48 Outlook 1999, Number 1There is no one-size-fits-all way to effectively tap a firm’s intellectualcapital. To create value, companies must focus on how knowledge is used to build critical capabilities.Afirm that had invested millionsof dollars in a state-of-the-artintranet intended to improveknowledge sharing got some badnews: Employees were using it mostoften to retrieve the daily menu fromthe company cafeteria. The systemwas barely used in day-to-day busi-ness activities.Few executives would argue with thepremise that knowledge management iscritical—but few know precisely whatto do about it. There are numerousexamples of knowledge-managementprograms intended to improve innova-tion, responsiveness and adaptabilitythat fall short of expectations.Researchers at the Accenture Institutefor Strategic Change have been explor-ing the roots of the problem and havedeveloped a method to help executivesmake effective knowledge managementa reality in their organizations.Much of the problem with knowledgemanagement today lies in the way thesubject has been approached by ven-Knowledge management strategies that create valueBy Leigh P. Donoghue, Jeanne G. Harris and Bruce A. Weitzmandors and the press. Knowledge man-agement is still a relatively youngfield,with new concepts emerging con-stantly. Often, it is portrayed simplisti-cally; discussions typically revolvearound blanket principles that areintended to work across the organiza-tion. For example, companies areurged to emulate knowledge-manage-ment leaders such as British Petroleumand Skandia. And most knowledge-management initiatives have focusedalmost entirely on changes in toolsand technologies, such as intranetsand Lotus Notes.These approaches have little relevancefor executives contending with theday-to-day reality of running a com-pany. Knowledge management is com-plex and multifaceted; it encompasseseverything the organization does tomake knowledge available to the busi-ness, such as embedding key informa-tion in systems and processes,applying incentives to motivateemployees and forging alliances toinfuse the business with new knowl-edge. Effective knowledge manage-ment requires a combination of manyorganizational elements—technology,human resource practices, organiza-tional structure and culture—in orderto ensure that the right knowledge isbrought to bear at the right time. Many companies have implementedsophisticated intranets, commonrepositories and other systems, largelyignoring the complex cultural issuesthat influence the way people behavearound knowledge. By and large,those companies have seen littleimprovement in their ability to man-age knowledge. Too often, companiesimplement state-of-the-art technologyand then discover that culture andbehavior are slow to change.In short, simplistic solutions and “one-size-fits-all” approaches leave execu-tives with little in the way of practicaladvice about how to transform theentire knowledge-management system.What’s more, this fuzziness makes itdifficult for executives to see a clearOutlook 1999, Number 1 4950 Outlook 1999, Number 1process can be performed in differentways. Sales, for example, can refer toindividuals covering their respectiveterritories (expert model) or to a sup-plier’s multifunctional team workingclosely with a customer to maintainretail inventories (integration model).So the key is to understand how workis performed; it is the nature of thework that determines the appropriateknowledge-management approach. Knowing the work model that’s associ-ated with the core process is importantbecause each model presents its owndistinct set of knowledge-managementchallenges. In the collaboration model,for example, a key challenge is theachievement of breakthrough innova-tion. To drive such innovation, a com-pany needs to encourage risk-takingand bring together a variety of knowl-edge domains, such as research, productdevelopment, marketing and manufac-turing, in order to solve complex prob-lems. At one biotech company, theInstitute found that increasingly com-plicated projects and the need for agrowing number of scientific disciplineswas making it harder to integrate activ-• Expert model, in which there is lowinterdependence and high complexity.Work requires judgment and is depen-dent on “star performers.” •Collaboration model, in which there isa high degree of both interdependenceand complexity. Work involves improvi-sation and learning by doing, and relieson deep expertise across functions andthe use of flexible teams. Key to understandingIn general, a given core process can be mapped to one of these four cate-gories. For example, supply-chainmanagement and procurement tend tofit into the integration model; the workin these processes is often routine, andactivities generally span multiple func-tions and organizations. In comparison,marketing and financial managementtend to be expert model work, requir-ing individuals in one functional areato apply their judgment to solve unan-ticipated problems.However, it is important to note thatthere are no hard-and-fast connec-tions between a certain core processand a work model, because the sameIntegration model• Systematic, repeatable work• Highly reliant on formal processes,methodologies or standards• Dependent on tight integrationacross functional boundariesComplexity of work Level of interdependenceRoutineIndividualactorsTransaction model• Routine work• Highly reliant on formal rules, procedures and training• Dependent on low-discretion workforce or automationExpert model• Judgment-oriented work• Highly reliant on individual expertise and experience• Dependent on star performersCollaboration model• Improvisational work• Highly reliant on deep expertise across multiple functions• Dependent on fluid deployment of flexible teamsSOURCE: ACCENTURE ANALYSISCollaborativegroupsInterpretation/judgmentKnowledge Management Framework: Work modelsThe characteristics of the type of work will help determine which model works best.link between their knowledge-manage-ment investments and business value. To help executives, the Institute hasdeveloped a framework that associatesspecific knowledge-managementstrategies with specific challenges thatcompanies face. This Knowledge Man-agement Framework is based on thepremise that the focus should beplaced on the way knowledge is usedto build the critical capabilities a com-pany needs in order to succeed—on thecore processes and activities thatenable it to