practices to deliver a Knowledge Portal. This solution and supporting practices provided a 360-degree view of critical business processes, enabling staff and executives to identify synergies and opportunities for collaboration in their work.
Ability to cross-pollinate ideas and increase awareness across traditional organizational silos. This capability can be enabled through a diverse set of practices and tools. Traditionally, Communities of Practice (CoPs), have been a common tool for organizations to create spaces to nurture knowledge sharing. Other approaches can include Knowledge Cafes, such as the one we instituted at the Green Climate Fund (GCF), providing a repeatable opportunity to bring together people from all areas of the organization to discuss topics relevant to their work and encourage them to learn from each other.
Ability to deploy advanced KM technologies to accelerate innovation. The proper application of advanced technologies can enable organizations to leverage its institutional knowledge as a springboard to unlock and accelerate business capabilities. For instance, a Semantic Layer can unlock knowledge that has previously been siloed within individual systems and organizational units, enabling executives to make faster decisions using more complete data available throughout the organization. Similarly, a semantic layer can enable individual contributors to gain broader awareness of expertise throughout the organization, creating pathways to collaboration. AI applications can further increase the organization’s capabilities to create and share insights, and take faster action.
Closing
Innovation is a key business capability. All too often though, we find that innovation efforts are hampered because staff spend a lot of time fixing issues that have been fixed in the past rather than on ensuring that the organization is evolving to continually be able to meet its objectives.
Enterprise Knowledge brings a holistic set of solutions that involve human-centered approaches and cutting edge technology to enable organizations to accelerate their innovation processes. Contact us at info@enterprise-knowledge.com if you would like assistance in maximizing the ability to leverage your institutional knowledge for innovation.
Institutional knowledge is the sum of experiences, skills, and knowledge resources available to an organization’s employees. It includes the insights, best practices, know-how, know-why, and know-who that enable teams to perform. This knowledge is the life blood of work happening in modern organizations. However, not all organizations are capable of preserving, maintaining, and mobilizing their institutional knowledge—much to their detriment. This blog is one in a series of articles exploring the costs of lost institutional knowledge and different approaches to overcoming challenges faced by organizations in being able to mobilize their knowledge resources.
References
Keiningham, T., Aksoy, L., Buoye, A., Yan, A., Morgeson, F. V., Woodall, G., & Larivière, B. (2023). Customer perceptions of firm Innovativeness and Market Performance: A Nation-level, longitudinal, cross-industry examination. Journal of Service Research, 27(4), 475–489. doi:10.1177/10946705231220463
NII (2021), Technical Description: The Norwegian Innovation Index Research Model. Norwegian School of Economics (NHH). Available at: https://www.nhh.no/en/norwegian-innovation-index/about-nii/technical-description/
Wartzman, R., & Tang, K. (2021). Which industry excels at innovation? you’ll be surprised; consumer-staples companies stand out in the management top 250 ranking. New York, N.Y.: Dow Jones & Company Inc. Retrieved from https://www.proquest.com/blogs-podcasts-websites/which-industry-excels-at-innovation-youll-be/docview/2490681747/se-2