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Master Thesis

Creating Effective Knowledge Management through Key Enablers

- A study at TietoEnator Services Sweden by

Fredrik Danell Fredrik Olsson

LiTH-IDA-Ex-00/27

2000-03-24

Creating Effective Knowledge Management through Key Enablers

- A study at TietoEnator Services Sweden

Examensarbete utfört inom ämnesområdet Ekonomiska Informationssystem vid Institutionen för Datavetenskap

Linköpings Tekniska Högskola

Av


LiTH-IDA-Ex-00/27

2000-03-24

Examinator

Alf Westelius, IDA, LiTH

Handledare Alf Westelius, IDA, LiTH; Ulf Lindelöw, TietoEnator

CREATING EFFECTIVE KNOWLEDGE MANAGEMENT THROUGH KEY ENABLERS

EXECUTIVE SUMMARY When we first started out planning our master thesis work we had three different approaches that we felt were interesting. The reason we choose to study Knowledge Management was simply because we felt that the issues involving modern knowledge companies and how they strive to stay competitive and attractive in an increasingly tougher business world were very interesting.

Modern knowledge companies of today, especially IT-services companies that are making a living on providing the latest knowledge and technologies, must be efficient in their work and continuously improve their way of working. Today this might be how they improve their internal communication, reuse previously developed solutions, and distribute the most important knowledge throughout the organization. To be able to improve these Knowledge Management related activities, companies need a framework that helps them to investigate and analyze their way of working.

To get a solid foundation in the decision-making process of the new policy for Knowledge Management, TietoEnator Services Sweden wanted us to investigate how other Swedish IT-businesses are working with their Knowledge Management. They also wanted us to investigate the status in their own organization regarding Knowledge Management issues and focus on what kind of leadership Knowledge Management demands.

Knowledge Management as a concept is new to TietoEnator, even though several of the activities connected to it already exist. They are now trying to implement the concept and create an organization that will secure the presence of a working Knowledge Management. Within this work, a vital part is the development of new principles and guidelines for the new organization (the merger between Tieto and Enator in the fall of 1999).

TietoEnator Consulting AS has developed a model for mapping and diagnosing different factors that is necessary to enable an effective Knowledge Management effort within a knowledge company. We have based our work on their “ISI Knowledge Management model” and altered it to better fit our needs.

We have found that essentially all of our chosen enablers have a profound impact on the effectiveness on KM-initiatives at all the studied companies. We have compiled a list of best practices used to support Knowledge Management in the studied companies.

Managers at TietoEnator Services Sweden must use guidelines and policies as means to manage the business units. Inform and entrust is the key word here. Employees must know what policies and guidelines affect their work and how to interpret them. Employees must feel entrusted to conduct their work. Another way to manage the company is through measurements. The use of Balanced Scorecard as the primary way to manage the company on a long- and short-term basis is a very good idea as long as the business goals are broken down to fit the local Business Units.


We feel that if Knowledge Management is going to have an impact on Services Sweden and TietoEnator globally, there are however a few conditions that cannot be overlooked. These conditions are: Managers have to be enthusiastic about Knowledge Management, Managers have to create a knowledge friendly environment, the Knowledge Management Steering Group (KMSG) must have commitment from top management in order to succeed, Responsibility for Knowledge Management should be extended to Business Unit level, and when building a Knowledge Management support system, start small and implement quick hits.

It is our opinion that the leadership at TietoEnator is not entirely consistent with the required leadership of a knowledge organization. We feel that managers are not supporting employees by providing the necessary resources, know-how and personal engagement that one might require of modern leader in a company of TietoEnator’s size.


SAMMANFATTNING När vi började planera detta examensarbete hade vi tre olika inriktningar som vi ansåg vara intressanta. Anledningen till att vi valde att studera Knowledge Management, var helt enkelt att vi ansåg att frågorna kring hur man som ett modernt kunskapsföretag agerar för att behålla konkurrenskraft och vara attraktiv för kunderna i ett allt hårdare klimat var mycket intressanta.

Moderna kunskapsföretag, särskilt IT-företag som lever på att sälja sin kunskap måste vara effektiva i sitt arbete och ständigt utveckla nya arbetssätt. I dagsläget handlar mycket av arbetet om att förbättra intern kommunikation, återanvända tidigare erfarenheter och göra viktig kunskap tillgänglig inom företaget. För att förbättra dessa Knowledge Management relaterade aktiviteterna behöver företagen ramverk som hjälper dom att inventera och analysera sina arbetssätt.

Våra uppdragsgivare, TietoEnator Services Sweden ville ha hjälp att ta fram ett beslutsunderlag som skulle ligga till grund för en ny Knowledge Management policy. Vårt arbete bestod i att göra en omvärldsanalys på deras konkurrenter med fokus på hur man jobbar praktiskt med Knowledge Management. Dom ville också att vi skulle undersöka statusen internt med avseende på Knowledge Management och fokusera på vilket typ av ledarskap som Knowledge Management kräver.

Knowledge Management som koncept är nytt för TietoEnator, det finns dock ett flertal aktiviteter som är nära släkt med Knowledge Management. TietoEnator jobbar nu med att implementera konceptet och skapa en organisation som ska säkerställa en satsning på Knowledge Management. Som en del av detta arbete jobbar ett projekt med att ta fram nya policies och guidelines för den nya organisationen. (Sammanslagningen av finska Tieto och svenska Enator).

TietoEnator Consulting AS i Norge har utvecklat en modell för kartläggning och diagnosticering av vilka faktorer som behövs för ett möjliggöra Knowledge Management, vi kallar dessa faktorer ”möjliggörare” eller ”enablers” på engelska. Vi har utgått från denna modell kallad ISI Knowledge Management modell och gjort anpassningar av modellen för att den bättre ska passa våra behov.

Vi har kommit fram till att en stor del av våra utvalda möjliggörare för Knowledge Management haft en viktig inverkan på effektiviteten av Knowledge Management initiativ vi har stött på. Som en del av omvärldsanalysen har vi sammanställt en lista över ”Best Practices” som används på de studerade företagen.


Vi anser att cheferna på Services Sweden måste använda de guidelines och policies som finns för att leda verksamheten. Informera och förtroende är nyckelord som bör användas för att leda de anställda. De anställda måste få veta vilka policies som används och hur de påverkar de anställda. Ett annat sätt att leda företaget är via mätning, d.v.s. använda Balanced Scorecards som det primära sättet att styra verksamheten både på kort och lång sikt. Företagets mål kan på detta sätt brytas ned och anpassas till varje resultatenhet inom företaget.

Vi anser att Knowledge Management kommer att få stor betydelse för Services Sweden och TietoEnator globalt. Innan dess måste ett par villkor uppfyllas: Cheferna måste vara positiva till Knowledge Management och skapa en kunskapsvänlig miljö. KMSG måste ha stöd från ledningsgruppen för att lyckas. Ansvaret för Knowledge Management måste inkludera affärsenheterna. När man implementerar Knowledge Management, starta i liten skala och visa snabba resultat.

Vår uppfattning är att ledarskapet på Services Sweden överensstämmer inte helt med den typ av ledarskap som Knowledge Management kräver. Vi anser att cheferna inte är de supportpersoner som de måste vara genom att inte understödja, inte ha de resurser och personliga engagemang som krävs inom ett företag av TietoEnators storlek.


FOREWORD During the last five months we have spent most of our time reading Knowledge Management literature, interviewing a lot of people and of course writing on this master thesis. At times it has been hard to find motivation, we have had our share of set backs during the fall. At this point we would like to thank a few people for making our work a little bit easier.

Ulf Lindelöw, our man on the inside. He supported us and gave us valuable tips on how to proceed with our work even though he had a busy schedule.

Anders Blomé for his interest in our work and invaluable inputs; the result would not have been this good without the help from Anders. We wish him all the luck with his new book.

Alf Westelius for taking the time to guide us and provide valuable feedback when we needed it the most.

Our opponents Daniel Jonsson and Henrik Eskilsson for providing invaluable constructive feedback and comments on our work. They deserve a little star for their work.

All of our interviewees for taking the time out of their busy lives to talk to us.

Hallonet and Ronin for being there to enlighten our days and taking our minds off this work.

Stockholm March 24, 2000.




TABLE OF CONTENTS 1 INTRODUCTION.................................................................................. 1

1.1 BACKGROUND.............................................................................................2 1.2 THE PROBLEM.............................................................................................3 1.3 PURPOSE .....................................................................................................4 1.4 DELIMITATION............................................................................................4

2 METHOD.................................................................................................5 2.1 THE SCIENTIFIC APPROACH........................................................................6 2.2 METHODOLOGICAL APPROACH...................................................................6 2.3 THE INVESTIGATIVE APPROACH.................................................................8 2.4 TYPES OF STUDIES.......................................................................................9 2.5 OUR VIEW...................................................................................................9 2.6 SOURCES OF ERROR...................................................................................10 2.7 READER’S GUIDE ......................................................................................11

3 KNOWLEDGE AND MANAGEMENT............................................. 13 3.1 WHAT IS KNOWLEDGE MANAGEMENT?....................................................14 3.2 THE KNOWLEDGE PROCESS......................................................................18 3.3 WHY KNOWLEDGE MANAGEMENT? .........................................................19 3.4 KNOWLEDGE MANAGEMENT FRAMEWORKS.............................................24 3.5 SYNTHESIS OF KNOWLEDGE MANAGEMENT MODELS ..............................29 3.6 ENABLERS FOR KNOWLEDGE MANAGEMENT...........................................32 3.7 KNOWLEDGE MANAGEMENT IN PRACTICE ...............................................46

4 KNOWLEDGE MANAGEMENT WITHIN SWEDISH IT-BUSINESSES .........................................................................................................53

4.1 INVESTIGATIVE TASK ................................................................................54 4.2 CONTENT GUIDE.......................................................................................55 4.3 ELEKTRA...................................................................................................56 4.4 ACME ........................................................................................................60 4.5 ZORG........................................................................................................65 4.6 CYBER.......................................................................................................69

5 CONCLUSIONS FROM THE COMPARATIVE STUDY...............73 5.1 GENERAL DISCUSSION...............................................................................74 5.2 IS THERE A PROFIT TO COLLECT?...............................................................76 5.3 THE BEST PRACTICES FOUND IN THE COMPARATIVE STUDY......................78

6 KNOWLEDGE MANAGEMENT AT TIETOENATOR SERVICES SWEDEN................................................................................................................79

6.1 SERVICES SWEDEN, A BRIEF PRESENTATION..............................................80 6.2 INVESTIGATIVE TASK ................................................................................81 6.3 SERVICES SWEDEN AS A “KNOWLEDGE COMPANY”..................................82 6.4 VISION, POLICY AND BUSINESS OBJECTIVES.............................................84 6.5 LEADERSHIP..............................................................................................85 6.6 THE KNOWLEDGE MANAGEMENT ORGANIZATION..................................87 6.7 INFORMATION TECHNOLOGY ...................................................................89 6.8 METHODS AND TOOLS..............................................................................91


6.9 MEASUREMENT.........................................................................................94 6.10 BUSINESS PROCESSES.................................................................................95

7 CONCLUSIONS FROM THE TIETOENATOR STUDY..............99 8 SUGGESTED ACTIONS.................................................................... 103

8.1 GENERAL SUGGESTED ACTIONS.............................................................104 8.2 SUGGESTED ACTIONS FOR TIETOENATOR..............................................105

9 REFERENCES.................................................................................... 107 9.1 LITERATURE............................................................................................108 9.2 ARTICLES................................................................................................109 9.3 INTERNET SOURCES................................................................................110 9.4 INTERVIEWS............................................................................................111 9.5 OTHER SOURCES.....................................................................................112

10 APPENDICES ..............................................................................113 10.1 APPENDIX A, INTERVIEW GUIDE, COMPARATIVE STUDY ........................114 10.2 APPENDIX B INTERVIEW GUIDE, TIETOENATOR STUDY.........................116


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1 INTRODUCTION In this chapter we present the background to our problem, the purpose of our master thesis and the delimitations we have made.


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1.1 Background When we first started out planning our master thesis work we had three different approaches that we felt were interesting. The reason we chose to study Knowledge Management was simply because we felt that the issues involving modern knowledge companies and how they strive to stay competitive and attractive in an increasingly tougher business world were very interesting.

”In an economy of networks, information and intelligence, the individual holds the key to performance. The primary challenge of today’s enterprise is to discover the power of its people and use it to advance, develop and grow both the business and the individuals who help it to flourish.” (C. Schaffer, Cap Gemini)

Modern companies of today, especially IT-services companies that are making a living on providing the latest knowledge and technologies, must be efficient in their work and continuously improve their way of working. Today this might be how they improve their internal communication, reuse previously developed solutions, and distribute the most important knowledge throughout the organization. To be able to improve these Knowledge Management related activities, companies need a framework that helps them to investigate and analyze their way of working. To be able to deliver the services requested by clients, modern knowledge companies need to recruit highly trained professionals and at the same time keep their existing employees. Employees´ demands are high, the employer has to care for and actively work to keep their employees. Staff turnover is high and approximately ten percent of the work force is exchanged on an annual basis according to Per Nyström at Celemi. With this in mind it is not hard to understand that recruiting is extremely costly and time consuming for large companies.

Today more and more companies earn their living from products and services which have been developed in the last couple of years, this as a result of an escalating evolution pace in the society, it is not longer possible to rely on one product for several years. Due to the ever-increasing global competition, the only sustainable competitive force is the organization’s ability of faster development of products and services. Knowledge Management is one way to handle problems that occur through this environmental change (Stewart, 1997).

Companies active in the IT-sector tend to grow fast, mergers and acquisitions is one common way to grow fast. This often results in that “one hand does not know what the other hand is doing, and the wheel is reinvented over and over in different parts of the organization. Knowledge Management tackles this through knowledge maps, knowledge databases etc. One example is to facilitate the connection between the one who needs knowledge and the ones who possess it (Stewart, 1997).


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When talking about Knowledge Management and what factors support the Knowledge Management process one can talk about enablers. An enabler is for example the Company Culture and the views of employees. If the Company Culture is open-minded and encourages sharing of knowledge between co-workers, one can then argue that the Company Culture is supporting Knowledge Management. There are several enablers for Knowledge Management, such as Management, Visions and Policies, IT-systems, Methods and Tools, Measurements and the above mentioned Company Culture.

“The biggest challenges are in leadership philosophy and company culture. Perhaps 80 percent of efforts must be concentrated on these areas, whereas infrastructure will only take up the remaining 20 percent. It will not be sufficient merely to install a marvelous Intranet and then believe that you have created a knowledge-based organization. But neither, of course, must infrastructure be neglected” (www.netsys.se).

The challenge for companies’ lies in storing the critical knowledge and information residing in individual employees’ minds. The idea behind Knowledge Management is that modern knowledge intensive companies cannot rely on traditional management theories to run their companies.

Managers do not have all the information, neither are they able to “lead” the work in a traditional way as managers always have done. In knowledge-oriented companies, the managers have to act like hockey coaches, supporting their players on the ice with proper training, strategic and tactical advice, resources and mental strength.

In order to act like hockey coaches, managers need new tools; one of the tools is Knowledge Management. We believe that during the next couple of years many companies will be using the thoughts expressed by authors of Knowledge Management literature to run their companies in different ways than today.

1.2 The Problem

The problem we have been faced with can be described as follows:

Knowledge Management as a concept is new to TietoEnator, even if several of the activities connected to it already exist. They are now trying to implement the concept and create an organization that will secure the presence of a working Knowledge Management. Within this work, a vital part is the development of new principles and guidelines for the new organization. To get a solid foundation in the decision-making process of the new policy for Knowledge Management they wanted us to investigate how other Swedish IT-businesses are working with their Knowledge Management, in addition, they wanted us to investigate the status in their own organization regarding Knowledge Management issues.


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1.3 Purpose

Part one: Comparative study among large Swedish IT-businesses.

The first part of the purpose is to investigate how “enablers” affect a company’s Knowledge Management efforts and point out the perceived customer and employee values created by Knowledge Management.

Part two: Within TietoEnator Services Sweden.

The second part of the purpose is to investigate how “enablers” affect Knowledge Management at TietoEnator Services Sweden. We focus on what kind of leadership Knowledge Management demands and attempt to judge how consistent the leadership of TietoEnator Services Sweden is with this kind of leadership

1.4 Delimitation

When conducting a study one needs to delimit the area studied in order to obtain a graspable and manageable amount of data. The problem is to make reasonable and correct delimitations so the area studied keeps its relevance and correct scope.

This research is on a general level, covering several areas of Knowledge Management instead of an in-depth analysis of a few areas, this due to the characteristics of the problem. As a result of conducting a general level study, our conclusions will be kept on a general level.

We have chosen not to investigate and describe the knowledge process in-depth, in other words how knowledge is created and transferred. The knowledge process is thoroughly described and surveyed throughout the Knowledge Management literature. We feel that our attention is better utilized in other areas than describing the knowledge process in detail. Therefore we are not able to explain in detail where and when knowledge is being created and transferred.

The amount of time for conducting this master thesis work is limited; therefore we have chosen to study only the Swedish part of TietoEnator Services, one of six business areas of TietoEnator. The comparative study only includes large competitors to TietoEnator and the study is on a general level. We have only looked at internal processes; the external processes are excluded from this study. Therefore we are not able to explain customers’ influences on the knowledge process within TietoEnator Services Sweden.


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2 METHOD The purpose of this method chapter is to give further details about our course of action, the selected path and the considerations that we have made throughout this master thesis work. We start off with a discussion about the scientific approach and then move on to our research approach. This chapter is concluded by a description of our practical work.


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2.1 The Scientific Approach When conducting a study, the researchers have their own way of seeing and interpreting things from the object studied. During the whole research process they have to make decisions on how to handle the gathered information, what to include and what to exclude. The researchers have their own way too see and interpret things connected to the study, their scientific view of the research. This view should be presented to the reader to help him better understand the result and the analysis of the study.

In this chapter we are trying to find a scientific perspective that is suitable for our study. There are two predominant philosophies presented in the literature, the positivistic approach and the hermeneutic approach. (Lundahl & Skärvad, 1992)

Hermeneutic approach: The hermeneutic approach states that everything around us is interpreted in some way because we all have our personal frameworks of experiences that affect our actions and decisions, therefore is it impossible to be completely objective in a study. Opposite this, there is the positivistic approach, with its roots in natural science that uses experiment and objective methods to collect the results.

We have mainly carried out qualitative interviews combined with documentary researches, which leaves much room for our own interpretation. This brings us close to the hermeneutic approach, which stems from the Greek word “hermenues” which means interpreter. The approach is founded on the assumption that there are no absolute truths, only relative ones.

Positivistic approach: The positivistic approach is primarily based on objectiveness, which means that the researcher observes the studied object. Within positivistic research one strives to find laws that either confirm or dismiss the proposed theory or hypothesis, acting on the assumption that everything is measurable. The positivistic approach assumes that the surrounding world is too complex for the researcher to study without simplifying and reducing the object studied. (Patel & Davidson, 1994)

2.2 Methodological Approach There exist several different opinions on what a method is and when and how a certain method is to be used. The different opinions can be labeled as different method views. The different views affect the way a study is carried out, comprehended and the way the problem is presented. The selected method view affects the researcher’s view of the problem and the way the work is conducted. As a consequence of this, data collection and analysis is conducted in different ways depending on the selected method view.


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Information considered essential for one method view might be irrelevant for another method view. A method view is based on assumptions of reality. The suitability of a certain method view is determined by the research situation and personal views. It is therefore impossible to argue that one method view is better than another. Due to the fact that every person has his/her own personal beliefs of the world, the choice of method view is affected by this belief. We have found that there are three different method views, the analytical, the systematical and the participant view.

Analytical view: The analytical view is part of the positivistic approach and it rests on the assumption that a total is equal to the sum of its pieces. It is in other words easy to grasp the whole picture if one has all the pieces. The researcher is looking for pure causalities, logical models and representative cases. The stepping-stone is an objective reality from which the researcher can clarify objectives, facts that end in an objective result.

Systemic view: The systemic view combines the thoughts of both the positivistic approach and the hermeneutic approach and builds on the assumption that we can view the reality as a system. Within the systemic view, there are two dominant views. One view assumes that the reality may act as a system. The other view does not take a position whether or not this is true, but believes that it is useful to view the reality as a system. The reality is based on components that in many cases are dependent on each other and therefore are not addable. The knowledge derived is system-dependent, i.e. the separate parts are explained from the properties of the whole.

Participant view: The participant view belongs to the hermeneutic approach and builds on the assumption that the reality exists as a social phenomenon. The picture of the reality is therefore not objective, the picture changes depending on who’s observing. The researcher tries to describe and comprehend interpretations of the surrounding reality.

According to both the analytical and the systemic views, the reality is considered to be objectively accessible. It is our opinion that the result of a study is always colored by the author’s background, knowledge and motive. The desired objectiveness can be hard to uphold, instead the author should present his own views in order for the reader to draw his own conclusions.


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2.3 The Investigative Approach According to Lekvall & Wahlbin there are three dimensions of an investigative approach. The first dimension implies that the investigator decides whether to focus on and prioritize depth, width or progress over time. The question of a quantitative or qualitative study is raised in the second dimension. How to collect data is decided upon in the third dimension.

An investigation that prioritizes depth is conducted by limiting the investigation to one or a few objects while prioritizing width is obtained when studying an adequate amount of objects in order to find more general conclusions. When focusing on an investigation over time, the investigator tries to reproduce a course of action and in some cases express an opinion about the future development.

When conducting a case study, the investigator acts from a comprehensive view and strives to gather as comprehensive material as possible. In some cases problems will arise if the respondent is not willing to share sensitive information. Case studies are often useful when studying processes and changes. The ability to generalize the results from a case study is viewed as very important in the research community (Gummesson, 1985). On the other hand, case studies are criticized by many researches for only being suitable for formulating a hypothesis or act as an illustration (Patel & Davidson, 1994).

Quantitative research is based on numerical data that is gathered and analyzed statistically, while qualitative research is based on verbal analysis methods. Qualitative investigations often mean that the researcher conducts a small amount of in-depth personal interviews. The interviews allow the investigator to follow-up interesting leads with follow-up questions and thus get a more qualitative answer.

The data collected in the course of an investigation is either viewed as primary data or secondary data. Primary data is the kind of data that is not processed and compiled. The researcher has to gather his or hers own primary data whereas secondary data has been collected entirely by other persons. Internal reports, project documents etc. are also considered secondary data.

In our research work, interviews and literature studies have been our primary source of information.

Literature studies are used to gather secondary data and are often useful in the beginning of research to gather knowledge of a specific area of interest. Literature may include books, research reports, magazines, Web pages and industry-related information. The most common criticism directed at use of secondary data is that the data has been gathered with a totally different purpose than the researcher’s original purpose. A significant problem when using secondary data is to estimate the reliability and authenticity of the data.


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Interviews have several advantages, and are especially useful when investigating complex issues. The researcher can ask follow-up questions to ensure the perceived answer is correct and get additional information. On the downside, it can be very difficult to ask sensitive and delicate questions and get busy people to make an appointment for an interview. We have utilized both on-location and telephone interviews. When performing a telephone interview it is easy to lose control over the conversation to some extent. Telephone interviews can be used to follow up on-location interviews. We have not used telephone interviews to a large extent to follow up interviews; the medium used has been e-mail. The advantage with e-mail follow-up from telephone follow-up is that the respondent can answer our questions at the for him or her best suitable time then if telephone follow-ups are used.

2.4 Types of studies A research’s level of ambition is dependant on the available research in that particular field. One usually separates the following types of studies (Wallén, 1996):

Explorative studies are used to get basic knowledge of a problem’s when, where and how, as well as its context.

Explanatory studies deal with the issue of why, and the researcher tries to sort out cause and effect for a studied object.

Descriptive studies are used to determine the properties of studied objects.

Normative studies are conducted when the researcher wants to produce a norm, or an action plan. The purpose of the study is to show the consequences of different actions and the impact those actions will have on the studied object.

2.5 Our View

In our study we have conducted qualitative research. The qualitative study is descriptive in nature and the reason for choosing a qualitative approach is our need for a deeper understanding of the different aspects of Knowledge Management. We are not interested in analyzing our material statistically and therefore the chosen approach suits our purpose better than a quantitative approach. The two studies conducted are both performed as descriptive studies.

We have chosen to use the systemic view, since we have chosen to view our problem area as a system. When the parts of the system are changed, the whole picture of the system is changing. When talking about Knowledge Management and its enablers, we believe that the individual parts and their liaison are presenting a view suitable for our problem. The systemic view is a combination of the positivistic approach and the hermeneutic approach.


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Since we have used interviews as our main source of information when conducting our studies we are positioning us more towards the hermeneutic approach, which leaves more room for our own interpretation.

The data used to compile this master thesis have been both primary and secondary data. The primary data has been gathered from interviews with people connected to the studied companies.

The people we have interviewed are persons that we have been recommended to talk to by our supervisor at TietoEnator or through our own contacts or research have found interesting. Based on our purposes we have selected areas of interest and formulated questions based on these areas into two questionnaires, one for each study.

The secondary data has been compiled from literature, articles, master theses and Web pages from the Internet. Our supervisor at the University has provided useful tips on relevant literature and other master theses to read. The Web pages and articles used are the result of searching the Internet and library databases for relevant data. We have also had access to internal TietoEnator material such as reports and surveys.

2.6 Sources of Error

When using Web pages found on the Internet, the problem is to grade the reliability of the published information. We have chosen to only include Web pages published by well-reputed Internet sites.

As described in chapter 2.5, the people we have interviewed have mainly been proposed by the TietoEnator supervisor. We have no way of telling if the persons interviewed represent a normative opinion or can be viewed as biased. After each interview we have felt that the persons selected are knowledgeable and in our opinion not biased. We may however been influenced by the interviewee and have an over-optimistic view of that person.

We cannot neglect the fact that when conducting interviews, we have guided or have been guided ourselves by the interviewee. In order to deal with this, we have used interview guides and taped the interviews for later processing. On every interview occasion, we have both participated during the interviews to minimize misconceptions.

Another problem might be that the questions asked are not covering relevant areas. To deal with this problem we have tested the questionnaires on people not part of the studies. These people are in similar positions as the people included in the study. The interview guides can be found in the appendices.


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2.7 Reader’s Guide As a service to the reader we have illustrated the structure of this master thesis in Figure 1.

Figure 1, The Reader’s Guide

What is KM? In this chapter we describe the differences between information and knowledge and the concept of tacit and explicit knowledge.

Why KM? In this chapter we describe why companies continually must develop new competencies to stay competitive. We also point out in what ways Knowledge Management can be used to administer old and develop new competencies.

KM models & Synthesis In this chapter we present three frameworks that we think are suitable for our purpose. Each framework is briefly described. We then rebuild the ISI-model and adjust the model to better suit our view.

Enablers for KM In this chapter we focus on the factors that make Knowledge Management work in an organization. We choose to call these factors enablers. Each sub-chapter contains a description of a specific enabler and the problems related to that enabler.


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How KM? In this chapter we present the reader an insight of practical management when it comes to managing knowledge projects.

Study of Knowledge Management within Swedish IT-businesses In this chapter we are present our study of four Swedish IT-businesses where we wanted to investigate how “enablers” affect a company’s Knowledge Management efforts.

Conclusions from the comparative study In this conclusion we summarize the general impression from our comparative study, our own thoughts on this subject and why Knowledge Management is so vital in a knowledge organization.

Knowledge Management at TietoEnator Services Sweden This chapter deals primarily with TietoEnator Services Sweden, a business area within TietoEnator. The study deals with Knowledge Management at Services Sweden and what enablers Services Sweden relies on.

Conclusions from the TietoEnator study In this conclusion we summarize the general impression from our study of TietoEnator Services Sweden. We present our conclusions of TietoEnator’s work on Knowledge Management and leadership.

Suggested actions In this chapter we making our suggestion as to how TietoEnator should proceed with their Knowledge Management actions.


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3 KNOWLEDGE AND

MANAGEMENT In this chapter we give readers that are not familiar with all the concepts in the field of Knowledge Management a summary to better understand the concept of Knowledge Management. We isolate the word and concept of “knowledge” to find its characteristics and then move on to discuss different Knowledge Management models and the enablers of Knowledge Management. The chapter is concluded with a discussion on practical Knowledge Management.


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3.1 What is Knowledge Management? In this chapter we describe the differences between information and knowledge and the concept of tacit and explicit knowledge.

3.1.1 Information or Knowledge?

At first sight the word knowledge seems clear and easy to define but after reading a few books on the subject, we realized the complexity of the subject. Authors in the Knowledge Management area go through several “schools” or traditions of “knowledge-thinkers”, Nonaka & Takeuchi, for example guide the reader from Plato through to many of modern times philosophers and the equal amount of aspects of knowledge. We have tried to express ideas from a few of these theories that could be helpful for us in our attempt to clarify the concept of Knowledge Management and different ways of managing knowledge.

First we put knowledge in relation to information in order to make it easier to know and understand what it is we are trying to manage. Gruvberger & Malmborg have, from the sources mentioned below, in their master thesis “The Blossom: A framework of Knowledge Management” made a hierarchy of different complexity-levels of information, with data at the bottom and competence at the top of their model, see Figure 2.

Figure 2, Comprehension levels of the information hierarchy, (Gruvberger & Malmborg, 1999)

Davenport & Prusak define data as a set of discrete, objective facts about events. Data only describes parts of what has happened, i.e. nothing is said about its own importance or irrelevance and it does not tell the reader anything about why someone does certain things in a certain way, it just tells the reader that it has been done. So if we structure data to say something, we have actually created information.


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Davenport & Prusak define information as follows: “Information is a message with a receiver and a sender, usually in the form of a document, audible, or visible communication. Information is meant to change the way the receiver perceives something, to have an impact on his judgments and behavior.” To be able to promote information to the next comprehension level, knowledge, Gruvberger & Malmborg have placed intelligence as the level between information and knowledge. The National Encyclopedia, (1992) suggests some characteristics that an intelligent person should have. An intelligent person should for example be capable of abstract thinking, be able to adapt to new a situation and have the ability to efficiently use experience to solve problems. These are the abilities that are used to create knowledge.

Davenport & Prusak defines knowledge as: “information combined with experience, context, interpretation, and reflection. It is a high-value form of information that is ready to apply to decisions and actions.” or “knowledge unlike information, is about beliefs and commitment” (Davenport & Prusak, 1998).

Sveiby (1997), referring to Polanyi (1958), defines competence as. “know-how + the ability of own reflection.”

Competence, in Polanyi’s view is know-how within a certain domain and the ability to reflect about the consequences of a certain action. Competence is formed by knowledge, experience, and own reflections. Knowledge can be transformed to competence if a person has the ability to integrate knowledge, experience, and own thinking into a unity. Competence means that you know and can act on this knowledge, whereas knowledge means you know but not necessarily can act on that knowledge.

3.1.2 Explicit and Tacit Knowledge

Another perspective of knowledge that several authors express is explicit and tacit knowledge. The dominating difference between explicit and tacit knowledge is that explicit knowledge is considered easier to document than tacit knowledge that exists only in people’s minds (Cliffe, 1998). ”Tacit knowledge is hard to formalize and communicate to others. It often takes the form of mental models and beliefs that are so ingrained that they are hard to articulate” (Nonaka & Takeuchi, 1998).

Explicit knowledge can be explained as follows: “Explicit knowledge can be expressed in words and numbers and shared easily.” (Nonaka & Takeuchi, 1998)

Or as: Knapp & Havers chooses a slightly different definition in saying that explicit knowledge is what has been written or otherwise recorded. It includes among other thing books and manuals. It can be readily identified, articulated, captured, shared and applied.


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There is a great risk of confusing the two concepts of information and explicit knowledge; in fact, Nonaka & Takeuchi argues that most of the western writers do that unintentionally, whereas the Japanese school is very strict when talking about information and explicit knowledge. With the previous chapter in mind we hope we have reduced the risk of a mix-up of the concepts discussed in this chapter.

3.1.3 Information Management

Information Management focuses on using IT to enable collection and management of explicit business information. Knowledge Management, on the other hand, focuses less on technology and more on creating and using knowledge inside the company (De Long et. al., 1997; Knapp & Havers, 1999).

3.1.4 Organizational learning

Organizational learning is a concept that has been around much longer than the concept of Knowledge Management and we have glanced through two authors that are well known in this area, Senge and Mayo. In a very brief description one can say that this view focuses around making the employees aware of how they learn or what knowledge they obtain through their daily work tasks. Individual learning is by most viewed as a prerequisite of organizational learning, since the organization after all consists of individuals. (Senge, 1995; Mayo, 1995).

3.1.5 Knowledge Management

We have earlier established that there are different views of “knowledge” and there are just as many views on how to handle and use knowledge. There are many concepts closely related to each other that appear in the discussion around Knowledge Management, concepts such as for instance information management, competence management, intangible assets management, organizational learning etc. Some of these expressions we take a closer look at in other parts of this study, while others we briefly describe in this chapter. One thing that most of them have in common is the term “management”, a term traditionally associated with exploiting and developing a company’s resources. Knowledge is indeed an invaluable resource, though it seems it would be easier to handle if it had a price tag.

Knowledge Management is an outgrowth of the resource-based view of the company. This view suggests that the ability of a company to outperform competitors lies in how well it uses its internal resources, rather than how the company positions itself on the market (Earl & Scott, 1999)

Knowledge Management tries to offer people access to an organization’s collected knowledge, preferably on a just-in-time basis. To manage this, the organization should provide an infrastructure for information and organization, which can deal with knowledge effectively (Davenport & Prusak, 1998).


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Gruvberger & Malmborg have extracted some characteristics that definitions of Knowledge Management have in common:

Creating or generating new knowledge Acquiring knowledge Sharing and reusing knowledge Creating value and improving business performance of the company Changing people’s attitudes and behavior Enabling an organizational and technological infrastructure and

providing sufficient resources

Nonaka & Takeuchi place the individual at the center of knowledge creation. It is the individual that enables the conversion and transfer of his knowledge into organizational knowledge and this process is strictly dependent of the context where the individual acts (Nonaka & Takeuchi, 1998). This statement further expresses the similarities between Knowledge Management and organizational learning.

Our study covers many areas but is not an in-depth study. We want to take a holistic view of Knowledge Management in the organizations studied rather than focus on a specific type of Knowledge Management or a part of the Knowledge Management process. Therefore we have found Sveiby’s definition of Knowledge Management useful.

“Knowledge Management is the art of creating value from an organization’s intangible assets.” (Sveiby, 1997)

This definition might also be dangerous because it includes all the aspects connected to Intellectual Capital. Therefore we are going to combine the use of the definition above with the following more narrow definition of Knowledge Management:

“Knowledge Management is the capability of a company to create new knowledge, disseminate it throughout the organization and embody it in products, services and systems.” (Nonaka & Takeuchi, 1998).

3.1.6 Criticism against Knowledge Management

Gruvberger & Malmborg have gathered different sources of criticism against Knowledge Management. We summarize their thoughts in the list below. They refer to authors such as Dempsey and Sunoo when describing the criticism towards Knowledge Management. Dempsey argues that Knowledge Management is “so wrapped in the obscure language of management that they verge on the bizarre”, and Sunoo says that Knowledge-sharing should be the preferred term. She believes that knowledge is something that cannot be managed, and therefore, it is inappropriate to use a name that implies that knowledge is possible to manage. Gruvberger & Malmborg then argue that “Most of the criticism against Knowledge Management has its origin in the fact that there does not exist a direct correlation between business performance and IT-investments in Knowledge Management. Most Knowledge Management


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initiatives have in the past been investments in databases, Intranets etc. and the discernible effects of these investments have been notably small. However, if the Knowledge Management initiative focused more on the human aspects, the effects would be more evident.” (Dempsey and Sunoo through Gruvberger & Malmborg, 1998)

A buzzword that has lost its hype. Abstract theories without practical benefits. Too technology based solutions. Time and cost consuming.

3.2 The Knowledge Process In this chapter we associate the concept of knowledge with activities such as “creation” and “transferring”.

“Knowledge is a fluid mix of fragmented values, contextual information, and expert insight that provides a framework for evaluating and incorporating new experiences and information. It often becomes embedded not only in documents or repositories but also in organizational routines, processes practices, and norms.”…”Knowledge Management is the seamless, organic process how knowledge is created, sustained, shared and multiplied” (Davenport & Prusak, 1998). This process has many characteristics similar to those of the business processes described in chapter 3.6.7. The knowledge process goes through the whole firm and contains activities such as creating, acquiring, organizing, sharing and using knowledge (Gartner Group through Beckmann & Ahde, 1998).

3.2.1 Create & Acquire

We have identified two main views on how knowledge is created. First a more linear way where knowledge is evolved from the information level in the information pyramid, see Figure 2 in chapter 3.1.1. Nonaka & Takeuchi describe the creation of knowledge in another way, as different interactions between explicit and tacit knowledge. The activity “Create & Acquire new information and knowledge into the company” is the first step in the knowledge process.

A failure to create and acquire new knowledge, may account for the declining performance of many well-established firms (Inkpen, 1996).

3.2.2 Transfer & Share & Reuse

Sveiby says that there are two ways to share knowledge, either through tradition or through information. By tradition, transfer occurs on a person-to-person basis, i.e. through watching, imitating and finally learning. Through information, knowledge can be transferred with the use of other media such as paper, drawings, databases etc. (Sveiby, 1997).


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3.2.3 Organize & Capture & Document

One of Knowledge Management’s tasks is to capture the individuals’ knowledge in a form that is explicit knowledge. This makes the knowledge more valuable in two senses: it makes the company less dependent on the individual and the knowledge can be distributed electronically and made available to the whole organization independent of time and space (Hjertzen & Toll, 1998).

The survival of the knowledge company relies on the ability to collect, structure, invent and in an intelligent way reuse knowledge (Blomé, 1999). This has to be a never-ending process; if it ever stops the end is close. In most organizations there is no shortage of creativity. The real challenge for these companies lies in capturing these creative ideas and allowing them to flow where they can be used (Fahey & Prusak, 1998).

3.3 Why Knowledge Management? In this chapter we describe why companies continually must develop new competencies to stay competitive. We also point out in what ways Knowledge Management can be used to administer old and develop new competencies. Competencies in this chapter are primarily equal to the concept of core competencies. We also introduce the concept of Intellectual Capital.

3.3.1 Competencies

In the introduction we talked about the requirements of the modern economy: that a company no longer can continuous tuning and inventions are necessary in order to stay competitive. Prahalad & Hamel have studied a few companies that have managed to invent new markets and adapt to the changing boundaries of existing markets: companies that have dramatically shifting patterns of customer behavior. The specifics about these studied companies that set them one step ahead of the competitors, the authors try to explain in the following quote: “The critical task for management is to create an organization capable of infusing products with irresistible functionality or, better yet, creating products that customers need but have not yet even imagined.” To achieve this, the authors agree that; in the short run, a company’s competitiveness derives from the price/performance attributes of current products but in the long run, however, competitiveness derives from an ability to build, at lower cost and more speedily than competitors, the core competencies that spawn unexpected products. Core competencies are the collective learning in the organization, especially how to coordinate diverse production skills and integrate multiple streams of technologies (Prahalad & Hamel, 1990).

We think that the focus on core competencies makes organizations analyze their strengths and increase the awareness of what learning processes develop these competencies. To us Knowledge Management is the natural tool to develop and manage a company’s core competencies.


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Most organizations have a fairly unspecific feel for where in the organization core competencies exist and the identifying process of these core competencies can therefore be difficult. One common mistake is to confuse core competencies with products. Useful questions to ask when identifying core competencies may be; who are our Key-Players and what kind of knowledge make them Key-Players? What customers are demanding the most and what is it that makes them require all of our abilities (Blomé, 1999)?

Three tests can be applied to identify core competencies in a company according to Prahalad & Hamel.

A core competence provides potential access to a wide variety of markets.

A core competence should make a significant contribution to the perceived customer benefits of the end product.

A core competence should be difficult for competitors to imitate

In the second test we see similarities to the definitions of Knowledge Management by Nonaka & Takeuchi referred to in chapter 3.1.5. They state that organizational knowledge creation is the capability of a company to create new knowledge, disseminate it throughout the organization, and embody it in products, services, and systems.

3.3.2 Key-Players

Hansson explains that it depends on the will of the employees to use and develop their skills and abilities, if the knowledge company will succeed or not. The tasks often require that workers take great individual responsibility in carrying out management tasks such as competence development. This is often fits a person with high integrity who is stimulated by challenges and learning tasks rather than rewards.

All organizations have their Key-Players, persons they rely on more than others. It can be persons that attract a lot of customers or it can be the ones able to solve the most difficult problems. The problem is that there is always a shortage of this kind of people and the best people pick their place of work carefully. Sveiby has a few reminders for those who wish to attract new Key-Players into the organization.

The image that is built through customer relations, the reputation, has to be good.

The person is counting on that he is continually going to learn, and a strong competence development program is therefore extremely important and a necessity in today’s business world.

Money is of course important but not always a triggering factor. Some people value other fringe benefits just as highly as monetary ones. Travels, babysitting and domestic help or use of company housing at attractive resorts are just a few examples.


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If the person then chooses to stay within the organization depends on how well the image is matching reality. As we have pointed out before, satisfied co-players are important and the fact that it is very expensive when persons like that choose to leave the organization is obvious (Sveiby, 1997).

Margareta Barchan, CEO at Celemi expresses the image issue as follows; “Quality relationships may result in a Fortune 100 leader recommending Celemi to others, thus enhancing our image. They could also lead to our employees gaining competence from a challenging project, or to the creation of a new simulation model which addresses an emerging business issue and can be reused as a "universal application" for other clients with similar needs.”

A study conducted by UPS (United Parcel Services, a large US company) measures the productivity in divisions with a positive “employee relation index”, compared to those with lower scores, and found that those divisions with more satisfied employees also have higher productivity (Cap Gemini, 1998). MIT, Sloan school of Management has conducted a study of employees in Fortune 500 companies, the study shows that there are systematic links between employee loyalty and organizational performance (Cap Gemini, 1998). These results may not be shocking but it is an attempt to show some pay-off on long-term investments. So if companies can learn what culture climate makes their employees loyal and satisfied, the pay-off in more satisfied employees is not to be neglected.

Body Shopping

In modern consultant organizations the term Body Shopping is used to explain a common phenomenon. A company that “sells” its employees by the hour to the highest bidder is considered to use Body Shopping (Sveiby, 1997). When profitability is low, management is often forced to use Body Shopping as means to raise profits. On the down side, not many employees like the idea of being sold as a resource for hire. Personal development is not stimulated and the knowledge enhancement compared to working in projects is low (Davenport & Prusak, 1998). If the company itself manages a project they also get the opportunity to man and manage their resources in the most suitable way. Not until then is it possible to include the knowledge perspective, for example contemplating who should work with whom.

3.3.3 Intellectual Capital

“The modern knowledge intensive company is continually moving the focus from the financial to the intellectual assets of their significance to future revenues” (Skandia, 1996).

To this point we have discussed Knowledge Management from a view with its focus on the phenomenon knowledge but now we will bring a few authors into the discussion that have focused on the intangible assets of a company, often referred to as the Intellectual Capital.


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Organizational resources can be split into two categories, namely tangible and intangible resources. Tangible resources are those typically found in the company’s balance sheet and are for example cash, buildings and machinery. The other category comprises the intangible assets, e.g. people and their expertise, business processes, and market assets such as customer loyalty. Collectively these intangible assets are refereed to as Intellectual Capital (Brooking & Motta, 1996).

In recent years it has become more and more evident that there are shortages in today’s monetary way to value a company’s assets. The tangible assets in the balance sheet include only a small part of a company’s total assets. When the market value of some companies is a hundred times higher than the total value of the tangible assets there is a need to describe and explain the remaining part (Celemi, 1998).

According to Hjertzén & Toll (building on Sveiby, Edvinsson and Stewart), the Intellectual Capital is used as a tool to explain what constitutes the value gap between a company’s market value and the value visible in the balance sheet, see Figure 3.

Figure 3, Differences between market value and the value visible in the balance sheet, (Hjertzén & Toll, 1998)

After defining Intellectual Capital, many authors continue to investigate how it can be divided further and what label to put on each component. The concept we describe is the one Edvinsson developed for Skandia and it is very similar to Stewart’s view and with small adjustments it also fits the view of Sveiby.

The Intellectual Capital is first divided into Human Capital and Structural Capital.

Human Capital is the stock of usable knowledge, skill and competence residing in organizational members (Lynn, 1998). To be more precise, it is the competencies of the employees that might be useful to the company’s business operations.


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More than ever the service-business companies are trying to beat each other in being “the most preferred employer” and spending lots of money to keep their Key-Players within the company walls, having realized that Human Capital is the most valuable asset. Other companies cannot copy a company’s Human Capital and therefore, it is the primary source for sustainable competitive advantages (Gruvberger & Malmborg, 1999).

Structural Capital can be described as what is left in the company when the day is over and the employees have left the office. This holds the Customer Capital and the Organizational Capital. The Customer Capital is the total value of a company’s customer relations, a value that is transformed into financial value when interacted with the Human Capital and the Organizational Capital. The Organizational Capital contains systemized and packaged knowledge; this can be manuals, process descriptions and networks. The Organizational Capital also contains systems and IT-solutions to leverage a company’s innovation power and value adding processes (Skandia, 1996).

3.3.4 Knowledge Management in relation to Intellectual Capital

In order to clarify how Knowledge Management and Intellectual Capital relate to each other we depict the opinions of a few authors. Sveiby claims that Intellectual Capital and Knowledge Management are two branches of the same tree, and consequently, they are very closely related. The main purpose of Knowledge Management is to increase the value of the Intellectual Capital. Curry & Cavendish hold that Knowledge Management can be regarded as the process of transforming Human Capital into Structural Capital.

Hjertzen & Toll view Knowledge Management as a management tool a company can use to leverage and exploit their Intellectual Capital. Knowledge Management is one way to improve the knowledge related parts of the Intellectual Capital. Improving the other parts they refer to as Intellectual Capital Management or IC Management. In Figure 4 below they describe the interaction between Knowledge Management and Intellectual Capital.

Figure 4, Knowledge Management in relation to Intellectual Capital, (Hjertzén & Toll, 1999)


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They compare their model with the traditional model of financial accounting where the Knowledge Management side corresponds to the cost and revenue account and the Intellectual Capital side corresponds to the balance sheet. The Intellectual Capital tells us the status of the assets and how we are able to manage them over a long period of time.

Knowledge Management generates direct value by saving time and enabling new solutions, this is shown through the arrow on the left side. It will also generate new knowledge that can be added to the Intellectual Capital, the indirect created value of Knowledge Management. The Intellectual Capital is expected to generate direct value in the future but this requires effective Knowledge Management that enables reuse of Intellectual Capital assets. Today the Intellectual Capital generates direct value of a different kind, e.g. increased market value, improved reputation, etc. (Hjertzén & Toll, 1999).

3.4 Knowledge Management Frameworks In this chapter we present three frameworks that we think are suitable for our purpose. Each framework is briefly described.

3.4.1 What is an Enabler?

When reading Knowledge Management theories, there are some aspects of Knowledge Management that almost every author describes as absolutely necessary in order to gain a functional Knowledge Management process. We have chosen to call these facilitators enablers.

3.4.2 The Frontec Model

Johansson & Erlandsson have in their master thesis “Knowledge in the frontline”, 1999 developed a model of the “knowledge process” based on authors such as Davenport, Cliff, and Knapp etc. see Figure 5. They describe the way knowledge is created and shared as a process-cycle influenced by Knapp.

The process starts when knowledge is used and created. In their opinion, the most effective way to create new knowledge is to put together a team of consultants with different backgrounds, competencies and knowledge in customer projects. A project can then act as a learning space where the collective knowledge is put to work. Another important part of the knowledge process is the surrounding environment; in what ways is the organization influenced or affected by the environment.

The actual transfer of knowledge the authors divide in direct and indirect transfer. Direct transfer takes place from person-to-person while the indirect transfer goes through formalized or documented information.


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Figure 5, The Frontec Model, (Johansson & Erlandsson, 1999)

The goal of documenting is to make knowledge only found in employees’ minds available for others that need it within the organization. Johansson & Erlandsson mention four guidelines for managers regarding documenting principles:

Managers must decide and express what goals that are supposed to be fulfilled with the documentation.

Managers must recognize the different types of knowledge.

People handling knowledge must evaluate how useful and how well suited for documentation that particular knowledge is.

The ones handling knowledge also must identify a suitable media for documenting and distributing.

It is important that the “sender” or the person processing the knowledge is thinking of who may be the future recipient of the knowledge. This may affect in what way you deal with bullet three and four in the list presented above.

Johansson & Erlandsson have chosen five enablers that the process requires to function properly.

Organizations: The structure of the Organization, i.e. the way different units are connected to each other influences the knowledge process. How formal is the organization? Through a centralized structure, a company minimizes duplication of work and has better control of what “best practices” are being used. Through a decentralized structure the employees get more motivated with a higher degree of responsibility. The individual engagement is vital to solve problem and collect new knowledge.


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Management: Without support from Management, it is impossible to get a sustained effect of the Knowledge Management process. Many of the knowledge related activities are not directly value creating so there must exist incentives for knowledge-sharing supported by top management. The management has to provide the necessary resources like tools, methods and time.

Culture: is important for all activities in the knowledge process, Johansson & Erlandsson divides Culture into three parts, Company Culture, Knowledge Behavior and External Influences. Company Culture deals with the characteristics of the company that distinguish one organization from other organizations. Knowledge Behavior is about the individuals’ attitude towards knowledge and External Influences is how the environment affects the Company Culture.

Information Technology: It is usually said that Knowledge Management is much more than Information Technology but it is necessary for a company to have well functioning information systems, groupware etc. to be able to spread information and share knowledge throughout the organization.

Measuring: is important because in the end all businesses is about money and the value created by Knowledge Management has to be shown and monitored.

3.4.3 The ISI Knowledge Management Model

TietoEnator Consulting AS in Norway, formerly ISI Consulting, has developed a model for mapping and diagnosing different factors that are necessary to enable an effective Knowledge Management effort within a knowledge company, see Figure 6. The model was created as a result of an internal organizational and Knowledge Management improvement process and was finally made available for TietoEnator’s customers as a stand-alone product.

Figure 6, The ISI Knowledge Management Model, (TietoEnator Consulting AS, 1999)


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They have defined eight areas to be investigated and each area is divided into several concrete aspects that influence the way knowledge is transferred within the organization. The consultants use checklists and questionnaires as support tools when the model is used in a customer project. Depending on how mature the organization is regarding Knowledge Management issues, different levels of the model are applied.

Leadership: The knowledge company demands a leadership that nurtures, develops and manages the Intellectual Capital and a leadership that focus on competence.

Culture: The mission is to create a knowledge-sharing culture based on mutual trust and understanding. This can only be achieved through an open-minded culture with benefits connected to knowledge-sharing.

Organization: Organizational structure must support Knowledge Management solutions. This is done e.g. by creating informal learning spaces that stimulate personal contacts or by forming multi skilled teams with organizational cross-border competencies.

Processes: Knowledge processes and business processes have to be complete and oriented towards the business objectives. All processes should be defined, integrated and uniform and the responsibility and ownership has to be clear. The knowledge processes themselves have to be integrated into all the other work and business processes.

Learning: It is important that managers enable quality assured reuse and provide learning spaces and time for sharing. They also have to develop learning in knowledge processes and create arenas for learning.

Relations: The Company must exploit the opportunities from signals given by the market.

Technology: The technology must be flexible and user friendly in order to support the knowledge processes.

Business Objectives: The goals and guidelines for Knowledge Management have to be in line with the main objectives of the company, goals such as innovation, responsiveness, productivity and competence.


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3.4.4 The Blossom Model

Gruvberger & Malmborg, (1999) have developed a model with the purpose to serve as an analytical tool for Knowledge Management. Their model of Knowledge Management consists of two main parts, the fundamental activities in Knowledge Management work and the enablers. The four fundamental activities are: Create & Acquire, (Re)use, Organize & Document, and Share. The six enablers that they have found most relevant are: People, Managerial Influences, Culture, Technology, Environmental Influences, and Communities, see Figure 7 below.

Figure 7, The Blossom Model, Gruvberger & Malmborg, 1999

Create & Acquire: It is vital for a knowledge-oriented organization to create and acquire new knowledge and manage this new knowledge as a critical asset. For the knowledge creation process it is important that there are shared spaces that stimulate knowledge-sharing, for example open-plan offices. Another condition for a well functioning knowledge creation process is that middle and top managers are aware of the importance of reasoning and experimentation. In most organizations there is no shortage of creativity, but the most common problem is how to deal with this creativeness.

(Re)use: Leading companies know how to exploit their collected knowledge to gain competitive advantages. If companies do not take advantage of the knowledge they create, the expected benefits from Knowledge Management initiatives will be minor. The reuse of knowledge is cost effective, time-saving and will enable the company to take on more projects.

Organize & Document: Organization and documenting of knowledge is an important activity to support and enable reuse of explicit knowledge. The main purpose of organizing and documenting of knowledge is to relief the staff of their specific knowledge and transfer it within the company so it can be easily accessible to other employees


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Share: Without sharing knowledge, the concept of Knowledge Management collapses. Effective sharing is a key factor in every Knowledge Management project. The organization must understand the importance of sharing and the company culture must encourage spontaneous knowledge-sharing. Managers must understand that most knowledge-sharing between employees occurs in the local surrounding, i.e. with people one knows and trust. Very few persons would expose themselves to a “stranger”, even though they work within the same company. Sharing knowledge is not about giving or receiving, this is however true for information. Knowledge-sharing occurs when people are genuinely interested in helping one another.

The blossom model relies on six enablers, namely Managerial Influences, Culture, Technology, Environmental Influences, Communities, and People. These enablers are very much alike the enablers of the Frontec model and the ISI model. Therefore it is our opinion that further presentation of these enablers is unnecessary.

3.5 Synthesis of Knowledge Management Models In this chapter we rebuild the ISI model and adjust it to better suite our view.

There are large similarities between the three models we have acknowledged in the previous chapters. The three models previously described all highlight important aspects of Knowledge Management and what factors make that particular model successful, see Figure 8. To better serve our purposes and investigations we will narrow down and arrange the models slightly different.

Figure 8, The Knowledge Management Models

The ISI model represents models, which have their focus on a more practical method than the other two models. The purpose is to map and diagnose the status of an organization from the knowledge management point-of-view. The Frontec and the Blossom models have their main focus on the knowledge process, so from them we pick the surrounding enablers and use the ISI model as a base. In the following table we list the enabler in each area covered. It may appear that the ISI model includes more enablers than the other two models. This is however not the case, the investigated areas are grouped differently by all three models. For example, Relations is an area that the Blossom model covers in Environmental Influences while the Frontec model does not view Relations as a separate enabler. Relations is viewed by the Frontec model as the environment surrounding the model and its enablers.


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The enabler Business Objectives found in the ISI model is covered by the Blossom and Frontec model in the Managerial Influences and Management. In our opinion, the ISI model only differs from the other two models by including Processes an enabler, an area not found in the other models.

ISI Model Blossom Model Frontec Model

Organization Communities Organization

Leadership Managerial Influences

Management

Culture Culture Culture

Technology Technology Technology

Processes People Measuring

Business Objectives

Environmental Influences

Relations

Learning

We choose to exclude some enablers found in the original ISI model and include some new enablers, see Figure 9. In the remaining part of this chapter we motivate why we have made those choices and present our final view of the model (see Figure 10) used throughout this master thesis.

Culture: This enabler is covered by all models and is thus to be considered extremely important for Knowledge Management. We believe that it will be difficult to point out tangible aspects that clearly connect to the company culture. We have chosen to move Culture into the center of the ISI model, into the Knowledge Company area; this circle symbolizes all general aspects of the Knowledge Company.

Learning: We will not investigate this as a specific process or area. In our opinion; the learning process is incorporated in the overall Knowledge Process.

Relations: Another area for which we will not devote a separate topic is Relations. The focus of the ISI model in this area is mainly on relations between a company and its external contacts, for example customers and other environmental influences. This is something all the three models take under consideration but due to our delimitations we have only looked at internal relations and will mention this under Communities and Networks instead. Therefore we are not including relations in our model.


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Figure 9, Our modification to the original ISI model.

Business Objectives: We choose to insert Vision and Policies into the Business Objective area. They are closely related and by bundling them, the model will be simplified even further. We choose to call this area Vision, Policy and Business Objectives.

Methods and Tools: This is an area we have chosen to add. Many consulting firms have formalized several of their competencies in methods, productifying their knowledge and competencies. We think that Methods and Tools are of great importance for a company’s knowledge transfer and use of knowledge. We have got the impression that if this is covered in the ISI model, it is part of the Processes area. We have chosen to add Methods and Tools as an area in its own right.

Measurement: Finally, we add an area called Measurement, since it does not mention measures at all. In this case we agree with the Frontec model in that measurements are essential for motivating the knowledge management process and enabling the company to track changes and progress.

Business Processes: We simply rename Processes to Business Processes in order to further clarify the model.

Figure 10, The final model.


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3.6 Enablers for Knowledge Management In this chapter we will discuss the enablers we feel have the greatest value to our investigation and present the chosen enablers thoroughly. Each chapter contains a description of a specific enabler and the problems related to that enabler.

3.6.1 Vision, Policy and Business Objectives

When reading management literature of today we have noticed in general that there is great focus on missions, visions and other guiding directives. A vision is necessary to help people within the organization see and grasp the overall picture. Visions also help employees relate to the environmental changes in order to be more flexible and make the organization respond faster to changes (Strategi Ledarskapbulletin, 1999). Mission, vision, policies and business objectives are all cornerstones when managing a company. The Mission puts the company in a context with its environment. The vision expresses where the company is striving and policies are the rule of conduct for the business (Blomé, 1999).

Hansson says that the most important task of the leadership is to create enthusiasm among the employees to work towards a common goal. An effective way to get the employees to pull in the same direction is to pronounce a common mission. A mission acts as a statement that explains the purpose of the company’s business activities, or the actual reasons why the company exist (Hansson, 1997). Hansson describes the cornerstones of a mission in Figure 11.

Figure 11, Cornerstones of a Mission, (Hansson, 1997)

A company policy acts as a guide, for example how a company conducts its business, i.e. very much like the Ten Commandments. These rules and guidelines are important when building and influencing corporate culture and self-image. The policy has to be in line with the vision, act as means to an end. A policy without vision does little good. A blunt policy can be perceived as purposeless rules, with ignorance as a natural consequence. “When a policy turns into elegant wording that is not consistent with the way business is carried out, this is a sign that either the policy is wrong or the company is not managed in a credible way” (Blomé, 1999).


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A company consists of several visions and policies; we focus only on the visions and policies that deal with Knowledge Management. Despite this delimitation, there can be several visions and policies that affect a company’s Knowledge Management efforts. One example is TietoEnator’s Group level policy for Knowledge Management that stipulates:

“All personnel shall work with full openness and willingness to create, develop, share and transfer knowledge” Draft from the Toolbox project, January 2000.

We are interested in the employees’ awareness and understanding of company policies and visions. In the end it comes down to how effective top management is in communicating and how they succeed in establishing a trustworthy dialogue with employees, or as Blomé expresses it “It is a long way from identifying the company vision and objectives to expressing them and finally getting the co-workers to take a stand”.

The purpose of a business objective is to provide clarification to the vision and act as guidance for employees in their day-to-day work. The business objective usually expresses what products or services the company will deliver. Customers and employees should be attracted by the business objectives and agree on the basic principles of the objective. The business objectives answers to the question why the company exists (Blomé, 1999).

Summary

Visions, policies and business goals are the outermost means of management.

In the complex environment of the IT-service business there have to exist policies and guidelines which employees can act on their own in the spirit of the company culture.

The policy has to be inline with company visions.

The purpose of the business objective is to act as guidance in the day-to-day work.

3.6.2 Leadership

Try to implement or change a behavior in an organization without management support. You will not only find it difficult, it is merely a mission impossible. Employees tend to take impulses and impressions from their closest manager. If that manager ridicules a project, tool or any other initiative from top management, which behavior will affect employees whether you like it or not.

When talking about the knowledge company and the knowledge organization, what kind of leadership is needed? In the following chapters we try to illustrate the views we have found regarding leadership and the knowledge organization.


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The Impossible Leadership

Sveiby talks of the impossible leadership of the knowledge companies. Organizations that consist of well-informed, highly educated employees and due to their close contact with the customers and their participation in networks, formal as well as informal, are considered a knowledge-oriented organization. It is impossible for a manager to have an overall view of the business because so much of it is taking place outside the company walls, at customers, in project teams and by individuals.

The flatter the organization, the easier information and knowledge will transfer. This is also the way most knowledge intensive businesses are organized. The characteristics of organizations with widely delegated responsibilities demand a lot from company management. A flat organization needs improved methods for managing compared with a traditional hierarchy. Managers need new ways and channels of collecting and communicating information. That is why new types of managing support methods are getting so popular, methods like Balanced Scorecard, Navigator, Intangible Asset Monitor etc. use objectives connected to measures to guide and manage. Their main contributions are that they provide common frameworks for supporting managers in the way they carry out the business (Strategi Ledarskapbulletin, 1999; Skandia, 1996).

For managers in knowledge-oriented organizations, the most crucial issues involve knowledge transfer within the in-house teams and how to get these teams to interact with each other. The internal information to employees has to be rich and open hearted in order to maintain the trust between the different projects and its members (Sveiby, 1995).

The inform-and-entrust paradigm

Wilson, (1996) has derived a modified version of the Joiner triangle. The model is based on Total Quality Management (TQM) and focuses on three factors: Leadership, Teams and Knowledge, see Figure 12. Wilson feel that TQM is not that well applicable on the public nor the expanding service sector. TQM is best applied in the manufacturing sector where there is an observable process and a tangible product. The product and process can be objectively studied, analyzed, measured and counted. That is not the case in the service and information sector. The derived model is however better suited for the service and information sectors. TQM is used as a stepping-stone in the new model, the obsession with quality is modified to better suit the reality in service and information sectors where, according to Wilson the fixation of quality is not applicable to the same extent as in TQM.


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Figure 12, The Inform-and-Entrust paradigm, (Wilson, 1996)

Leadership: In a knowledge intensive organization, the leader has to be able to listen, inform, interact and provide a representative leadership. According to Wilson, a leader “sets worthy goals which people might not think up on their own, but to which they are nevertheless prepared to commit themselves.”

Leadership in a modern knowledge-oriented organization should focus on the concept of responsibility, the responsibility of managers toward employees for example. This includes helping employees acquire new skills and develop themselves through learning and education.

Leaders in knowledge-oriented organizations should behave like hockey coaches, guiding and supporting the players rather than yelling orders like a sergeant major. The most important tasks are:

Communicating worthy goals through visions and metaphors that leave some freedom of interpretation.

Developing and communicating shared values and support commitment to the goals.

Setting up and maintaining a non-hierarchical structure, to remove fear and allow trust and co-operation to develop.

Nurturing knowledge by ensuring full and free opportunities to all for communication of, and access to information.

Teams: In every organization there are teams. Employees organize themselves in formal and informal teams. There are teams within the team, consisting of a few people with the same values and/or mission. The team thinking is vital in a knowledge-oriented organization; the teams are where everything should come together. Guided by values shared throughout the organization and the focus of organizational learning, the teams are vital for any modern organization.

Knowledge: For any organization, knowledge is vital. Without knowledge about products, customers, processes, and organization it would be very difficult to run a company. However many organizations do not utilize the knowledge of its employees. Knowledge workers need to use both sides of the brain, they need to be imaginative, creative and intuitive.


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“Today’s organization must have embedded knowledge built-in, in the form of policies, practices and values which allow the organization to tap this resource by learning through dialogue in which team members get beyond competing among themselves and start performing effectively as a team”. (Robinson et. al., 1991)

Summary

For managers in knowledge-oriented organizations, the most crucial issues involve knowledge transfer within the in-house teams and how to get these teams to interact with each other.

In a knowledge intensive organization, the leader has to be able to listen, inform, interact and provide a representative leadership.

The team thinking is vital in a knowledge-oriented organization; the teams are where everything should come together.

3.6.3 The Knowledge Management Organization

Davenport & Prusak claims that it takes a few defined “roles” within an organization to get Knowledge Management working properly. These roles focused on capture, distribution and usage of knowledge. People with these roles should only organize the knowledge work, not carry out the work, since this is everybody’s work. Davenport & Prusak have defined in detail four levels and roles of the knowledge work; the Co-operators, Knowledge Workers, Project Managers and Chief Knowledge Officer (CKO). First it is important to make co-operators (all employees) aware of, focused on, and hungry for knowledge. This is the foundation of an organization where people exchange experiences and use other peoples knowledge. An example of how to create an environment that enables this is mentioned in chapters 3.6.2 Management and 3.6.1 Vision, Policy and Business Objectives. To create an infrastructure for information, a company needs technical skills. It is always possible to buy external competence to administer and run an information system but the organization needs to have competence of its own to administer and develop the system strictly from a knowledge point of view. These persons are referred to as Knowledge Workers. The next important role is that of the Project Managers, who also have to be aware of the different technologies available to facilitate knowledge-sharing. They must also encourage their co-workers to be open minded about knowledge-sharing. Finally, Davenport & Prusak say that it is essential to have a high level manager responsible of the knowledge work to get penetration for the Knowledge Management actions being taken and to get better overall management support.


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We have summarized a few areas that a CKO has to push for:

Missionize the importance of knowledge for the competitiveness of the company.

Create a knowledge-oriented environment.

Supervise and organize the company’s infrastructure for knowledge-sharing.

Provide for external sources of knowledge.

Organize and implement routines for documenting knowledge.

Measure the value of knowledge and the management of it.

Develop a strategy and policy for Knowledge Management.

(Davenport & Prusak, 1998 and Earl & Scott, 1999) To carry out these tasks in practice we think the CKO has to use his organization of Knowledge Workers to distribute the responsibility to local levels.

Summary

All employees have to be aware of and focused on knowledge work.

There are four key roles: Co-operators, Knowledge Workers, Project Managers and Chief Knowledge Officer (CKO).

3.6.4 Information Technology

Today, Information Technology (IT) is part of all of a company’s business processes, from business development to products and services. IT is used to control and manage information flows and is a support tool for business activities. In Sweden, companies have used IT for more than thirty years and it is a condition for their competitiveness and normal functioning. The supply of information has today become one of the most important “critical success factors” (Falk & Olve, 1996).

From our “knowledge” view, we see a lot of different IT-solutions with various purposes. Some work as information and communication channels e.g. an Intranet, others are specialized in document management such as Lotus Notes. Most software is used as support tools for specific tasks, for example groupware and word processing. There are several shrink-wrapped products on the market today that claim to address and fulfill the increasing need for Knowledge Management tools. One of the largest players on this market is Lotus with its products Lotus Notes and Domino (www.netsys.se). Knowledge Management is much more than technologies but the availability of a certain new technology such as Lotus Notes and the World Wide Web has been instrumental in catalyzing the Knowledge Management movement (Davenport & Prusak, 1998).

Attempts to capture and manipulate knowledge with technical systems have been made for decades, known as “artificial intelligence” (AI). These efforts


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have typically concentrated on managing narrow domains of knowledge such as diagnosis of a particular type of disease. There is extensive research being made in the area of related systems known as expert systems, case-based reasoning, and neural networks (Davenport & Prusak, 1998). We are not interested in any technical aspects of AI and therefore the discussion ends here.

Intranets An Intranet is a TCP/IP-based company network with a homogeneous user interface, independent of computer platform, adjusted to strengthen the internal communication, making it easier to access and exchange knowledge/data within the organization. The demands or aspects that are in focus when designing an Intranet are the information and communication aspects. The ability to connect people with the needed information and connect people to people is the purpose of an Intranet (Bark et. al., through Berggren & Widstrand, 1999). Intranet at Ernst & Young

As an example of a modern Intranet we will briefly describe the functionality of Ernst & Young’s (E&Y) Intranet. We have only studied the Swedish part of the Intranet.

From the Intranet the employees may search in the company’s internal databases, public databases on the Internet and commercial databases at Reuter’s and Gartner Group.

On the company Intranet there are manuals and work descriptions for most of the company’s tasks. This is static information that might not cover all concerns employees have, and therefore E&Y’s accountants have developed a discussion group where they may search for advices and tips from previous cases. There is a recently developed global service for the E&Y Intranet called the “Knowledge Web”, a.k.a. “K-Web” that enables searches through all databases, internal and external and the user does not need to know in which database the information is stored. All the reports that are not written in English must have an English summary so that employees at E&Y outside Sweden can search the national databases for helpful information. Employees can then order a translated version of a requested document and enjoy reading the whole document.

The employees at E&Y have the possibility to view and attend courses via the Intranet and since the Intranet is accessible from the outside, employees can educate themselves from home or conduct on-location customer training sessions (Mats Uggleberg, CIO E&Y Sweden).


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Hewlett-Packard

In 1995 Hewlett-Packard’s (HP) information managers decided after a Knowledge Management applications workshop with Web-based Intranets and Lotus nets that Lotus Notes should be used for discussion-oriented applications, and the Web for publishing purposes. Today HP is a showcase for Web-based Knowledge Management. The sale-support system is available worldwide and the computer sales force have access to all the information and documents they need. Anyone may publish a document into the system, and the submitted information is reviewed by a small central group of reviewers that determines whether the information is unique or not. The HP retailers have an external system that allows them to collect all the necessary information about HP products without using the phone. Another system called Connex allows HP employees to search for experts within the organization. A search question in the latter may look like this; “PhD in electrical engineering that knows ISDN well and lives in Germany”.

HP has a Notes application that allows trainers and educators throughout HP to exchange experiences with educational programs and offerings.

One reason why HP’s knowledge repositories are so useful is that HP has a common set of tools for word processing, presentations, and spreadsheets. Any document produced within the company therefore can be read and modified by any other user (Davenport & Prusak, 1998).

WebWare

We have chosen to include a brief description of an IT-solution that is built to support Knowledge Management “out-of-the box”. The reason for this is simply that there are only few standardized products on the market (excluding groupware software such as Lotus Notes) with a focus on Knowledge Management. The product described below is called “WebWare Knowledge Management”, and it has been developed by the Swedish company Netsys.

WebWare Knowledge Management is just as the name implies a Web-based application that supports organizations of any structure.

“WebWare Knowledge Management leverages and extends the connective power of the Web to support collaboration across continents and diverse computing environments…Virtual teams organize and manage themselves, without any hierarchical, bureaucratic or technical barriers” (WebWare presentation, 1999).


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Figure 13, Webware Project view

WebWare gives the user access to Virtual Team Collaboration, Business Process Automation, Knowledge Library Management and Information Retrieval through four different workspaces. Each workspace can be custom tailored and presented in regular Web browsers. See Figure 13 for an example of one of the views in Webware.

Virtual Team collaboration supports project groups by providing a tool for project management, which includes such features as workflows and task lists. Project news channels and multi threaded discussion groups are other functions. Business Process Automation is designed to ease the creation, deployment, modification and management of business processes with no programming involved. WebWare has a graphical Java-based tool for Workflow design, supporting drag and drop. Knowledge Library Management deals with document management and automatically converts document to HTML - on the fly – for immediate viewing in a Web browser. WebWare acts as a central repository for all objects, not only documents. Information Retrieval focuses on gathering and organizing all the information users need to get the job done. WebWare offers tools for finding and accessing information from the corporate Intranet and even across the Internet as well as on-demand access to information even if the knowledge base spans distributed and diverse network environments.

Summary

The ability to connect people with the needed information and connect people to people is the purpose of an Intranet.

IT-solutions such as Intranets must be accessible to every employee inside as well as outside the company.

The Intranet should be able to present information on different levels e.g. Corporate, Business Unit, Personal and Project level.


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3.6.5 Methods and Tools

In most companies there are several methods and tools that help employees and managers to perform their respective work tasks. Methods are Human capital that has been transformed to Structural capital. One common example is methods for project management, usually developed in-house over a long period of time and by means of a large amount of invested man-hours. The big advantage of methods is that many years of experiences from that specific area are bundled with the purpose to make the method more effective and accurate. When employees use the method they automatically use the best practice the company has to offer.

For newly hired employees methods are vital for them to be able to carry out work without needing someone to constantly showing them how things should be done.

Successful methods are in some cases packaged and offered to customers. One example is TietoEnator’s project management method PPS [sv. Praktisk Projekt Styrning]. Customers buy the right to use PPS and the customer’s employees receive training on how to use the method. By selling TietoEnator’s know-how on project management, the company is able to retrieve some of cost of developing the method. Another aspect of selling a method to external users is that the method can be tested and evaluated in different situations than first intended. Some critique may be uttered as a company productizes a method to offer external clients. The concern is that the company is selling critical business knowledge by making methods publicly available to potential competitors. The response from the advocates of pro-sell side is simply that knowledge about something can be sold without losing the knowledge. The same argument is used to encourage knowledge-sharing. In the case of TietoEnator’s PPS, the know-how and process used in developing PPS is kept within the company.

Summary

Methods are Human capital that has been transformed to Structural capital.

Methods give people comfort in supporting work tasks.

Methods and Tools should make work more efficient.


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3.6.6 Measurement

The post-war Industry has gone through a major technical evolution, which has resulted in bigger and more complex companies. It is not longer enough for a company to rely on economic information alone to stay competitive; it takes a complete report from the operative business. This is the reason why several new types of management methods have evolved during the eighties, methods such as TQM, Kaizen, Lean Production and BPR - management methods that not only define how to execute business processes, but also make it easier to follow-up the effect and outcome of the processes (Strategi Ledarskapbulletin, 1999).

Measuring intangible assets builds internal and external confidence in the company, by improving employees’ business sense and by drawing shareholders’ attention to the organization’s self-awareness. A Monitor can also act as a tool for management to visualize the company’s vision to its employees. For example, if the company values and monitors repeat orders, employees are aware of these goals and can act according to them. “First, there is a deeper understanding throughout our organization about our business, and which factors drive our success.” Margareta Barchan, CEO Celemi.

Per Nyström at Celemi argues that openness to the market is a key enabler of Knowledge Management. One way of being open to the market is to make the Intellectual Capital visible in the annual report. Celemi has done just that, since 1996, their “Intangible Assets Monitor” is a vital part of the annual report. The focus of the monitor is to measure customers, organization and people. The reason for using a monitor like Celemi’s is because in a knowledge organization, the financial statement does not necessarily represent the true value of the company.

Per Nyström argues that before one starts utilizing any kind of monitor, one has to make sure that the people involved in the process of measuring these assets share the same vocabulary and speak the same language. The reason is that before you understand what you are measuring it is impossible to report the correct figures.

Balanced Scorecard

The first thoughts on the concept of Balanced Scorecard were introduced in 1992 by the two professors Kaplan and Norton. Their concept is trying to connect a company’s short-term management to the company vision and strategy. To cover these perspectives the company has to focus on a few critical key indicators in the selected goal-areas. To see how today’s actions will affect tomorrow’s result, a scorecard covers three dimensions of time: yesterday, today and tomorrow, see Figure 14. Today and tomorrow are results of yesterday’s actions (Strategi Ledarskapbulletin, 1999).


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Figure 14, The concept of Balanced Scorecard

Experiences from Balanced Scorecard

At Ernst & Young’s Balanced Scorecard seminars they explain that the start-up process is at least as important as the scorecard itself. With start-up process they mean the process of getting all the participants to understand what Balanced Scorecard is all about and creating the first “platform” of goals and visions.

Usually companies that decide to use Balanced Scorecard contract a consultancy firm to handle the learning process and the start-up process. A selected group from the organization is gathered in a situation extracted from the ordinary daily work, for example, during a seminar to be able to focus on nothing else but the Balanced-Scorecard issues. The selected group should preferably be as large as possible to get wider understanding in the organization, and the scorecard should cover all functions of the company.

First the participants have to express and understand the company’s vision, and then they try to break down the visions into goals, see Figure 15. When the scorecard is operational, the fulfillment of the goals is continually monitored throughout the organization (Ernest & Young BSC-seminar, 1999).

Figure 15, The Balanced Scorecard process, (E&Y, 1999)


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“Our belief is that the process around creating a scorecard anchors and visualizes a company’s goals and visions in the day to day business. By breaking down the scorecards in smaller cards for every part of the business, the method is locally perceived as more relevant than earlier used methods ” (Strategi Ledarskapbulletin, 1999)

Summary

Measuring intangible assets builds internal and external confidence in the company, by improving employees’ business sense and by drawing shareholders’ attention to the organization’s self-awareness.

Balanced Scorecard is a measuring method that tries to connect a company’s short-term management to the company vision and strategy. To cover these perspectives the company has to focus on a few critical key indicators in the selected goal-areas.

The process around creating a scorecard anchors and visualizes a company’s goals and visions in the day-to-day business.

3.6.7 Business processes

To use processes as means to describe business activity grew in popularity in the early nineties. The “process focus” became a counterweight to the traditional view of a company as one divided into many units or functions. With “process focus”, the customers are in focus and the organization was redesigned to create most possible value for the customer, for example through shorter lead-time and lean production. “When the business processes are documented there is a platform for improvements. Through discussions of experienced difficulties and benefits from the users, new knowledge is created” (Blomé, 1999).

Business Process Reengineering (BPR) was a popular method for implementing this “process focus” into organizations. Davenport, the founder of BPR defines a process as follows: “A process is simply a structured measured set of activities designed to produce a specified output for a particular customer or market” (Davenport, 1993).

Beckmann & Ahde have summarized the characteristics of a process from different authors as follows:

It is repeatable (Steneskog, 1991).

The process consists of different activities that are to be executed (Davenport, 1993).

The process has an inflow and an outflow, where the latter is meant for some kind of customer (Davenport, 1993).

The process has a process owner who designs and controls the progression of the process (Willoch, 1994).


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We do not have the intention to describe different business processes in the studied companies, since this is an area of its own right that could easily fill a master thesis. To us business processes are interesting in the way they interact with the knowledge process that we described earlier with its central activities, create and transfer, see Figure 16 and Figure 17.

Figure 16, The Knowledge Management process is integrated with Business Processes.

The other way to do it is to see the knowledge process as an isolated process reaching through the organization. An example of this is central documenting policies on how and what should be documented after a project or when the access to a knowledge databases is separated from the personal desktop environment.

Figure 17, The Knowledge Management process is excluded from Business Processes.

To make the knowledge management process work, all of the authors we have read argue that the knowledge management process has to interact with a company’s ordinary business processes and not be considered to be a separate process dealing only with knowledge creation and sharing. When implementing a knowledge management process, one has to start looking at the business process and extract activities that do not support knowledge creation or sharing and replace those activities with activities that support knowledge management. Examples of this can be that a consultant documents experiences as part of a report procedure during a project or when a salesperson can access all kind of useful information during the sales process with a customer. Another aspect on this issue is provided by Davenport’s thoughts on asking knowledge workers to record the lessons they've learned during a hard day's work, or to spend extra


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time searching through an extensive repository before undertaking an important task, is unlikely to meet with a great deal of success. In other words, the knowledge capturing and sharing process has to be a natural part of that process. The only way to get knowledge capturing and sharing in as a natural part of a process is to redesign that process: exclude activities that are not that critical and include knowledge related activities instead, according to Davenport, (1999).

Summary

The process has a process owner who designs and controls the progression of the process.

A process is repeatable, contains different activities that are to be executed and has an inflow and an outflow.

Integrating the Knowledge Management process into the business processes is critical.

3.7 Knowledge Management in practice In this chapter we give the reader an insight of practical management when it comes to Knowledge Management projects.

For those readers that are just about to start out a Knowledge Management project we want to share some of our findings from the literature on how to introduce Knowledge Management. In the previous chapters, the focus has been on a theoretical level, we believe that many readers will appreciate a more practical approach on how to introduce Knowledge Management in practice. This chapter is not to be considered as a checklist for Knowledge Management projects but can enlighten the reader of common pitfalls and what important questions to be asked before initiating a Knowledge Management project.

3.7.1 How to introduce Knowledge Management

There are many ways of introducing the concept of Knowledge Management. Some are good, and others are not so good. Acclaimed author Knapp has written an article on how to keep your Knowledge Management initiatives shining bright. In her article, she states that many companies try to do too much at once, meaning that many projects are very ambitious and try to implement several areas at once. Knapp’s advice is to focus on one area where Knowledge Management can produce quick and substantial results. Davenport & Prusak share this opinion. They also point out that one should not promote and market a project until there is something to actually show the users.


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3.7.2 What to manage?

One important aspect that is easy to overlook is the amount of knowledge stored in company repositories. It is easy to gather and store knowledge; it is a whole different story to find useful knowledge when needed.

”Today, in many companies, the knowledge warehouse is full. In fact, one company I know has more than 3,600 databases and millions of "knowledge objects." Its shelves are overflowing, and seekers of knowledge are having a difficult time finding what they need” (Davenport, 1999). In his article, Davenport points out what should be obvious to everybody involved in Knowledge Management projects: information overflow is, and will be a large problem if not dealt with from the start. Davenport also talks about how the same company described above is thinking about another system for finding their knowledge, a system similar to supply-chain management traditionally used in manufacturing processes. We believe that the lesson to be learned is; reduce the amount of stored knowledge from the beginning and plan for a structured way of retrieving the information stored. On the other hand, we believe that there has to be a critical amount of useful knowledge stored in a system before employees will notice the benefits of using such a system.

3.7.3 Where to start?

What part of the company offers the best pilot implementation? That question is not easy to answer but Davenport & Prusak give an example of a feasible area to start in: One should look at the most important knowledge domains in the company. Such areas could be customer relations. If it is too much to handle in one project, break of a piece and start small. Davenport & Prusak believe it is important to find the “key knowledge jobs”, in other words the jobs where creating, sharing and using knowledge will generate great benefits for the rest of organization. Knapp also adds the aspect of selecting and organizing the most relevant information in order to support the daily work and increase value and work-performance. Davenport & Prusak also point out that one should preferably start with several simultaneous approaches, not only technological but also organizational and cultural changes. We think that it might not be as easy to find the most important knowledge domains as expressed by Davenport & Prusak.

3.7.4 How to start?

Once you have decided where to start it is time to think about how to actually go about planning the implementation. Knapp describes a good example that includes several departments in what she calls “Innovation Teams”. These teams include IS staff, marketing people, product specialists and other business types. The teams then help the company by suggesting how to go about when implementing Knowledge Management. A successful Knowledge Management initiative will most certainly need a project sponsor.


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A project sponsor is, according to Davenport & Prusak, usually a senior management member with both formal and informal power to “clear the way” for and fund a Knowledge Management project. These sponsors also clarify what type of knowledge is important to the organization.

Andy Machuda, president of Teltech, says: “We found that [managers of] 76 percent of high-impact applications had invested in putting together an advance-planning strategy. Only 13 percent of [those in charge of] low-impact projects had done so. So it seems that the “let's go out and do it and see what happens” philosophy does not yield groundbreaking Knowledge Management efforts”. Machuda says that the lesson here is to remember that Knowledge Management is a means to an end, not an end in itself. “It's a process you can apply,” he says, but there first has to be a well-defined business goal and a clear strategy (Hildebrand, 1999).

Machuda’s thoughts on an advance-planning strategy comply with Knapp’s approach on innovation teams. Davenport talks about including knowledge workers on the redesign task force; the basic idea is the same as Knapp’s.

We think that some of the ideas presented above, such as advance planning and including users in the development process have great similarities with software engineering. In software engineering the phrase “Rapid Prototyping” is used to describe a way to develop software. The idea is to quickly develop a “dummy” with the basic functions implemented without any data handling such as database connections and interfaces for external data sources. The prototype can then be used to test usability, functions and basic structure. The client then validates the prototype; this allows the development team to start programming on the “real” application without fearing that the client will reject the finished application (Schach, 1997).

3.7.5 Are there High impact applications?

Are there such things as high impact applications when talking about Knowledge Management projects? According to Machuda, the answer is yes! If there are such things as high impact applications, what characteristics are significant for a high impact application?

In the early 1990´s, Arthur Andersen began to build what they called a Global Best Practice (GBP) knowledge base. The information was gathered in a large-scale repository, accessible to all Arthur Andersen consultants worldwide. The knowledge base contains qualitative and quantitative information about world-class business practices. During the development and implementation process, Arthur Andersen’s development team learned some ground breaking lessons about implementing changes in the way a company shifts its way to do business and culture. Below you will find some of the most important lessons learned by Arthur Andersen, described by Wendi Bukowitz, (1996).


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Important lessons:

Keep it in prototype longer than you think you should: By keeping the GPD knowledge base in the prototype state for a longer time (18 months), many of the flaws and problems surfaced. The users were expecting flaws and problems and the developers were able to have an openhearted dialogue with the users about conceptual design, features and future developments.

If you must train, be clever about it: People that hadn’t yet used the GBP knowledge base argued that they needed training before they would be able to use the system. Users that used the system were not formally trained and did not request any formal training. This fact created a dilemma for the development team. The team felt that training was not necessary; the GBP software was friendly to any average computer-literate business user. Managers requested formal training, despite the thoughts from the development team. This resulted in a clever way to conduct training. They positioned the training as the first step in a widespread pilot program to integrate use of GBP into the organization's core audit and tax services. Each group that participated in the training program targeted 10 to 20 clients with whom they would use GBP as an integral part of delivering service. The GBP team provided special hot line consulting support to these pilot clients.

Commit to a rapid release schedule: The first release of the GBP software was limited in scope and depth. By the end of the year two more releases found their way to the users. The rapid release schedule made it possible for the development team to make improvements on the fly. When releasing the third version, the GBP software was already a useful and meaningful tool for many Arthur Andersen employees.

Including new technical features in the Knowledge Management project will increase the tangible feeling of the project and might increase the commitment from the technical oriented personnel.

In the beginning of this chapter we asked if there are any high impact applications. The answer to this question has to be yes! In the above chapter we describe several characteristics of high impact applications. We have summarized those characteristics below:

Keep the application in the prototype state longer then you think.

Be clever about training users; don’t let them know they are getting training!

Commit to a rapid release schedule allowing improvements on the fly.


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3.7.6 Who to include?

When putting together a project-team for your Knowledge Management project it is very important to select the “right” people. With the “right” people we are talking about people that feel knowledge is important and are great supporters of the Knowledge Management concept. In every department there is most likely someone who feels managing the company’s knowledge is important. These are the kind of persons to include in a project team.

3.7.7 Common Knowledge Management Traps!

It took Thomas Edison over 6,000 attempts before he found a filament for his first light bulb. As he said, "Genius is 1 percent inspiration and 99 percent perspiration."

When building a system for Knowledge Management there are a few common pitfalls identified by Davenport & Prusak. They have looked at and talked to a vast number of organizations about their work on Knowledge Management and have listed the seven most common pitfalls. We have summarized their thoughts in the list below. The list is extracted and summarized from “Working Knowledge”, chapter 9.

If we build it… they will come! They will not come is the simple truth. The lesson to be learned is that you can buy as many licenses for Lotus Notes as you want, create fancy looking Web pages on your Intranet: if there is no relevant content, no one will use it! The two authors present a rule of thumb, stating that if you spend more than a third of money and effort on technology, it is not a Knowledge Management project. The factors that enable Knowledge Management, such as for example content and organizational culture cannot be neglected. The reason why many companies focus on technology when building a Knowledge Management system is that technology is easier to buy, implement and measure. It is the opinion of the authors that technology is the number one pitfall.

Let’s put the Personnel Manual on-line! This pitfall can be summarized by this quote; “Now that we’ve got our Intranet up and running, we’ve got to populate it with knowledge. Gee, how about the personnel manual, the procedures manual, our cafeteria menus, and the campus shuttle bus schedule?” What the authors object to is that this is not knowledge; maybe the effect will be some saved trees and efficiency in distribution. The problem occurs when you actually put knowledge in on-line repositories - who will notice it?

Restricted access “We’re trying to create better access to our knowledge.” In many cases this is just half of the truth. Sure, better access to knowledge is important but only the first step. The real challenge lies in getting people to utilize the knowledge accessible to them.


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None dare call it Knowledge In companies where a few lonely individuals are pursuing Knowledge Management, the intellectual-phobic sentiment sounds something like this: “We’re afraid to use the term knowledge because everyone in the company is so pragmatic. So we call it best practices.” The term “best practice” is not doing justice to the entire domain of knowledge. Label it for what it is! The inability to call it “knowledge” suggests that senior managers are not backing up the idea behind Knowledge Management.

Every man a knowledge manager “We think Knowledge Management is everybody's job. So we’re not going to build up some big staff organization of knowledge managers to do the work everyone should be doing.” Like most myths, this one has a grain of truth in it. It should be everyone’s job to create, share, and use knowledge to some degree. Davenport & Prusak argue that everyone should reflect in life but not everyone is writing poems! If we take that into account, it should be obvious that there must exist workers and managers whose primary duties involve gathering and editing knowledge from those who have it, paving the way for the operation of knowledge networks, and setting up and managing knowledge technology infrastructures - otherwise Knowledge Management will not succeed.

Bottom up! “Knowledge Management isn’t a hierarchical thing in our company. We don’t need senior management approval; they are not the ones with the knowledge anyway. Knowledge is flattening the organizational chart, making our organization more democratic...” Knowledge has always been a way for those who have it to control those who do not have it. The authors argue that it is impossible to transform our company through Knowledge Management unless the CEO and the management team stand on the front lines of Knowledge Management.

Information overload. Author Knapp argues that one common pitfall is providing too much information at the fingertips of employees. The company has to be selective in the choice of information channels. It must figure out what knowledge is needed to do certain jobs and how to provide this information.

Too much, too soon! The pressures on Knowledge Management projects are often overwhelming. Organizations seek immediate bottom-line benefits and direct results, frequently driving people to set out first stage goals that are way too ambitious. The solution? Start small and plan the implementation carefully. See chapter 3.7.3 and 3.7.4 for more details (Davenport & Prusak, 1998).

We believe that many Knowledge Management projects are less successful than other in-house projects because of the lacking experiences of such projects. The list presented above give us some hints of the most common traps, we feel that the first two pitfalls are the most important ones to avoid.


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3.7.8 Knowledge Profiteering

Leonard M. Fuld, president of Fuld & Co., a competitive intelligence research and analysis firm in Cambridge, Mass. wrote an article called “Knowledge profiteering, turning knowledge into profit.” He argues that there is profit to collect from knowledge. You either profit from selling your knowledge, by obtaining the right information before your competitors or controlling the knowledge.

One example of profiteering from knowledge is American Airlines. They built a booking system called The Sabre System, turning its reservation system into an industry standard that nearly every travel agent had to use. By controlling the knowledge they could promote their own flights and hotels when travellers made their reservations. (Fuld, 1998)

Apply knowledge as intelligence. Use market knowledge, or intelligence, to take advantage of business opportunities. Like this morning's stock quotes, these competitive insights have a short shelf life. Act quickly on market knowledge to beat the competition.

Use knowledge to persuade. Publicize powerful pieces of information to create demand.

Control the knowledge platform. Create the knowledge real estate everybody must use. For example, operating systems do not create information; they store and share information. But by owning the operating system you can become a very powerful and wealthy landlord. Just ask Bill Gates.

Sell knowledge as a product. Although knowledge products have existed for centuries in the form of encyclopedias and other reference sources, 20th century Knowledge profiteering can create technology products that standardize whole bodies of knowledge. Knowledge profiteers who offer their products on the Web can instantly hook large populations of customers.

(Fuld, 1998)


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4 KNOWLEDGE MANAGEMENT

WITHIN SWEDISH IT-BUSINESSES

In this chapter we present our study of four Swedish IT-businesses where we wanted to investigate how “enablers” affect a company’s Knowledge Management efforts and point out values created by Knowledge Management that customers and employees experience.


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4.1 Investigative task In this chapter we present our study of four Swedish IT-businesses where we wanted to investigate how “enablers” affect a company’s Knowledge Management efforts and point out the experienced customer and employee values created by Knowledge Management. This task was an early requirement from our employer at TietoEnator, who wanted a theoretical and practical foundation in the decision-making process of creating a Knowledge Management process. To create such a foundation we thought a comparative study between a few companies within the same business segment would be a good way to proceed.

The areas were chosen both from what we at that time considered important in the literature and from the predefined task. Each area/topic is further described in the following content guide. Each company/chapter is concluded by a short discussion where we make room for our own opinions. The chapter is concluded with a general discussion and our conclusions.

In the study TietoEnator represent one of the companies and the picture presented might have inconsistencies with the picture presented later in the study. In that case it is due to the fact that only two people were interviewed in the first case and our view of the company has changed during the study. The companies that agreed to participate in this study demanded to be anonymous. We have therefore given the companies fictitious names. We have conducted two interviews at each company, one interview with a management representative and one interview with an employee representative.

The questionnaire we have used as a template for the interviews can be found in Appendix A.


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4.2 Content guide

General information

Under this chapter, we have made a brief presentation of the company to facilitate comparison between the different companies in this study.

Image

In this chapter we discuss the perceived image of the company and the ranking of attractiveness to Swedish IT-students.

Knowledge Management in practice

This chapter tells the reader how Knowledge Management is visible in day-to-day business.

Enablers

From chapter 3.5 we have picked the following six enablers: Vision, Policy and Business Objectives, Management, IT, Methods and Tools, Organization, Culture and Measurement that we think cover the whole spectrum of Knowledge Management and are necessities for a functioning Knowledge Management in the sorts of businesses we are studying.

Vision, Policy and Business Objectives

Anyone that wants to justify investments in Knowledge Management has to show the connection to the overall business goals.

Management

Without enough support and sponsoring from the management, Knowledge Management will have a hard time to survive within an organization. The key word is commitment.

IT, Methods and Tools

We have grouped Methods and IT together because these two enablers are most important for the “hard-factors” of Knowledge Management, e.g. explicit knowledge that is more easily documented and shared.

Organizations and Culture

We try to point out different key aspects that relate to Knowledge Management and how we have interpreted the studied companies’ organizations and cultures.

Measurement

Measurement is a requirement for successful Knowledge Management. The ability to visualize improvements to the organization and what areas need extra attention is vital for management.


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Customer value

In what ways does the customer benefit from a company’s Knowledge Management efforts? How does a knowledge-sharing company interact with its customers?

Employee value

What is the return to the employees, i.e. in what ways is Knowledge Management contributing to the employees’ working situation?

4.3 Elektra

4.3.1 General information

Elektra is one of the leading IT-businesses in the Nordic countries, with more than 8000 employees in over 55 locations.

The first person interviewed at Elektra works as a consultant in e-commerce and has been with the company for two years. The second interviewee is working as an e-commerce visionary and has been with the company for five years.

4.3.2 Image

According to the Universum Graduate Survey [sv. Företagsbarometern] (a study conducted among Swedish University students where the students rank the most preferable employer), Elektra is in the top five among Swedish graduate students. Among Elektra’s competitors, the company is the highest-ranking IT-company.

The image in media of Elektra is that the company is the largest IT-company in Sweden and keeps expanding on the market. In our opinion, Elektra is not one of the companies involved in the media discussion of Knowledge Management.

Elektra has been the largest and strongest actor among the Swedish IT-businesses for a long time and this has made the brand name Elektra very strong.

4.3.3 Knowledge Management in practice

Elektra has its own production support system called “Elektrafied”, an Intranet application that contains templates for project management, policy and guide documents, project databases, CV-databases, message boards, system development and other tools to support customer projects. The information displayed in Elektrafied is custom tailored for different subsidiaries, locations, projects and roles.

Teknikkonsult, a subsidiary of Elektra uses a database called Tactic [sv. Taktik ] to fulfill the consultants’ need to reuse information about customer projects. This is a local solution, known only to employees of Teknikkonsult.


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4.3.4 Enablers


The overall business concept is to create customer and employee value through complete IT-related services. This means that Elektra wants to be equipped to take total responsibility for all or parts of the IT-operations of major private and public sector customers, and to develop IT-solutions that support their business goals. The customer shall clearly see that cooperation with Elektra leads to expected results.

A number of shared values permeate Elektra’s culture and the way they work. These values have been formed during the last decades through different projects and assignments in the public and the private sector.

Management

Elektra is an old IT-company, the two founders are still on the board of directors. The spirit of Elektra with its short decision routes and with no traditional administration staff is a key enabler of Elektra according the interviewees. The challenge lies in transferring this spirit to new employees; over the last couple of years Elektra has employed some 3500 people and has acquired more than 30 companies but there are still no people assigned to work with Knowledge Management on corporate level.


Our first impression of the Intranet was that it is easy to grasp with a well-arranged structure. The people we spoke to use the Intranet daily and were convinced that so was the case throughout the rest of the organization. With a mobile phone and a laptop every consultant at Elektra can reach the company Intranet “Elektrafied” from anywhere in the world.

The Wheel [sv. Ratten] is a project management tool developed in-house over the last 25 years. The tool has been adjusted to better suit different types of projects and Teknikkonsult uses a method called the Rally Wheel [sv. Rallyratten], that basically is a reduced version of the Wheel that better suits its needs. Teknikkonsult usually works in relatively short projects and does not have the need for a complex method such as the Wheel. The original method contains instructions for documentation of projects.


The corporate culture is supposed to ensure that customers meet skilled, reliable employees. The consultants are used to having the authority and responsibility to solve problems when they occur, instead of having to ask permission from management. This gives the employees a vast amount of freedom but also increased responsibility. The employees are in charge of recruiting new members to the project-teams. Management feels that persons in project teams are best suited to hire new personnel.


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The employees of Elektra are used to sharing information and knowledge among each other. There is always someone that has an answer. The problem is to find that someone among 8000 employees.

Employees of Elektra are encouraged to develop their own personal network. Successful projects rely on project members to have a large and good personal network within the company.

Elektra is organized as independent subsidiaries with one front-end toward the market. The organization is very flat with few managers and a minimum of staff personnel.

The project manager “allocates” personnel that he thinks are necessary in order to complete the project on time. In other words, this way of allocating work teams leads to heavy utilization of senior experts and less allocation of less experienced consultants. There are no incentives for project managers to include “rookies” in their projects, Elektra is aware of this problem and is currently working on solving it.

Elektra demands and encourages its personnel to educate themselves. An employee of Elektra is in charge of his/her own competence enhancement. As part of the company policy to offer interesting courses to its employees, Elektra offers after work conferences on a variety of subjects.

Measurement

As one of the first Swedish companies to show their intellectual capital in the annual report, Elektra measures this on an annual basis. Unfortunately the only measurement within the Intellectual Capital that includes the employees is the degree of debiting which is a short-term measurement that focuses only on profitability.

4.3.5 What value come from Knowledge Management?

Customer value

The customer is always involved in Elektra projects. Hardly any projects are done in the office; the consultants spend most of their time in the customer’s organization. The customer benefits from this approach due to increased knowledge-sharing between consultants and customer. The bond between consultant and customer also becomes stronger over time.

Project teams utilize in-house expertise when necessary. These experts may save valuable time for the project by supplying information or solving a specific problem. The experts debit the customer for this “extra” time, but since in almost every case the same problem would take much longer to solve for project members. In the end the customer benefits from this. The total cost for the project will be lower even though the “expert” may be more expensive. These contacts between consultants are mainly taken through informal networks.


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Employee value

As the Elektra company vision tells us, they are creating employee value through supporting the employee’s professional goals. The persons we talked to agree that the company does support the individual’s professional goals through creating opportunities for personal development but the responsibility to execute is laid upon the individual. Working closely with the customer is one way of ensuring increased knowledge in the consultant’s field of knowledge. In order to live up to the goal as the most attractive employer on the market, Elektra invests in social activities to enable team building and growth of personal networks.

4.3.6 Discussion

One opinion that surfaced during the interviews is the need for a missionary that can communicate the goals of Knowledge Management to the organizations. Someone in top-management needs to take on the responsibility of Knowledge Management and implement the basic ideas. According to Elektra, the company has a very unique company spirit, due to the fact that the “founding fathers” are still around and the long history of the company. This company culture is an excellent breeding ground for some exciting Knowledge Management in the future. The solution is not so much technical as it is ideas and visions.

Elektra is an IT-company that relies on its employees’ capability to solve complex problems. Despite that Elektra relies on knowledge to do business, there are hardly any technical systems that support knowledge-sharing between work teams, company subsidiaries and single employees. Even though there is a well functioning Intranet, the need for a system of this kind has surfaced. Work teams build their own systems to solve this problem. The thing is that these “Skunk works” only solve the problem for that particular work team; no one outside the work team – no one has any knowledge of its existence. There is an IT-policy within Elektra; “If it is not in Elektrafied it does not exist”. Maybe it would be better to take care of and evaluate these things that do not exist.

The foundation for successful Knowledge Management is already molded, but in our opinion the organization needs a framework of visions and policies regarding Knowledge Management.

All the persons we have talked to say that the most important aspect that influences their daily work performance is their personal network. This is the main way to collect information and solve problems. As we said before, Elektra promotes these networks strongly and have the fullest understanding of their importance. In our opinion; there should be caution if the company relies too much on the networks. People’s social differences result in big differences within their personal networks and there is a small risk that some consultants may be left standing alone on the side. Judging from the way they handle the growth of personal networks via social activities and the support they give new employees via mentorship, everybody should have good opportunities to build their personal networks and the risk should be reduced.


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4.4 Acme


Acme is an IT-company with over 4000 employees in the Nordic region.

The first person interviewed at Acme works as a salesperson and has been with the company for four years. The second person interviewed is responsible for the Knowledge Management initiatives in the Nordic region and has been with the company for ten years.

4.4.2 Image

The picture of Acme that we have built from media is that they belong among those companies that are open and willingly discuss the way they are handling information and knowledge flows. The picture also tells us that they belong among the leaders in actually handling the issue of knowledge-sharing.

Acme’s slogan, the worldwide standardization of a consistent brand or as they say in the annual report; “ - One group, one name, one logo, one corporate signature”, this because they believe in a globalization of the market that favors a few strong brands. They also believe that the intangible nature of the consultant services requires a backup of a strong company image. Another aspect of the importance of a strong brand for IT-services companies is the increasing competition from hardware manufactures and software developers that already have strong brands.

In the Universum Graduate Survey 1999 [sv. Företagsbarometern] Acme is positioned among the top ten in the ranking of most attractive employers among Swedish IT-students.


Knowledge Management is, to our interviewees mainly reusing experiences from projects and earlier work. It is also connected with all these things that make daily business matters easier and more effective.

The main way for employees at Acme to get in contact with Knowledge Management in practice is mostly through the company’s Intranet. Information about Knowledge Management is also available on the Intranet. The salesperson we interviewed wishes that the technical systems such as the Intranet and databases should have increased support for specific tasks such as information concerning sales proposals, etc.

A dedicated work-team and a steering committee coordinate Knowledge Management initiatives in order to implement some Knowledge Management applications that are considered particularly important. The two groups prefer to implement quick hits, in order to show results early, rather than forcing a complete Knowledge Management program on the organization. Knowledge Management differs widely throughout the transnational organization that Acme is. This is a chosen strategy, to encourage local practices and then leverage successful programs to global practices.


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4.4.4 Enablers


One of the main objectives for Acme is to be able to supply their customers with a complete set of solutions, solutions that will help and make the customer’s business more effective. According to Acme, this mission has had fairly good impact throughout the Acme organization.

The main objective for internal Knowledge Management is the fact that the company employs over 40.000 people in 240 locations around the world and somewhere in the organization there is someone who knows how to solve the customer’s problem. The size of the company makes Acme a natural partner for a large number of multinational companies and a solid base for handling large projects.

Acme has recognized that it must use all of its global competence to be competitive, and to follow the customer as one company in all countries. The overall purpose of Knowledge Management at Acme has been stated as:

“To facilitate the collection, synthesis, dissemination, reuse, and enrichment of Acme Group and third-party knowledge, information, Intellectual Capital and experience based on business needs in order to increase margins.” (Acme KM Position paper, Acme KM Workgroup)

Another main issue of their Knowledge Management is to increase sharing and distribution between the different business areas/knowledge centers. Because of top management involvement and a vast understanding of the issues concerning Knowledge Management and especially the importance of knowledge-sharing among employees, the company has a great possibility to achieve these goals, according to persons interviewed at Acme.

This is due to different things, e.g. Acme has installed prizes like travels for departments or employees that have made major contributions to knowledge-sharing within the company.

Acme has a strategy that is aiming to give the customer more value through more complex projects. More complex projects does not only increase payoff, it gives a better leverage of the intellectual capital.

Management

There is a good understanding of the significance of Knowledge Management among the top managers. There are a few real Knowledge Management enthusiasts at the top level.


Acme has grouped the technologies that support Knowledge Management solutions under four headings:

Communication tools, based on Intranet technologies with e-mail and workflow features are now indispensable for efficient Knowledge Management.


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Stockpiling tools, organized around knowledge servers and document management systems, these tools are used to create compilations of all of an organization’s knowledge and know-how.

Working tools, based on data warehousing, data mining and groupware technologies, they enable the sharing of information related to the organization’s projects, customers and markets.

Analysis tools, based on technologies like expert systems, sector-related applications and simulation tools in order to make sector-based expertise available to the greatest range of users. (Annual report, 1998)

In 1997, all employees had their own laptop which made it possible for them to connect to Acme’s Intranet and reach all of the information stored from anywhere in the world. There are plenty of well-developed technical enablers, for example there is a global Intranet application called the Knowledge Galaxy. The Knowledge Galaxy was developed through small sub projects in order to show quick hits and reduce the development time, according to employees interviewed.

Acme also sells a methodology that started out as an internal tool for Knowledge Management. The method is an important part in the strategy that calls on the full range of the Acme Group’s skills, both management consulting and information systems expertise. In the Annual report 1998, they promote it as follows: “… enables individuals and organizations to perform their usual tasks better, to grow their activities and to detect and explore new opportunities more rapidly. These improvements are based on better informed decision-making and improved exploitation of individual know-how.”


Acme has a very flat organization where the decision routes are short and informal. There is openness within the organization itself.

The drive and motivation for knowledge-sharing is coming both from the management and from the employees. The way they have managed to implement this way of thinking at Acme is possibly a key factor. This thinking is more or less developed through different levels of the company; middle management and business unit managers is where Knowledge Management has not had as much impact as at other levels of the company. The reason for this is that the end-users e.g. the consultants out in the field, see the need for practical knowledge tools that can support their daily business. The top managers are supposed to see the long-term values connected to e.g. learning organizations. Meanwhile the midlevel managers are stuck managing the day-to-day business of the divisions.

The attitude among Acme employees is open and forgiving. An example of this behavior; employees are not afraid to make a fool of themselves on the Intranet discussion forums. New employees quickly learn to respect and understand the importance of other people’s knowledge and experiences. At the same time they are taught that everybody has something valuable to contribute to the collected mass of knowledge.


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The attitude of top-management is to be very frank and open when communicating with others within the company. If you are a senior consultant or newly employed does not make a difference, you are both equally important according to the Acme representatives that we have interviewed.

The deliberate strategy when putting together work teams is that to the greatest possible extent put “rookies” with experienced consultants with the intent to further develop the “rookie”. This may sound easy and natural but a project manager wants as much competence in the team as possible and this may leave the “rookie” outside projects.

Acme has developed a model for the individual employees’ competence profile. The model is based on different levels where e.g. further education is one level. Employees are encouraged to attend courses that are job related. All employees have the opportunity to study at the Acme University in Paris, where the consultants once took the introduction course. “Acme University plays a key role in spreading values, harmonizing current methods and practices, assuring that newcomers get a proper welcome” (Annual report, 1998).

Measurement

When a project is completed, a questionnaire is filled out together with the customer that focuses on customer satisfaction. The questionnaire maps the expected values and experienced values the customer had of the project. In this way Acme learns from and learns about the customer. In the end, Acme hopes this will lead to longer and better customer relations.

Once a year every employee takes part in an evaluation, where they express different things and aspects connected to their situation. Things like; relations to managers, what the employee thinks of the values, policies and ideas Acme stands for are discussed. Some other questions related to Knowledge Management are also answered. Later on, there is a workshop where the opinions are processed.


Customer value

Due to Knowledge Management, employees of Acme can be more effective and shorten the time for customer projects, which in the end benefits the customer. There are plans to let customers access databases with information like; previous projects accomplished, which people were involved, the result of the projects, etc.

Employee value

Acme uses Knowledge Management as a way to attract possible employees and keep their current employees satisfied. One of Acme’s goal is to be “Employer of choice”, the most attractive employer in the business. To accomplish this, they provide tools for every employee that facilitates the work. This is especially important for new employees that usually need some kind of guidance to feel comfort.


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The employees need to feel important and appreciated, and the use of worldwide intranets where experts in Sweden can communicate with people of the same kind anywhere in the world brings that kind of value. The standardization of methods and other means of assistance provide useful tools when working at Acme internationally.

As mentioned above, the goal of Acme is to be the number one employer, i.e. the most attractive employer on the market, and they are convinced that Knowledge Management helps them to achieve that.

4.4.6 Discussion

By working with Knowledge Management internally they can generate “new” revenues by offering Knowledge Management services to the market. The external market for Knowledge Management will most likely be considerable over the next 5-10 years according to Acme representatives. The fact that the middle managers are less involved in the issues connected to Knowledge Management is a bit perplexing to us considering that Acme has succeeded so well in communicating the issues of Knowledge Management to employees. We wonder if the middle managers themselves have less need for knowledge support or if there is another explanation to it.

Acme has no explicit mentorship polices, and therefore it is extra important that the deliberate strategy of the work-team composition is understood and carried through by everybody. The way Acme University is taking care of newcomers and spreading the company values is a good way to introduce Acme values and methods.

Acme has a well-developed Intranet but their most important enabler for Knowledge Management is their open-minded culture and the vast understanding of Knowledge Management. One explanation for this is that the top missionaries are making the Acme values visible throughout the organization.

Acme has a sales reference database, a system for storing descriptions (references) of earlier projects and their implications for the customer. The system forces the salesman to create an asset in the reference database which then can be used by other salesmen for showing experience of earlier projects.


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4.5 Zorg


Zorg is divided into two divisions, Software engineering and Consulting. We have interviewed people from Zorg Consulting.

The first interviewee has worked in the company for one year as a SAP-consultant, and did a master thesis on knowledge-sharing at Zorg Consulting during 1999. The second person interviewed works as a Human Resource manager and has been with the company for ten years.

4.5.2 Image

Our view of Zorg before we conducted this study was mainly formed through media. The picture displayed in Swedish media has not always been positive; the company has had problems with profitability and has had a modest growth on the Swedish stock market. There are, however a few positive developments as well, for example Zorg is providing consultant services for Volvo IT as one of four selected entrepreneurs.

In The Universum Graduate Survey 1999 [sv. Företagsbarometern] Zorg is not among the top 50 most attractive employers according to Swedish IT-students.


The fact that knowledge is important to Zorg is not a new discovery. Since day one, they have realized that the competence of the employees is the company’s most valuable asset. It is not until recently that they started to structure and leverage the individual knowledge as a whole. The focus has been on team working and how knowledge transfer between team members can be increased.

In recent years, Zorg has initiated a concept called Team Games [sv. Flygning], a concept for analyzing customers and products that are of interest for Zorg. This concept is limited to a maximum of three days and has a framework of predetermined rules. The idea is to solve a specific customer problem within the three days. The “Flygning” team is a composition of consultants and experts from Zorg and representatives from the customer.

4.5.4 Enablers


In the company’s new vision “Vision k2”, they have broken down the vision into three parts. These are to be known as the most developed knowledge center on the market, to provide the most professional work teams on the market and finally to be the quickest developer of future visions and implementation of these.

The managers at Zorg have been working on the goal to be a “learning organization” for a long time. This way of thinking is not new to employees of Zorg.


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Zorg has identified three types of behavior that will help achieve the company’s vision. These three are quickness, distinctiveness and seamlessness. Quickness is to work smarter and solve problems quicker through Knowledge Management. Distinctiveness is higher quality of knowledge-sharing among employees. Seamlessness is the focus of managing project teams with knowledge-sharing in mind and increase communication between business areas.

The efforts of working with company policies and visions are mainly to support a common company identity. The guidelines of the vision are presented in two perspectives, one that aims to increase employee value and one which aims to increase customer value.

Management

Zorg management has their main focus set on IT as an enabler for Knowledge Management. At Zorg, the management has introduced a once a month, Friday afternoon coffee break, Vision Coffee [sv. Visionsfika] where managers take the opportunity to speak and preach new goals and visions. The goal is to gather entire divisions and make it a natural place for employees to expand their personal network. Our interviewee thinks managers at most levels of the company show dedication and commitment to communicate the importance of knowledge-sharing to the work teams.

In the folder “Vision k2”, management has given several promises to what they should do in order for the company to reach the three goals in the company’s vision. We think this is a good way to get commitment from the staff, when management is showing their own commitment in print. Every one of these promises is tangible and explicit. We have not been able to verify to what extent the “Vision k2” is practiced in the day-to-day business.


Within Zorg the opinion is that one of the most important aspects of IT in the perspective of Knowledge Management is a standard for IT. When the guidance or the willingness to follow the guidelines is poor it is often the result of bad documentation and problems related to finding the requested information. For example, Zorg has not fully solved the conflict between Notes-users and Web-users; this is one example of obstacles for knowledge-sharing.

There is a system called the Compass [sv. Kompassen] that is meant to support knowledge-sharing. The Compass contains information about different methods for e.g. projects and software engineering methods.


The culture is one of the most important enablers for Knowledge Management within Zorg. According to them, the climate at Zorg is not prestigious, which has the effect that people can and will ask anyone about anything.


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Zorg have visualized their point of view in handling work teams of consultants in the word “the Super Consultant”. A sort with extreme capacities that everybody wants but everybody knows does not exist. Instead they are letting their “teams” be this Super Consultant, a configuration of their ability to leverage each other’s competencies. The work-teams are put together to contain the most accurate competence for the specific problem. To facilitate this, the consultants have to keep track of and update their “Consultant Profiles”, a sort of competence CV, in which for example a Project Manager can search for the needed competence on the company’s Intranet. In some divisions they have extended this CV to also include a template where the employees competencies in his/her expert-area are structured after how important they are for the employee’s assignment. This makes it possible to add an individual to a group’s total competence. The template also contains more subtle information on the individual, abilities e.g. what is important for a person’s group working capabilities like qualities of leadership and power of initiative. It is also a deliberate policy try to put together border-crossing teams with personnel from different units with the purpose of knowledge-sharing.

One business unit has developed this concept even further. From the business goals they have defined roles that are needed to fulfill the goals and defined what competencies each role must have. Then they have looked at the actual competencies within the unit and assigned different roles to the consultants. They then see how well the unit’s competencies are matching the tasks they are facing. To keep track of this they are using commercial software designed for this type of tasks called ProHunt.

The company does not push enough for courses and other things related to the individuals own further education according to one of the interviewees. The declining profits may be a cause to why the management is not willing to invest in employee’s competence enhancements, and instead they are managing the company to show short-term profits.

In our opinion, the CV database can also be used to visualize areas where improvement is needed.

Measurement

There are currently no measurements of the impact of Knowledge Management and the outcome and effects of managing the intangible assets. In those cases where there is some measuring, it is focused on how much competence there is in a group etc. On company level there is little or no focus on mapping the organizational knowledge.

We feel that the CV database can also be used to measure different aspects of people’s tacit and explicit knowledge areas.


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Customer value

We have not found any Knowledge Management tools connecting the customers with the company. For the customer, the benefit from Knowledge Management is mostly time reducing and a higher level of efficiency. Since this is the key word in Zorg’s business objectives, it is a bit odd that managers do not put more energy into convincing employees of the importance of Knowledge Management.

Employee value

The Zorg “team think” where teams are put together of individuals with focus on various competencies and experiences is a great support for the consultant out in the field. This stimulates knowledge transfer and is an easy way to introduce new recruits into the organization.

4.5.6 Discussion

The company has the will to work with Knowledge Management. The fact that they financed a master thesis and funded the implementation of some of the ideas in the master thesis tells us that they are willing to adopt the concept of Knowledge Management. They have not yet allocated any personnel to handle the issues regarding Knowledge Management. A company this big needs dedicated personnel with a focus on Knowledge Management.

Vision Coffee [sv. Visionsfika] is an excellent idea for sharing and discussing important visions and goals of the company. Employees need to know how these visions and goals are going to affect them and what the company will expect from them.

During 1998, Zorg had a 16 percent staff turnover, which is very high when compared to other IT-companies (10-12 percent). The costs are considerable for hiring and training new staff. The reason for this is of course very difficult to explain and Zorg is trying to work this out. Several aspects of Knowledge Management contribute to make the employees happy and satisfied. We think that an increased focus on the individual competence enhancements would have positive effects.

Not a word on knowledge-sharing, Knowledge Management or any other methods for dealing with intangible assets is mentioned in the annual report of 1998, instead they have presented this in the new “Vision k2” folder. We think there are several ideas from this folder that should be mentioned in the annual report.


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4.6 Cyber


The company is present in 13 countries with focus on the Nordic market and has more than 11.000 employees. The company has just concluded a large merger.

4.6.2 Image

One of Cyber’s goals is be the most preferred employer for IT-professionals. The 1999 edition of the Universum Graduate Survey (Företagsbarometern) shows that Cyber is the fourth most preferred employer, beaten on the goal line by for example Elektra.

The new company slogan “Building the Information Society” announces that they want to take an active part in the frontline of tomorrow’s technologies. Cyber defines the Information Society as being one in which most products and services will be produced, distributed and consumed electronically via information networks. Building the Information Society is an enormous undertaking.


Cyber is using a traditional Intranet based solution for their knowledge-sharing known to the organization as “The Well” [sv. Kunskapsbrunnen]. The new organization has yet to decide the shape of new knowledge-sharing tools. One existing tool for Knowledge Management is the CV database, a database with all consultants’ CV’-s and their experiences. Cyber in Norway haves worked with Knowledge Management for some time. They have methods for implementing Knowledge Management in customer organizations. Most likely the Norwegian model will be used as a reference model when implementing Knowledge Management at Cyber.

4.6.4 Enablers


In “The Guiding Principles”, a statement from the new management, the company goals and visions are introduced.

The vision is formulated as “A leading provider of high-value-added IT-services in Europe”, the explanation is that Cyber wants to follow and grow with its customers. When the customer expands in Europe, Cyber has to follow the customer and be close to the customer in order to offer high-value-added services. This is further narrowed down in the business concept; “As our customers’ IT-partner, focus on value-added services in areas where we can keep a high market share, high expertise and good profitability.”


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Currently there are no guidelines or directives for Knowledge Management, however work is being done in this area. Later this year there will be company wide guidelines regarding Knowledge Management.

Within the Guiding Principles there are “Common Values” [sv. Värdegemenskap] that consist of three Knowledge Management related values, Participation, Customer Value and Personal Evolution. In the Guiding Principles folder one can read the following: “Without participation no organization can survive and it takes knowledge of the company goals to achieve participation. Satisfied customers are the cornerstones of our business and the customer’s reality is our reality, a reality that demands both knowledge and competence. Knowledge that may be passed forward, administrated and developed in a structure. The complexity in combination of the increasing speed of the information society demands both knowledge and competence, and therefore Cyber stimulates a working environment that stimulates personal evolution.”

Management

Management at Cyber has understood the importance of effective knowledge-sharing and Knowledge Management. New Human Resource managers at group level and a stronger focus on managing Intellectual Capital emphasizes this.


The Intranet is the main way to inform employees and share information among employees. For many years, Cyber has been developing and selling methods for project management, software engineering and testing, these are only a few of the methods and tools that Cyber offered to the market. All the methods and tools are collected in something called “the Repository”. These methods are heavily rooted within the organization and have been a strong contributor in building Cyber’s company culture.


The attitude of the organization is fairly open; people are used to share information among each other. When an organization grows as fast as Cyber has done in the last few years there will be controversies among new employees and employees that have seen the company evolve. Many times, people who have been with a company for many years have a hard time dealing with changes. People we have talked to have the opinion that this is the case at Cyber.

New employees are taught the very first day at work that they have the opportunity to do anything, but that on the other hand they the responsibility to make that happen. Cyber has a policy that approximately 60 hours per year of the employee’s time can be used for competence enhancing training. It is up to the individual and his group manager to decide how these hours are best spent.


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Measurement

Currently there are no measurements connected to Knowledge Management. The plan is to include the status of Cyber’s Intellectual Capital in the Annual report of 2000. The exact parameters are yet to be decided upon. According to the people we interviewed, Cyber will use Balanced Scorecard (BSC) throughout the organization; some business units are using BSC already but the actual use of BSC within Cyber today is estimated as fairly low.

4.6.5 What value comes from Knowledge Management?

Customer value

Those parts of Cyber that have an effective way to match the profile of consultants needed to solve customer problems have more competent teams helping the customer.

The more the consultants learn about the customer’s business, the greater the benefits will be. Learning about their own business as well, this contributes to a better result since there is a larger mass of knowledge to extract from.

Employee value

The openness within the organization enables employees to learn from each other. This is especially valuable for new employees. The Repository and its useful tools enable people to have a common way of doing things. The way Cyber manages projects will be similar throughout the company.

Other valuable assets are the Competence Networks, where employees join the most appropriate network based on their profession and personal interest. The networks act as effective knowledge distributors and a way to build employees personal networks. We came across one opinion that the actual “Expertise Knowledge” was not represented on the Networks. There are nine official Networks, all sponsored by the company and managed by people within the company, not by management. These Networks reflect Cyber's core competencies.


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4.6.6 Discussion

Today, Cyber has a higher staff turnover then the other companies we studied and the fact that Cyber have expressed the not so modest goal “To be the most attractive employer in IT-business” shows the concern of the problem with employees that leave the company.

It is hard to give a fair picture of Cyber’s work on Knowledge Management, since the new company has yet to conform to a new policy and tools for Knowledge Management.

The Networks, as well as the informal networks, have played a vital role in forming Cyber. The future for the Networks is uncertain but they will most likely survive the merger in one shape or another. The output and exchange that the company will receive from the Networks will most likely be more than the input, however the output can be increased further. If the Networks were to document and share experiences with the rest of the company, the exchange of information and knowledge would increase further. We view the Networks as a valuable asset in the knowledge-sharing process at Cyber that definitely should have further support from top management.

The fact that Cyber is focusing on measuring intangible assets and will manage the company based on the Balanced Scorecard concept is a good start. As the company starts to monitor the softer values and use Balanced Scorecard, the employee’s understanding of why these measures are important and why the focus is on strategies and visions will increase. Most employees will feel comfortable due to fact that they will know why and what the company is aiming for the next few years. The increased focus on strategies and visions will also help employees in their day-to-day business.


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5 CONCLUSIONS FROM THE

COMPARATIVE STUDY

In this conclusion we summarize the general impression, our own thoughts on this subject and why Knowledge Management is so vital in a knowledge organization.


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5.1 General discussion In this chapter we discuss some general aspects from our comparative study.

We have found that essentially all of our chosen enablers have a profound impact on the effectiveness on KM-initiatives at all the studied companies. Some further general observations are discussed below.

The problem with Knowledge Management is that it is very intangible; employees have in most cases vague ideas of what Knowledge Management is really about. Several of the person we interviewed stressed that there is a great need for a project sponsor; someone who can spread the concept of Knowledge Management. Too often do top management realizes the importance of Knowledge Management and try to communicate the concept to the employees via Powerpoint slide shows and printed material. According to our interviewees, this is the wrong way to do this. The employees need to know how this affects them and what the company expects them to do about it. In other words there is a great need for discussion and reflection among the employees, and between employees and managers, something most companies neglect.

One of the studied companies talks about the organization as an upside-down pyramid where the consultants provide the wide “base”, the persons who actually serve the customer and earn the money. They try to keep the bottom as narrow as possible with only a few hierarchy levels of managers. We think that by referring to their own organization like this actually creates a culture that approves shorter decision routes. When the persons interviewed described the organization they started by describing the consultant-foundation. According to the representatives of the company, they focus on trimming back-office and administrative personnel to an absolute minimum. The consultants are earning the money, not managers and back-office personnel.

Another thing we noticed was that the one company that offers Knowledge Management services to their customers also had a more focused view of internal Knowledge Management work.

Other interesting aspects of Knowledge Management are that it is image enhancing. Companies who have adapted Knowledge Management utilize the fact that they are using Knowledge Management in their marketing towards customers and potential employees. Customers’ benefits are basically that they buy a larger “mass of knowledge” when dealing with Knowledge Management enabled companies.


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A general conclusion is that all of the companies studied showed differences between what users actually do use and come in contact with in their work and what applications management emphasized, regarding Knowledge Management initiatives. We are certain that there are excellent applications and processes that already exist; the problem is letting the organization know they exist and start using them.

Several of the consultants, regardless of employer, stresses the need for improved knowledge about the customers they work with, information or knowledge that already exists within the company but is seldom taken care of. One way of doing this is to collect data from and transfer data to the employees that work or will work with that particular customer, with reporting systems grouped by customers. To this information there should be added historic data on previous sales and ongoing projects.


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5.2 Is there a profit to collect? In this chapter we discuss if there is profit to collect from Knowledge Management.

Because of the actual costs connected to Knowledge Management such as keeping track of the information in an organization or keeping it fresh and updated, there must be an actual profit in order to get the required sponsors. It is usually difficult to see the profits directly in short term monetary values, but we have made an effort in this chapter to point out the contribution of Knowledge Management to a company’s long term wealth. The activity to measure is not in it self enough, there has to be a further attempt to visualize the connection between non-monetary measures and profit.

Today, most companies make great efforts talking about the company’s vision, trying to make all the people within the organization work towards company goals and strategies. For a knowledge company, Knowledge Management seen in a broader perspective serves the same purpose as the company’s vision, guiding people to long-term goals. People we have talked to think that the activity and focus on Knowledge Management itself contributes to an awareness of the company vision and puts an increased focus on strategies. Most of them also agreed upon that culture and attitudes are the most important enablers for Knowledge Management, an open atmosphere where people are not afraid of asking questions. We ourselves agree that Knowledge Management strengthens an open-minded culture, and a culture where the employees like to stay. If this makes the staff turnover drop, there are significant savings to be made.

For some of the interviewees, Knowledge Management is to provide people with the right information at the right time, in other words make the daily work more efficient. There are lots of concrete methods and technical systems that usually fit under the Knowledge Management umbrella. As we said, the main contribution is to make the daily business more efficient, but they also make a person’s work easier and more pleasant. In fact, there are companies who use this to be a more attractive employer by saying that: “we have so good and well developed support systems that new employees will feel comfortable with their tasks from day one.”

Internal work to spread the use and understanding of Knowledge Management is important. Just as important is external communication. If the company wants to present a picture of a modern knowledge respecting and caring organization, efforts have to be made to communicate this externally. In our opinion, an attractive picture attracts new young employees. Today, big amounts are being spent on recruitment, and there are definitely savings to be made by improving the company image using Knowledge Management as a marketing tool.


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One of the companies studied, used their large number of employees in combination with their effective use of Knowledge Management, as an explanation for why they should have higher quality services and more complex solutions, to motivate a higher service price than competitors.

Several of the companies say that they are definitively learning from old mistakes, i.e. through good documenting procedures. In this way the quality of the service is improved and fewer projects miss their deadlines. This leads to better relations and improved trust between the company and its customers.

The knowledge-focused environment where people use each other’s experience to learn not only shortens the “production time”, but also stimulates new ideas.

Another thing that helps creating new ideas is the awareness of the competencies of other parts of the company, as people can use this internal competence to develop their own. This awareness may also result in bigger sales when the employees know what competencies the company can offer.

None of the companies asked says they have effective measures that covers the Knowledge Management process but agrees that measuring by itself puts focus on the importance of the Intellectual Capital. Even if it is not financial figures that are measured there have to be indicators of change. To be able to evaluate a process or an activity you must be able to see what kind of change it makes, if things are improving or getting worse.

Today most knowledge companies are presenting diagrams of their Intellectual Capital. We have asked several people what they think is the benefit of presenting these asset diagrams. Besides the marketing values this contributes to an improved internal understanding of internal management tools such as Balanced Scorecard and other methods that are also focused on non-financial measures.


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5.3 The Best Practices found in the Comparative study.

In this chapter we summarize the Best Practices found in our study. We interpret and summarize what we consider are the best solutions found in the studied companies in the list below.

Custom tailored Intranets. The content and functions are custom tailored for different companies, locations, projects and roles.

Company Intranet is reachable from anywhere in the world.

Encourage local practices and then leverage successful programs to global practices.

Implement quick hits, in order to show results early, rather than forcing a complete Knowledge Management program on the organization.

Dedicated work-teams and a steering committee that coordinate Knowledge Management initiatives.

Project sponsors in the top-level management who mission the “word” of knowledge management throughout the organization.

Vision Coffee [sv. Visionsfika] where managers take the opportunity to speak and spread new goals and visions. The goal is to gather entire divisions and make it a natural place for employees to expand their personal network.

A good way to introduce new recruits is to have a deliberate strategy for putting together work teams with both “rookies” and experienced consultants with the intent to further develop the competence of the “rookie”.

A working mentorship program/policy is vital for any organization.

Justify the time it takes for a consultant to help colleagues in his own “debit-able time”. He or she can debit the other consultant’s customer the time it takes to solve the issue. This should not include shorter questions; this would restrain an open company culture.

A sales reference database, a system for storing descriptions (references) of earlier projects and their implications for the customer is a good way to handle customer relations. The system forces the salesman to create an asset in the reference database which then can be used by other salesmen for showing experience of earlier projects.


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6 KNOWLEDGE MANAGEMENT AT

TIETOENATOR SERVICES SWEDEN

This chapter deals primarily with TietoEnator Services Sweden, a business area within TietoEnator. The study deals with Knowledge Management at Services Sweden and how enablers affect Services Sweden. The study has been performed through interviews with key people in the Swedish organization


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6.1 Services Sweden, a brief presentation For the readers that are not familiar with Services Sweden and the organization we present a brief description of the organization.

With a staff of 11,000 and an annual turnover of 1.2 billion Euro, TietoEnator is one of the leading suppliers of value-added IT-services in Europe with presence in the Nordic countries, the Baltic States and central Europe.

Services is one of the four vertical segments of TietoEnator; see Figure 18. The vertical segments are traditionally viewed as Business Areas (BA). The other three vertical segments are Bank & Finance, Public sector, and Process & Manufacturing. The horizontal segments include Business Areas that are not related to any specific branch of industry sectors, all branches utilize these Business Areas. They include Process & Support, Communications and finally Application Services.

Figure 18, TietoEnator's organization on group level

Services BA is divided into two parts, the Swedish and the Finnish part. In this study, we have delimited this work to Services Sweden. Services Sweden is organized in a similar way to TietoEnator, with horizontal and vertical Business Units, see Figure 19. The vertical units consist of six different sectors, Energy, Telecom, Retail, Travel & Transport, Car Retail, and Newspaper. The horizontal units are connected to a subject or competence instead of being related to a sector. The horizontal units are Management & IT Development, Integration, and Information & Informatics.


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Figure 19, Business units of TietoEnator Services Sweden

The coordination between the units is very limited, as a tradition within Services Sweden; the Business Units are managed independently. This has of course its advantages and disadvantages but viewed from a Knowledge Management perspective it would be better with more coordination between the units. Today, things like salaries and insurance are handled on Business Area level and the units handle other issues by themselves. This may result in various levels of goal fulfillment between the units.

The idea of organizing Services Sweden in small autonomous units is obviously not ideal from a Knowledge Management point of view when companies strive for as much interaction between employees as possible. Services Sweden is at the moment working towards a less diverse structure that also enables larger and more complex project commitments than before.

6.2 Investigative task In our investigation of how enablers affect Knowledge Management at Services Sweden we are using the modified ISI model, from our synthesis, see Figure 20, as a guide when presenting the investigated areas. First we address Services Sweden as a knowledge company where we bring forward issues of a general character that are not directly sorted under the enablers. After this we are covering the chosen enablers; Visions, Policies & Business Objectives, Management, Knowledge Management organization, IT, Methods & Tools, and Business processes.

Our sources of information have primarely been interviews with employees and managers at TietoEnator Services Sweden. We have also had the opportunity to read internal surveys and project documentations.


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Figure 20, The final model.

6.3 Services Sweden as a “Knowledge Company”

In this chapter we discuss general Knowledge Management aspects that we have come across when studying Services Sweden.

The tradition within Services Sweden, formerly Enator, has been to see the employees as a resource for hire. The focus has not been to sell projects with a larger engagement but rather to sell competence at an hourly rate. Instead of selling a project team to a customer, the customer demands specific employees for a specific task, using the consultant as temporary manpower. As we discussed in chapter 3.3.2 Body Shopping, this way of selling competence is a large problem when addressing it from a knowledge creating perspective. First, the consultants are working by themselves separated from their TietoEnator colleagues and this reduces the amount of experiences and knowledge directly transferred between the consultants. In chapter 3.6.2 we referred to David Wilson, where he states; “it is in the teams the information sharing occurs and the embedded knowledge can be found.” A deliberate strategy for putting work-teams together is a Knowledge Management action found in the best practice list in chapter 5.3. We feel this would be a great contribution to Services BA as well. Secondly, we think this way of man-powering is bad for the organizational learning gained through handling in-house projects, like developing complete IT-systems, a competence TietoEnator has to be good at in order to be ahead of the competitors.

Kjell Lökensgård, CEO at TietoEnator Services Sweden, is aware of the problem and states that the goal is to move away from Body Shopping and to focus more on selling larger projects that can be handled in-house. The poor profitability of Services Sweden has postponed this shift but profit projections are looking better and the shift toward project commitment can be initiated during this year.

Earlier, we referred to Sveiby in chapter 3.3.2 and his opinion that in order to be able to attract the Key-Players, which it not easy, a company has to build an image that appeals to these people’s particular needs. A company must market itself as a provider of stimulating and challenging work tasks within an environment that stimulates individual learning and development. This is an image that we incorporate with the concept of the “Knowledge Company”.


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Several interviewees as well as ourselves think that TietoEnator should focus on further development of this image. The company slogan “Building the Information Society” is a step in the right direction. Another step, we think, is to present the company’s Intellectual Capital to the market improving the image as a knowledge company, as for example Skandia has done. An in-depth discussion on this subject can be found in chapter 6.9.

The customers’ picture of TietoEnator as a “knowledge company” is different depending of which unit they have been in contact with and which customer it is. According to some of the employees at TietoEnator, some customers view TietoEnator as IT-administrators instead of an IT-service partner. As one of the interviewees said: “We have had customers that hire us to administer their information systems but turn to our competitors when they want to develop new IT-services.” In the attempt to be the most preferred employer it is not flattering to have the image of being the one that administers instead of innovates. We think that one way to improve the reputation is to enlighten and inform the employees better of what the company as a whole is capable of, information of what the other units have as their strengths.

One example of how employees utilize information about the company to influence customers is when a consultant at work in the customer’s organization learns that the customer is planning an investment. The consultant can then refer inquiries to a salesperson who then contacts the customer to discuss the project. As one of the other companies from our other study did as a deliberate strategy, trying to sell more services through the consultants who are already in place at the customers.

An image only helps to attract people; to make them stay is a completely different matter. Sveiby pointed out that if the reality matches the image, people will stay with the company to a larger extent. We have our own opinions of how TietoEnator may improve the situation. This is one thing we are going to cover in the following chapters. To keep the Key-Players within the organization takes an increasing amount of resources as the competitive recruitment increases daily. This is a lesson learned the hard way by TietoEnator Consulting AS in Norway. In one day they suffered a heavy loss when 30 of their senior consultants walked out the door to work for a competitor. It did not only cause a huge brain drain that will take a long time to recover from, it also left an awkward feeling among the employees left behind.

To summarize the above discussion, we want to emphasize a few aspects. TietoEnator should in our opinion:

Focus on selling entire in-house projects instead of Body Shopping in order to develop the competences needed to solve the projects.

Increase amounts of in-house projects to leverage organizational learning.

Market the company as a stimulating and creative company in order to attract future employees.


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6.4 Vision, Policy and Business Objectives In this chapter we discuss how visions, policies and guidelines can be of help for managers when managing a company from a Knowledge Management perspective.

In the “Guiding principles”, top management at TietoEnator proclaims the mission, vision and Business objectives. The mission is to be part of “Building the Information Society” and the vision is to be “A leading vendor of value adding IT-services in Europe”. The business objective is to do this in areas where “TietoEnator can keep expertise, strong market position and high profitability”. As a step towards reaching the “Guiding principles” there is a project in progress called the Toolbox project with objectives to investigate, define and propose common policies, business systems and methods. The project pyramid below illustrates this process, see Figure 21.

Figure 21, TietoEnator’s Project Pyramid.

The Toolbox project has recently presented a suggestion of the company’s new Knowledge Management policy:

“All personnel shall work with full openness and willingness to create, develop, share and transfer knowledge”

“As a result of all TietoEnator personnel pursuing this policy and assuming responsibility for compliance, we gain increased benefit and we enhance personal growth and shareholder value”

The new Knowledge Management policy takes a wide scope that leaves necessary room for interpretations. When reading the proposed policy for Knowledge Management, we feel that the customer should be included in the policy instead of shareholder value. The problem is what potential customers feel when reading the policy only to find that the shareholders are more important then TietoEnator’s customers. If customer value were to be included, shareholder value would most likely be a result of satisfied customers. If the policy is going to act as guideline for employees, how are they going to act in order to increase shareholder value? Our suggestion to TietoEnator is to rewrite the policy and include customer value instead of shareholder value.


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It is our opinion that management should start a dialogue with employees on the core visions and objectives of the company, similar to the Vision Coffee [sv. Visionsfika] discussed in chapter 4.5.4. By doing this, managers can rest assured that employees grasp and have understood the impact of visions and objectives.

To summarize the above discussion, we want to emphasize a few aspects:

Including the customers instead of the shareholders in the Knowledge Management policy is a better signal to the customers.

Utilize the concept of Vision Coffee [sv. Visionsfika] described in chapter 4.5.4.

6.5 Leadership

In this chapter we investigate if there are inconsistencies between the management of Services Sweden today and the required leadership for Knowledge Management according to the theory in this field.

The managers at Services Sweden that we have had an opportunity to interview gave us a unanimous picture of the practiced leadership. All but one of the managers agreed that the workload was too heavy and as a result, employees were given less attention than they normally would. The employees interviewed; strengthen our view that managers did not have time to focus on the day-to-day issues concerning their employees. In chapter 3.6.2, we discussed different aspects of management. One important lesson from that discussion is that managers need to focus less on managing and focus more on supporting the employees. What did we mean by supporting? Think of a hockey coach, he might not be the best hockey player but he knows how the game is played. In other words, give employees the resources needed and entrust them to do their work. A leader “sets worthy goals that people might not think up on their own, but to which they are nevertheless prepared to commit themselves.” Management has to be enthusiastic about the knowledge-sharing and state a good example by transferring fancy words into actions, visible for everybody. We have the opinion that managers at Services Sweden are not doing this enough. We believe a reason for this is a series of incidents that has placed Services Sweden in a stressed situation with a huge workload for the managers. For example there have been unfortunate resignations from key-players. There have also been project commitments that have not worked out in the way they were supposed to. Circumstances like these are hard to deal with for any organization, and on top of this, the merger with its organizational changes. We think this has placed Services Sweden in a position where the managers do not fully have the opportunity to deliver the needed personal dedication even if they wanted to.

We have the opinion that to deal with this problem within Services Sweden, managers have to be better informed on how to create an environment that supports knowledge-sharing. They have to understand how they best can use the resource that the knowledge of the employees constitutes. This understanding requires a fundamental change of thinking for many managers at


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TietoEnator. No more fancy words, there has to be action to backup the talking. We think this is suitable task for the Knowledge Management Steering Group, described in chapter 6.6, to inform and spread the concept of Knowledge Management.

We think that the managers to a greater extent should use teamwork with a focus on knowledge-sharing and they must also develop awareness of what knowledge their co-workers possess that can be stored into structural capital.

One might jump to the conclusion that a manager needs to be a generalist in order to be a good manager. One manager interviewed stated that a manager must know, understand and get respect from the professionals doing the actual work. We believe managers without acceptance from the employees will have a hard time trying to impose changes in the teams. One must remember that a large number of Services Sweden’s employees are IT-professionals with highly specialized competencies.

According to the chief Human Resource Manager, the leadership within TietoEnator has to reflect the changes imposed by being a knowledge company. Such changes are, for example, that managers have to act as good pedagogues, role models and be entrusting people. Another important aspect is that employees are a corporate wide resource, “one common pool of talents” and many managers firmly hold on to their employees in a protective way. If this is a result of poor routines or policies for internal debiting we don’t know.

The recruitment of new managers has by tradition been mostly been done internally. Only in some cases are managers recruited externally. There are mainly two different ways to get a management position. You either work as a salesperson or as a project manager. The problem as we see it, is the fact that there is no strategy for supplying the organization with the managers needed. This creates a vacuum when a manager is leaving his position. As we mentioned at the beginning of this chapter, the workload on managers is very high. If Services Sweden was to deal with this problem by appointing more managers there are no plans on how to do this. We suggest that Services Sweden immediately starts to map possible management “prospects” and train them so when a position needs to be filled the preparations are already concluded and the “new” managers can take over and fill the vacant position quicker.

6.5.1 Internal Communication

We have come across the opinion that the internal communication and information sharing is working poorly at the moment. There are confusions concerning who is responsible for what and who is responsible for spreading which information. As one interviewee said: -”Critical company information is not supposed to be shared in an underground fashion, there must exist structures for sharing critical information.”

Some people think that the information from the management could be much better concerning what is happening in the new organization at the moment. Internal surveys conducted by the Human Resource department further


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strengthen this fact. Managers at all levels of TietoEnator Services Sweden are involved in improving communications and information sharing according to Kjell Lökensgård, CEO at TietoEnator Services Sweden. A way of improving communications with employees is to look at the Vision Coffee [sv.Visionsfika] described in chapter 4.5.4.


Managers have to be enthusiastic about Knowledge Management and take actions to backup the fancy words.

In our opinion, many managers at TietoEnator have to fundamentally change the way they think to better fit the concept of Knowledge Management.

Managers have to create a knowledge-sharing environment.

Employees should be a company wide resource, available to all managers.

Work on a strategy to supply the organization with new managers.

6.6 The Knowledge Management Organization

In this chapter we describe how TietoEnator is organizing the Knowledge Management work.

Today there is no formal position for handling Knowledge Management issues in the organization. Several issues are carried out by the Human Resource Department. The objective is to create a Knowledge Management Steering Group (KMSG) on group level that can act as coordinator of the Knowledge Management initiatives throughout the new organization, see Figure 22 for a conceptual view of the KMSG. The objective for the steering group is to elaborate a clear vision and strategy for how TietoEnator should look at and handle Knowledge Management, and they intend to lean on the Guiding Principles and the newly developed Knowledge Management policy. The KMSG is also to coordinate and initiate subprojects that all deal with Knowledge Management related projects. The KMSG is proposed to include representatives from the Human Resource, The Enator Process Group (EPG), and top management.

We have gotten the impression that the KMSG will mainly consist of people from Human Resources with one representative from each Business Area. This is natural since many Knowledge Management related issues are handled by the Human Resource function, such as individual competence issues.

One of the ideas with KMSG is to gather the knowledge about Knowledge Management in one forum and representatives from the Norwegian part, the only ones that worked with Knowledge Management, are fortunately included. Without having looked deeply into the ideas of the KMSG we think there might be a risk that competencies such as information infrastructure might be excluded.


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The plan is to get a wide commitment from management, so that the concept of Knowledge Management has a chance to become the tool it is supposed to be. It is the belief of the chief Human Resource Manager that leadership and business strategies are the most important factors for management commitment. To achieve this, the search for a member of top management is under way to represent the KMSG.

Figure 22, The proposed Knowledge Management Steering Group.

Today, the plan for the Knowledge Management organization is only covering the top level and the BA level with a, yet to be appointed, CKO as chairman for the KMSG. We suggest that the next step is to distribute the responsibility for Knowledge Management one level further, to Business Unit level. Define the job description for a Knowledge Worker and assign persons to the positions, for example one at each Business Unit.

The KMSG also needs to decide on how to cooperate with the responsible persons of the different Competence Networks. We think that the Network activities should be subordinated the KMSG and the Chief Manager of the Competence Networks should be included in the KMSG.

The group is using the ISI model of Knowledge Management to guide and structure the future Knowledge Management work. Right now (January 2000) they are about to collect and evaluate the different kinds of methods, i.e. for competence measurement that exist in the organization and in the future they want to have company wide best practice methods.

The key business processes of TietoEnator are recently collected by the Toolbox project and we think this material would be suitable as a base for decision on which process that is most suitable for Knowledge Management actions.

As we stated in the comparative study, employees have in most cases vague ideas of what Knowledge Management is really about. They need to know how this is going to affect them and what the company expects them to do about it. This is an important discussion that the KMSG has to initiate.


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The Knowledge Management Steering Group must have commitment from top management in order to succeed.

Responsibility for Knowledge Management should be extended to business unit level.

The KMSG has to initiate the Knowledge Management debate.

6.7 Information Technology In this chapter we discuss TietoEnator’s IT-systems such as Intranets as well as our impressions and suggestions related to this.

TietoEnator Services has two Intranets, EWW and Winnet. EWW is a heritage from Enator and Winnet is a new Intranet for the new organization. In our opinion, the problem with Winnet is the content; it is basically a huge message board! When we conducted our interviews with TietoEnator employees, this was a recurring statement. As we described in chapter 3.7.7, successful Intranets contain knowledge usable for employees, not just information! EWW and Winnet need to be integrated and get the same graphical layout and content. The fact that employees need to use two sources to collect information is counter-productive when trying to build a new company. There should be only one Intranet.

Neither one of the two company Intranets is accessible outside the walls of TietoEnator. The result; many Business Units build solutions to access their own Intranet from places outside TietoEnator. “Skunk works” are starting to become a rule of practice for Business Units in order to have a functional Intranet that suits the consultant’s needs.

Employees and managers cannot on their own publish information on the Intranets. In order to accomplish that, the information has to be published by an “Info Master”, usually a secretary or an assistant. A problem we see with this structure is that the “Info Master” has a lot of power over what information is to be published. The effects of this structure are that many Business Units build their own Intranets to support functions lacking from the company Intranet (EWW and Winnet). The ideal solution is to grant certain roles with different access levels for publishing new material. In order to support publishing of new material, there is a need for a well designed and structured way to catalogue and store submitted data in internal databases. One example is to tag the submitted data with predefined labels, describing the content and context of the submitted data. This enables a more effective way to search submitted data in company databases. We feel that Hewlett Packard’s system (described in detail in chapter 3.6.4) with a review board that reviews submitted data is interesting and that TietoEnator Services Sweden should evaluate this way to submit knowledge into company repositories. We feel that TietoEnator should look at tools with characteristics similar to intranet tools like Webware referred to in chapter 3.6.4.


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When discussing the Intranets with our interviewees, several interesting points were made regarding how TietoEnator is managing the Intranets. One example of such suggestions is that the Intranets need to standardize on certain technologies and solutions. For example there is no standard Web browser, and the Intranets are standardized on version three Web browsers from both Microsoft and Netscape. TietoEnator is emphasizing technology independent browser platforms for accessing the Intranets. The reason for this is hard for us to comprehend. We believe that with a standardized Web browser the Intranets can more easily be administered and will enable shorter and faster development of future Intranet projects. A parallel to this discussion is the internal Intranet projects that have a tendency to be lengthy projects that consume vast resources according to people interviewed. The problem is that there are lots of people involved, many decision points and meetings before the project is finished. This is very costly and time consuming.

Our suggestion is to manage in-house projects with the goal to show quick results and then evaluate that project. Correct any problems if necessary and then move on to the next project. All projects should be kept small and limited in time, see Best Practice in chapter 5.3.

According to TietoEnator’s chief Human Resource Manager, the need for common IT-solutions that support Knowledge Management is obvious. Over time TietoEnator will have several different IT-solutions. These IT-systems will operate on Corporate, Business Area, Sub Business Area and Business Unit level in order to support the day-to-day work.

Several of our interviewees have pointed out needs for different kinds of support tools within Services Sweden. One need is for a sales supporting tool that maps Services Sweden’s customers, who is in charge, what projects are TietoEnator conducting at the moment, and which projects have been completed? We believe such systems would be valuable for Services Sweden.

Another need expressed by people interviewed is a company wide competence database that the Human Resource department can utilize for planning and finding recruiting needs and what competences the company consists of. We think that Project Managers can use such a competence database for finding suitable members for project teams (as they did at Zorg, see chapter 4.5.4 Organizations and Culture).

We have used the term “Skunk works” earlier in this report as a term to describe the “underground” Intranets that exist in the organization without official “approval”. A typical example is Business Units that builds its own Intranet to solve the specific need that exists within in their organization. During our interviews, almost every one who represented a Business Unit described how they have built their own Intranet. In many cases these Intranets are located outside TietoEnator’s network. The important question to ask is why are there so many “Skunk work” Intranets? The obvious answer is that EWW and Winnet do not answer to the needs of the organization. What are these needs? One example is the need for localized information, if one consultant is home sick or working from home and want to notify his co-


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workers, the place to do this is not on Winnet and EWW. Why do you need to interconnect these Intranets then? It is our belief that many of TietoEnator’s best practices can be found at the individual Business Units. If Knowledge Management is going to have an impact on TietoEnator, all Intranets need to be incorporated and interconnected with each other. This is the strength of applications like Lotus Notes and Webware. Through one client (Notes) or one application (Webware) the entire Intranet is accessible form the user’s desktop.

We have found a great need for finding people within Services with a specific competence. One solution is to categorize competences in the different areas of expertise, preferably on a Business Area level. The obvious reason for this is to find people “next door” with the requested competence. This tool should work as, and be designed as the “Yellow Pages” or an internal competence version of the popular Internet service Yahoo, updated and maintained by Knowledge Workers, described in chapter 3.6.3. The tool could preferably be designed with different levels of geographic content. For example on Business Unit, Business Area, and geographic location and at the highest level the whole company.


Integrate all Intranets into one application, accessible outside TietoEnator.

Fill the Intranet with knowledge, not only information.

Use some sort of process for submitting best practices, like the way HP handles best practices.

6.8 Methods and Tools In this chapter we describe the methods and tools used for Knowledge Management related issues within TietoEnator.

6.8.1 The Competence Networks

In order to utilize and develop the different competence areas within Enator more effectively, it was decided that networks should be formed around certain predefined competencies. This is done in order to visualize and manage the competence areas better. This should be an area of strategic importance to Enator and the first two Networks were formed around the competencies System Testing and Usability, both critical competencies for System Development. The incentives for the Competence Networks were that the knowledge should be spread throughout the organization and new ideas would thrive in the Network forums. “The employees should get help with the question; who knows what.” a statement from the Enator Process Group (EPG).


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Today there are nine Competence Networks that have their origin from Enator; areas such as Leadership have been added. The Networks reflect the core competencies from Enator, competencies and values lasting over a longer period of time (see Competencies, chapter 3.3.1). Areas of front-line characteristics like the latest Programming languages and new techniques that may well be gone in a few years are supposed to be lined under the wider core competence Networks in subgroups. The Networks have 60-150 members and activity varies widely from Network to Network. The Networks are managed by one or two persons who are compensated for some of the time they spend on managing the Network.

After the merger with Tieto, there are a lot of “new managers” in the Finnish part of the organization who are not aware of the existence of the Competence Networks. The person that bears the main responsibility for the Networks explained that this is why there is a need for lobbying the Networks harder. At the moment it is uncertain what is going to happen with the Networks in the future. The existence and extension of the Networks will be brought forward under the umbrella of the Toolbox project. It is certain that collecting competencies from Finland and Norway and combining them with the existing Swedish Networks will require a tremendous amount of work. The management of the Networks is probably going to move closer to the new Human Resource function of TietoEnator explains the person responsible for the Networks.

The people we have spoken to have the opinion that a higher compensation for persons engaged in the Networks would increase the commitment and increase the status of working with the Networks compared to operative tasks. We think that this type of forum should be very suitable for interactive communication via the Intranet, where all the activities can be displayed and the members would be reachable from the virtual place of each Network. Maybe there can be a connection to the Knowledge Well (see chapter 6.8.3 for further information) via the Networks because of the similarities in the basic structure. Some Networks are already using discussion forums but the use of them is not widely spread. It is our opinion that the use and commitment to the different Networks will benefit from using modern IT-solutions such as Web based discussion forums, this to attract new members and act as the natural forum for in-depth discussions and to build personal networks.

6.8.2 The Toolbox

One thing that has been significant for the services offered by Enator is the Toolbox, a set of neatly packed procedure manuals for business methods in the shape of a toolbox. From the beginning this was experiences from their core competence areas that were collected into explicit methods and instructions. Within the Toolbox there are methods for Project Management, Systems Development etc. The different methods in the Toolbox are offered to customers as educational courses as well as used internally. For example, all in-house projects are managed with PPS [sv. Praktisk Projekt Styrning].


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In our opinion this is a good example of the organizations ability to formalize routines and skills into methods. In other words transforming human capital into structural capital and profiting from this knowledge. However, one should keep in mind that delivering the neatly packed content of the Toolbox with its educational material is far away from delivering complex IT-solutions that we earlier stated is the kind of inspiring work that employees of the modern Knowledge Company demand.

6.8.3 The Knowledge Well

The methods and “ways to work” that are explicitly described in the Toolbox have a Web based counterpart called the “Knowledge Well” [sv. Kunskapsbrunnen]. It is an application on the EWW Intranet where knowledge and information related to an area in the Toolbox is being stored, in other words they both have the same basic structure. Today it does not contain much information but it is planned to describe the way work should be carried out and “How we solve our customers’ problems”. In the Knowledge Well everybody has the right to publish material and it is supposed to contain dynamic material, information that will continually change with the changing demands. The idea is that the Toolbox will present a best practice “snapshot” of the Knowledge Well, a formal picture, the one that actually is for sale.

We feel that the idea behind the Knowledge Well is good. The problem is the lack of usable content. If the Knowledge Well is going to be successful, the Knowledge Well has to be internally marketed and filled with useful knowledge.

6.8.4 Enator Process Group

Enator Process Group (EPG) is a constellation inherited from Enator, a Network with the objective to keep track of and develop methods and tools, and the way day-to-day business is carried out. The group investigates what methods the organization has to be knowledgeable of. It might be methods other than their own required by certain customers. EPG is also the formal owner of the methods within the Toolbox. The nursing of the company methods is important since improved and newly developed method are part of the future service/product portfolio.

EPG has examined what roles the Toolbox and the Knowledge Well are going to have in the new organization. They also investigate what future significance EPG should have; we do not know the result of this investigation. This is also an issue covered by the Toolbox project when it recently collected the total common processes and business systems for TietoEnator. The only thing we do know is that it resulted in a project to increase the use of the Knowledge Well and investigate the need of a new technical platform. Another project is investigating the created effects and gathering experiences from educational programs within the company over the last few years.


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The Competence Networks are important for developing TietoEnator’s core competencies.

The idea behind the Knowledge Well is good; usage must increase before the payoff can be noticeable.

6.9 Measurement In this chapter we discuss aspects of measuring and the impact that measuring has on management.

All of the goals of TietoEnator are not measurable which means that there is no way of knowing the level of goal fulfillment. According to interviewed experts on management development the company goals need to be measurable in order to be fulfilled.

What tools can the KMSG utilize to affect the behavior of managers described in the previous chapter? Measurements are an important way of influencing managers to work towards Knowledge Management goals. For example, if the goal is to increase internal transfer of employees and the managers are measured on the rate of internal transfer, then the internal transfer rate will most likely increase as described in chapter 3.6.6.

The use of Balanced Scorecard (BSC) within Services Sweden today is very diverse. Some units have not heard of BSC, while others claim that they are very much helped by the concept of BSC. There has been a directive from top management of TietoEnator that the new organization should start using BSC. We think that BSC is an effective way and a good choice to enlighten the non-economic aspects. Several of these aspects are also very important from a Knowledge Management point of view, and in our opinion the people dedicated to Knowledge Management issues should also have insight into and fully understand the work of BSC.

The organizational behavior needs to be altered to support Knowledge Management, and the reward system has to be integrated with Knowledge Management to support the goals of TietoEnator’s work on BSC, according to TietoEnator’s chief Human Resource Manager.

In the annual report of 2000, TietoEnator will present the Intellectual Capital as a complement to the financial statements. At the moment, the Human Resource departments are involved in finding relevant measures for measuring Intellectual Capital. We feel that this is a very good idea, not only will the shareholders appreciate the measures, it will provide the stock market with a more accurate statement of the company, a view shared by Per Nyström at Celemi.


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Measurements are important tools for any manager, vital for a knowledge manager.

The use of BSC is an effective way to illustrate non-economic aspects.

By visualizing the Intellectual Capital, TietoEnator is building external confidence.

6.10 Business processes In this chapter we discuss core business processes and we have chosen the Human Resource Management with sub activities as an example of how to introduce and incorporate new employees into the organization.

The Toolbox project has recently collected the common business systems of TietoEnator and the key business processes within the business systems. To make the Knowledge Management process work, all of the authors we have read argue that the Knowledge Management process has to interact with a company’s ordinary business processes and not be considered to be a separate process dealing only with knowledge creation and sharing.

We have looked closer into the Human Resource Management area because it contains many Knowledge Management related issues. We do not say that this is the best area to start a Knowledge Management project in. (We are of the opinion that an area like Customer Relations might be better, since this will probably gain quicker and greater value.)

6.10.1 Human Resource Management

In today’s organization all the issues concerning the individual employees are managed under the umbrella of Human Resources. The key sub processes for Human Resource Management within Service Sweden are defined in the Toolbox project as follows:

Recruitment

Acquaintance

Development discussions

Competence development

Competence assessment

Personnel Satisfaction Surveys

“The common aim of the Human Resource management processes is to create such an organizational competence which helps to attain the business vision continually and profitably.” (The Toolbox project)


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In our opinion, the key sub process for Human Resource Management covers the basic functions of a Human Resource function. The key sub processes are somewhat Knowledge Management related; Competence development and Competence assessment share some basic ideas from Knowledge Management. For example, Competence Development dealing with the idea of organizational learning and Competence assessment is a method for systematic development of competence. Our conclusion is therefore that incorporating Human Resource in the proposed KMSG is a good idea. When the new Human Resource organization has been given some time to find the right tools and methods to perform its tasks, we believe the focus on Knowledge Management will improve.

6.10.2 The New Recruits

When recruiting new employees it is critical to get them on board as quickly as possible and start being productive employees. When selling competence by the hour it is hard to introduce new employees into customer projects. The customer may react to the fact that they are only paying for one consultant and not two. Another example of this behavior is that the customer is not willing to let the experienced consultant train new employees within their project due to fear of breaking the deadline, all according to people interviewed at Services Sweden.

If more projects where handled by TietoEnator, also the manning of projects would be different. The customer will only pay a predetermined price for a project, regardless of how many hours TietoEnator allocate to solve the project commitment. By selling projects, TietoEnator would have an excellent way of introducing new employees and increase their productivity, says Kjell Lökensgård, CEO at TietoEnator Services Sweden.

At TietoEnator Consulting AS (formerly ISI Consulting) they have a program called “New Spark” [sv. Nytt Krut]. This program is designed to make introductions of new employees into the organizations faster and more stimulating for the new employees as well as for the Business Units. Basically the new employees attend an introduction course and when finished they are transferred directly into a customer project. Managers at the different Business Units are committed to find suitable projects and to take care of a certain number of new employees. The result of this program is very positive according to Nina Jacobsen, CEO TietoEnator Consulting AS. The introduction process is shortened and new employees are productive earlier than with a traditional introduction. The new employees are more satisfied then their new colleagues from other parts of the company.

We feel that this way of introducing new employees into the organization is something that should be promoted to a company wide best practice. We have shared this idea with managers interviewed and the response has been very positive.


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Another Knowledge Management best practice is a working mentorship program (chapter 5.3) that we think would be equally useful for supporting the new recruits in Services BA as well.

In the IT-sector, staff turnover is usually 10-12 percent on an annual basis, a percentage viewed by Kjell Lökensgård as a healthy turnover rate. He feels that a company like TietoEnator needs new influences from new employees and internal job rotation. Recruitment is traditionally expensive and Kjell Lökensgård feels that the cost of hiring new employees will rise, not necessarily due to increasing salaries but due to benefits and extended possibilities for personal growth. New Spark [sv. Nytt Krut] can be one way of reducing the cost for recruiting new personnel.

6.10.3 ”Personal development”

As we said earlier in the report, the moments between the manager and his employees, where they discuss the personal plan and future progress, are very important from a Knowledge Management point of view, even though it often is ordered under the Human Resource function in organizations.

There are no standardized methods for “personal competence enhancement” within Services Sweden; it is very much up to the individual to convince his manager that there is a need for further competence enhancement. The Human Resource unit is aware of a few different methods for “personal competence enhancement” within Services Sweden. In one case a group of three to four consultants who were responsible for follow-up the other consultants’ enhancement, but in most cases it is a matter between the closest manager and the individual. TietoEnator Consulting AS has developed a tool, the “Competence Wheel” [sv. Kompetenshjulet] for “personal enhancement”, which according to Nina Jacobsen, a very successful method. During this year, the Human Resource Department is going to gather information from the Business Units on existing methods used for “personal competence enhancement”.

The need to conduct “development discussions” in a consistent way throughout the company will in our opinion generate a more accurate picture of the competencies gathered in the organization. Rather then conducting an inventory of the Competence Networks, managers need to learn how to perform “Development discussions” in a standardized way. Group managers and the employees evaluate the performance of the employee together. When conducting an evaluation, the need for references is critical. Employees should be measured against a “fictitious” reference person with similar competence. The Human Resource Managers within TietoEnator Services should handle the “employee benchmarking”. This will enable the Human Resource department to compose a strategy for recruitment that suits the need of the organization.


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New Spark [sv. Nytt Krut] is an excellent way if introducing new employees into the organization. The introduction process is shortened and new employees are productive at an earlier state.

Employees should be benchmarked with a fictitious reference employee to enable a standardized way for conducting “Development discussions”.

TietoEnator should introduce a company wide mentorship program to secure that the new recruits are getting the needed support.


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7 CONCLUSIONS FROM THE

TIETOENTOR STUDY

In this conclusion we summarize the general impression from our study of TietoEnator Services Sweden. We are presenting our own opinions and thoughts, opinions that have been formed by the ten interviews carried out within TietoEnator. Our opinions and thoughts are further based on the insight achieved from four months of literature studies and investigations of how competitors of TietoEnator are dealing with Knowledge Management. It is impossible to get a complete picture from interviewing a few employees from a specific business area and it would have been highly desirable with quantitative data to further strengthen our conclusions but unfortunately this opportunity was not given to us.


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TietoEnator Services Sweden is facing some rather dramatic changes. The organization has just concluded the merger with Tieto and several large projects have just ended. Will the changes for the organization end there?

If TietoEnator is serious about Knowledge Management (we do believe they are) the company culture has to change. The proposed move towards in-house projects, to further use and develop the competencies is one important step. That employees should be considered as a company wide resource is another example. These two examples of culture changes are needed to get a sustainable effect of the Knowledge Management efforts. We are aware that cultural changes take a long time to complete and it is hard to measure the changes. We also believe it will have a positive affect on recruiting and the ability to keep key-players within the company. When Services Sweden has solved the problem with internal information sharing, employees will feel more at ease and can focus 100 percent of their attention on work-tasks instead of worrying about their future as TietoEnator employees.

Managers at TietoEnator Services Sweden must use guidelines and policies as means to manage the business units. Inform and entrust are the key words here. Employees must know what policies and guidelines affect their work and how to interpret them. Employees must feel entrusted to conduct their work. Authors such as Blomé and Wilson support our standpoint and emphasize the need for “enlightened” managers. Another way to manage the company is through measurements. The use of Balanced Scorecard as the primary way to manage the company on a long- and short-term basis is a very good idea as long as the business goals are broken down to fit the local Business Units, this is a view we share with Celemi’s Per Nyström. One problem by utilizing any measuring system such as Balanced Scorecard is that people reporting the figures must be properly trained and understand what they are reporting. We feel that the benefits from using Balanced Scorecard is much greater then not using any kind of measuring system and therefore we recommend TietoEnator to further develop the use of Balanced Scorecard throughout the company.

We feel that if Knowledge Management is going to have an impact on Services Sweden and TietoEnator globally, there are however in our opinion a few conditions where TietoEnator not fully reaches the level of required Knowledge Management efforts presented in the literature and efforts achieved by competitors in TietoEnator’s market segment that cannot be overlooked. These conditions are:

Managers have to be enthusiastic about Knowledge Management. Without management support, no initiative from top management will have an impact on the organization. We believe that if managers are included in the Knowledge Management projects at an early stage, the understanding and dedication will increase.


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Managers have to create a knowledge friendly environment. Without a knowledge friendly environment no Knowledge Management project will succeed. With a knowledge friendly environment we are talking about company culture, management styles and organizational behavior. Other types of knowledge friendly environments are open office spaces, natural meeting points and an open attitude towards learning.

The forming of a Knowledge Management Steering Group (KMSG) and the planning of its work tasks is the most important Knowledge Management activity for TietoEnator, and this is also the natural starting point.

The KMSG must have commitment from top management in order to succeed. We have discussed the need of a project sponsor as a critical success factor. If the KMSG gets commitment from top management and one top executive can act as a project sponsor and spread the concept of Knowledge Management within the organization, the risk of failure is significantly minimized.

Responsibility for Knowledge Management should be extended to Business Unit level. Integrate all Intranets into one application, accessible outside TietoEnator. We feel that the KMSG is one step in the right direction, however the local Business Units need to be involved on a higher level. The Business Areas must be represented in the KMSG in order for local Business Units to feel that they have a communication channel to the executive forum for Knowledge Management.

When building a Knowledge Management support system, start small and implement quick hits. Research on Knowledge Management projects indicates that successful implementation is more likely in small projects, limited in time and with an extended development phase before the system is delivered. Keep it simple and small!

In our purpose for this master thesis, we said we wanted to “... if possible see how consistent the leadership of Services Sweden is with this kind of leadership”. What are our findings on leadership within Services Sweden? It is our opinion that the leadership is not entirely consistent with the required leadership of a knowledge organization. We feel that managers are not supporting employees by providing the necessary resources, know-how and personal dedication that one might require of modern leaders in a company of TietoEnator’s size. Why is that? As we stated in chapter 6.5 we believe this is due to the stressed situation that Services Sweden are finding themselves in. We think it will take a bigger commitment than the ones we have seen, if Services Sweden quickly want to place themselves in a better situation.


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8 SUGGESTED ACTIONS

Instead of finishing our thesis with our conclusions, we have chosen to present our views on how TietoEnator may proceed with their Knowledge Management actions that brings the conclusions down to a more concrete level. The suggested actions should be considered as an example of conceivable actions, to help the responsible persons with new impulses. In this chapter we are making our suggestion for how TietoEnator may proceed with their Knowledge Management actions. We also suggest some general actions, applicable to any organization working on Knowledge Management.


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8.1 General Suggested Actions In this chapter we present the general actions suggested by us that can be applied in an organization working on Knowledge Management.

This is only one part of our general conclusions. In chapter 5 we present other findings from our comparative study. This part deals with suggestions from our work at TietoEnator and our general findings from studying that organization.

Create and pronounce a clear strategy for the future Knowledge Management actions, project strategy and so forth.

Create opportunities for people who are going to be affected to give their opinions. (Look at the Toolbox project; they conducted a workshop with the involved people before the work was started. It also had a very clear project strategy similar to the one we described in chapter 3.7).

Create work descriptions for the defined roles in the Knowledge Management organization.

Launch a project to identify a key business process, a process that has clear benefits of Knowledge Management in order to create quick hits.

The knowledge process should be interacted into the chosen process.

Identify the information flows for this process.

Including new technical features in the Knowledge Management project will increase the tangible feeling of the project and might increase the commitment from the technical oriented personnel.

Set up a project on company level that will investigate the Intranet with a knowledge focus with the objective to develop a specification of an Intranet that contains several layers and is scalable, that enables local requirements and specific needs and at the same time is fully integrated. It must be possible to abstract local best practice to a higher level.

Create company wide policies for competence development and focus on the best practices.


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8.2 Suggested Actions for TietoEnator In this chapter we present the actions suggested by us that TietoEnator can apply when working on Knowledge Management.

We want to present our ideas and suggestions on how TietoEnator Services Sweden should continue the work on Knowledge Management. We have grouped our suggestions in suitable categories below.

The Knowledge Management Organization

Proceed with the work of forming the KMSG; this will create the needed foundation for the future work on Knowledge Management. The top-down procedure will increase the management commitment in the rest of the organization.

The next step is to proceed with the rest of the organization on Business Unit level where directives for Knowledge Workers, Project Managers, and Information Brokers should be executed.

The overall Knowledge Management plan

Make a thorough plan for the future Knowledge Management actions that rests on the ISI model and the identified key business processes from the Toolbox-project.

Improve the information infrastructure on company level to better suit the requirements of Knowledge Management. (Information Technology infrastructure is only one of the tools/channels).

The overall common policy for Knowledge Management should be put into words. Continue developing guidelines within the different areas of the ISI model for Knowledge Management.

The Knowledge Management project

Gather information about local Knowledge Management initiatives such as the Knowledge Well, Competence Wheel, etc. and evaluate them on a corporate level.

The Information infrastructure

Improve the information infrastructure on company level to better suit Knowledge Management requirements. (The information technology infrastructure is only one of the tools/channels)

It is the KMSG’s job to secure that the authority to spread and publish information is located in the right place.

Develop a “Yellow Pages” application that fulfills the requirements of finding specific competences within Services Sweden; the “CV database” is not filling this need.


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Methods

The use of Balanced Scorecard (BSC) should be supported by the KMSG. We described how the increased use of BSC will have several positive effects within the Knowledge Management field in chapter 6.9.

Develop the Knowledge Well; secure that the result from the EPG investigation is taken care of properly.

Incorporate the work of the Competence Networks into the Knowledge Management organization; probably this requires an investigation of the corporation’s most common competencies.

Investigate how virtual networks within the Intranet can enhance the penetrating power of the Competence Networks.

Develop or find a course/instructions that all managers that have personnel responsibility have to attend to support them when conducting “Development discussions”.

Look through the policies for introduction programs like New Spark [sv. Nytt krut]

8.2.1 Future Studies

Our suggestions for TietoEnator presented in this chapter includes represents a wide range of areas. The most important area in our opinion is to launch a functional intranet that supports Knowledge Management. TietoEnator has to investigate what data to include and what to exclude from this new intranet. By starting to plan and implement a new structure for storing and retrieving data, the employees’ will most likely have a powerful tool supporting their daily work. This work should include database structures, and predefined tags for marking stored data for later retrieval. Some of the suggested actions are suitable for several other master theses. Examples of interesting areas to investigate are: Polices for introductions plans of new recruits. This work should be supervised by the Human Resource Department and initiated by the proposed KMSG. Another area of great importance is to find a reference model for benchmarking employees’ competence levels throughout the company. Since the policy is that all employees’ are considered to be a company wide resource, the need for a benchmarking model for competencies is great. This is also a project that should be initiated and supervised by the KMSG since the impact of such reference models will involve all business areas.


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9 REFERENCES


108

9.1 Literature

Arbnor, I., Bjerke, B., 1994, Företagsekonomisk metodlära Studentlitteratur

Beckmann, J., Ahde, C-J., 1998, Kunskapshantering I den svenska bankbranschen, Master Thesis Linköpings Tekniska Högskola

Berggren, S., Widstrand, M., 1999, Intranet usage in large projects, Master Thesis Linköpings Tekniska Högskola

Brooking, A, 1995, Intellectual Capital, Thomson Learning

Blomé, A.,1999, Kunskapsföretaget –kort och brett och lite djupt, Anders Blomé Projekt & Kompetensutveckling

Davenport, T. H., Prusak L., 1998, Working knowledge: How Organization Manage What They Now, Harvard Business School Press

Davenport, T. H., 1993, Process Innovation. Reengineering work through information technology, Harvard Business School Press

Erlandsson, J., Johansson, O., 1999, Kunskap i frontlinjen, Master Thesis Linköpings Tekniska Högskola

Falk, T., Olve, N-G., 1996, IT som strategisk resurs, Bättre ledarskap

Gruvberger, D., Malmborg, C., 1999, The Blossom: A framework of Knowledge Management -A case-study at IFS R&D, Master Thesis Linköpings Tekniska Högskola

Gummesson, E., 1985, Forskare och konsult - om aktionsforskning och fallstudier i företagsekonomin, Studentlitteratur

Hansson, J., 1997, De nya kunskaparna, Liber Ekonomi AB

Hjertzén, E., Toll, J., 1999, Measuring Knowledge Management at Cap Gemini AB, Master Thesis Linköpings Tekniska Högskola

Lekvall, P., Wahlbin C., 1993, Information för marknadsföringsbeslut, IHM Förlag AB

Lundahl, U., Skärvad, P-H., 1992, Utredningsmetodik för samhällsvetare och ekonomer, Studentlitteratur

Mayo, A., 1995, Lärande i organisationen, Liber-Hermod

Nonaka, I., Takeuchi, H., 1998, The Knowledge-Creating Company, Oxford University Press

Patel, R., Davidson B., 1994, Forskningsmetodikens grunder, Studentlitteratur

Schach, S.R., 1997, Software Engineering with Java, McGraw Hill

Senge, P., 1995, Den femte diciplinen, Double Dell Publishing Group


109

Stewart, T., 1997, Intellectual Capital -The New Wealth of Organizations, Doubleday Dell Publishing Group,

Sveiby, K-E., 1998, Intellectual Capital and Knowledge Management

Wallén, G., 1996, Vetenskapsteori och forskningsmetodik, Studentlitteratur

Wilson, D., 1996, Managing Knowledge, Butterworth Heinemann

9.2 Articles

Cliffe, S., 1998, Knowledge Management, Harvard Business Review, July/Aug

Earl, J. M., Scott, A. I., 1999, Opinion: What Is a Chief Knowledge Officer?, Sloan Management Review, winter

Fahey, L., Prusak, L., 1998, The eleven deadliest sins of Knowledge Management, California Management Review, VOL. 40, NO. 3, spring

Inkpen, C. A., 1996, Creating knowledge through collaboration, California Management Review, Vol. 39, No. 1, FALL

Knapp, E. M., Havers, C., 1999, Easing into Knowledge Management, Strategy & Leadership, Vol. 27, March/April

Lynn, B., 1998, Intellectual Capital – Key to value added success in the next millennium, CMA Magazine, February

Prahalad, C.K., Hamel, G., 1990, The Core Competence of the Corporation, Harvard Business Review, May/June

Robinson, Akers, Artzt et. al., 1991, TQM on campus, Harvard Business Review

Strategi Ledarskapbulletin, 1999 (Fredrik D har den korrekta källan, avvakta…)


110

9.3 Internet sources Brooking, A., Motta, E., 1996, A Taxonomy of Intellectual Capital and a Methodology for Auditing It, McMaster University, Hamilton, Ontario, Canada, URL: http://kmi.open.ac.uk/~simonb/org-knowledge/ic-paper.html, accessed 1999-12-17

Bukowitz, W., 1996, In the Know, CIO April 1, URL: http://www.cio.com/archive/041596_ins_print.html accessed on 1999-12-09

Curry, A., Cavendish, S., 1998 Understand Intellectual Capital, URL: http://intellectualcapital.org/tour/index.html, accessed 1999-12-09

De Long, D. W., Davenport, T. H., Beers, M. C., 1997, What is Knowledge Management Project?, URL: http://www.businessinnovation.ey.com/mko/pdf/KMPRES.PDF , accessed on 1999-12-04

Fuld, L. M., 1998, Knowledge profiteering, turning knowledge into profit, CIO June, URL: http://www.cio.com/archive/enterprise/061598_intellectual_print.html accessed on 1999-11-04

Davenport, T.H., 1999, Knowledge Management, Round Two, CIO, Nov 1, URL: http://www.cio.com/archive/110199_think.html accessed on 1999-12-08

Davenport, T.H., 1997, Known Evils - Common pitfalls of Knowledge Management, CIO, June 15, URL: http://www.cio.com/archive/061597_think_print.html accessed on 1999-12-02

Hildebrand, C., 1999, Making KM payoff, CIO Feb 15, URL: http://www.cio.com/archive/enterprise/021599_ic.html accessed on 1999-12-08

Knapp, E., 1997, Know-how’s Not Easy, Computerworld, March 17, URL: http://www.computerworld.com/home/online9697.nsf/all/970317leadership accessed on 1999-12-02

Netsys AB, URL: http://www.netsys.se accessed on 1999-11-15

Sveiby, K-E., 1995, The Pro-Team, URL: http://www.sveiby.com.au/Pro-Teams.html accessed on 1999-11-12


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9.4 Interviews

Blomé, Anders, Consultant, Anders Blomé Projekt & Kompetensutveckling

Birkestad, Jenny, Business Unit Manager, TietoEnator Services Sweden

Evans, Patricia, Service Offering Manager, Cap Gemini AB

Fransson, Ann-Marie, CIO, Frontec Nordic AB

Israelson, Helen, Vice President Communications TietoEnator BA Services

Jacobsen, Nina, Chapter Manager, TietoEnator Consulting AS, Norway

Johansson, Ola, SAP/R3 Consultant, Frontec Göteborg

Lindelöw, Ulf, Management Consultant, TietoEnator Trigonen AB

Lindquist-Björkman, Maria, Competence Network Manager, TietoEnator Services Sweden

Lindström, Jenny, Human Resource Manager, TietoEnator Services Sweden

Lökensgård, Kjell, President TietoEnator Services Sweden

Nilsson, Anna, E-Commerce Consultant, WM-Data

Nyström Per, Celemi AB, 1999

Stern, Eve, Business Unit Manager, TietoEnator Services Sweden

Uggleberg, Mats, CIO, Ernst & Young AB

Wallén-Fogde, Ann, Vice President Human Resources Development, TietoEnator Corporation


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9.5 Other sources

Cap Gemini, Annual Report, 1998

Celemi, Annual Report, 1998

National Encyclopedia, 1992

Schaffer, C., People Solutions Network, Cap Gemini, 1998

Skandia, Supplement Annual Report, 1996

TietoEnator, The Toolbox project, final report & draft, 2000

WebWare, product presentation, 1999


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10 APPENDICES


114

10.1 Appendix A, Interview guide, Comparative study

1. General information 1. In what part of the company do you work and what is your job description? 2. For how long have you been with the company? 3. What is your background?

2. Introduction I this part we want to get your view on and experience of knowledge management. 4. What is knowledge management to you? 5. Do you have any experiences from this area? 6. According to you, is the company a learning organization?

3. Mission and guidelines In this part we address the goals and guidelines that the company wants to communicate to its employees regarding knowledge. 1. In your own words, can you describe the main objectives for the company? 2. Are there any goals that aim to increase the knowledge-sharing and in that

case, in what ways does the company promote and communicates these goals? 3. If any, what parts of the goals do you come in contact with in your daily work? 4. In your opinion do you think that upper management understand the impact

of knowledge management? 5. Is there a project sponsor for knowledge management? 6. Who in your opinion is the driving force behind knowledge management,

employees or management? 7. Are there any vital levels in the company that are excluded from the

knowledge management project? 8. When did the company start to focus around the concept of knowledge

management? 4. Knowledge Management in practice

In this part we want to focus on the routines and enablers for knowledge management that exist in your company today. 1. What shape has knowledge management within the company today? 2. What enablers does the company rely on for knowledge management? 3. Are employees dedicated to manage the collected knowledge? 4. What is the main incitement for the employees to support the knowledge

management? 5. In your own words, can you describe the knowledge management policy?


115

5. Value In this part we want you to focus on the added value that knowledge management

can bring the company. Customer value

1. In what way, can your customers benefit form the company’s internal work on knowledge management?

2. Is there an existing method for knowledge-sharing between the company and its customers?

3. Do you think that knowledge management have contributed to added satisfaction for your customers and increased your competitiveness on the market?

Employee value 4. Are there specific aspects from knowledge management that makes your work

more enjoyable? 5. Have the company’s work on knowledge management influenced the way you

perceive your work? 6. In what ways have knowledge management affected your work performance? 7. How is your company making all these values visible? 8. Is there any existing measures connected to knowledge management?

Profitable 9. Does all the things connected with knowledge management contribute more

than it costs? 10. Has the implementation of knowledge management shortened the

time/improved quality for customer projects? 11. In what areas do you think that the knowledge-sharing idea can generate new

revenues?


116

10.2 Appendix B Interview guide, TietoEnator study

General information 1. In what part of the company do you work and what is your job

description? 2. For how long have you been with the company? 3. What is your background?

Mission and guidelines 4. Are visions and policies important to you? 5. Are there any goals that aim to increase the knowledge-sharing and in that

case, in what ways does the company promote and communicates these goals?

6. In your opinion do you think that upper management understand the impact of knowledge management?

7. Who in your opinion is the driving force behind knowledge management, employees or management?

8. Where would you like to place the responsibility for knowledge management?

9. I want more information about the status of the company Knowledge Management in practice Culture&Organisation

10. Is the culture at TietoEnator open minded? 11. Are the employees aloud to take own initiatives? 12. The organizational structure of your unit/BA is the most efficient way of

organizing a knowledge company. 13. At TietoEnator are you credited for sharing knowledge? 14. Uses People knowledge as means of power? 15. What are your main sources of information? 16. Do you lack useful tools for effective knowledge management? 17. Are there any networks formal or informal where knowledge is shared

between individuals? IT

18. Do you have any specific IT needs that are not fulfilled for your business tasks?

19. Within your unit, have you local IT-solutions in order to find and reuse knowledge?

20. How often do you use the intranet? 21. Do you think the intranet is sufficient to find requested knowledge? 22. Do you think “Kunskapsbrunnen” is a good way of collecting and

distributing knowledge? Other

23. When, do you feel new knowledge is created? 24. Do you have time to document new knowledge after finished projects? 25. Do you have time to determine to whom my new experiences and

material produced may be of value for?


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26. Do you think methods as Balance Score Card helps putting focus on other factors then financial?

27. Do you focus and measure on short-term goals or long-term goals? 28. Do you come in contact with measures that are related to knowledge

management? 29. Do you think there is a use for competence profiles 30. How is the employee’s evolution of competence in your unit

accomplished? 31. There is a company policy that each employee has 60 hours a year to

competence enhancement, how many do you use?

LINKÖPINGS UNIVERSITET

Rapporttyp Report category

Licentiatavhandling

Examensarbete

C-uppsats

D-uppsats

Övrig rapport

Språk Language

Svenska/Swedish

Engelska/English

Titel Title

Författare Author

Sammanfattning Abstract

ISBN

ISRN

Serietitel och serienummer ISSN Title of series, numbering

LiTH-IDA-Ex-

Nyckelord Keywords

Datum Date

URL för elektronisk version

X

X

2000-03-24

Avdelning, institution Division, department

Institutionen för datavetenskap

Department of Computer and Information Science

Creating Effective Knowledge Management through Key Enablers - A study at TietoEnator Services Sweden


TietoEnator Consulting AS has developed a model for mapping and diagnosing different factors that is necessary to enable an effective Knowledge Management effort within a knowledge company. We have based our work on their “ISI Knowledge Management model” and altered it to better fit our needs. We have found that essentially all of our chosen enablers have a profound impact on the effectiveness on KM-initiatives at all the studied companies. We have compiled a list of best practices used to support Knowledge Management in the studied companies. Managers at TietoEnator Services Sweden must use guidelines and policies as means to manage the business units. Inform and entrust is the key word here. Employees must know what policies and guidelines affect their work and how to interpret them. Employees must feel entrusted to conduct their work. Another way to manage the company is through measurements. The use of Balanced Scorecard as the primary way to manage the company on a long- and short-term basis is a very good idea as long as the business goals are broken down to fit the local Business Units. We feel that if Knowledge Management is going to have an impact on Services Sweden and TietoEnator globally, there are however a few conditions that cannot be overlooked. These conditions are: Managers have to be enthusiastic about Knowledge Management, Managers have to create a knowledge friendly environment, the Knowledge Management Steering Group (KMSG) must have commitment from top management in order to succeed, Responsibility for Knowledge Management should be extended to Business Unit level, and when building a Knowledge Management support system, start small and implement quick hits. It is our opinion that the leadership at TietoEnator is not entirely consistent with the required leadership of a knowledge organization. We feel that managers are not supporting employees by providing the necessary resources, know-how and personal engagement that one might require of modern leader in a company of TietoEnator’s size.

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