Content Versus Knowledge
If they heed the lessons of CRM (customer relationship management) failures, VARs with vertical expertise can profit with knowledge management solutions.
"We are our own worst enemy," one ISV (independent software vendor) told me last week. He was referring to the fact that software vendors create new catch phrases and buzzwords to describe themselves. Not wanting to be left out of the latest terminology and seen as outdated, other vendors adopt the Staple's slogan: "Yeah, we've got that." Unfortunately, it's not always clear what "that" is. A case in point: knowledge management (KM). Since all content is knowledge of one form or another, everything from a scanner to storage management software to a search engine is "managing knowledge."
What Is Knowledge?
As engaging as it might be, let's avoid the deep philosophical discussion of the nature of knowledge and concentrate on how we can differentiate knowledge from content. "It's not knowledge until a person is involved," says Ted Collins, senior VP at divine, inc. (Chicago). "It's only information up to that point." A contract is content. The revisions and negotiations necessary to finalize it are knowledge. The ability to explain why a section is worded a certain way is knowledge. Information that will be of assistance when implementing the agreement or negotiating a new agreement with that same party is knowledge.
"As an employee, I have a knowledge and understanding about our customers," says Mike Ball, VP of marketing at SER Solutions (Dulles, VA). "What I know can be used to manage important business relationships and make decisions about service levels, and 90% of what I know leaves the building when I do. KM takes what I have as a person and manages it in a fashion that can be shared cooperatively."
Beyond notes in a database file, KM can help people make the kinds of connections they might make if they actually spoke to each other and asked the right questions. "It's like the electronic version of gathering at the water cooler or leaning over a cube," says Dave Cadoff, senior director of marketing for Day Software, Inc. (Newport Beach, CA). In other words, a KM system takes tacit knowledge and makes sure it is shared with those who need it. Though there is still much room for interpretation, one scenario might be that when an employee is working on a project, a KM system might generate links to other documents or provide contact information for other people who have worked on similar projects. It has the potential to increase efficiencies by eliminating redundant work as well as preventing poor decisions made without complete access to all information.
Capitalize On Vertical Expertise
"The success of a VAR entering the KM market is based less on technology than on an ability to leverage some strength in an established vertical market," says Steve Wood, senior director of product marketing at Ceyoniq (Herndon, VA). "Effective tools with open APIs [application programming interfaces] are available to VARs. Success will hinge on the ability to apply those tools to something they know well." Because the business practices and vocabulary vary so much from one industry to another, being able to offer horizontal KM is probably more than any one VAR can do. However, a VAR who is already offering imaging or other services to an insurance company may want to use KM to expand its footprint in the client site. Wood suggests that knowledge of those internal practices may be the hardest thing to learn, and VARs might want to consider hiring a professional from that vertical.
According to Collins, a vertical approach also lowers acquisition costs because once a VAR has obtained the knowledge of the software and how it can be applied to a specific vertical, it can be used again and again. Successful vertical implementations also help you establish a market position. "The biggest challenge is getting that first success," advises Collins. "You may have to buy that first win as an investment in credibility, but nothing succeeds like success."
Ball cites the value of KM in conjunction with CRM (customer relationship management) or environments where there is a customer-interfacing requirement. "One demand many organizations are challenged with is responding in a timely manner to customer questions," says Ball. "A company often has the knowledge; a KM solution puts it at a rep's fingertips and makes it easy to gain information." According to Ball, KM solutions could also be a complement to services offered by VARs in high-end document and workflow solutions who understand the needs of companies that can't convert information to knowledge fast enough.
Wood recommends KM for VARs working in highly collaborative environments. "Consultants, legal practices, medical offices, and other environments where professional services are offered in different forms and require shared knowledge are prime candidates for KM," comments Collins. Cadoff adds research-driven fields like pharmaceuticals to that list.
With the growing adoption of mobile or remote workforces, KM may be a tool that helps workers stay "in the loop" professionally. "Most knowledge focuses on what is new and relevant such as a competitor's press release or a counter to customer objections," says Cadoff. "Off-site employees need to know that information as much as, and sometimes more than, those who are centrally located."
Market Offers Opportunity For C-Level Sales
In pointing out the potential opportunity for VARs, Ball cites an IDC study predicting that revenue from KM solutions will reach more than $12 billion by 2005. IDC's estimated CAGR (compound annual growth rate) exceeds 40%. In addition, says Ball, a number of companies have actually created positions for CKOs (chief knowledge officers) in the past year, which is further evidence of the growing emphasis corporations are placing on knowledge.
Despite these optimistic indications, vendors admit that KM may not be an easy sale. "Bottom line - KM is a C-level sale," says Collins. "If you're selling this tool to the knees instead of the head, you aren't going to be very successful. Establishing value high on the chain makes a VAR's KM solution indispensable."
The sudden demand and high expectations for KM solutions might open that technology to the same criticisms that plague CRM and prompt end users to call it a failure. Among these are failing to demonstrate ROI and user resistance. "The benefits are soft, as is the return," notes Wood. "So it's important to focus on the things that can be quantified such as personnel and training time. It can allow employers to reduce forces yet still retain the knowledge of displaced or reallocated workers. Workforces are volatile, and even high-knowledge workers like lawyers have some turnover. Losing a lawyer with knowledge of a particular case can be devastating."
Provide Strategies For End User Acceptance
To encourage end user adoption, solutions should mirror existing routines as much as possible. "Ease of use to the point of invisibility is the most important feature in a KM product," says Cadoff. "If employees have to actively participate, it should not only be easy but also look as much like what they are used to as possible. Privacy will also be an issue. It will have to be clear to employees how a KM system will be used and to have a set usage policy."
Even if using a KM solution is simple, there is still little incentive for individual users to make the most of the tool. Any kind of notes or indexing will almost always require extra time, even if it's only a few seconds. Completing the process necessary to share knowledge may not be a priority. After all, if the solution is intended to leverage my knowledge even if I am laid off, why would I want to share it? If my goal is to outperform or otherwise differentiate myself from my coworkers, why would I want to share the things that help me do that? It's going to take more than good software to make employees accept a solution that makes them dispensable. A plan for encouraging employee cooperation may well be a part of the design phase for successful KM VARs.