Stephanie McFarlandINF 385Q — Knowledge Management SystemsDr. Don TurnbullMay 11, 2005 Knowledge Management in Public Organizations Many organizations see knowledge management as a practice that enhances their ability to compete with others. Strong knowledge management strategies often translate to more satisfied customers, better products, and increased innovation. In fact, some knowledge management proponents believe the concept of knowledge management originated in part as a result of economic factors like globalization as businesses sought to capture their knowledge in order to “bring new products and services to wider markets ever more quickly” (Prusak, 2001). But in the public sector, competition, products, customers, and marketplaces oftendo not exist in the traditional sense, and many nonprofits tend to assume that employees find motivation and reward through means unrelated to money. And in the absence of direfinancial consequences as a result of poor knowledge management, many public organizations simply fail to see the need for such initiatives. Furthermore, federal operations and government branches tend to not function like the average corporation, with many adhering to stricter guidelines about how knowledge is created, disseminated, and stored, as well as how employees take ownership of the knowledge they obtain. Recent well-publicized examples of failed technology initiatives and poor communication in the federal sector have begun to explore knowledge management in that setting, while many nonprofit leaders have published articles and books seeking to improve the non-corporate approach to knowledge. As a whole, public organizationsfunction quite differently than private businesses, due to a variety of financial and social factors that influence the organizational culture as well as the knowledge it breeds.Private vs. PublicBy private sector, economists mean private firms and companies that are not controlled by the state. The public sector, on the other hand, indicates “that part of economic and administrative life that deals with the delivery of goods and services by and for the government, whether national, regional, or local/municipal” (Wikipedia, 2005). For the purposes of this paper, public knowledge management will specifically point to what are commonly known as nonprofit organizations, as well as those operating as part of the federal government. Examples of such entities range from smaller social organizations such as churches, city libraries or local chapters of an advocacy group such as Planned Parenthood, to large operations like the Federal Bureau of Investigation (FBI) and the United States military. Independent federal agencies, such as the National Archives and Records Administration (NARA), the National Aeronautics and Space Administration (NASA), and the United States Postal Service (USPS), also qualify as public organizations. Unlike private companies, public organizations do not rely on earnings reaped from commercial products and services. Federal departments and agencies, for instance, receive funds via national taxation. Nonprofits, working as organizations established not for private gain but for public or mutual benefit purposes, finance their activities through donations. Entities contributing to a nonprofit's well-being can include the government (federal, state, or local), charitable foundations, or individual donors (Light, 2000). One consequence of relying on such outside funding, rather than sales of merchandise or 2services, is that nonprofits and other public organizations often must answer to those external sources about how they assist or improve the community they purport to serve. So in addition to proving to their clients that they can help them without providing traditional goods, nonprofits have donors who want, and often demand, to know their money is well spent.Money and MotivationLikewise, due to totally different financial concerns than those in a corporate setting, government and nonprofit workplaces’ efforts at establishing new technology, revised communication strategies, and training, “rarely yield tangible results such as increased sales or profits” (Chiem, 2001). This absence of material, product-based income makes it virtually impossible for public outfits to motivate workers to create and share knowledge according to the traditional, extrinsic bottom line measure of success that creates financial rewards for the organization and its employees. When a corporate worker comes up with an idea for a product that reaps millions of dollars in profit for the business, he/she usually receives a monetary bonus or higher status in the organization. In contrast, in a public business, innovation may help further the organization’s mission or the lives of its clients, but rarely increases the bottom line orthe innovator’s paycheck. While this altruistic aim often motivates individuals to work in the public sector in the first place, it poses some problems when used as the sole reward for knowledge creation and sharing. More often than not, workers look to improve their knowledge skills when they know the organization uses knowledge as a measure of an employee’s potential longevity with the organization or when management grants raises and promotions based on 3innovation, be it individual or collaborative (Chiem, 2001). Although many individuals might respond to simple words of praise or the possibility that colleagues can benefit from their knowledge, many knowledge management theorists argue that acknowledg-ment without extrinsic results can wear thin. Financial- and status-based rewards, on the whole, keep a greater number of employees happier and around longer than lofty ideals about sharing knowledge purely for the benefit of others (Van Grogh, 1998). Although the promise of serving a social or political cause might attract employees working for Planned Parenthood or the United States Army, the average nonprofit or government employee still has economic needs, as well as a drive to advancewithin the organization. And with limited funds and resources leading many nonprofit and government organizations to rely on a smaller number of workers to produce results, it is not uncommon for a public employee to feel he or she performs the duties of three orfour employees at once, without the salary to back it up. As a result, public management has undergone a recent shift toward ensuring employee longevity