Measuring the value of KM

1. Measuring the value of KM Measuring the value of KM David Gurteen Gurteen Knowledge www.gurteen.com

2. Objectives Objectives • Take a look at the many things you need to think about when ‘measuring’ anything but in particular KM • Look at the role of rewards in motivating people – Create measures, set targets, reward people when they meet them!

3. Two things can be measured Two things can be measured 1. Measure the knowledge of an organization – Intellectual capital 2. Measure outcomes of ‘knowledge in action’ – Say a KM initiative • My interest is in outcomes – demonstrating the value of a KM initiative The value of knowledge is contextual! – You can have all the knowledge in the world and still do nothing with it •

4. Some considerations when Some considerations when measuring things! measuring things!

5. Beware the word “Measure” Beware the word “Measure” • Beware the word “measure”! • Other words: performance indicator, metric, ROI • Performance indicator is usually best • Measures and metrics imply an exactness that is usually not achievable • Its ok 'to measure' but you don't create 'a measure‘ but an ‘indicator’

6. Why measure? Why measure? • Could be for one of several purposes – To conform to laws or regulations – To deliver on a promise or agreement – To meet a service level agreement – To justify your existence – To enforce performance – You have been told to – To prove to yourselves you are not wasting time – To provide feedback that facilitates learning

7. Keep asking the question why! Keep asking the question why! • What are your real objectives and are measurements the best way of achieving them? • Don’t measure for its own sake!

8. Beware not measuring Beware not measuring • Your manager may not have asked for measures • But when the going gets touch you had better be able to justify your existence • Change of Management!! • Your manager’s manager may have different ideas • When cuts have to be made – KM is high on the list! (KM means Kill Me!)

9. Plan to measure before you start Plan to measure before you start • You should plan to measure before you start a project or initiative- not after • What you measure and how you measure will affect how you do things!! • Too often Knowledge Managers don’t plan to measure up front!

10. There are multiple stakeholders There are multiple stakeholders • Multiple stakeholders will 'measure' you or want to see different measurements from you depending on their perspective • Don’t assume: – you know what the right measures are. Ask your stakeholders! – they will tell the truth or measure you by the measures you have agreed to provide them • You need to understand what is important to them • At the end of the day you will probably be measured on their 'gut feel‘ (How might you influence this!)

11. Two Stakeholders Two Stakeholders • Senior management – Sell & measure on business outcomes • Staff – Sell & measure on what's in it for them

12. Two types of measure Two types of measure • There are two types of measure – you can measure activity – or you can measure business outcomes • Business outcomes are best by FAR • Setting up say 10 communities of practice is an outcome but is NOT a business outcome • Business outcomes: increased revenue; decreased cost; improved bid to win ratio

13. Focus on Outcomes not Activities Focus on Outcomes not Activities • Too often we measure activity rather than outcome • And we try to measure & justify KM initiatives on activity rather then outcome • Sometimes activity is the only proxy we have but too often we focus on activities at the expense of outcomes

14. Examples of Measure of Activity Examples of Measure of Activity • Number of documents captured in a database • Number of times a document is read • Number of meetings held • Number of active communities of practice • Time taken to complete a task

15. Examples of Measure of Outcome Examples of Measure of Outcome • Bid to win ratio • Increased sales • Decreased costs • Improved quality • Reduced development time • Reduced staff turn over • Percentage of customers happy with service according to customer satisfaction survey

16. Beware of Targets Beware of Targets • People are often given ‘targets’ by which they are ‘measured’ • Often a command & control way of trying to force people to change • All imposed measures or targets will be gamed • They rarely work well – e.g. NHS • Targets need to be agreed and bought into

17. Examples of Poor Measures/Targets Examples of Poor Measures/Targets • First piece of baggage should arrive in arrival hall within 10 minutes of plane touching down • Patients when booking an appointment should not have to wait more than 3 days to see their doctor • In-patients in A&E should be seen by someone within 30 minutes of arrival

18. General Rule of Measurement General Rule of Measurement • Any measure that is based on a simple metric such as a number or time interval is probably a bad one as it can be too easily “gamed” – too simple to reflect the complexity - the multidimensional & contextual aspects of life – a simple ‘satisfaction survey’ that measure ‘customer perception’ is better – difficult to game ‘perception’

19. Some things cannot be measured Some things cannot be measured • Cynefin domains – Simple – Comlpicated – Complex – Chaotic • You cannot correlate cause & effect in the complex domain • You cannot say this was an outcome of my activity • And thus things cannot be directly measured

20. Cannot measure the new Cannot measure the new • If doing something new • Cannot plan to measure • As unsure of the outcomes • Act on gut feel • Can only measure in retrospect

21. Measures Distort Measures Distort • Measures distort behaviour – and have unintended and unimagined side-effects – always detrimental to the whole!

22. Softer Measures Softer Measures • Outcome based measures • Activity based measures • Anecdotal stories – Success stories – Focused on outcomes • Surveys and polls – Can provide numbers

23. Best Measures Best Measures • To provide feedback to facilitate learning • NOT for control or conformance • Must be developed, owned and bought into by the people involved otherwise they will be ‘gamed’ • They are personal learning tools!

24. When a measure becomes an objective it When a measure becomes an objective it ceases to be a good measure! ceases to be a good measure!

25. What and How? What and How? • Only now think about what you are going measure and how you plan to do it!!

26. Rewards?

27. Don’t reward people! Don’t reward people! • Rewarding people for meeting targets is detrimental to – Quality – Motivation – Pride in work • Leads to gaming • What about sales? – Highly quantifiable outcome – But even then has side-effects

28. Here is what Alfie Kohn has to say about rewards To the best of my knowledge, no controlled scientific study has ever found a long-term enhancement of the quality of work as a result of any reward system http:// www.alfiekohn.org

29. Rewards Punish Rewards Punish • Threats & coercion destroy motivation and so do rewards • Rewards are manipulative • “Do this and you will get that” is not much different to “Do this else here is what will happen to you” • When people do not get the reward they hoped for they feel punished • The more desirable the reward the more demoralizing it is to miss out

30. Rewards rupture relations Rewards rupture relations • Excellence depends on teamwork • Rewards destroy cooperation – Especially if scarce or valuable • Incentive driven employees will not ask for help from their manager when they need it • They will conceal problems from their manager to appear infinitely competent

31. Rewards ignore reasons Rewards ignore reasons • To solve problems people must understand the causes • They ignore the complexities of the problems • Each situation calls for a different response • Rewards tend to blindly promote a single solution

32. Rewards deter risk-taking Rewards deter risk-taking • People are less likely to take risks; to explore possibilities; to play hunches • The No. 1 casualty of rewards is creativity

33. Rewards undermine interest Rewards undermine interest • Loving what you do is a more powerful motivator than any goody including money • Rewards are controlling! • If people focus on getting a reward they tend to feel their work is no longer freely chosen and directed by them • If they have to bribe me to do it - it must be something I don’t want to do!

34. Summary Summary • Beware of measures! • Think carefully! • Measure outcomes not activities • Chose measures that can not be easily gamed • Measures are best as learning tools  • Don’t reward outside the normal ‘appraisal system’

35. David Gurteen David Gurteen • • Knowledge Networker Knowledge Website – www.gurteen.com Knowledge Community and Knowledge Letter – 13,000 people – 145 countries Knowledge Cafés – London, Liverpool, Bristol, New York, Adelaide, Zurich Educator, speaker, facilitator, coach, consultant • • •

36. www.gurteen.com www.gurteen.com David Gurteen Gurteen Knowledge United Kingdom Tel: +44 1252 812 878 Email: david.gurteen@gurteen.com