People-focused knowledge management

KBS to Support
Production Line
Workers
Greater &
easier access
to knowledge
Improved
understanding of
relevant expertise
Increased
knowledge
sharing & creation
More effective
renewal & removal
of knowledge
Quicker decisions
Less time from
design to product
Lower operating
costs – fewer
operating errors
Improved reuse of
technology &
lessons-learned
Knowledgeable
people – motivated
to use knowledge
Greater customer
product/service
understanding
Increased
products/services
value to make
customer succeed
Increased
customer
satisfaction
Increased product/
services demand
Increased orders
Improved relations
between customer
& enterprise
Products/services
with better fit to
customer needs
Higher quality
products/services
Faster responses
Quicker delivery of
products/services
Elicit & Codify
Key Worker
Expertise
Market
Image
Enterprise
Profitability
Enterprise
Viability
Employee,
Community, &
Society Relations
External Benefits & Reaction
- Customer & Market Focus -
Internal Benefits & Effects
- Operations Focus -
Improved Deliverables
- Product & Service Focus -
Directly Related
KM Effects
Knowledge
Management
Activities
Bottom-Line
Benefits
Intermediate Effects and Benefits
Figure 2-3
Enterprise performance results from changes that propagate through operational excellence, product leadership, and
customer intimacy. Copyright © 1993 by Karl M. Wiig. Reproduced with permission.

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44
People-Focused Knowledge Management
Characteristics of the Effective Enterprise
Ideally, all enterprises should carry out their daily work excep-
tionally well. When they succeed in the short term, they should also,
to the fullest extent possible, observe their goals and strategies to
pursue longer-term opportunities and conquer or avoid threats. Such
behavior will require management vision and considerable resources,
infrastructure, and dedicated personnel. It is often anticipated and
expected that all employees — and in the aggregate, the enterprise
itself — always will act effectively, and “do the right thing.” Every-
one should make sense of challenges, find the best approaches to
handle situations, anticipate outcomes, inform all concerned, imple-
ment decisions effectively, and so on. Unfortunately, few employees
and enterprises, if any, live up to such expectations. Worse yet, only
rarely is there an explicit and shared understanding among any of
the enterprise’s employees — or managers — of what “acting effec-
tively” might mean in practice, although most would agree that such
behavior would be highly beneficial. It also is difficult to determine
what is required to make behavior more effective.
Enterprises are complex, and it is hard to manage the intangible
and less visible functions associated with human intellectual work
and application of structural intellectual capital. The complexity may
appear deceptively simple since the operational and structural func-
tions can only be partially observed and understood, and it is tempt-
ing to focus only on what is readily apparent — what is directly
observable. Nonetheless, the interplay of individual factors cannot be
reduced to the study of separate elements. The interrelatedness
requires that the systemic effects be considered to the greatest extent
possible.
The effective enterprise can be described by many observable char-
acteristics such as:
Philosophy, Leadership, and Strategy
The management and operating philosophy focus on creating
environments and practices that promote the best possible 
performance.
Top and middle management act as leaders and provide be-
havioral examples and role models and practice governance with
integrity, purpose, and consistency.
Rank-and-file employees are competent and effective leaders
within their purviews.
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The Effective Enterprise
45
Goals and strategies are realistic, reachable, and competitive.
The whole enterprise works to implement them.
People at all levels share a common understanding of enterprise
management and operating philosophy, purpose, strategy, and
the general service paradigm.
4
Employees, departments, business units, and the overall enter-
prise deliver the desired service paradigms.
Resources and Efficiency
The enterprise is well structured to allow its people, functions,
and operations to implement strategy successfully.
The enterprise has adequate financial, physical, personal knowl-
edge, and structural IC resources.
The enterprise utilizes its resources efficiently and minimizes
waste in all forms.
Innovation, Quality, and Renewal
The enterprise and its employees constantly innovate, renew,
and maintain personal knowledge, IC assets, and other
resources.
Innovations and experiences are captured, communicated, 
and applied, and employees are recognized for their 
contributions.
Everybody is motivated to perform their work competently, with
appropriate task knowledge and metaknowledge to tackle work
and challenges naturally and with relative ease.
The enterprise regularly obtains outcome feedback on how well
products and services perform — in the marketplace and with-
in the enterprise — and uses these measures to monitor its 
performance.
People consistently act in a timely fashion, and delays are rare.
Employees consistently “close the loop” by communicating to
the originators that messages or requests have been received,
understood, and are being pursued.
To minimize the risks of acting on inappropriate assumptions,
employees clarify assumptions before proceeding.
The enterprise creates, produces, and delivers superior products
and services that match present and future market demands.
Individuals, teams, units, and the enterprise itself deal 
competently with unexpected events, opportunities, and 
threats.
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46
People-Focused Knowledge Management
Motivation and Engagement
Everybody understands what their role is in implementing enter-
prise strategy and why they personally benefit from making the
strategy work.
Employees are noticeably motivated and engaged in their 
work.
Interpersonal work is performed through effective coordination,
cooperation, and collaboration.
Undesirable personal or systems behaviors are controlled.