What is Knowledge Management? Benefits of Knowledge Management for Your Business

Ahh! The same thing again!

You are at your office desk trying to find the installation procedure of that tool. Where did you save the file with the info? You don't remember. 

And you spend time asking your teammates only to realise they don't remember it either.

We all have such instances, many times!

Loss of time, money and effort!

When Knowledge is not freely accessible within the organization, it causes an immense cost to the business as time is spent in seeking information and reinventing the wheel rather than focussing on productive work.

Source

The above-mentioned instance is a simple case of poor knowledge management.

What is Knowledge Management?

Today, an average person generates 1.7 megabytes of data every single second.

This data can be used by companies to drastically improve their productivity and services, therefore can retain existing customers and attract new customers by understanding their preferences. 

Your employees are happy, and your customers too.

The bottom line - cut down costs and increase profits!

Not seeming practical yet? Look at some stats.

Netflix saves $1 billion every year by using big data to retain customers through understanding their preferred content. 

Numbers prove it all!

but, the data in itself will not generate business value. It’s what you do with the data that creates competitive advantage and business value.

Netflix just did not gather data but brought actionable insights out of the Big Data 

This is where knowledge management comes into the picture. It helps you extract the relevant information and presents you with insights from this data. 

To put it as a definition, knowledge management is the process of identifying, organizing, storing and disseminating knowledge within the organization.

Knowledge Management Use Cases

It is already proven that knowledge management achieves cost cutdown and profit growth. However, there are other key benefits involved in managing knowledge.

1. Employee on-boarding

It's a common sight that a new employee asks for details about procedures, policies and processes from other teammates. This not only cuts the productive time for the team but the new employee loses the opportunity to self-learn.

2. Creates experts

Recognizing subject matter experts and pushing them to share their knowledge develops confidence in the employees.

3. Nurtures a learning culture

Employees appreciate if learning happens as a part of their work. This in turn contributes to employee retention and the overall growth of the company.

4. Provides an internal knowledge base

It's humanly impossible to remember all the policies, procedures and regulations as they keep changing with strategy and business environment. 

An Internal Knowledge base helps users to access this knowledge in no time and save their time.

Also, these internal knowledge bases preserve the culture of the organization retaining the founders' vision and motives of the organization.

Even after years, this documentation of the ‘Why’ of the company gives direction to new generations.

What about the externally-facing benefits of knowledge management.

Reduction in customer support requests

It is not uncommon for customer support agents to receive calls for trivial questions. 

These queries and solutions can be documented once and for all and make it accessible to all the customers out there. This reduces a great percentage of customer support calls. 

Conclusion

The loss due to poor knowledge sharing may appear negligible to most businesses. 

But,

It is estimated that fortune 500 companies lose at least $31.5 billion a year due to poor knowledge-sharing.

And,

A cross-industry study by Harvard revealed the following statistics about the usage of data by organizations across:

• Less than half of an organization’s structured data is actively used in making decisions or for business purposes.
• Not even 1% of its unstructured data is used at all.
• More than 70% of employees have access to wrong data, or to the data that they should not have.
• Data gets settled in silos when the technology demands put on it are not met.

These statistics show there is still much progress and scope in the area of knowledge management. 

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