The 10 myths about knowledge management

Knowledge management is a systematic and organised approach to improve an organisation’s ability to mobilise knowledge to enhance performance. It means using the ideas and experience of employees, customers and suppliers to capitalise on what is already known, prevent reinvention of the wheel and support innovation. The bottom line is, it can also reduce an organisation’s exposure to risk and prevent the loss of business opportunities. So, in all it’s a great thing to do but there is a lot of hype and nonsense around the topic that needs to be laid to rest.

Myth 1 – Knowledge management is just another “management speak” fad

Knowledge management is not new. Many organisations are probably carrying out the principles of knowledge management without realising it and referring to some of the processes by another name. The term “knowledge management” (KM) began in the early 1990’s and evolved from a collection of ideas and practices about stopping the leakage of knowledge from the organisation. As KM started life in some of the large consultancy firms, it was inevitable that frameworks, structures and processes would follow and make KM into a new discipline.

The economy also changed at that time and as manufacturing declined and service industries grew, more emphasis was placed on “knowledge” as the new capital. What makes service organisations competitive and profitable is the collective expertise of the people who work for them. Also in the early 1990’s, there was a wave of ‘downsizing’ with many people losing their jobs in the de-layering process. What companies didn’t realise was that they were throwing away some of their key knowledge and skills and often had to hire the same people back on a consultancy basis to recoup that knowledge. Lessons were learned.

Alongside these developments, technology has moved on rapidly and has made it easier than ever to share knowledge and communicate more widely. The power of managing knowledge effectively is only just being realised by some of the late adopters and far from KM being a fad, it is continuing to evolve, has reached many Boardroom agendas and is being taken seriously.

Myth 2 – Knowledge management is a huge financial investment

Undoubtedly money will have to be spent on a KM programme but the amount and pace of that spend does not have to be daunting or debilitating. A recent survey suggested that the average KM spend by organisations is less than 2% of revenues, a relatively low percentage in comparison to the business opportunities it can exploit. In a large organisation this is still undoubtedly a significant sum of money, but is it being spent wisely? Often, KM initiatives fail because they start with sorting out the IT issues. There are many KM systems on the market to choose from which can deliver several of the benefits you might be looking for. But most companies who start with the technology angle fail to implement KM effectively and either end up with systems that no-one will use, no-one sees the value of or indeed they may abandon KM altogether as an idea that didn’t work.

Knowledge management is about connecting people, so starting with a technology solution is the back to front approach. Start with the people. How do people do their jobs? What are the processes involved? How does information flow around the organisation? How do people share information and what are the barriers to sharing? Starting to answer some of these questions will give answers to the kind of technology that is required e.g is the need for collaborative technology, document management systems, content management or something else? To decide, you have to know how people work, how they use and share information and the critical points where knowledge could be captured. Without this analysis, the technology will be inappropriate and be under-utilised.

Before making the financial investment, step back and decide what you want out of it first. It is possible that you can make better use of what you already have or add some components that are relatively inexpensive but scalable over time. Plan, think, adapt and then purchase.

Myth 3 – It’s an IT problem

As many organisations start their KM programmes with buying the technology first, the KM programme often gets owned by the IT department. If the ownership sits with IT, the solution for KM will obviously be IT driven and focused. As we have learnt in Myth 2, this is not the place to start. The IT department is undoubtedly very important in any KM programme. It is the technology that enables information and knowledge to be shared effectively. But technology is the enabler. It is only part of the process and should not be the starting point.

KM should be the “problem” of everyone in the organisation. It effects everybody and no team should remain untouched. This does not only apply to functional teams such as Marketing, Human Resources, Finance, it effects all teams and work groups in the organisation. However, the effectiveness of KM relies entirely on the culture of the organisation. If you have a traditional industrial culture with a hierarchical structure which is rules based, risk adverse and financially focused then knowledge management principles will be stifled. These organisations tend to hive off such initiatives to the IT department. A knowledge based culture is more open, promotes shared responsibility, has a flatter structure and is principles based, providing the ideal environment for knowledge to flourish. You will know whether you are a knowledge based organisation or not by answering the following 3 questions:

1. Are you encouraged to share information with others in the organisation?

2. Do you know who to go to when there is a problem?

3. Do you really know what knowledge is useful and critical to the business?

Answer “no” to one of these questions and your knowledge culture is weak.

The IT platform is not the critical factor. It’s the cultural platform and the inherent need for openness and trust.

Myth 4 – It’s either a top down process or bottom up process.

The ownership of KM needs to be at the very top of the organisation. The CEO, the Board or whoever is at the top, must own (preferably initiate) the KM drive and not just for a short while to get it going, but for the long term. Many KM initiatives have started at the other end of the organisation with work groups or teams collaborating and sharing information to solve problems or just to do their jobs more effectively.

The top down approach cannot work unless the CEO captures the hearts and minds of all the employees. KM will be seen as another “management speak fad” (see Myth 1) and will soon fall into disrepute. The bottom up approach could remain as isolated activities which may not be able to attract investment or credibility unless they engage the enthusiasm of the people at the top. Good ideas come from all corners of the organisation and a good KM programme will integrate all knowledge sharing ideas from all teams.

The ideal situation would be that the drive for KM has come from the top but that the management team have also tapped into knowledge capturing processes and ideas that are already going on in the organisation and integrated these into their strategy. This helps people to see that it is a strategic issue of importance but that the whole organisation is included. This process assumes a strategy for KM is in place and that the afore-mentioned needs analysis has been done.

Myth 5 – You cannot capture “knowledge” – it’s too intangible

It is undoubtedly difficult to capture the knowledge in someone’s head. You cannot force someone to divulge all their secrets or make them write down what they know. Information can be too difficult to explain, too uncertain, too changeable, too contextually specific, or too politically sensitive. The art is in developing the corporate culture to encourage knowledge sharing, instigating the right people management and development policies to reward people for sharing and installing the right technology that makes the process simple and efficient.

It isn’t necessary to document every thought. Organisations who have been successful at knowledge management have encouraged “communities of practice” to emerge where groups of people meet on an informal basis to share ideas, solve problems or innovate processes. Their output or knowledge may not be easy to document but if it’s known that they are discussing and solving problems, then it a network that can be tapped into. The knowledge is not just in one head but in the heads of many. If you know where these experts are, then you know how to find that knowledge. At least you have a starting point. Many communities of practice share some of their knowledge via corporate intranets or other communication channels. Making these channels open and easy to use also encourages people to share this tacit information.

A vast amount of information can be captured, put into databases and searched. The more intangible information can be accessed by knowing who to speak to.

Myth 6 – KM will consume too much time. Our people should be out winning work and making money instead.

There is always too little time. To earn the money, you have to have clients. To have clients you have to have something they want. To have a robust product or service, you have to understand your market and who your competitors are. To be successful you have know your market position, your niche and how to provide solutions to your target audience.

To truly understand all this, you need to have feedback from current clients and good intelligence about the market place. This entails managing the knowledge that is already available in your organisation. You can spend time searching commercial business information databases about potential clients and the market in which you operate, but most of the resulting information will be historic or out of date and the real nuggets you are looking for are often undocumented or hard to find. That knowledge already exists in the heads of the experts. Those experts are in your own and your clients' organisations.

In a recent survey by KPMG1, 78% of respondents believed that they are currently missing out on business opportunities by failing to successfully exploit available knowledge. Capturing vital information and lessons learned from client projects can improve efficiencies for future work, help to develop best practice (which can be used as a marketing tool to clients), reduce risk and provide useful guidelines about how to work with that particular client in the future.

As well as documenting the projects that have been carried out, capturing information about the project team helps to build up internal knowledge of expertise and best practice areas. 74% of respondents in the KPMG survey also said that knowledge management helped them to achieve higher customer added value by understanding and documenting their needs but also using technology to start knowledge networks with their clients and suppliers. In the next 2 years, companies expect to shift focus from internal knowledge sharing to external knowledge sharing to improve supply chain planning and forecasting, share market developments with selected partners and manage critical supplier performance.

Myth 7 – KM is impossible to measure so we will not be able to judge if it’s of value or not.

There has to be some means of measurement in any major undertaking to realise the value of the investment and there are many ways to measure the value of a KM programme. These are:

· Strategic effectiveness

· Organisational effectiveness

· Job effectiveness

· Financial

· Customer

· Process

By adopting this range of measures it is possible to assess the overall effectiveness of a KM programme. Starting with the strategic impact, it is relatively easy to see whether the strategy for KM is working or not. Has the culture changed enough so that people are able to share information more easily? Are we capturing business critical information? Has our market share increased? Are we winning more work ahead of our competitors?

Organisational effectiveness is about measuring whether the organisation has become more efficient. Has productivity improved? Do we learn from our mistakes? Job effectiveness will be improved if it’s easier to find information and therefore save time; are people able to locate information that was inaccessible before? Do they make better informed decisions and gain more input by locating expertise? Financial measures are probably the easiest to assess, such as monitoring the effectiveness and use of technology and whether the spend on technology stayed on budget.

Measuring customer value could be manifested in fewer customer complaints, more positive feedback, winning more repeat business from customers and tracking the number of customer referrals. A very tangible measure is to assess whether any business processes have been re-engineered that saved time and money or improved general efficiency.

Too much focus can be placed on the financial aspects of measurement and a return on investment calculation should encompass all of the above measures. In the KPMG survey, 27% of respondents said that ROI was above the required company level for their KM programmes, 9% said it was at the required level and 64% said ROI was unknown. True ROI is difficult to calculate, but the best outcome will be achieved if the organisation determines tangible business goals for the project, identifies key business metrics that directly relate to these goals, identify the supporting implementation, customer service and cultural metrics, and use best practice approaches or pilot groups to ensure that the metrics are effective.

So, myth blown out of the water. Measurement is not easy, but by thinking about what you would want to achieve out of a KM programme and setting up the appropriate metrics at the beginning, KM has a much stronger chance of adding real value to the organisation.

Myth 8 – Knowledge is power, so no-one will want to share their expert knowledge

Knowledge can be powerful. Accepted. Some of it will always remain confidential. Experts like to be revered and in demand. Experts are critical within a knowledge culture but ring-fencing their knowledge is not good practice. Sharing knowledge does not diminish expertise, in fact it enhances an individual’s reputation and gains them credibility. They will probably continue to have a more in depth grasp of a topic than others who benefit from using their knowledge and will continue to innovate in their specialist area.

Hording information in a knowledge culture is an unacceptable activity and many knowledge based organisations have information sharing as one of the core competencies by which people are measured. This is the case in many consultancy firms. If you do not contribute to the knowledge pool during the year, then this will affect your compensation and prospects.

Knowledge is power, but it is much more powerful when it can be used widely for competitive advantage rather than short term personal gain.

Myth 9 – KM makes you focus internally; we should be focusing on our customers

It can take time to put together a knowledge strategy and to do that, it is necessary to spend time analysing internal business processes. But the world doesn’t have to stop while this is taking place. KM is an ongoing activity and cannot happen in one big bang. This internal reflection will help to reveal whether your processes are entirely focused on delivering customer value and if they are not, then opportunities will be lost.

Your own organisation needs to understand itself and its own goals (especially if it is a global organisation) before it can deliver superior value to its customers. Without that knowledge, it will be more difficult to resolve customer issues and offer the best advice and it will hamper new business development. The next phase of knowledge management that will set companies apart is the ability to share information and knowledge with clients. In today’s difficult environment, flexibility in reacting to changes in demand and co-ordinating supply chain activities correspondingly quickly is a key challenge and one that needs to be met to stay ahead. To do this effectively, a knowledge strategy has to be in place, with the people, processes and technology aligned to take advantage of changing events.

Business processes should constantly be reviewed, so the internal reflection is not a one off huge project that deflects attention. It is part of every day business.

Myth 10 – Put an intranet in place and KM will happen

Intranets have become invaluable communication and knowledge sharing tools in many organisations. In themselves they do not make knowledge management happen but are a key enabler to connecting people. However, many intranets do fail because they are set up with no clear objectives in sight or without having carried out an information audit to establish what information resources and knowledge banks there are within the organisation. Most first generation intranets are structured along organisational lines and business groups manage a section of their own intranet where they publish information of interest to them but content should be based around business tasks, activities and processes and around how people use and share information. This is how people tend to search for information. If there is no plan or strategy behind the intranet, the technology used can be inappropriate or un-scalable. Long term planning is necessary to avoid costly mistakes such as a need to constantly upgrade software and servers. The key reason that intranets fail is because the information they contain is out of date or of little value. So, if you just build it with no objectives and leave it to anyone to participate, it will decline rapidly. Intranets need management, updated content and a good structure. They also need feedback to constantly improve them.

You would not just build any other technology platform and hope for the best. You would want to see a return on your investment and maximum use of the product. Treat the intranet as the key business tool in your organisation and pay it the due attention such an investment would deserve.


Knowledge management is a process rather than a technology solution and it affects all parts of the organisation. To make KM it successful, you need:

1. Clear and explicit links to the business strategy

2. Real understanding of the knowledge advantage>/p>

3. Good information architecture

4. Leadership and champions

5. Systematic knowledge processes

6. Well-developed knowledge infrastructure

7. Appropriate bottom line measures…..and a realistic approach.

Forget all those myths.


1. KPMG. “Insights from KPMG’s European Knowledge Management Survey 2002/2003”. Published in 2002. See also

If you would like further information or consultation relating to the content of this article, or your firms knowledge management requirements please e-mail Lesley Robinson

The content of this article does not constitute legal advice and should not be relied on in that way. Specific advice should be sought about your specific circumstances.