What is this nonsense about knowledge management? What is knowledge in the first place? How do you measure knowledge let alone manage what you can?t measure? Is this another management consultancy jargon that holds no real value for money for organisations that buy into it? Better still why the focus on Ghanaian Banks? In fact, the questions are endless. Really, the number of questions you can ask on this subject is limited only by your ingenuity and how well you still remember question tags! This piece is an extract of empirical research by the writer on knowledge management in consulting firms in Ghana. Its relevance to Ghanaian business community, particularly those in the financial services industry, cannot be gainsaid.
First, let us understand what knowledge management(hereafter, KM) is. As an emerging management discipline, the concept of KM dates back to the 1990?s. Academic literature suggests that KM as a self-conscious and new management field could be traced to the management guru, Peter Drucker (1988, 1994). He stressed the centrality of knowledge asset in the organisational context. As suggested by Drucker (1994), the foundations of the economies of industrialized nations have shifted towards knowledge-based economies. Simple reminder: In the past, landlords (in Britain, the Manors) were the most powerful and of course, the richest. Putting that in the Ghanaian context, gone were the days when the wealth of a man was measured by amount of land he possessed (and of course, the number of wives and children)!.Later, the wealth and power of a nation a was measured in terms of how industrialised she is; and this is how America, Britain, etc become powerful nations in the world. Towards the end of the 20th century, information (or its technology) became the measure of power and wealth. IT and its application or misapplication is the measure of power and wealth today(hence the rising economic authority of China and India).To me this is the 3rd wave.
These waves are so overlapping that one might not be able to draw the line where one ends and where the other begins. Herein lies the danger of missing out on the 4th wave- knowledge management!! Knowledge can be explicit or tacit. In its simplest form and in my estimation, KM is harnessing the power of what people know (sometimes, which they don?t know they know) using the power of ICT, with emphasis on people! Note here that we are putting together two most powerful powers-the power of knowledge and that of information. Information power and reference power have long been identified by organisational theorists; and the fact that knowledge(or the right use of it) is power, is common knowledge. This is the coming power of KM. So, why manage knowledge and why should Ghanaian banks take this seriously?
Pause a minute. Ponder how much it costs to advertise, recruit , train and develop key employees for your organisation! Of course, if the culture of your business or the country is one where people are not trained to do what they do, then you would not appreciate how much this costs organisations. However in the financial services industry, particularly as Ghanaian banking industry gets more competitive, you cannot ignore the obvious forever. Unfortunately, not all your staff working for you today will continue to work for you for the rest of their lives. The truth is, in a capitalist system, people seek live-long employability rather than live-long employment. There is no such thing as employee loyalty! As the banking industry gets tougher, the stuck reality of ?poaching? of your key and most experienced staff will soon hit you hard in the face! And of course, you can?t stop them, they may leave for different reasons: for better offers from competitors (you might try to give a better deal), but what about those who retire, die or travel? These staffs go with huge amount of organisational knowledge and experience. It is lost knowledge. Lost for good! The sad truth is, in instances where the loss is due to competitor action, the employee never necessarily gets to use all his acquired knowledge from previous job, in the new organisation. So the vicious circle of investing in your people and losing their knowledge as they exit your organisation begins, unless you find a way of managing that knowledge; hence the need for knowledge management.
Next, KM is not a management fad. There is evidence to show that most management fads do not weather a five year mark. In other words, if one plots the graph of the life cycle of management fads such as Quality Management(QM), Total Quality Management(TQM) and Business Process Re-engineering(BPR) you get a bell-shaped graph. Thus they rise, peak and fall after 5years. QM momentumed in 1979 and peaked in five years; TQM momentumed in 1980s and peaked in 1983; BPR started in 1991 by Michael Harmer and peaked in 1995. Research has shown that, KM is an emerging management discipline and practice; fast growing and one most important trend in business today; and will continue to define success of corporate strategy in the next fifteen years. In a survey of CEOs by the Economic Intelligent Unit, top CEOs agree that KM is the most important to realising corporate strategy second only to sales and marketing; others being customer service, operations and production.
Last but not the least, all five most renowned consulting firms in Ghana that I used for this research recognise the importance of KM and are making frantic efforts to manage knowledge. In fact, the whole business of consultancy is selling knowledge to those who lack it or fail to manage their in-house knowledge. The KM discipline has gained ground in academia with undergraduate and postgraduate programmes running in Nanyang University in Singapore. At national and international levels the Word Bank and UNFPA manage this important asset called knowledge. For example, the World Bank Institute sees itself as responsible for capacity building and knowledge sharing whereas UNFPA states ?UNFPA is a community that dynamically generates and uses knowledge to accomplish her mission?. Within the knowledge management industry itself, the list of firms that adopt and manage knowledge is endless. Examples are Mckinsey, Booze Allen-Hamilton, Cap Gemini and Ernst and Young, Deloitte and Touche, Price Water House Coopers (Wilson, 2002)
In conclusion, this piece is an extract of empirical research by the author. We have traced KM to Peter Drucker and definition of the concept attempted. KM has been identified as the 4th wave of world power, fast growing and most likely to be missed as these waves are overlapping. Indeed, KM is not a management fad! This article has concluded with importance of KM. The real question, however, is how do you manage knowledge of your organisation and what strategies are available? How do you place people at the heart of KM with investment in information technology? Watch out for the next piece!
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