Thorough commentary on successful and unsuccessful cases of knowledge management along with the effects of introduction

Knowledge management is an attempt to verbalize and share knowledge, but many companies have tried to put it into management, but have failed.
What were those companies missing? On the other hand, what kind of ingenuity can be seen in companies such as Kao and Keyence that are able to utilize knowledge management? In this article, we’ll share four key lessons to learn from knowledge management successes and failures .

Contents of this article 

  • Examples of failed knowledge management
    • 1, Company A failed due to undeveloped operation system
    • 2, Company B was unable to organize a huge amount of knowledge and no one could use it
  • Knowledge management success stories
    • 1, Converting “voices from customers” into knowledge and using them for product development | Kao Corporation
    • 2, Centralize knowledge management system and improve operational efficiency | au Commerce & Life Co., Ltd.
    • 3, Consulting firm that stores information assets of 20,000 people | McKinsey
      • A powerful system that underpins McKinsey’s knowledge management
    • 4, Knowledge sharing in marketing | Keyence Corporation
      • Keyence not only shares knowledge, but also has a culture of seeking knowledge
      • Reasons why KEYENCE succeeded in knowledge management in the sales department
    • 5, Fujifilm Business Innovation (Fuji Xerox)
      • Two Effects of Knowledge Management by Volunteer Counselors
  • Summary of 4 points necessary for successful knowledge management
    • 1, Definition of Knowledge
    • 2, Establish a corporate culture of knowledge sharing
    • 3, High performance knowledge management tool
    • 4, External organizations that support the introduction of knowledge management

Examples of failed knowledge management

First of all , let’s look back at what kind of background companies in the past have failed in knowledge management , referring to failure cases.

  1. Company A did not have an operational system in place and no one used it.
  2. Company B is unable to refer to knowledge due to a huge amount of databases

1, Company A failed due to undeveloped operation system

In the 1990s, when the concept of knowledge management began to spread, Company A introduced a system for creating a database of knowledge in order to incorporate the “knowledge management management” that was popular at the time .

There was no problem with the system that was introduced at that time, but in the case of Company A, there was a problem with the knowledge management system itself. The system was managed without an operational mechanism , such as how to define knowledge and the flow after registering knowledge , and no one could use the system, and eventually it became obsolete.

Knowledge management is not something that can be achieved simply by implementing tools. In order to do so, it is necessary to create a culture and a mechanism for sharing information with the entire company based on the “dedication of personnel who understand the details of the business”.

Source: “This Information Sharing Is Profitable” (Diamond, 2004)

2, Company B was unable to organize a huge amount of knowledge and no one could use it

Company B, which has multiple subsidiaries, introduced multiple groupwares for knowledge management and continued to accumulate a huge amount of data every day according to the prescribed knowledge sharing flow.

However, several years after the introduction of knowledge management, Company B’s groupware has more than thousands of databases.
The database was completed with information unorganized and in different formats, and no one could refer to which information was where.

The reason why Company B failed in knowledge management can be considered to be that the process of consolidation was flawed in the “SECI model” that was completed as the theory that forms the basis of knowledge management.

Company B did not have a mechanism to “consolidate” the huge database accumulated in the “community” and “exhibition” stages. As a result, it became a database that merely accumulated information, and no one could use that information .

The knowledge stored in the database becomes meaningful only when it is utilized. It is necessary to think about how to “easily extract,” “combine,” and “utilize” the data, rather than just entering the data.

Knowledge management success stories

Next, let’s take a look at an example of applying knowledge management to corporate management. Every organization is designed to be managed well.

  1. Converting “voices from customers” into knowledge and using them for product development | Kao Corporation
  2. Centralize knowledge management system and improve operational efficiency | au Commerce & Life Co., Ltd.
  3. A consulting firm that stores information assets of 20,000 people across the company | McKinsey
  4. Knowledge sharing in marketing | KEYENCE CORPORATION
  5. Fujifilm Business Innovation (Fuji Xerox)

1, Converting “voices from customers” into knowledge and using them for product development | Kao Corporation

Kao Corporation, which provides healthcare products, has introduced a system that directly links customer feedback to product development and service improvement through the Marketing Intelligence System (MIS) and the Kao Echo System.

At Kao, customer feedback sent to our support desk is compiled into a database on our knowledge management system, which can be referred to at any time by the Product Development Department.

Kao’s Sumida Plant in Sumida Ward has a Consumer Community Center, which receives 220,000 inquiries from users annually. User voices are delivered to Household Research Institute, and you can view the latest user voices by searching for products.

By referring to the knowledge database, the development department can focus on product development without missing even the smallest customer needs.

As a result, we succeeded in developing convenient products that had never existed before, and succeeded in selling mega-hit products such as “Cucute Clear Foam Spray”, “Attack”, and “Bath Magiclean” .

2, Centralize knowledge management system and improve operational efficiency | au Commerce & Life Co., Ltd.

Knowledge management also contributes to the efficiency of internal inquiries and call center operations.

au Commerce & Life Co., Ltd., which operates multiple general shopping sites such as “au PAY Market” and “LUXA,” uses a total of three business tools according to need, and has spent a huge amount of time responding to inquiries.

Therefore, the tool introduced and unified is sAI Search, which is the FAQ system of Sciseed. At the same time, by renewing the customer response flow, we were able to reduce the processing time after responding to inquiries by 40%.

Before introduction After introduction
Usage system Use 3 tools together, such as Excel Call center type sAI Search
How to Use Access and search shared folders, enter and manage correspondence history in another tool Operators can do everything from “inquiry content search” to “log recording” on a dedicated system screen.
business change Search multiple data during inquiry work,
replace the written contents with your own words and reply, and manually enter the history after responding
By using the tag search function and category search function, the post-processing time
after the response was reduced by 40% so that the flow from search to history recording can be completed with just a click operation.

By using the AI-equipped FAQ system, operators can now efficiently refer to manuals even while dealing with customers. Thanks to the search function underpinned by a powerful AI engine, we were able to get the information we wanted at our fingertips.

 

3, Consulting firm that stores information assets of 20,000 people | McKinsey

In a consulting firm where employee productivity is directly linked to sales, it is essential to have a mechanism (=knowledge management) to turn the knowledge acquired through projects into an asset for the entire firm .

A consulting firm that operates on a project-by-project basis accumulates a huge amount of research data and proposals.
At McKinsey, it seems that knowledge management is carried out so that consultants can work efficiently without waste by drawing out past cases for each new proposal and referring to them each time.

A powerful system that underpins McKinsey’s knowledge management

The knowledge that McKinsey accumulates on a daily basis is managed by a unique system called Know. The consultant assigned to the project can refer to past cases and knowledge from Know, and can contact the creator of the knowledge if necessary.

[Major information assets that can be referenced from Know]
・Industry market size
・Industry-leading player information
・Value chain, etc.

There are three factors that contribute to the success of knowledge management at McKinsey.

  • Knowledge formalization/unified format
  • Knowledge sharing incentives
  • A powerful management system that allows you to manage your knowledge

As you can see from this example, in order to succeed in in-house knowledge management, it is necessary not only to introduce a system, but also to create a mechanism that permeates the culture of knowledge sharing within the company .

4, Knowledge sharing in marketing | Keyence Corporation

Keyence is famous for its high sales force, but it is often talked about as a role model in web marketing. Actually, there was a mechanism for sharing knowledge here as well.

At KEYENCE, we constantly create content such as white papers that meet customer needs based on the vast amount of knowledge shared by sales and development. More than 40,000 pieces of content have been created so far, most of which are created based on knowledge such as customer needs and case studies gathered by the sales department on site.

At KEYENCE, we have created a system for constant production by providing feedback for company-wide sales promotion.

Keyence not only shares knowledge, but also has a culture of seeking knowledge

What makes KEYENCE unique is that it not only seeks to “disseminate know-how” but also to “recruit know-how” as well .

For example, there is a culture in which salespeople from all over the country will answer based on their experience when we solicit similar cases and know-how in the industry of the company with which we will be negotiating next time.
It seems that the order rate in business negotiations has improved significantly by recruiting know-how from sales people nationwide.

Reasons why KEYENCE succeeded in knowledge management in the sales department

Among knowledge management, the one performed by the sales department is said to be particularly difficult. Sales is a job that often increases sales through intra-organizational competition. Therefore, there is a problem that the culture of knowledge sharing is difficult to take root compared to other occupations.

In response to the above issues, Keyence has created a culture in which salespeople actively share knowledge by evaluating personnel performance at a ratio of 5:5 for sales performance and knowledge sharing .

In order to create a culture of sharing knowledge within the company, simply telling subordinates to “share knowledge” from their superiors is not very effective.
Just like Keyence’s personnel evaluation, salespeople can feel a clear incentive to share knowledge, and the knowledge-sharing system will function for the first time, and it will be cultivated as a culture.

5, Fujifilm Business Innovation (Fuji Xerox)

At Fuji Xerox, there is a department within the company that responds to inquiries from sales personnel, called the Anything Consultation Center . This is handled by people with sales experience who volunteered through open recruitment, and the consultants seem to answer as many as 2,000 consultations a month.

Questions and answers sent to the consultation center are immediately categorized into 50 categories and stored in a database. All databases are open to the public within the company and can be viewed by all employees, not just sales staff.

Two Effects of Knowledge Management by Volunteer Counselors

Fuji Xerox’s knowledge management has two expected effects.

The first is to improve the operational efficiency of sales personnel .
Since all the consultants are employees with sales experience, the questioner will be able to work more efficiently than investigating the question by himself. It seems that there was a work reduction effect of 3 hours and 20 minutes per person.

Second, it has the effect of enabling employees to acquire a variety of knowledge.
This is an effect that comes from the acquisition of new knowledge by the salesperson who asks the question, but it also seems to be beneficial for the salesperson at the Anything Consultation Center who answers questions. At Fuji Xerox , the system is designed so that
counselors understand the internal structure, personal connections, and where to find information, and when they return to the field, they can conduct higher quality management and sales activities.

Summary of 4 points necessary for successful knowledge management

Based on the success cases of knowledge management introduced so far, we will introduce four points necessary for success in knowledge management.

  1. Definition of knowledge
  2. Corporate culture of knowledge sharing
  3. Powerful knowledge management tool
  4. External organizations that support the introduction of knowledge management

1, Definition of Knowledge

Knowledge should be clearly defined. There is a high possibility that management will fail if you plan to see what kind of information is converted into knowledge and shared.

Clarify the information to be managed from now on, which items of the business will be converted into knowledge. At the same time, decide what format/flow the knowledge will be shared.

2, Establish a corporate culture of knowledge sharing

Efforts to create a corporate culture of knowledge sharing are also important. In the case of McKinsey, which I mentioned earlier, one of the factors behind the success was the fact that the values ​​shared by all employees were fostered within the company in the first place.

If you need to make a big shift in company culture, it’s also helpful to have specific incentives for knowledge sharing.
KEYENCE succeeded in knowledge management in the sales organization by incorporating knowledge sharing frequency into personnel evaluation.

3, High performance knowledge management tool

It is also important to introduce tools with powerful search functions that allow employees to quickly retrieve the information they want, and easy-to-use tools designed with a simple UI.

No matter how much employees create information assets, they are useless without a mechanism to easily withdraw and refer to them.

For example, specific measures include the introduction of tools that can be used to narrow down searches by tags and categories, and the introduction of tools equipped with AI engines.

4, External organizations that support the introduction of knowledge management

One of the points is to incorporate an external organization with knowledge management knowledge into the team.

All of the success points introduced so far are extremely difficult to put into practical use. How to define knowledge, how to foster a culture of information sharing , and how to derive the best solution for your company, hire a consultant who is familiar with knowledge management.

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