Knowledge Management of a utility company in Hong Kong
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Group member: Arthur KU, Grace LI, Hilda LAI, Kenny WONG, Kiko CHENG
In this report, a case analysis on the knowledge management practice of an organization in Hong Kong is conducted, using variety knowledge management concepts. Background of the organization and its key knowledge management strategies are stated and analyzed. Evaluation and relevant recommendations are also given out, according to such implementations. Through this project, an overview of some issues and development in knowledge management field is reported in order to allow audience understand how knowledge management is actually applied in a utility company.
As more and more emphasis is put on the knowledge society and knowledge-based global economy, the ability of the organization to manage knowledge soon become the key to business success; especially for the organization which heavily rely on the past knowledge and experience to run the business, such as utility company.
Utility industry is a highly knowledge-intensive industry. Knowledge management (KM), is absolutely critical to ensure effective management of knowledge asset, reuse past experiences and enhance knowledge creation and innovation. KM in utility company aims to capture and organize knowledge and experience systematically gained from staff and business partners to make the knowledge readily accessible to users and encourage knowledge generation and learning and at last to achieve the organization objectives (Wiig, 1993). Many utility companies have implemented a structured approach of KM but the effectiveness of the approach is rarely analyzed. It is worth exploring the implementation of KM in utility company and the relationship between KM activities and business performance measures.
In this study, a small scale KM research is conducted and a KM-related business case in utility industry is analyzed to investigate the KM strategies used in utility company and evaluated the effectiveness of those strategies to see if how KM helps the company.
1. Role of KM in utility industry
KM in utility industry refers to the management process for knowledge acquirement, study, organization storage, sharing, communication, utilization and innovation in the production process (Li & Li, 2010). According to Li, Li and Zhou (2010), knowledge assets become primary power for utility company to create fortune, which in turn, arouses the awareness of organizing knowledge and speeds up the urge of employing KM. KM takes up important role in coordinating many aspects of organizations through putting in more and more information communication and share. To utility company, KM is effective in Research and Development (R&D), since this is the most intensive field of knowledge demand, which requires massive knowledge archiving, handling, accumulating, transmitting and sharing. Also, KM would eventually foster innovation, in which new knowledge is generated based on archived knowledge.
2. KM tools & strategies for utility industry
A) After Action Review (AAR)
After action review (AAR) was first implemented by U.S. Army Research Institute (ARI) since mid-1970s (Morrison & Meliza, 1999). It is a tools originally adopted for training programme for the US army. Later on, it is applied in several business operations, and even knowledge management.
AAR is an on-going practice which used to capture lessons learned from past successes and failures, aiming to improve the future performance of the organization. With the reference to the AAR processes applied by US Army, AAR comprises 4 steps, namely, planning, preparing, conducting and following-up (Department of the Army, 1993). According to Signet Consulting Group (2002), AAR is conducted in various companies:
- A motor company uses AAR for new product launches, by gathering opinion for adjusting planning assumptions and performance standards, so as to ensure the new products meet the standards.
- One of the leading oil companies even employed “Before Action Review” to discover the “ground truth” for the next phase of a project, in order to take the lesson learned of the previous stage to the next stage.
- Wine producers adopts AAR to capture lessons from each warehouse manager for reviewing warehouse operations quarterly, via conducting one-on-one AAR.
B) Elicitation Interviews
Elicitation interviews use a stimulus (e.g. photographs or written records) to encourage participants to discuss subjects in greater detail than during standard interviews (Henry & Fetters, 2012). This method is useful for knowledge management, especially in the part of knowledge sharing via socialization, which aims at transferring tacit knowledge between individuals (Becerra-Fernandez & Sabherwal, 2001). Henry and Fetters (2012) suggested that, video elicitation interviews refer to interviews with video recording. It is commonly used by companies nowadays, since it helps produce high-quality data, even though it is relatively more time-consuming and complicated. 5 major steps are involved for elicitation interviews:
1. Conceptualizing a video elicitation study (i.e. choosing suitable research topics and deciding the scope)
2. Participants and sampling (i.e. determining unit of analysis and sampling)
3. Data collection and management (i.e. choosing appropriate equipment, designing steps for conducting video recording and training interviewers)
4. Data analysis (i.e. reviewing interview and data quality regularly and choose method for analyzing the data)
5. Mitigating limitations of video elicitation interviews (i.e. deciding what kinds of interview data are needed for different purpose)
Taxonomy provides carefully developed definitions for each major knowledge categories that a company recognized (Krathwohl, 2010). With an appropriated taxonomy, search terms can be commonly attached when search engine is working. In aerospace industry, it is to adjust the posting permissions and develop appropriate taxonomy to enhance the search (Jafari, Rezaeenour, Akhavan & Fesharaki, 2010).
Dalkir (2011) mentioned that the knowledge sharing system should not be complicated in order not to let users feel troublesome since all the knowledge sharing activities must be self-motivated. Alavi and Leidner (2001) expressed that knowledge sharing is always easy that even the newsletter within the company is an effective way to share knowledge. People do not necessary decide complex information sharing model, since knowledge sharing can be done once the participant is willing to spend time on it.
According to the definition of Wiki by Wagner (2004), Wiki is described as a set of linked webpages, created through the incremental developed by a group of collaborating users. Its uniqueness lies both in its software and in the use of the software by collaborating members.
An investment bank uses corporate Wikis for employees to contribute and edit their corporate website without the need of special permissions of knowledge of HTML or web-authoring skills. It first started in IT department, then introduce bankwide wikis that provides access to most bank employees (Becerrs-Fernandes and Sabherwal, 2010)
Portal provides a company with rich and complex shared information workspace. It can be classified into 2 types: extranet and intranet. Intranet portal is widely used as a way to access disseminated information within a company, since information can be stored in various systems using different formats (Benya, Passiante & Belbaly, 2004).
In electric power enterprise, users visit all information through portal which has two major functions regarding knowledge management. The first function is to provide knowledge map and the second one is to form coordination and task pushing systems. Both of them are belongs to the layer of knowledge application. In addition, Portal is mainly supported by business supporting information e.g. ERP, business subsystem information etc. and management supporting information e.g. OA, HRM etc. Both of them are belongs to the layer of knowledge creation (Li J., Li G., 2010).
SharePoint is a software developed by Microsoft, as an end-to-end solution for managing documents. Usually, custom portal is also developed to aggregate content from multiple sources into a single location (Ngai & Chan, 2005). In multi-national enterprise, SharePoint is the integration of collaboration, portal, content management, business, process and business intelligence to help users easily find, use and share information and increase productivity. The target of SharePoint is much more than just collaboration between humans. Instead, it connects people, process and information across organizational boundaries in the enterprise. In addition, SharePoint provides an extensive search framework. As a result, enterprise not only can break down knowledge silos, but also facilitates effective knowledge reuse within the corporation (Laahs, McKenna & Vanamo, 2008).
H) Decision Support System
Decision support system is a computerized system which facilitates decision making. For example, it helps a company to choose the best supplier and assign the optimum order quantity between selected supplier, through looking in both tangible and intangible factors (Ghodsypour & O’Brien, 1998). According to Nihalani, Silakari and Motwani (2009), this technology helps decision making through searching the internet, brainstorming via data-mining technology, interpreting internet-derived material, the human web interface, remote condition monitoring and many other areas.
In e-commerce industry, Wen, Chen and Pao (2008) suggested a mobile knowledge management decision support system using multi-agent technology for automatically providing efficient solution for decision making and managing an electronic business. With the help of Artificial Intelligence (AI) technologies, users can modify, add, or drop their latest knowledge riles from the system. The AI system can automatically evaluate accurate action or alternatives solution when a new knowledge is introduced. Last but not least, the decision support system improves financial management by using a neural network for predication the future financial measures.
I) Communities of Practice (CoP)
CoP is a network in which employees voluntarily participate to facilitate exchange of knowledge, especially tacit knowledge (Wenger & Snyder, 2000; Zboralski, 2009). It is a useful tool for decreasing time required to training new employees (Lesser & Storck, 2001). For example, science-based Small and Medium Enterprises (SMEs) gain benefits from CoP, for supporting incremental innovation in the form of problem-solving activities. The CoP they conducted are usually inter-organizational CoPs, where different people (e.g. customers, technicians etc.) are joined together, since the leveraging of personal relationships helps bring people together (Pattinson & Preece, 2014).
J) Reward and Recognition
Reward and recognition is the driving force for successful knowledge management, particular in the aspect of knowledge sharing (Swan, Newell, Scarbrough, & Hislop, 1999). In the past, these two elements never be included as best practice, however, it is mentioned by McDermott and Dell (2001) that reward and recognition can highlight the most important things that the company feels and in turn, motivate the staff. Example for companies using reward and recognition for KM:
- A technology and management firm makes knowledge sharing as a criterion to receive the highest rating on a performance evaluation. They track the frequency that the staff contribute to knowledge base through uploading reports, and these data are used for promotion discussion. Annual awards such as “Knowledge in action” and “Best practices awards” are issued to recognize staff’s participation and contribution (McDermott & Dell, 2001).
- An IT service management company give reward as fame or recognition to the engineer for providing applicable solutions (which are evaluated by peer assessors) to solve tricky problems. This incentives is rather a visible one and communal (Earl, 2001).
3. Problems tackled by utility industry
Utility industry is an industry with unique knowledge, knowledgeable staffs equipped with unique expertise in handling the high-value assets in utility company are essential. As suggested by Poole and Sheehan (n.d.), the loss of knowledge and experience will be particularly pertinent among manufacturing, engineering and R&D professional. Potential to innovate will be harmed and there will be a higher risk for making mistakes, if the knowledge and experience of senior staff and experts is not transferred to the next generations either through teaching or process.
However, not many experienced people are available in the market due to the limited companies in the industry, which means this industry is prone to knowledge drain when there is any staff movement or retirement (Singh & Yadav, 2009). Therefore, it is important to determine the knowledge needed and retain those critical one for the company.
4. Improvement/Further development trend for KM in utility company
As suggested by Martin-Rios (2014), building inter-firm network would probably be the future trend to make companies gain more through sharing knowledge, especially human resource management (HRM) knowledge. Utility industry is not an exception. Since it is so obvious that utility company is now facing knowledge drain, apart from keeping the professional knowledge of this domain from the experts, it is also critical for firms to gain knowledge about how to manage their employees. By doing so, staff would have greater loyalty towards the company and sharing culture can be fostered, which in turn, help the company to run KM smoothly.
Results of this research are concluded from qualitative research which is interview. An interview was conducted with the knowledge management manager from Company A to collect the information about KM strategies and tools used in Company A, as well as the effectiveness of those strategies. As KM implementation in each industry is different, interview is important in this research as it helps obtaining first-hand information about the actual implementation of KM in a utility company.
Interview questions were drafted in advance so as to gather the required information. After the interview, interview were then processed and interview notes were transcribed to prepare for analysis.
For interview questions, please refer to Appendix A.
Case Study of utility company in Hong Kong
A. Background of company
Company A is a Hong Kong based company focusing on the electricity supply business and has served Hong Kong for over 110 years. It generates and supplies reliable electricity to the Kowloon Peninsula, the New Territories and outlying Islands in Hong Kong. Company A operates a vertically integrated electricity business with three major business group, namely, generation business, power system group(transmission and distribution business) and customer service group as shown in Figure 1 (Chan, 2007).
Company A is a large-scale business with over 2000 employees. It is obvious that large amount of information and knowledge is generated. For the whole business group, the ratio of explicit knowledge (e.g. documents) to tacit knowledge (e.g. experience and skills not codified) were found to be 51:49 (Shek Cheung, Lee & Chong, 2007). This indicates that the amount of hidden knowledge asset was large, and the knowledge assets would be lost when these employees left the company. Therefore, Company A has applied KM for more than 10 years, and during the years various pilot KM initiatives were implemented to capture the crucial knowledge and promote knowledge sharing culture. In 2010, the company won the Most Admired Knowledge Enterprise (MAKE) Award 2010 to recognize its outstanding performance in KM practices.
B. Problem/Issues before KM implementation
Company A implements knowledge management mainly due to 2 majors reasons: difficulties in outsourcing and prepare for knowledge drain (Shek Cheung, Lee & Chong, 2007).
Unique in business nature
Business nature of the power industry is unique and focus on engineering professionals. As there are only limited number of power utility companies in the industry and the standard of Electricity Company is not equivalent with other countries, it is hard to outsource in the market. Therefore, company A has to create, capture, and store the relevant knowledge assets by itself to capture the invaluable capital from the incident experiences.
Prepare for the knowledge drain
Prepare for the knowledge drain is the major need for KM. As many senior staff are going to reach the retirement age, Company A is losing a significant knowledge packed into the minds of those staff. It is hard to find replacements for experienced staff in short notice as there is insufficient experienced personnel in the market and it requires over 10 years to develop a qualified engineer. Therefore, critical knowledge and experience is needed to retain for junior employees and to shorten their learning curves.
C. KM Journey
Company A has employed systematic knowledge management processes for more than 10 years. A number of pilot KM initiatives such as developed PSBG Wiki, After Action Review (AAR) and Community of Practice (CoP) were adopted. In 2014, the KM implementation is mainly focus on strengthening the learning and sharing culture (Figure 2).
D. Implementation of KM (Tools & strategies used)
Collison and Parcell (2004) mentioned that 3 perspectives: technology, people and process must be taken in account when designing KM activities in a company. Balance among them should be maintained in order to deliver the optimum outcome. In this part, this model is applied to explain the implementation of KM in Company A (Figure 3).
Technology & Process: KM Tools 
According to the model suggested by Dalkir (2011), KM cycle includes three aspects: knowledge capture and creation, knowledge sharing and dissemination, as well as knowledge acquisition and application. It means that knowledge is assessed through sharing and dissemination among people after they are captured and created. Later on, knowledge are contextualized for acquisition and application. After knowledge is applied, it will in turn update the original knowledge in the knowledge repository or even create new knowledge for future use.
Besides, other elements like KM strategy, KM technology, KM team and KM metrics are essential for running KM in a company. Most importantly, organizational culture would be the vital factor to decide whether the KM is successful or not. Figure 4 illustrates all the elements involved in Dalkir (2011)’s model.
In the following part, this KM cycle is used to describe the KM strategies used in Company A.
1. Knowledge Capture and Creation
I. Content Creation
- After Action Review (AAR)
Company A implemented AAR when there is projects or specific tasks, meaning it is project-based KM tools. Face-to-face AAR session, aiming to harvest tacit knowledge from each projects, is held for staff to gather together to share good practices and lessons. Especially, AAR is organized for projects with external consultant involvement.
In company, AAR is conducted after identifying key milestones in project. After that, harvesting template would be uploaded to knowledge portal repository (i.e. K portal), with active email alert sent to staff. The process are described in Figure 5:
- Elicitation interviews & Video development
Elicitation interviews was launched in Company A since 2004, after they have identified 11 core business knowledge themes. This aims to capture in-depth core business tacit knowledge from subject matter experts. In recent years, videos are taken for recording the whole process of interview.
Knowledge elicitors first interview a panel of subject matter experts and record the interview in digital format. Those files (e.g. transcript, video etc.) are uploaded to tacit knowledge repository platform after restructuring the materials into the format suitable for upload. The process are described in Figure 6:
II. Content Management
- Taxonomy of document repository and layout
In Company A, knowledge taxonomy being a classification scheme of resources is implemented. It is organized and assists user in navigating through the content. By using card sorting methods, which allows user to participate in classification of glossaries and names of documents, documents can be classified into a particular class. Consequently, a customized search engine could be done, based on knowledge domain taxonomy.
An expert directory is created as taxonomy to manage documents systematically in Electronic Document Management Systems (EDMS). The Criteria for nomination of knowledge domain into the Expert Directory includes: - Experience in the field - Communications skills - Knowledge sharing inclination
- Electronic Document Management System (EDMS)
In Company A, Microsoft SharePoint 2010 is used as EDMS, which is the base of SharePoint to support SharePoint. All formal company documents reside in EDMS. Through hyperlinks associated with materials, user can find documents in a particular subject. EDMS stores forms, policies and references, best practice and so on by classifying into different areas e.g. department, usage and function etc.
After recording the practice of knowledge capture and creation, following parts illustrate how the organization effectively “use” the information:
2. Knowledge Sharing and Dissemination
Knowledge sharing and dissemination is particularly important as it is the most obvious practice of the whole knowledge management process, as stated by Lee (2011).
I. Communication and Collaboration technologies
- Knowledge E-Quiz (K E-Quiz)
Company A sets up online quiz system which is also a reward-based system for all employees. Questions in the quizzes are collected and generated from the senior staff or Internet sources related to the knowledge of the company practice.
- Knowledge Newsletter (K Newsletter)
In Company A, newsletter is issued in digital form. Content of newsletter includes asset management, engineering, safety technology and health and environment. It is used to spread out the latest news in the company regularly.
The Wikis developed by Company A follows the practice of Wikipedia which collects collaborative knowledge of company Wiki users (i.e. internal users). Knowledge on Wikis is arranged by the several core business themes. Information keeps updating as users continuously edits the content or adds new information.
- KM Blog
KM Blog in Company A is a more general technology sharing platform, compared to the above-mentioned Wikis. Staff can freely write anything on the blog to share anything they like.
II. Networking technologies
- K Portal
K Portal is a web application which allows users to search for subject-related knowledge. In Company A, with the single entry point for various knowledge, it is easy for users to access the K Portal. Better still, the contents are arranged in logical structure for easy navigation and information retrieval. In addition, it provides web search engine and glossary. For development of K Portal, it is continuous improved based on the results of the knowledge audit. Subject Experts has been nominated to provide advices on technical enquiries.
- SharePoint site
In Company A, SharePoint is adopted as a platform to share knowledge by sharing document of different areas among different departments. SharePoint acts as an intranet for internal usage in Company A. Access right is granted for staff by their position in the company and the level of security. SharePoint also links up with K Blog, by storing those documents of the postings created in KM Blog and KM Newsletter. As a result, staff can easily access to the document by simply clicking the hyperlink in K Blog or KM Newsletter.
3. Knowledge Acquisition and Application
I. Artificial Intelligence (AI) technologies
- Intelligence Decision Making System
Company A employs a number of knowledge-based systems which provide services in an ontological framework. The intelligent knowledge management is supported by Artificial Intelligence techniques for practical applications. For instance, for generation, it created Generation Efficiency Monitoring System; for transmission and distribution network, it invented Lightning Detection System for System Operation and; for customer services, it produced Customer Voice Management System.
People: Strategies fostering sharing cultures 
- Communities of Practice (CoP)
Communities of Practice is widely adopted in Company A, targeting to gather a group of employees to share knowledge regarding certain subject matters. Learning Communities (LC) is established for members with particular domain to join together to share knowledge or resources concerning that domain. Experience sharing session is also organizaed in order to invite experienced staff to share their experience to junior staff.
- Recognition Ceremony
Company A launches recognition ceremony as a rewards and recognition to employees so as to recognize contribution from knowledge contributors, including LC participants, AAR participants, KM coordinators and subject experts.
- K Seminar
K Seminar is held to invite external professionals from other utilities or organization to share knowledge regarding certain specialized topics. For example, electric power enterprises from other countries like Japan or India, or even local public transport company.
- KM Ambassador
Company A assigns several KM ambassadors in each department, whose job is to facilitate knowledge management in that department. Knowledge elicitation workshop is held regularly such that training is provided for KM ambassadors to assist them in putting forward different KM solutions, as well as identifying appropriate knowledge to be collected in the next stage and evaluating existing KM strategies.
Finding and Analysis
Evaluation of KM tools & strategies
The assessment methods by Becerrs-Fernandes and Sabherwal (2010) and Alavi and Leidner (2001) is applied in this part for evaluation the KM tools and Strategies in Company A. The methods included 2 aspects: KM impacts and organizational impacts.
Aspect 1: KM impacts – Impacts on KM processes
4 processes are taken for assessment, namely knowledge discovery, capture, sharing and application (Figure 7).
Aspect 2: Organizational impacts
To see the effectiveness or influence of knowledge management practice, it could be evaluated through measuring its impacts on the organization as a whole. According to Alavi and Leidner (2001), knowledge management practice would affect the employees (process of learning and adaptability), organization processes (improvement on effectiveness and efficiency), organization products (introduction of value-added products) as well as organization performances (development of competitive advantages). At the same time, people would further affect products while processes would have influences on organizational performance (Figure 8).
Technology & Process
1. Knowledge Capture and Creation
Elicitation interviews and video development are constructive to Company A as they are the important steps for knowledge discovery, creation and capture. Somehow, they are like the keys so build up a good knowledge base. Without them, knowledge would not be generated for storage. Employee learning is stimulated as a result of having this elicitation tools since they hugely increase the staff’s awareness towards knowledge discovery and capture. Moreover, comprehensive procedures for conducting elicitation interviews and video development is well-written, enhancing the efficiency of the whole company in capturing knowledge.
KM tools in the company like taxonomy and EDMS are successful as they greatly enhance the effectiveness and efficiency in Company A, since knowledge and documents are systematically arranged and stored. Taxonomy is useful such that it helps increase the average number of annual hits in the document repository by facilitating staff to manage and find suitable documents, as well as uploading sharing materials. Powerful content management also enables the company to streamline certain operation processes, say, spending less time on sending out document requests to other staff for getting certain documents, as all the documents are put on EDMS. Besides, taxonomy can allow employees to look for information or knowledge easier in order to generate reports faster, as well as saving time for searching certain knowledge, since knowledge are arranged in a structured way such that staff can locate the needed knowledge easily. All these contribute to higher overall efficiency.
Unfortunately, there is big problem in launching these KM initiatives: Employees are generally reluctant to use these tools as they generally see these KM tools are time-consuming. This problem is particularly serious in the case of AAR meeting, the KM initiative with the least participants; since it is always difficult to gather a group of experts for discussion when they have finish certain project milestone or when their working hour have ended. Indeed, engaging in these KM strategies take up a rather longer time for staff, say, they have to spend time on completing the AAR template or preparing interviews or video editing etc. But, if the company can let the employees understand that the company actually emphasis employees to share knowledge and eventually, change the attitude of the employees, it would gradually increase the participation rate in those KM initiatives.
2. Knowledge Sharing and Dissemination Practices of communication and collaboration of knowledge could easily be observed in Company A. The company has ranges of practices of knowledge sharing and dissemination which are effective to promote knowledge management in the entire company. They include one-way communication as well as interactive communication.
Members within the organization could access to the information or knowledge that captured by the organization’s effort. And it would link to knowledge acquisition and application for further use of the knowledge created. As the middle step of knowledge management practice, the company performs quite well in this area. The company has done the practice of knowledge sharing and dissemination in a high extent to arouse the awareness of knowledge management among junior employees and senior staff as well.
The unique K E-Quiz demonstrates the efforts put in gathering questions (knowledge). It is so unique that even some large corporates like MTR and Police Force do not have such questioning system or activities for internal members. This unique feature shows that the company is highly willing to put resources to develop the most high-end knowledge sharing system.
The K Newsletter regularly arouses the interest of employees towards different kinds but related knowledge which in turn improves the employee learning. The response rate is high since there are rewards for high participation record. This practice is common for many well established corporates to share knowledge or opinions regularly. Suggested by Dalkir (2011), this one-way regular knowledge sharing approach is only useful when organization members are engaged in reading the newsletter shared by other staff. However, this practice reflects the well-being of business practice to competitors as it shows the sufficient knowledge storage and resources put in knowledge management. It also lets the employees know the most recent performance or activities of the entire organization. Sometimes, promotion of certain events and compliments for some employees would also be shown in this newsletter.
Job satisfaction is also enhanced as senior staff has a platform to share their valuable working experiences to the juniors. According to Wagner (2004), the introduction of Wikis brings convenience to every internet user to share knowledge in a more leisure manner. Employees of the company have free access to this collaborative platform to share what they know, without much restriction. This collaborative tool bring great effect to the entire company.
Similar to Wikis, KM Blog encourages the knowledge sharing among internal staff. Even they do not know each other, they could easily gain the knowledge shared by others. The flow of knowledge within the company improves the innovativeness of different staff after learning others’ knowledge and it could bring eventual advantages to the company. It is more likely for senior staff to share their knowledge or even opinions or life experiences in KM Blog. The blog is useful in terms of free sharing. According to the manager, in the past, there were less interactions between senior and junior staff, let alone across departments’ interaction. With KM Blog, everyone could read the sharing post or conference video recordings freely which could in turn strengthen relationship among staff while effectively sharing knowledge.
The K Portal serves as the backbone of the whole knowledge sharing and dissemination system. With the advanced single entry point, staff could browse the online resources (knowledge) effortlessly without much searching time, which enhances the efficiency of the whole process and leads to high level of user-friendliness. It does not only contain the internal resources but also the hyperlinks for other online useful resources. The SharePoint site is another knowledge sharing platform, which is not the same as Wikis mentioned above, as it is the knowledge asset of the company. The comprehensive and centralized database includes the catalogs of ranges of knowledge that is also very convenient for users to browse.
However, some recorded drawbacks are found. There is no incentive or effective encouragement for staff to participate more in the entire knowledge sharing system. The only attraction is the reward system of the E-Quiz, which brings high cost to the department. The participation rate will drop significantly after removing the reward system. Moreover, the knowledge in K Newsletter lacks in-depth analysis since it should avoid knowledge leakage to the competitors, which harms the competitive advantages, and it would affect the organization performance as a whole. When the knowledge is not deep enough, staff may lose interest in it since the knowledge shared never surprises them.
3. Knowledge Acquisition and Application
According to Wen, Chen and Pao (2008), with the help of AI technologies, knowledge management decision support system provides efficient solution for decision making and managing electronic business. Moreover, it can automatically evaluate accurate action or alternatives solution when a new knowledge is introduced. The decision support system improves financial management by using a neural network for predication the future financial measures.
Decision-support system in Company A is well organized since it improves effectiveness, efficiency and the overall performance in organization. Increasing use of decision-support system can foster knowledge discovery and application and at the same time, helping managers to make quicker rational and even-handed decisions, through using the database and data mining technologies behind. Organizational process is enhanced through boosting the employees’ degree of innovation in the company, since the system can help staff to produce creative solutions for problem. Organizational products can also be refined by advancement of value-added products. Employee learning is encouraged by learning from prior experience of former employee.
However, same as the previous KM tools, there is very few staff updates the knowledge assets since it is not too popular to use it in daily routine.
Strategies fostering sharing cultures
In Company A, KM tools applied is common, e.g. CoP and K Seminar; on the other hand, tools like recognition ceremony and KM ambassador is rather special to certain extent.
To KM processes, tools like CoP and K Seminar are efficient in fostering knowledge discovery and capture, which in turn encourage employee learning via socialization (i.e. transfer tacit knowledge to tacit knowledge). With better employee learning, intellectual capital can be enhanced as human capital is improved as a result of better skills and competencies of Company A’s personnel. Besides, innovativeness increase in Company A when employees gather together to look for solution. For instance, it is found that CoP actually helps the company in producing value-added products e.g. automatic fault location system, which aims at identifying the most probable fault locations in a fast and accurate way.
At the same time, by offering rewards in recognition ceremony or some other small gifts as incentives, sharing culture is cultivated in a long run and this is important for knowledge sharing. On the other hand, employee adaptability is increased since those tools greatly encourage staff to adopt change of culture and be more prepared to respond to change (i.e. changing from a traditional to a rather open sharing culture). All these can generally increase the collaborative climate in the company and make Company A a learning organization.
However, there are still some reasons which lowers the effectiveness of the KM tools. Since most of the incentive are intangible, and employees are not too keen on getting those recognition, as times go on, they become less willing to share knowledge or join any CoP. One more hidden reason is that, those recognition do not help promotion or bring any actual benefits to them. Besides, most of the employees are afraid that they might get replaced if they have poured out all the knowledge they have in their brain. This indicates the problem of trust in Company A and eventually, affect the effectiveness of KM tools originally planned to foster sharing culture.
Knowledge Management Metrics (Brown, 2010) To evaluate KM strategies in a more systematic way, Bose (2004) suggested that effective implementation of a right KM strategy for a knowledge-based company is seen as a compulsory circumstance of success for organizations because they enter the era of the knowledge economy. However, there is not much standardized KM metrics for evaluating the effectiveness of certain KM strategies (Fairchild, 2002).
In order to quantify knowledge and convince the stakeholders of KM implantation, Brown suggested “Knowledge Management Metrics” to evaluate KM. In his metrics, 4 types of measurement listed should be taken to evaluate the effectiveness of the KM strategies, which are awareness, behavior, outputs and outcomes (Figure 9).
Awareness means the access to documented knowledge as well as database; behavior refers to the participation level of organization member in KM activities; outputs is defined as the creation of database or any physical or digital storage of knowledge; outcomes is the influence of knowledge towards organization performance in terms of cost, revenue or other economic concerns. This model is used to analyze the overall performance of KM in Company A.
Evaluation of Company A Company A develops quite a comprehensive knowledge management system. Its components include knowledge capture and creation, knowledge sharing and dissemination as well as knowledge acquisition and application. The entire system is decided to capture and store the knowledge for internal staff’s use. Company A is the pioneer in Hong Kong which actively puts resources in the development of KM.
Four measurements suggested by Brown (2010) are useful to evaluate the how knowledge management practices in the company function and its corresponding impacts: In terms of arousing employees’ awareness of the knowledge management and knowledge sharing, the company performs well. A number of activities, namely After Action Review (AAR), K Newsletters and introduction of several systems (e.g. Intelligence Decision Making System and Knowledge Portal), provide employees with the detailed information about the knowledge captured. Employees across departments develop the sense of involvement and importance of knowledge management practice, which in turn benefits the KM development of the company as a whole.
The second aspect regarding behavior of the measurements shows that there is high participation of the knowledge management process. Elicitation interview and recognition ceremony are two of decent examples showing different levels of employees could participate in knowledge sharing events at the same time. Making presentation in K Seminar by inviting external professional guests to have sharing sections on particular subjects also encourage high participation rate of staff in different departments.
Outputs of the knowledge metrics can also be found in the company. Practical implementations like database creation (e.g. Electronic Document Management System and the centralized database in SharePoint Site) are the visible “outputs” for the KM practice. There are also thousands of pieces of learned reports of reference and best practices about the knowledge shared by different staff.
However, Company A does not perform well in terms of outcomes. The overall knowledge management implementation does not focus on the improvement of organization performance. It is hardly to find that there is significant impact of KM to the new product sales, productivity or other related aspects. It could attribute to the business nature of the utility company that its business model would not change from time to time frequently.
All in all, Company A in general performs well in introducing knowledge management to the entire company. By referencing the index with four types of measurement suggested by Brown (2010, the company performs well in three specific areas which are arousing company members’ awareness, encouraging behavior and creating outputs. More than ten KM practices cover those three aspects to enhance the KM environment in the company. There are several minor drawbacks of implementation of each KM tool or technique, namely low participation rate on KM Blog, and the overall ineffectiveness of improving organization performance.
After evaluating the KM strategies applied in Company A, we found that there is still a need for further improvement in order to raise the effectiveness. Hence, two recommendations are suggested to ease the obstacles that the company faces when implementing the KM initiatives.
Collison and Parcell (2004) states that KM is a hybrid discipline which consists of people, technology and the process elements. Nowadays, drain of professional knowledge is the main reason that why Company A has to establish KM climate. Therefore, the effectiveness of KM strategies should be improved by those three aspects mentioned by Collison and Parcell. In this case, only the people and technology aspects will be focused.
People: Compulsory participation in KM activities
Refer to the Company A’s KM manager, awareness of senior staff to share knowledge is rather low. Although the junior staff are more likely to involve in the KM aspect, knowledge sources (e.g. experiences to deal with the serious electricity incidents) actually come from the senior employees. However, senior staff passively take part in KM such that they are not frequently involved in the Wikis or KM Blog (e.g. not browsed or updated frequently). At the same time, new staff movement trend (i.e. more resignation and retirement) directly leads to knowledge drain within Company A, making the company suffer from insufficient high qualifications’ personnel. Nowadays, it typically needs more than ten years to develop a qualified engineer or inspector for this field in Hong Kong. However, there are less young people willing to enter such a professional sector, which is the second reason leading to knowledge drainage.
To solve the problem, people who know and who need to know should be connected (Collison & Parcell, 2004). It is recommended that Company A can put KM as compulsory activity for all employees to take part in exchanging knowledge and experiences with others. For example, current staff are compulsory required to attend the seminars or focus groups regularly. Staff resigned are also expected to upload all document they produced such as working procedures or guidelines (e.g. procedures of dealing with customer complaints) or AAR template to SharePoint, so as to facilitate the hand over process before they leave. In order to generate greater outcome, Company A can even include KM under job specifications, making taking part in KM an obligation and responsibility for all employees. Because of the restricted working duty and guidelines, KM becomes part of their daily work and employees are compulsory to participate in some indicated KM activities according to their positions.
Compulsory experiences sharing session is recommended in order to foster the general sharing culture in Company A. Currently, participation rate of sharing session is low as the company do not make it a must for all employee. However, if it is made compulsory as part of their working scope, it can greatly increase the participants. Moreover, employees are only required to capture or share opinions in an easier way (e.g. face-to-face chatting), but not to do many extra work like keep updating the blogs or forums, or documentation work.
Jie, Gang and Xin (2010) stated that skills and experiences exist in employee brain in the form of implicit knowledge. This part of knowledge is crucial to utility enterprises like Company A. Therefore, adjusting the employees’ working scope, which means including KM as their daily task, can facilitate the knowledge sharing process. With this practice, both critical tacit and explicit knowledge from the experienced employees can be retained for the next generation more efficiently. Employees can also learn from previous experiences, which assist them in decision making as well.
Technology: Enhance platforms for knowledge sharing
Hasan and Crawford (2003) pointed out that informationization makes electric power enterprises accumulate a lot of data and those enterprises begin to have the awareness of selecting useful knowledge from messy data and making the best of the data, meaning those enterprises start their knowledge management times. Staff wish to obtain more data so as to assist business decision-making in utility enterprises like Company A, and the wide and better use of information technology makes it possible.
The existing online K platforms in Company A do not perform very well as expected. It is found that the user interface of SharePoint is rather complicated and mass information is still messy. Even though documents are categorized according to different knowledge domains, document versioning problem still exist, making staff confused and hard to find the most suitable documents. Because of this, staff are reluctant to use the system. This technical problem badly affect the smoothness of knowledge acquisition and application process.
As mentioned, all KM tools and strategies can be classified into 3 categories (Dalkir, 2011). Company A has put much effort to develop different strategies under the first two categories (i.e. knowledge capture and creation, as well as knowledge sharing and dissemination). However, the third one (i.e. knowledge acquisition and application) has not done enough.
Polprasert (2011) pointed out that making use of the learning technologies can facilitate KM processes. Collison and Parcell (2004) also stated that a common and reliable technology infrastructure can benefit to information sharing among people. Therefore, it is advised to enhance the supporting technologies for the existing online knowledge repository like portal and Wikis, which are related to the third category, in order to provide a better learning channel for employees and at the same time, capture their professional knowledge. E-learning and artificial intelligence (AI) technologies in the K platforms can be enforced by improving computer-based learning technology (CBT) and intelligent filtering tools.
With computer-based learning technology, better e-learning environment can be provided for staff, since online tutorials (e.g. tutorial on guiding users to locate relevant information) are available, making it possible to deliver courses of certain domains via company intranet. Besides, AI technologies like intelligent filtering tools is an autonomous computer program which assists users and acts on his or her behalf. For example, watcher agents can help staff to handle mass information effectively.
Carroll and Tansey (2002) indicated that most industries need different technologies to raise efficiency of their work. Especially in utility enterprise like Company A, their unique and specific knowledge like engineering experiences (e.g. electricity network) or product detailed information (e.g. features about transformers) should be located in a reliable, well-structured and accessible common area for internal employees. Therefore, it is convinced that those practices suggested can help Company A to establish a more powerful and collaborative platform for accessing knowledge and employee learning, which in turn facilitates the KM cycle in a more comprehensive way and eases the problem of low usage in K-platforms.
Due to the uniqueness of the business nature (there is only one direct competitor of Company A in Hong Kong), Company A cannot rely on other means (e.g. public internet) or organizations (e.g. other industry area) to gain relevant knowledge about electric power issues. In light of this, it has to develop and manage the sole knowledge assets by itself. The two above suggestions can surely raise the effectiveness of KM strategies within Company A in a long run, by removing the obstacles that it faces while implementing those measures.
In this technology era, increasing number of business is turning into knowledge-based. The importance of managing knowledge within an organization has significantly and obviously increased. For the organization or company in the knowledge-intensive industry, the need of effective knowledge management is indispensable. The utility company investigated in this report is exactly in this kind of industry, which relies heavily on much knowledge to sustain the whole business.
With over a century of experience serving Hong Kong for electricity provision, the utility company generates and creates countless unique knowledge regarding electricity generation as well as transmission and distribution network. The concerns of implementing KM are the difficulties of outsourcing the business as well as preparing for knowledge drain. The unique business model generates and creates numerous of valuable knowledge that requires knowledge capture. The implementation directly refers to the KM tools and strategies used, for instance, After Action Review is the “tool” of content creation and Taxonomy of document repository and layout is the strategy for the content management. After creating and capture the knowledge, the utility company carries out knowledge sharing and dissemination by holding an Knowledge E-Quiz reward system, SharePoint site and so forth. The knowledge is “flown” to the employees across different departments. The lowered boundary of knowledge sharing access promotes a positive atmosphere of knowledge sharing, hence knowledge management practices. The last step of KM process is the knowledge acquisition and application. Thanks to the effective KM, the Intelligence Decision Making System is made for creating different systems to cater different and specific needs. The company sees people as the important and determine factor to the KM success. Communities of Practice (CoP) and K Seminar are held so as to provide platforms for employees to have real-time knowledge sharing and more concreted experiences of KM implementation.
Generally speaking, the utility company does well in KM implementation of the aspects mentioned above. The examples include the successful stimulation to staff’s awareness to KM by elicitation interviews. The taxonomy and EDMS also help with enhancing effectiveness and efficiency of company because of the systematic storage of ranges of important knowledge. In other words, employees have easier access to knowledge for any formal or informal use which benefits the company as a whole. For communicating and collaborating of knowledge, the practices of publishing regular K Newsletter and setting KM blog allow employee to participate in this stage through a number of means. They enhance the KM awareness while bring job satisfaction the senior staff since they have several platforms to share their invaluable experiences to the juniors. The communication goes well because of the contribution of knowledge capture and creation. Employees have the chances to explore diverse knowledge regardless of their domains which effectively broaden their horizons. The last stage of the entire KM process can be seen by the successful invention of Decision-support System, which processes the knowledge and information captured in a systematic way to help company to carry out effective decision-making. There is still some drawback of such implementation and it is commonly found in other organization. Since the company does not set the practice of KM participation as compulsory work, the participation rate of not satisfied.
The overall evaluation of the whole KM implantation is done by referencing the knowledge management metrics suggested by Brown. In terms of awareness, behavior and outputs, the utility company performs satisfactorily. There is room for desire for the level of facilitation in outcomes (organizational performance), since it is hard to significantly improve the company practice immediately after the KM implementation.
Last but not last, it is suggested that compulsory participation in KM activities could bring benefits to the company in terms of higher participation rate of knowledge sharing and more knowledge would be generated. The second recommendation is related to technology that makes enhancement on the knowledge sharing platforms. It could be the interface of SharePoint site, E-learning and artificial intelligence (AI) technology for enhancing computer-based learning.
We have to express our heartfelt gratitude to the KM manager in Company for his kindliness of accepting our interview request. Useful information were given to help us walk through all the stages of writing this report.
Nevertheless, we are also greatly indebted to Dr. Samuel Chu, for his encouragement and guidance. Without his precious information and insights towards the project, the report could not have reached its present form.
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Appendix A: Interview Questions
1. What is the main reasons for your company to implement KM?
2. What is the KM strategies used?
3. Which type of staff/which department are willing to join the KM activities more?
4. Any differences in strategies used towards the junior staff and the senior staff?
5. What is the obstacles of implementing those strategies? (The most difficult part?)
6. Any benefits can take from implementing KM? (Culture? Company performance? Any virtual cases?)
7. What is the differences of implementation KM several years ago and now?
8. How is the KM culture in your company in this stage?
9. What is the future trend of KM in your company?
10. Do you think it is worth for a company to invest in KM?
11. Any suggestion on implementing KM in a company?