Knowledge Management System for New Product Development

Confidential | Author name 1 | Author name 2 | Date © Copyright IBM Corporation
Knowledge Management
System for New Product
Development
by Stephen AU
MTECH Engineering Co.,Ltd.

KMS for NPDMTECH Consulting Service 2
Knowledge & Innovation

COMMODITY
PRODUCT
TECHNOLOGY
PRODUCT
PROLIFERATION
BUSINESSTRENDS
BUSINESSIMPACT
MANUFACTURING
COMPANY
LOCAL GLOBAL
Need to differentiate
Brand strength
Perceived value through
design
Customer centric
Total experience
- partnership
- smart business
World class
Business Innovation

The Transformation Process
Simplification
Integration
On Demand
By breaking down
barriers between
lines of business,
implementing
enterprise-wide
standards for five
core processes:
•Market planning
•Product development
•Procurement
•Customer Care
•Fulfillment
To deliver unified
processes across
the value net—from
suppliers to
partners to
employees to
customers. This
further increased
efficiency,
especially for
product innovation
initiatives like PLM
As the business
environment grows
faster, less
predictable and
increasingly
customer-driven, e-
business on demand
will allow us to
respond quickly to
changes and market
opportunities. We
have to migrate from
production driven to
knowledge driven
enterprise for “Right
At the First Time”

KMS for NPDMTECH Consulting Service
Knowledge Management and Organizational
Learning are emerging paradigms in industry
shorter product life cycles, lean organizational structures,
concurrent engineering efforts, globally dispersed virtual
enterprises, enterprise reengineering, ...
... make knowledge management an urgent need for enterprises
managers are biased towards non-technological issues,
like human resource management, cultural aspects,
organizational changes etc. ...
... which are crucial for KM, anyway
several IT communities recently „discovered“ the area:
workflow systems, CSCW, expert systems, case-based
reasoning, intranets, data mining, document management
systems, ...
... are considered to be useful for KM
CURRENT SITUATION
However, a commonly agreed-upon approach and methodology
is still lacking.

Knowledge
Drive Design
Collaborative
Engineering
Traditional
Engineering
ExtentofProcess
Change
Extent of Product Change
Incremental Product
Family
Additions
Build to
Order
New
Breakthrough
Products
Linear
Innovation
Customer
Driven
Innovation
Radical
Innovation
Levels of Innovation
The ability to develop and introduce standard products that
meet or exceed the industry average cycle-time and
incorporate innovations that follow the industry’s trends.
The ability to dynamically recombine, modify, or
tailor parts and assemblies into new or custom
products based on customer demands
The ability to develop and
introduce breakthrough or
“category-killer” products that
appeal to entirely new user
markets or dramatically expand
existing market opportunities

Categories of Product Innovation
Application Radical
Consumers perceive
significantly new benefits
Producers in the industry
perceive the technologies as
only slightly new
Consumers perceive
significantly new benefits
perceive the technologies to be
significantly new.
Incremental Technical
Consumers perceive only
limited new benefits
perceive the technologies as
only slightly new.
Consumers perceive only
limited new benefits
perceive the technologies to be
significantly new.
Technology Innovation
CustomerBenefits
HighLow
HighLow

Organization Baseline
Measurements
1. Leadership
1.1 Values and Vision
1.2 Managing For Results
1.3 Role Model Behavior
1.4 Fact-Based Actions and
Principle-Based Actions
1.5 Communication
1.6 Environmental and
Social Responsibility
2. Human Resources
2.1 Resource Planning & Staffing
2.2 People Development
2.3 Empowering Work
Environment
2.4 Total Pay and Recognition
2.5 Leveraging Diversity
3. Business
Process
Management
4. Customer
and
Market Focus
5. Knowledge
and
Information
3.1 Business Process
Management Principles
3.2 Management Processes
3.3 Operational Processes
a) Time to Market
b) Integrated Supply Chain
c) Market to Collection
d) Customer Services
3.4 Enabling Processes
4.1 Customer First
4.2 Customer Knowledge and
Market Requirements
4.3 Market Segmentation & Coverage
4.4 Customer & Market Communications
4.5 Customer and Partner Relationships
4.6 Competitive and Technology Trends
5.1 Knowledge Sharing
5.2 Quality and Productivity Tools
5.3 Information Management
6. Results
6.1 Customer Satisfaction & Loyalty
6.2 Employee Motivation & Satisfaction
6.3 Market Share
6.4 Financial Results
6.5 Productivity
6.6 Profitable Revenue Growth
Understanding &
Measuring the Value
of Knowledge

Business
Value
Process
Competency
StrategicTactical
Non-core Core
Infrastructure
Optimization
Business Process
Innovation
Infrastructure
Operations
Business-related
Operations
• CRM
• Risk management
• Process streamlining
• Cultural dynamics
• Adaptive strategies
• Product portfolio
• Disruptive technologies
• Product elaboration
• Marketing intimacy
• Best practices mgnt
• Logistics
• Procurement
• Finance
Revenues
Time
Sustaining innovation
Disruptive innovation
Innovation - The Innovator’s Dilemma

Knowledge Management can be supported
by exchange of information
– Individual Learning
– continued training & experience
– Learning by sharing experiences
– cooperation & observation
– Learning through communication
– supply-driven learning
– demand-driven learning
– Learning through development of
a knowledge repository
– storing and monitoring lessons
learned
information
externalization internalization
socialization
communication
knowledge
retrievalstorage
knowledge
information
repository
ORGANIZATIONAL LEARNING
IT people tend to concentrate on either the communication /
collaboration, or the repository aspects (Organizational Memory).
individual
learning
IT support
management

Knowledge explication, or on
knowledge capitalization
explication of tacit knowledge:
 the typical expert system approach
 [KühnAbecker97]: cost-benefit problems
 [Rittel72],[Buckingham Shum 97]: feasibility for “wicked
problems”?
 [DavenportJarvenpaa+96]: construction and maintenance
problems
capitalization on implicit and existing explicit
knowledge:
 existing documents and knowledge sources often
severely underutilized
 ease finding, access, and exploitation
 increase utilization potential
TWO COMPLEMENTARY APPROACHES

Practical solutions require different
degrees of formalization
Ensure the utilization of “formal” organizational knowledge:
 business rules, design guidelines, standard procedures, ...
 ... can be formalized to allow automatic processing
Enable sharing and reuse of experiences:
 lessons learned, best practice reports, case bases, ...
 ... can be stored as semi-structured electronic documents
Ease the exploitation of implicit knowledge, personal knowledge,
and knowledge contained in documents and databases
 technical documentation, hypertexts, personal notes, minutes of
meetings, graphics, images, product data sheets, business letters,
...
 ... must be effectively accessible
OBJECTIVES OF AN ORGANIZATIONAL MEMORY
How can several kinds of knowledge synergetically interact?

Agenda
What Is KM?
KM for New Product Development NPD
The Architecture of KMS for NPD
PLM Technology to support the KMS
Successful implementation of KMS

Data
Theory
Information
Experience
Knowledge Understanding Wisdom
What is Knowledge?
The Russell Ackoff Model
description:
What
instruction:
How to
explanation:
Why
what is best:
Care why
doing things right doing the right things
Vision & design:
What could and
should be done
the futurethe past
Knowledge & engineering:
What has been done
Michael Polanyi “ We
can know more than we
can tell.”
Knowledge is the fuel
of innovation
Knowledge as
information put to
productive use.
Knowledge emerges
through shared contexts
that are created through
interaction.

Knowledge & Learning Framework
know don’t know
know
what we
know we
don’t know
what we
don’t know we
don’t know
what we
know we
know
what we
don’t know
we know
What we Know & Don’t Know?

The Fundamental of KM
 The management of knowledge
from many diverse sources - by
linking people to people to serve
customers, people needing
expertise with people who have
expertise. They should be about
connection, not collection.
 Expeditionary marketing through
mutually dependent learning
 The integration of both explicit and
tacit knowledge
 The development of robust models
for competitive architecture and
organizational capability
 New organizational models
 New approaches to finance,
decision making, and accounting
 The management of technology
represented in the form of
intellectual property
 A new innovation process
 The process and tools through
which these elements are
integrated
Track / Level
Management
of
information
Management of
people /
process
Organization
Level
“Re-
engineering”
“Organization
Theorists”
Individual
Level
“Specialists”
- Learning
“Psychologists”
- Culture

Comprehensive Knowledge Management Framework
Culture
Leadership
Measurement
Technology
Reward and
incentive
systems
Initiation
Modeling
Repository
Distribution &
transfer
Use
Knowledge management activities
Knowledge resources
Human capital
Structure capital
Customer capital
Retrospect
Generation
Value and
norms
Influences on knowledge
management

The Knowledge-Based Theory
of the Firm
Individual
Competence
External
Structure
Internal
Structure
3. How can the organisation’s
customers, suppliers and other
stakeholders improve the
competence of the employees?
2. How can organisation’s
employees improve the
competence of
customers, suppliers and
other stakeholders?
6. How can we enable the
conversations among the
customers, suppliers and other
stakeholders so they improve
their competence?
4. How can we improve
the conversion of
individually held
competence to systems,
tools and templates?
systems, tools & processes and
products be effectively
integrated?
1. How can we
improve the
transfer of
competence
between people in
our organisation?
5. How can we improve
individuals competence by
using systems, tools and
templates?
systems, tools & processes and
products improve the competence
of the customers, suppliers and
other stakeholders?
7. How can competence from
the customers, suppliers and
other stakeholders improve the
organisation’s systems, tools &
processes and products?
$
Strategic Purpose: How can the
value creation capacity of the
whole system be maximised?
The 9 Knowledge Strategy Questions

The Knowledge Strategy of
Affärsvärlden
Individual
Competence
External
Structure
Internal
Structure
•“Piggy-backing”
•Journalists working in industry
•Readers giving In-house
seminars
•Readers as advisors
•Analysts give free seminars
•Article policy to be
“consultant”
•Interns from industry,
universities
•High image executives and
advertisers targeted
•Advertisers = Readers
•Free seminars for
readers+advertisers
•Create positive “buzz”
•R&D into analytical
models
•Computerised article
archive
•Computerise models
•Journalists -> Admin
•Open office
•Intangble Assets Monitoring
•Flat organisation
•Employee ownership
•Recruit highly educated
staff
•Articles written by teams
•No by-lines
•Frequent role rotation
• Swaps Sales <->journalists
•Models used by analysts
•Archives searched
•Admin -> journalists
•Other editorial systems
•Advertiser access to readership
data
•Subscriber access to Industry
analysis
•Subscriber access to AFV own
models
•Readership statistics collected
•Industry analyses collected
•Advertiser statistics collected
•JV with University
$
Strategic Purpose: To support
readers investment decisions by
maximising the value creation of
the whole system

-10%
-5%
0%
5%
10%
15%
20%
25%
30%
35%
40%
1
9
7
8
1
9
8
3
1
9
8
8
VA
AF
Sales Margin
AF:Affärsvärlden. VA: Veckans Affärer
Leveraging Intangibles
Most important Factors
 Higher education:
Working smarter
 Employee ownership:
Retaining Competence
 Close relations with selected
customers: Learning while
working
 Collaborative Climate:
Leveraging Competence
Competence
Internal Structure
External Structure
Internal Structure
Leveraging Intangible Asset:

KM to Support High Performance
Product, Processes and Resources
 All relevant information
available to make
planning, produce and
service decisions
throughout the product
lifecycle
 Integrated sales,
marketing, design,
production and service
 Focus on the
CUSTOMER VALUE
GLOBALIZATION
7X24X365
OPERATION
ACCELERATED
PRODUCT/
SERVICE CYCLES
DISINTER-
MEDIATION
RISING
CUSTOMER
EXPECTATIONS
SERVICE-
BASED
COMPETITION
REDEFINITION
OF VALUE
CHANNEL
SATURATION
CUSTOMER

Ten “Domains” of Knowledge
Management
Sources: Xerox
Capturing &
Reusing Past
Experiences
Instilling
Responsibility for
Knowledge
Sharing
Sharing
Knowledge & Best
Practices
Mapping Networks
of Experts
Building & Mining
Customer
Knowledge Bases
Embedding
Knowledge in:
Products, Services
Processes
Driving
Knowledge
Generation for
Innovation
Understanding &
Measuring the Value
of Knowledge
Leveraging
Intellectual
Assets
Producing
Knowledge as a
Product
D. Holtshouse
Knowledge Initiative, Corp. Business Strategy
©1998 XEROX CORP. All Rights Reserved

Key Knowledge Management
Principles
Information available to everyone by default
Information will be stored digitally
Innovation in knowledge management will be encouraged
Knowledge management will be global
We will retain business and corporate memory
Knowledge management will be business process driven
Information/knowledge content will have individual and
functional ownership
Knowledge acquisition, sharing and learning will be key
individual objectives
Processes, policies and standards will evolve to make us more
productive
Natural work team needs will dictate knowledge structure
Right5 information will be determined by personal choice
Databases will be used for knowledge deployment, e-mail for
communication

Knowledge Management Tools
Knowledge Management Tools
Workflow
Groupware
Data
Ware
-
hous
e
Watercooler
Communication
Intranets
Document
Management
Project
Management
Web
Conference
Case Base
Reasoning
Social
Gathering
Meeting,
seminar,..
Brain
Storming,
Mindmap,
Visual
Thinking

The KM Maturity Model
Ref: V P Kochikar, PhD, Principal Knowledge Manager, Infosys Technologies
Limited, Electronics City, Bangalore 561229, India
Kochikvp@inf.com

Ask New Questions
External
Structure
Internal
Structure
Individuals’
Competence
How can we capture data
into
systems supporting dialogue
with customers?
Which IT systems support tacit
knowledge transfer?
How can we maximize
leverage of all intangible
assets in working for
customers?
•How can we create an office space conducive to knowledge transfer?
•How can we change our internal control systems to measure our contribution to the
corporate strategy?
•How can we improve our core competencies?
•How we create events that
transfer tacit knowledge?
•How can we improve trust
among people?
How can we improve relations with
customers and suppliers
that bring intangible revenues?
How can we build better
relationships with those
customers and suppliers that
bring learning to our people?

The KM Maturity Model (1)
 Capability Maturity Model (CMM) states “continuous process
improvement is based on many small, evolutionary steps rather than
revolutionary innovations” (Software Engineering Institute1993)
Level Organizational Capability
1 Default Complete dependence on individual skills and abilities
2 Reactive Ability to perform tasks constituting the basic business of the
organization repeatably
3 Aware Restricted ability for data-driven decision-making
Restricted ability to leverage internal expertise..
Ability to mange virtual teams well
4 Convinced Quantitative decision-making for strategic and operational application
widespread
High ability to leverage internal and external sources of expertise
Organization realizes measurable productivity benefits thru knowledge
sharing
Ability to sense and respond proactively to changes in technology and
business environment
5 Sharing Ability to manage organizational competence quantitatively
Strong ROI-driven decision making
Streamlined process for leverage new ideas for business advantage
Ability to shape change in technology and business environment
Ref: Kochikar, V. P. "The Knowledge Management Maturity
Model - A Staged Framework for Leverage Knowledge."

The KM Maturity Model (2)
Ref: Kochikar, V. P. "The Knowledge Management Maturity
Model - A Staged Framework for Leverage Knowledge."
Key Result Area
Level People Process Technology
Default – ‘knowledge,
we’ve got plenty of – what
we need is to work hard’
-- -- --
Reactive – ‘We need to
leverage all our knowledge,
but we’re too busy to do
that’
Knowledge
Awareness
Content Capture Basic
Information
Management
Aware – ‘ At least we’ve
made a beginning in
managing our knowledge’
Central
Knowledge
Organization
Knowledge
Education
Content Structure
Management
Knowledge
Technology
Infrastructure
Convinced – ‘We’ve
reached where we are by
managing our knowledge
well, and we intend to keep
it that way’
Customized
Enabling
Content Enlivement
K. Configuration
Management
Quantitative KM
Knowledge
Infrastructure
Management
Sharing – ‘We’re sharing
knowledge across the
organization, and are proud
of it’
Expertise Integration
Knowledge Leverage
Innovation Management

K. Protection vs K. Sharing
K.Protection
K. Sharing

Knowledge vs Relationship
P E
O
PE
O
Company A Company B
Personal Relationship
(tacit level)
Organizational Relationship
(explicit level)
O = Organizational Capital.
P = Human Capital.
E = External Capital.
Boss A Boss B

KM in ICI
Aims of KM project
 To provide a basis for valuing the
knowledge in monetary terms
 To determine the structure and
extend of education and training
required by employees who are
concerned with the manufacturing
process technology
 To represent knowledge in the
form of guidelines and procedures
that may be used in direct problem
solving and diagnostic work.
Managing from
the Knowledge
Perspective
Organizational
Process
Person
Development
GroupWare
Expert
System
Information
Science
Ref: L.Gordon, J., C. Smith, et al. (1999). "Practical Approaches to Knowledge
Management." In Applications and Innovations in Expert Systems VII: 17-32

Agenda
What Is KM?
KM for New Product Development (NPD)

Positioning Breakthrough
Products
People use products to improve their
experience while doing tasks.
Tech Driven
Form follows
functions is
no longer
relevant
High
Low
HighLow
STYLE
TECHNOLOGY
Value Driven
We are now in a
period where
form and
function must
fulfill fantasy
Cost driven
Style driven
Ref: J.CAGA, C.M.VOGEL, ‘Creating
Breakthrough Products’, 2002
Useful,
Useable &
Desirable

Knowledge Model vs Business
Model
The Kantor/Gomory/Gover model of the marketplace (Gover, 1993), showing di!erent drivers for
knowledge management processes. Gover, J. E. (1993). "Analysis of US semiconductor
collaboration." IEEE Transactions on Engineering Management 40: 104-113
OEM
ODM
OBM

How Is Knowledge Embedded
in the Product?
R&D, management, and
advertising services necessary to
bring the product to market.
Do you know how may CPU in
the new BMW 7 Series?
 A car’s electronics cost more than
the steel in it
Chips are made mainly from
silicon which is worth nothing. The
value is in the design, the
intellectual content, not the
physical.

The Change of the Company
Market Value
Professor Frank Lichtemberg of Columbia
University measured the ROI – a dollar spent
on R&D returned 8 times more than a dollar
spent on new machinery. A new machine helps
you to do old work better – incremental
improvement. R&D leads to innovation – to
replace your competitor.
Margaret Blair of the Brookings Institution, in
1982, the tangible assets accounted 62.3% of
the company's market value, ten years later,
they made up only 37.9% of the whole value.
They’ve replaced inventory with information,
substituted knowledge for fixed assets.

Industrial Age
Value model
Capability assets
•Individual
•organizational
Capital
& tools
labor
technology
The Industrial Trend
Capability Assets in Two Ages. The relative importance of capital and
tools has diminished significantly in the Knowledge Age, while people
with knowledge, technology , and businesses processes have become
much more important .
Knowledge Age
Value model
Capability
assets
•Individual
•organizational
Capital &
tools
Process
labor
technology
Knowledge
Tacit & explicit
Ref: W. L. Miller, L.Morris, Four Generation R&D

The World of KM
From sharing with ourselves to sharing
with our customers and partners….
Fast to
Market
Customer
Engagement
The
Market
Place
The World of Knowledge
Management
Lower
Costs

Emergent generic KM business
strategies
 Knowledge replication
 i.e. banks, fast food chains, retailers e.g. Toys ‘r’ Us, MacDonald’s, INTEL
etc, all provide examples of conducting operations in precisely the same
way wherever they are located world wide.
 Knowledge diffusion/leveragability
 is about “knowing what we know, and using it”. This seems to be the key
strategy in most KM endeavours.
 Knowledge innovation
 which is concerned with knowing what comes next e.g. new products, new
services, new ideas that might keep an organisation competitive.
 Knowledge commercialisation
 which is concerned with, what does the organisation know that it can sell,
i.e.. Consultancy, products and services, e.g. British Gas plc have
developed KM systems initially for their own organisational needs but which
they now seek to promote externally for profit. (Prusak 2000)

What is a Knowledge
Business?
Says Professor Fumio Kodama
of Saitama University, Tokyo: “If
R&D investment begins to surpass
capital investment, the corporation
could be said to be shifting from
being a place for production to
being a place for thinking.”

Build a model where KM provide the framework to bring
the product closer to the needs of the customer
Building on the current leading position in operations excellence
KM will provide opportunities to
leverage other value discipline areas
Operations
Excellence
Customer
Intimacy
Product
Innovation
Future State
Value Disciplines
?
Customer
Intimacy
Operations
Excellence
Product
Innovation
Current State
Value Disciplines
?
Cost Reduction
Collaborative Environment
Performance Innovation
Benchmark against best practice
Revenue Growth
Customer Satisfaction
User Choice and Interaction
Improved Quality

Revenue Growth
• Percentage increase in sales proposals
per sales person
• Percentage increase in cross selling due
to better advice (include new products
from new acquisitions)
• New revenue attributable to KM (based
on sales force feedback)
Improved Quality
• Increase in sales conversion ratio
• Percentage of complaints due to poor
advice
Customer (Internal & External)
User Choice and Interaction
• User interaction
(frequency, searches, documents accessed per
session, amount of time spend per session)
• % of employees accessing the KM solution per
month and average time
Customer Satisfaction
• Customer satisfaction surveys
• Number of complaints where processes and
procedures are not adhered
• Number and types of calls to Help Desk
• Number of queries completed without hand-offs
Cost Reduction
• Decrease labour cost per proposal
• Decrease expenses per proposal (e.g., travel
costs)
Collaborative Environment
• Percentage of proposals using collaborative
(team and virtual working) environment
• R & D
• Product Development
• Sales and marketing programme
Financial
Business ProcessInnovation and Development
Benchmark against best practice
• Increase revenue from new services enabled
by KM
Performance Innovation
• Frequency/quality of contributions
• Specific solution innovations that can be
traced to KM initiatives
• Percentage of proposals that leverage “best
practice” content (including reuse).
• Percentage of proposals that employ “best
practices”
Benefits and measurements
(Balance Scorecard)

Mission
Strategy
Innovation
Feasibility Study
- Market
-Customer
- Technical
Business
Strategy
Idea
Generation
Product
Design Brief
Outline Tech
Specification
Concept
Development
Business
Case
Mock Up
Market
Analysis
Cost Analysis
User Testing
Project
Budget
Design Development
Prototype
Market
Testing
Strategic
Business
Plan
Production
Development
Manufacture
Plan
Tooling
Pilot
Production
Manufacture
Marketing
Communication
Sales &
Distribution
Promotion
Plan
Product
Management
Monitoring &
Control
Direction
Seeking
Opportunity
Measure
Exploit
Opportunity
Product
Develop
Make the
Product
Market
Launch
Create
Revenue
Go / No goGo / No go Go / No go
Activity
Deliverables
Purpose
STRATEGY
CONCEPT
PREPOSITION
CONCEPT CONVERSION EXECUTIVE LAUNCH EXTEND
New Product Development
Stage Gate Product
Development Process

First Product Correct
Integrated
Product/Process
Development
Product
/Process
Design
Manufacturing
Process
Execution
Product /Process
Modeling &
Simulation
Traditional
Processes &
Controls
Non-Traditional
Processes & Emerging
Technologies
FPC
Supporting
Infrastructure
Business
Operations
Management
Sustaining
FPC Culture
Value Stream
Integration
Requirements-
Driven Design
Tool & Fixture Design
Process Definition
Process Planning
Test & QA Planning
Design
Optimization
Product/Process
Design
Integration
Product Performance
Modeling
Process Capability &
Variability Modeling
Virtual Prototyping
Tradeoffs &
Optimization
Equipment & Process
Capability Models
Prognostics
Simulation-Based
Machine Instructions
Assembly, Packaging
& Handling
Material Processing
Material Preparation
Metrology
Control
Operations Control
Process Control
& Predictive
Maintenance
Information
Control
Additive Processes
Material Processing
Engineered Materials &
Surface
Reconfigurable
Manufacturing Systems
Hybrid Processes
Subtractive Processes
Future Transformations of
Manufacturing
Figure 1.2-1. The functional model for First Product Correct provides a framework for
identifying R&D requirements according to specific areas of need.
First Product Correct

Business Process Models represent
control flow of business activities
THE DFKI PURCHASING PROCESS
The main complexity of this process is hidden in few knowledge-intensive activities.
Specify
Demand
Check
Budget
Support
Demand
supp.?
no
yes
Reject
Hardware or
Software?
yes
no
Specify
HW/SW
Details
Specify
Details
price
> 800,- ?
yes Approve
Demand
appr. ?
no
yes
Send
Order
no
price
> 800,- ?
Update
Purchasing
Database
yes
Receive
Invoice
Sign
Invoice
Sign
Invoice
Install
HW / SW
Deliver
Goods
no
yes
Update
Database
Pay
Invoice
Allocat
e
Inv.no.
Attach
Inv.no.
Hardware or
Software?
Receive
Goods
Receive
Delivery Note

An ideal Knowledge Management system would
answer manifold questions related to a given
knowledge-intensive activity
Specify
Demand
Check
Budget
Support
Demand
supp.?
no
yes
Reject
Hardware or
Software?
yes
no
Specify
HW/SW
Details
Specify
Details
price
> 800,- ?
yes Approve
Demand
appr. ?
no
yes
Send
Order
no
price
> 800,- ?
Update
Purchasing
Database
yes
Receive
Invoice
Sign
Invoice
Sign
Invoice
Install
HW / SW
Deliver
Goods
no
yes
Update
Database
Pay
Invoice
Allocat
e
Inv.no.
Attach
Inv.no.
Hardware or
Software?
Receive
Goods
Receive
Delivery Note
– Are there general guidelines
for buying computer devices?
– Who bought a graphics card
recently?
– Are there any experiences with
card Matrox Mystique?
– Can anyone recommend a
good graphics card?
Which requirements can be derived for an Organizational Memory Information System
which is able to answer such questions?

KM Initiatives for NPD (1)
Innovation
 Innovation takes place when different ideas, perceptions,
and ways of processing and judging information collide. That
in turn, often requires collaboration among various players
who see the world in inherently different ways.
 ‘The greater challenge in innovation is linking emerging
technologies with emerging markets’ by John Seely Brown
 Manufacturing is the process of material conversion. It is
repetitive, benefits from variability reduction. On the other
hand, product innovation is the process of knowledge
conversion. It needs variability.
Mass Customization
 It requires a tight information exchange with customers, as
well as the advanced production systems required to create
“unique” products economically.
 The key is gathering the right information on the spot.
Francis, P. H. (2000). Product Creation - the heart of the
enterprise: from engineering to e-commerce, The Free Press.

KM Initiatives for NPD (2)
Product Complexity
Useful
Communication
Games
Computer
Video
etc…………
Useable
Materials
User interface
Reliability
Environmental
Safety
etc….
Desirable
Marketing
Sales channel
Customer services
etc.…………….
K. Quality
K. Quantity
K. Speed

Project
Decisions
CompetitiveAdvantage
Time Reduction
Strategic
Decisions
Actionable
Decisions
Access To Best & Latest Thinking
Faster Access To Knowledge
Minimizes Non-Informed Decisions
Faster Problem-Solving
Productivity Performance
Faster Innovation
Turn Knowledge Into Action Quickly
(Pfeffer and Sutton
2000) It is possible
that differences in
organizational
performance come
from differences in
what firms know. But
that a much larger
source of variation in
performance stems
from the ability to turn
knowledge into
action quickly.

Knowledge Value Driver
Knowledge Value Opportunity Sample Measure
Customer Intimacy
Intimate knowledge of customers for the purpose of providing world
class service, or to customize and target marketing of products and
services
Breadth & depth of
customer purchases
Intellectual Property
Increasing and managing a portfolio of codified and/or patented
knowledge that contributes to the financial value of the enterprise
Value of patents
Operation Excellence
Experimenting with, researching and sharing best practices to increase
quality of products, and serve and enhance performance
Spread of best
practices
Innovation
Expanding knowledge required to rapidly generate, produce and market
new and innovative products and services
Time to market
Knowledge-Based Products
Generating additional knowledge value in the value chain to deliver
higher value, "intelligent" products, and establish uniqueness
Number of knowledge-
based enhancements
Rapid Response
Increasing adaptability, flexibility and responsiveness in a constantly
changing environment
Change management
speed & efficiency

Integration in Product Development
Integration in product development takes increasing
ly complex forms to capture the synergy of Intra- and
Inter- company integration and relationships:
 Team integration
 Forming a team with members from all appropriate
functions
 Intra-process integration
 Managing the entire development project from its
concept formulation through market introduction.
 Resource integration
 Giving the team the authority and resources to carry out
the project
 Chain integration
 Involvement of customers and the supply chain for
product development
Hong, P., F. D. Williams, et al. (2004). "Knowledge sharing in
integrated product development." European Journal of Innovation
Management 7(2): 102-112.

Matching customer requirement
with engineering and manufacturing
capabilities
The design
process (sharing
knowledge)
Knowledge of
customer
requirements (present
and future)
Knowledge of
engineering and
manufacturing
capabilities (internal
capabilities and
suppliers)
Product development process
performance
•Teamwork
•Development productivity
Product development strategic
initiatives
•Value to customer
•Time to market
Hong, P., F. D. Williams, et al.
(2004). "Knowledge sharing
in integrated product
development." European
Journal of Innovation

3 Types of Knowledge Sharing in
NPD
Sharing knowledge of customers
 Refer to the extent of sharing understanding of current
customers’ needs and future value to customer creation of
opportunities among product development members.
Sharing knowledge of internal capabilities
 Refer to the extent of sharing understanding of the firm’s
internal design, process and manufacturing capabilities
among product development members.
 The key is how many different functional specialists are
aware of strengths and weaknesses of various aspects of
design capabilities, manufacturing processes, facilities, and
other manufacturing capabilities.
Sharing knowledge of suppliers’ capabilities
 Refer to the extent of sharing understanding of the suppliers’
internal design, process and manufacturing capabilities
among product development members

IPD Performance Measures
IPD performance measures are classified
into two categories:
Process outcomes that look at the effectiveness of
the IPD process in terms of teamwork and
productivity.
Product outcomes that look into how the products
performed in terms of serving the firms’ strategic
initiatives, such as value to customers and time to
market.

Teamwork & Productivity
Indicators of high level of teamwork are:
 Timely conflict resolution
 Effective decision implementation
 Creative problem solving,
 Effective communication
 Good coordination of activities
Development productivity is about the total costs
incurred in all activities of the product development. It
is measured by the overall technical and team
performance in terms of efficiency, budget, schedule
and innovation.

Time & Value
Time to market
 Values time to market would strive to get producers to
market ahead of competitors, develop products on schedule
and keeping improving on the previous time-to-market
performance.
Value to customer
 It is measured in terms of the value of new products in
meeting customer needs and expectations in the market
place
 It is also reflected in the product success in the market place
and its creation of value to customers in terms of highly
perceived product quality.

Knowledge Sharing in IPD
Shared
Knowledge of
Customers
Shared
Knowledge of
Suppliers
Shared
Knowledge of
Internal
Capabilities
IPD Process
Performanc
e
Time to Market
Value to Customer
H1
H2
H3
H4
H5
H1: The greater the extent of sharing K. of customers, the greater the extent of teamwork and development productivity
H2: The greater the extent of sharing K. of suppliers, the greater the extent of teamwork and development productivity
H3: The greater the extent of sharing K. of internal capabilities, the greater the extent of teamwork and development
productivity
H4: The greater the extent of teamwork and development productivity, the greater the extent of time to market
H1: The greater the extent of teamwork and development productivity, the greater the extent of value to customer
Improving overall product development
may require strategic thinking on how
critical components of knowledge
should be shared among cross-functional
team members

Agenda
What Is KM?

The Challenge of Knowledge Cycle
Product
Innovation
= Knowledge
Creation
Design Specification
Market surveys
Concept ional experiences
Skills
Technologies
Research
Process Know-How
Customer Requirements
Market data
WWW
Service information
Manufacturing Know-How
Design Methods
Quality information
Standards
Regulations
Patent information
K. Capture
Product Data
in KMS
systems
Irreversible Knowledge
which is obsolete or lost
after the project
K.Loss
Reversible Knowledge
must be accessible and
available for new projects
K.Reuse

Process Framework
Strategic
Triggered by shifts in the
macro environment
Assess
Build / Sustain
Divest
Tactical
Triggered by market-
driven opportunity
Capture
Use
Learn
Contribute
Cannot
meet it
Can
meet it
Lost
opportunity
From Personal Memory
Organization Memory
Knowledge repositories
Relationships
IT and communications
infrastructure
Functional skill sets
Process know-how
Environmental responsiveness
Organizational Intelligence
Failure
External Sources
……

Design of an iterative model of
technological innovation

The Organization From a
Knowledge-based Perspective
 Organization learning
Primary locus of Intellect
Locus of customization
 Collaboration
Direction of intellectual
flow
Communities of
practices
 Management change
Method of leverage
Human Capital
Individual
Competence
Organization
Capital
Internal
Structure
Customer,
Supplier &
Competitors
Capital
External
Structure
How Effective the
value creation is in
the whole system?
VALUE
Ref: Stewart, T.(1997), “Intellectual
Capital: The New Wealth of Nations”

Innovation vs KM
Human Capital Customer
Capital
Organization
Capital
Knowledge
management
Learning
Innovation
management
Kaizen
Intellectual
Capital
management
Rewarding
Culture
Talent retention
Community of
Practices
Brand
Pattern
Process

Communities of Practices
The Engine of Knowledge Creation and Use
OEM
OBM
Retail
Networks
ODM
Trading firms
Component
SuppliersBuying
Office
Sub-Contractor
e.g. moldmaker
Design House

KM oriented on Business Process Management
BPMS-METHODOLOGY: PRODUCT/PROCESS-PHILOSOPHY [Karagiannis, 1994]
Company
Products
Processes
Information
Technology
Employees
based on
created by
done by
Implementation of
the processes
Finished
business processes
How are the
processes realized?
How are the
products made?
Which products
do we offer?
What kind of improvement
potential exists?
Strategic
Decisions
Modeling
Implementation
Execution
Evaluation
What kind of knowledge
is required?

Knowledge Management adds a new quality
to Business Process Management
 Conventional business process models
represent procedural knowledge
 Business Process Management optimizes
efficiency of the whole process
 Knowledge Management improves the
result of the process
 It focuses on additional aspects:
 Modeling
 identification of required knowledge
 analysis of existing knowledge
 Implementation
 structuring and recording of knowledge
 strategies for the elimination of
knowledge deficits
 determining the access points
 Execution
 context-based information retrieval
 active assistance
Strategic
Decision
Modeling
Implementation
Execution
Evaluation
Organizational
Memory
Workflow-Management
Systems
Groupware-
Products
Document-Management
Systems
Internet Intranet etc.
TOWARDS A KNOWLEDGE-MANAGEMENT METHODOLOGY

Objectives Of An Organizational Memory
Ensure the utilization of “formal” organizational knowledge:
 business rules, design guidelines, standard procedures, ...
 ... can be formalized to allow automatic processing
Enable sharing and reuse of experiences:
 lessons learned, best practice reports, case bases, ...
 ... can be stored as semi-structured electronic documents
Ease the exploitation of implicit knowledge, personal knowledge,
and knowledge contained in documents and databases
 technical documentation, hypertexts, personal notes, minutes of
meetings, graphics, images, product data sheets, business letters,
...
 ... must be effectively accessible
How can several kinds of knowledge synergetically interact?

The Organization Architecture
Organization
TeamInter -Organization
Individual
System
ProcessStructure
Strategy
Asset

The “ideal” KMS

KMS Framework, Method and Tool
Org. Architecture
Knowledge
Assets
Measurement
System
Develop K.
Organization
Strategic
Planning
KMS
KM
Systems
Ontology
KM Process / Apps Library
KM Object Directory
K Objects Store
RDBMS
Strategic
Knowledge
Navigator
Knowledge
Worker
Navigator
Knowledge
System
Administrator
Knowledge
Navigators
K Server
KM Process /
Application
KMS Application Server
KM
Systems
Ontology
KM Object Directory
K Objects StoreK Objects Store
RDBMS
Strategic
Knowledge
Navigator
Knowledge
Worker
Navigator
Knowledge
System
Administrator
Knowledge
Navigators
K Server
KM Process /
Application
KM Process /
Application
Organization
Individual
System
ProcessStructure
Strategy
Asset
Organization
Individual
System
ProcessStructure
Strategy
Asset
KM Strategy
Common Language > Navigator
Key Business Area
K. Assets / Processes
KM Strategy
K. Objects
K. Processes
K. Systems
K. Objects
K. Processes
K. Systems
KM Case
Key Business Area
K. Assets
K. Objects
K. Assets

Developing the Knowledge Organization
Audit Design /
Implement
1. Analysis Business
Processes
2. Leverage
Knowledge
Business Processes
3. Analysis
Knowledge
Networks
4. Leverage
Knowledge
Networks
5. Analysis the
Technology
6. Leverage the
Technology
7. Develop Knowledge Asset Schema
8. Integrate
the
Organization
Architecture

Knowledge Management System
Layout
KM
Systems
Ontology
KM Object Directory
K Objects Store
RDBMS
Strategic
Knowledge
Navigator
Knowledge
Worker
Navigator
Knowledge
System
Administrator
Knowledge
Navigators
K Server
KM Process /
Application

Knowledge Discovery in
Knowledge Bases
Processing and analysis of useful knowledge
in databases as requested
Note that KD process comprises a number
of tasks

Knowledge
Strategy
Business
Strategy
Metrics
Incentives
Technical Infrastructure
Knowledge Application
Personal Portal
Content Store
Leadership & Communication
Individuals
Communities of Practice
Support Organization
Knowledge
Process
PLAN: link
knowledge
strategy to
business
strategy to
derive clear
value
COLLABORATE: gain involvement and commitment in all
phases and integrate with broader organizational culture
MEASURE:
Design
meaningful
incentives to
drive desired
performance,
link metrics to
incentives and
system goals
PERFORM: knowledge processes
integrated with business processes
ENABLE: technology leverages
and integrates with existing
platforms and initiatives
A comprehensive framework needs
to guide implementations

Knowledge processes clearly
defined and supported
The knowledge process must be actively managed and monitored by the
KM organization.
Knowledge
empowered
Individual
Leverage
the CoP
Virtual
Team
Leverage
Experts
Leverage
Codified
Knowledge
2b
2a
1
• Knowledge Coordinator
• Knowledge Integrator
• Subject Matter Experts
Creates
Knowledge
Object
Receives and
Adds Value to
Knowledge
Object
KM System
Knowledge Worker
Knowledge Integrator
1
4
2
3
KM Archive
5
Receives and
Adds Value to
Knowledge
Object
Subject Matter Experts
KM System
Knowledge Access Knowledge Contribution

Agenda
What Is KM?

Approaches of KM Software

Product Development Engineers have
an tremendous need for knowledge.
Transformation
of the economy Opening and liberalization of
the markets
Relevance of
Product Engineering
New Product
Development
Expansion
Need for
knowledge Knowledge Management
New Technologies
New Potentials
Opportunity for
Information
overflow
Increasing share
of new engineers
I n s t i t u t f ü r W i r t s c h a f t s i n f o r m a t i k
d e r U n i v e r s i t ä t S t . G a l l e n

e-Portal
K. Management
Knowledge Based
Engineering
Explicit
Knowledge
Formalize
Consulting
Methodologies
Index
Semantic
Parser Translate
Engines
Expert
Knowledge
PDM &
Knowledge
Database
Search
End-user
Information Technology for KM
Knowledge Life Cycle
Books of
Knowledge
K. Quality
K. Quantity
K. Speed

KMS Demo by PLM

Portal
What makes a portal, a portal? (Morrison)
Personalisation
Organisation on the desktop
Resource Division
Tracking of activities
Access & display of data stores
Location of people and things

A Knowledge Portal consists
of several components.
Functions
Document
Management
Teamwork
Structured Content
Personalization
User Interface & Navigation
Active
Process
Support
I n s t i t u t f ü r W i r t s c h a f t s i n f o r m a t i k
d e r U n i v e r s i t ä t S t . G a l l e n

Different functions have to be
combined into a useful entirety.
Functions
Personalization
Active Process Support Teamwork Document Management
• Checklists
• To Do list
• Push
• Workflow
• Video Conferencing
• Audio Conferencing
• Discussion Groups
• email
• Find Experts
• Message Boards
• Chat Rooms
• Meeting Planner
• Subscribe to Contents
• Versions Control
• Access Control
• Search / Navigation
• Document Sharing
• Append / Modify / Delete
• Content Rating
• Office Integration
• Personal Inbox
• Customizing
• News Push
• Scheduling
• Profile Matches
• Personal Favorites
• Save Queries
• History
• Replication
• Personal Directory
• Hotlist

Price to Do It?
How long do you need
to get those information?
How many people need
to help you?
How much & what do
you save comparing with
what you invest?
You don’t have
to pay a heavy
price for
moving heavy
goods.
You don’t have
to pay a heavy
price for
moving
valuable
information.

Deliverables of KMS to NPD
 System Thinking
Generate a big picture
perspective of the process and the
project
 New product development
process
Capable to capture, share and
leverage knowledge to the NPD
Focus on the needs of the multi-
functional team, process flexibility
and decentralization of the new
product process
 Learning by doing
Use facilitators at important team
meetings, e.g. planning, decision
making or “stage gates”, lessons
learned, etc.
 After Action Review
What is learned in the project is
the best way to improve the
process
 Collaboration
“The art of thinking together”
provides better, more creative
solutions
Being used to accelerate the
creation of mutual understandings
within the work group
 Experimentation
Use DMU to test concepts with
stakeholders
 Talent retention
Enable professionals to extend
their performance beyond their
personal limits, allowing them to
achieve more inside the
organization than they could on
their own
Ref: The Fifth Discipline, Peter Senge, Currency Doubleday, 1990

Agenda
What Is KM?

Business Transformation
“You can't manage intellectual assets unless
you know what you are trying to do with
them”
TOM STEWART

As- Is Current State
Technology
People
Process
• Do everything
• Overworked
• Capital starved
• Difficult to retain talent
• Silo’ed (many separate PD functions)
• Limited measurements
• 3rd or 4th Quartile in performance
• Legacy systems, many
“home grown”
• Some separate CAD/CAM & ERP/MRP
systems in place

To-Be Future State
Technology
People
+
+
Process
• “Expert” focus
• Capital rich
• e-enabled human resources
• Business outcome focus
• Processes, not functions
• Cohesive, simplified, standardized
• Best practices applied – 1st Quartile
• Current CAD/CAM technology
• State-of-the-art PLM technology
• Integrated NPD delivery model
• Leverage and rationalization of all
third parties

New Product Process Improvement
and Organization Learning
Operations
Phase I Phase II Phase III
Improvement
2
Architecture
& capability
development
Improvement 1
Platform
development
Product
development
Market
development
Customer feedback
Finance
Model
Ongoing
research
Project
finance
Return on investment
finance
Ref: Fig.8.1, W.L. Miller and L. Morris, “Fourth
Generation R&D”, 1999

Model of KM Analysis
Ref: Ferrari, F. M. and J. C. d. Toledo (2004). "Analyzing the knowledge management through
the product development process." Journal of Knowledge Management 8(1): 117-129

Critical Successful Factors
Achievable project scope with actionable
implementation plan
Trusted technology provider – partner
Applicable IT solution with future extended
capability
Change management
Process - Task
Individual
Organizational structure
Value – culture

Teams vs Technology vs Learning
Team Technology Learning
Trust The building of positive
team processes
Open and accessible
information
Implicit knowledge made
explicit through sharing of
information
Conflict Building relationships and
mixing team talents
Open and instant
communications for
working with conflict
For deep levels of
discussion and dialogue
Dialogue A ‘core competency’ for
developing effectiveness
and facilitating interaction
Enables a ‘higher order’
of communication
Open and powerful
communication for
moving beyond single
understandings
Meetings Helps motivate
individuals while building
relationships and shared
vision
Asynchronous and
synchronous meetings
Synchronised action
without specific action
plan
E-Practice Practice is performed in
similar to work situations
Establishes real work
environments for practice
Learning occurs through
team processes without
the fear of consequences
Technology
Teams
Greater performance
levels attained with
teams using technology
Technology enables
teaming process of
learning
Captured team
knowledge results in
learning for new team
members and the
organisation

Teams vs Technology vs Learning
Team Technology Learning
Virtual
Teaming
Real life skills snd new
team skills for enhanced
learning
Teaming without face to
face contact
Continuous learning
possible without waiting
for next meeting
Networks Develop team members Enables instant access to
information
Implicit knowledge made
explicit through sharing
information between
team
Groupware Necessity for building
relationships and bonding
team members
Enables instant
communication for
dealing with conflict
Needed for reaching
deep levels of discussion
and dialogue
Collaborat-
ion
Team vision and focus for
the team
User driven technological
development enhanced
Learning opportunities
from failure
Team
Learning
To align and develop
teams to create results
by challenging
assumptions
Immediate and
continuous dialogue and
sharing work whilst apart
Collective intelligence
greater than the sum of
individual team members
intelligence
Knowledge Information transformed
into knowledge
Tools for collaboration,
for capturing and storing
knowledge
Greater learning leads to
greater organisational
knowledge

Business
drivers
Business
changes
Implement
tracking
system
Manage
performance
costs
Business
caseRisks and
Opportunities
benefits
Identification
and structuring
Realising and
tracking
Business Case
Refine and
continuous
improvementOptimising the mix
Design &
Implement
solution
Business
Direction
ManagementBusiness Needs
Review and refocus
Overview of Benefits and
performance management cycle

Benefits management is a critical path of
the Knowledge Management programme
Outputs
• Opportunity identification
• Opportunity prioritisation
• Project justification
• Top level stretch target
• Project ROI and NPV based on
quantified financial benefits
Tasks
• KPI development
• Target setting
• Prioritisation review
• “Refine” business case
• Agreed performance targets for
streams
• Agreed performance tracking
mechanism
• Feedback on issues, risks
and “early wins”
• Management reports on
performance vs. target
Steps
Business Case Design Solution ImplementationProject
Phase
Business Case Development
Performance Target Development
Performance Tracking
Management
• Review ,refine and refocus
• Continuous improvement
Performance Management
Benefits Management

Overview of the Benefits Management
Process
Identify the Key
Performance Metric
categories
Break business case
into key categories
(balance scorecard)
Match Business Case
against key business
processes
Baseline current
performance
Define performance
metrics for the business
processes - where
benefits will be realised
Build Benefits
performance
requirements.
Include intangible
benefits
Other industry
standard
performance measures
Link to : - Vertical
Market
- Products
Existing performance
measures
Chart planned vs
actual benefit &
costs over time

Some of the Ways in which we Measure our Efforts
Is Knowledge Being Retained and Shared?
Harnessing Organisational Knowledge
success stories
can our knowledge
seekers better link with our
knowledge owners
participation in KBase
work
enthusiasm for new KBase
work
more responsive to clients
move favourable
responses from clients
can we work faster
are we more productive
more aware of our experts
more awareness about our
expertise in specific areas
more aware of what is
possible
reduced costs; reduced
time

• Increase in proposals per sales
person
• New revenue attributable to KM
based on sales force feedback
Revenue
Growth
Customer Value Measures
• Profile of user interaction
(frequency, # of docs per session,
document rankings)
• #/% of employees with access
• Frequency/quality of
contributions, system-wide and by
document
• Periodic customer satisfaction
surveys benchmarking against
specific metrics
User Activity
Cost
Reduction
• Decrease labor cost per
proposal
• Decrease expenses per
proposal (e.g., travel costs)
• Decreased project start-up
cost and associated increase
in first year margins
Revenue Measures
Operational MeasuresInnovation
Quality
• Increase in proposal hit ratio
Benchmarking
• Specific solution innovations that
can be traced to KM initiatives
• #/% of proposals that leverage
“best practice” content.
• #/% of projects that employ “best
practices”
• Increase revenue from new
services enabled by KM
Performance
Innovation
Customer
Satisfaction
A sample balanced scorecard to measure knowledge management impact.
Knowledge management metrics
linked to business strategy

Knowledge Management Audit
Rate 1 (Not at all) — 5 (Very great extent)
Learning Climate
1 People feel free to speak
their minds about what
they have learned.
2 Mistakes made by
individuals are
considered constructive
learning experiences.
Process-Based
3 There are formal and
informal structures
designed to encourage
people to share what they
learn with their peers and
the rest of the organisation.
4 There are channels of
communication for
collecting and sharing
information from outside
the organisation.
Knowledge Competencies
5 There are people in the
organisation gathering
information, observing and
sensing the internal and
external environment and
reporting back through formal
and informal channels of
communication.
6 There are many people
who report back into the
organisation the best sources of
information and make these
known to everyone through
appropriate technologies.
Harnessing Organisational Knowledge (1)

Knowledge Management Audit (cont)
Quality of Work Life
7 There is a general
feeling that it’s
always possible to
find a better way to
do something.
8 Continuous
improvement is
practiced as well as
preached.
Big Picture
9 People have an overview
of the organisation beyond
their specialty and function
and adapt their working
patterns to it.
10 Cross-functional learning
opportunities are expected
and organised on a
regular basis, so that
people understand the
functions
of others whose jobs are
different, but have related
importance.
Harnessing Organisational Knowledge (2)

 xxx
Critical Success Factor
Consistency and
Sustainability
How Gemini Consulting deals with it
• A purposeful incentive reward system must be sustainable. Only if stimuli to the active contribution to
the knowledge management within the enterprise are consistent they will become purposeful. In this
respect these incentives need to be consistent in themselves on the one hand. This means right from
the beginning of its implementation a system is structured in a way that its essential components are
conserved over a longer period of time. On the other hand, an incentive reward system for knowledge
management should be a consistent component of the general incentive reward system of an
enterprise. This is not meant to be a plea for a rigid, inflexible incentive reward system. The standard
of quality that has been achieved should be taken into account as regards the stimuli.
Open Communication • The communication to the staff member should already begin in the training period for the new staff
member if not already in the period of recruitment for the potential staff member. The communication
of the various incentives at Gemini Consulting starts in the member of staff´s first week at work at the
latest
Component of the Core
Consulting Skills and
Requirement for
Recruitment
• An incentive reward system is complemented by the fact that the capability of a potential staff
member to apply his/her knowledge in favour of the enterprise and to share it with other colleagues
especially belongs to the requirements for recruitment in the consulting business, of course. The
change from material to immaterial values should be taken into account by particularly assessing
these capabilities in the recruiting process.
Integral part of the
corporate culture
• Another condition for the success of the knowledge management is for the corporate culture to
support the readiness to mutual learning and to the active participation in the knowledge exchange.
This cultural dimension often turns out to be a big hurdle when implementing the knowledge
management.
Globally Standardized
Processes
• Condition for success since international teams work on the most part of the projects. Therefore a
uniform standard of assessment is indispensable.
Knowledge
Management as
Service Offering
• Essential element of the success of our knowledge management comes from Gemini Consulting
together with Cap Gemini offering knowledge management as Service Offering worldwide. Finally our
internal processes have also been benefiting and still benefit from the creation of know-how in this
field which essentially contributes to their permanent improvement
Information
Technology
• IT should merely be looked at as a necessary condition. Its essential contribution to success are the
implementation and continuous improvement of appropriate tools corresponding to the size of the
enterprise, the culture of communication and the level of evolution of the knowledge managementSource: © Gemini Consulting, 2000

Worst Practice: How to Block
Knowledge Transfers
Individual
Competence
External
Structure
Internal
Structure
Lack of professional support:
“We need engineering support but
we don’ t get it. They are never
here.”
Job security:
“If you are the only one
knowing something you
have an empire and they
can't dismiss you.”
Lack of recognition:
“Last week I helped out for
1/2 day. Next day I had to
get up earlier to do my job.”
Internal Trading:
“We are competing
against each other. If I do
a job for some one I have
to charge.”
Learning not positive
for career:
“No-one goes a career
for supervisor anymore.”
Lack of tools training:
“SAP is probably a good system
but it needs a lot of training to
work. But we have got no training
so we can't use it properly.”
No system to transfer (tacitly
held) Expertise
“It takes a lot of extra time
to find faults now that xx (name)
has left YY (department).”
Lost Customer relation:
“Earlier we knew the
customers and they could call
us and we helped them if
something didn't work in the
jobs we had done. We got to
know the problems first hand
and could often rectify on the
spot.”
No systems for customer
support and access
Reinventing the wheel:
There are three different business
groups developing databases, each
around $500K. We didn’t know others
were doing the same thing.

Worst Practice
Internal Climate: Competitive
Organisation: In “Silos”
Systems: Not integrated
Customers: Not involved
Tacit Knowledge: Not understood
Corporate strategy: Not known
Managers: Not here
Information policy: Don’t know,“Confidential”
Rewards: $-incentives to Individuals,
promotion to Hoarders
Incentives to Learn: None (or little)
Office: Closed design, managers in cubicles

•PDP
Diagnostics
•PDM Fastpath
•KM Auditing
•GCS-100
•Product Design
Services
MTECH Consultant Service
MTECH Consultant Service – MCS through
forming a KMS development community
including
Education, research & development
Universities
PLM Technology vendors
IBM & Dassault Systemes
Product design consultant
Quadro consultant
Industries - yourselves

Conclusion
In manufacturing, physical production activities are
increasingly becoming commodities, meaning that the
value is increasingly in design, marketing, and
management.
Regional centers and 'world cities' are increasing
their economic reach and span of control.
So the trends in Hong Kong's manufacturing sectors
indicate that Hong Kong can increasingly act as a co-
ordination and management center for product
making. We have to create and supply new design
and manufacturing knowledge for product
development rather than the physical products.

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